Monday, September 21, 2020

Democracy Journal: Richard Vague calls for a debt "Jubilee"

Richard Vague of the Institute for New Economic Thinking makes the case that freeing households and businesses from excessive private debt would be a boon to the economy. It's Time for a Debt Jubilee.

"In 1951, total debt stood at 128 percent of our national GDP. By the end of 2019, total debt had doubled to 256 percent. Government debt has increased markedly and gets the most attention, but we should be more concerned about the rapid growth in private-sector debt ... private sector debt has grown even faster [than government debt], tripling from 54 percent to 150 percent ... Certain types of broad debt restructuring and forgiveness could help get us out of this debt trap and could be politically feasible. The proposals discussed in this article are for relieving the burden of mortgage debt, student debt, and more, along with a radically different proposal for government debt."

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