What if every person, company and government in the world forgave every debt owed them?

I don’t think it would last very long… Just as soon as we are out of debt we would no doubt be plunging right back in.

Then, say, all the doctors who have treated patients go unpaid and close up shop, and merchants of every kind go broke, and landlords can’t afford to maintain buildings, and colleges have to file for bankruptcy, and so on? Does this sound like a good thing? If no one can be expected to keep their promises (and a debt is a promise to pay), how can society function? Not only does credit disappear altogether but people can’t actually trust one another to do anything or hold anyone responsible for failures to perform. Things would fall apart pretty fast, I think.

Now, if you were suggesting that we make all indebtedness disappear by having everyone pay off their debts, that might be another story. That would simply put the funds in the hands if the rightful owners.

So. Do you know that banks pretty much “create” money by taking loans from the government and from other banks, and loaning the money to other entities? If all of these loans were “forgiven,” a lot of the money supply would go poof.

There was a time back in the 1930’s when a lot of the money supply in the United States did go “poof.” So much borrowing had occurred to buy stocks that fell tremendously and couldn’t be repaid. There was a run on the banks, which caused roughly half the banks in the U.S. to fail (and therefore stop loaning/creating money). As a result, people just didn’t have any money and couldn’t get any, either. This was what we called the “Great Depression.”

So, in short? Bad thing.

I would be outraged. I’m debt free you bastards.

we’d just rack up more.

@Saschin lol good answer. me too. it wouldn’t be fair to do, but i like the hypothetical anyway.

I’m debt-free too, and yet a year ago I would have preferred to see the government pay off my neighbor’s mortgage for him than give that money to a firm in New York.

I’ve got money bitches !

@Jeruba – And in Eden, it would go to education…

Then we would have to change the system all together at the same time. Currency, bonds, stocks. It would all have to go away. We couldn’t build sky scrapers without it.

It’s a appealing thought, but it’s a lot like destroying every weapon on earth. People would just create new ones the next day.

Ditto what @Saschin said. Not to mention no one would learn anything and just be idiots again racking up debt.

Has there evey been such a thing as a world bankruptcy? i like your idea, but the planet would probably tilt over, if this occured.

Maybe there will be one day as our economies become more and more intertwined…

Debt is good.

Debt is control.

Jubilee! :D

Jeruba, that’s actually what I had in mind—just didn’t make it clear. I like your thinking on this.

@ChazMaz Why control? Do you mean the people who own the debt have the control?

Debt is good in that it keeps things moving.

Yes, the people who own the debt have the control.
Always has been a “good” and straight forward way to keep the worker motivated.
And, the community for that matter.

The opposite of debt would be interest. Your debt is another persons dividend.

@ChazMaz I agree whoever owns the debt has the control, so the US is giving away its control and so are individuals. I think it is awful. My husband and I have no debt, but we are still motivated. We are not wealthy, we still have to work.

@JLeslie – :-)

Nothing wrong with work. At any age.

Peace of mind is a wonderful thing.