On the morality of debt

The thing is, arguing over who is blame is not really productive at this point. As Jeffrey Sachs rightly points out, the Western world gave debt relief to Germany in 1953 when Germany — burdened with massive debt — needed it, after that country’s previous leader started World War II and committed multiple genocides as part of his master plan to build a thousand-year Aryan reich. When it comes to bad deeds by previous leaders, Greece’s current troubles are nothing like Germany’s former ones. But the West chose not to punish Germany for the Third Reich. And Germany did well in the wake of its debt relief, eventually growing back into the industrial powerhouse it is today.

Back then, the world better understood the need for debt relief. The crippling war reparations agreed at Versailles that plagued the German economy in the wake of World War I had, after all, been a key factor in creating the conditions ripe for the rise of the Nazis. Why impose those conditions again?

John Maynard Keynes presciently condemned the Versailles settlement that crippled the German economy, asking: „Will the discontented peoples of Europe be willing for a generation to come so to order their lives that an appreciable part of their daily produce may be available to meet a foreign payment…?

Yet almost a century after Versailles, we are imposing similar conditions yet again on a different set of countries. Greece is expected to continue to repay its loans until 2054. The periphery has been beaten about the head, not just by economic circumstances, but also by the irresponsible moralising of German policymakers like Jürgen Stark who insist that austerity and structural reform is the answer to everything, and that further debt-relief is impossible even though their own country’s success owes to it.

via On the morality of debt.

Stop the #Austericide! Free the Greek people!

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