The Debt Myth
St Lucia seems to be existing, some might call it living, under the weight of an ever-increasing burden of debt upon a bent back borne on legs almost bent double as she struggles along from day to day. But let me digress a little. A Rotary colleague of mine, a lawyer, shocked me once and let me tell you why. I was chairperson of the Club Committee and I got it into my head that I would buy a different book each week, read a page from it aloud to the club at our regular Rotary meeting and then donate the book to a Rotarian who would read it and then pass it on to another Rotarian, and so on. The books dealt with a number of genres and topics and the book scheme was a great success until one week I donated the book to my aforementioned lawyer friend who refused to accept it.
“Oh, no, no!” she cried and put out a hand as if to ward off evil spirits, “I don't have time to read. I'm a lawyer!” as if lawyering were a perfectly acceptable reason for not knowing anything about anything other than law! No wonder our lawyers are so one-track minded.
And if our lawyers do not have an allround education isn't it a little concerning that many of our politicians are lawyers? I mean shouldn't our leaders have an allround education in order to deal with the multitude of diverse everyday problems that beset the country on a daily basis?
But enough of these pipe dreams! Let us return to the very real problem of our national debt. You might, Dear Reader, recall Mr. Micawber's famous, and oft-quoted, recipe for happiness in Charles Dicken's novel David Copperfield when Mr. Micawber said, “Annual income twenty pounds, annual expenditure nineteen [pounds] nineteen [shillings] and six [pence], result happiness. Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery."
In other words, if you spend a penny more than you earn, you will live in misery. A simple enough rule to live by, one might think, but strangely one that our greatest minds – as they believe themselves to be – just don't get. Instead of working themselves out of debt, they borrow themselves into even greater debt – and boast about it – Check it out in the Government Propaganda Pages, the greatest loan ever!
But maybe they have a point. After all, as David Graeber relates in his book “The First 5,000 Years”, The Bank of England, the first successful modern central bank, was founded on debt: “In 1694, a consortium of English bankers made a loan of £1,200,000 to the king. In return they received a royal monopoly on the issuance of banknotes. What this meant in practice was they had the right to advance IOUs for a portion of the money the king now owed them to any inhabitant of the kingdom willing to borrow from them, or willing to deposit their own money in the bank—in effect, to circulate or "monetize" the newly created royal debt. This was a great deal for the bankers (they got to charge the king 8 percent annual interest for the original loan and simultaneously charge interest on the same money to the clients who borrowed it), but it only worked as long as the original loan remained outstanding. To this day, this loan has never been paid back. It cannot be. If it ever were, the entire monetary system of Great Britain would cease to exist.”
Of course, the government of Saint Lucia is not a bank – that's one thing – and did you notice that the original bankers were charging interest from different clients for the same amount of money? And they've been doing this for the last 400 years!!!
Thomas Jefferson did not believe in borrowing money that had to be paid back by the grandchildren of the borrowers. “I sincerely believe that banking establishments are more dangerous than standing armies, and that the principle of spending money to be paid by posterity, under the name of funding, is but swindling futurity on a large scale.” In Saint Lucia's case it will be the great, great grandchildren that will be paying off our debt.
Somehow, our leaders seem to have distanced themselves from the reality of being in debt. They live in another world where money borrowed need not necessarily be repaid. The American poet E.E. Cummings got it right when he said, “I'm living so far beyond my income that we may almost be said to be living apart.” He could have been talking about our government.
In Little Dorrit, Charles Dickens explained the system of living off credit. “Credit,” he said, “is a system whereby a person who can't pay, gets another person who can't pay, to guarantee that he can pay.”
I wish our lawyer politicians would read a little more, and maybe learn a thing or two.