This is great news, and I hope the world follows suit. Debt amnesty is indeed a time honored solution to the current crisis. When a person goes into debt they sell their future wages. When a government goes into debt they sell future tax revenue. Now all the future wages and tax revenue that can be sold are in the hands of the banks. (Sure, governments could keeps selling future tax revenue from future citizens who haven't been born yet, but let's pretend they don't.) So the banks are in a bad spot; no more debt to buy. If they stop lending, the money system dries up and everyone loses their jobs (happening now). If they try to raise the interest rates (effectively zero now) nobody will be able to afford the payments on their debt and everyone goes broke. So, the whole system needs a big reset. Hence the need for debt amnesty.
What we do after debt amnesty is critical. Do we just start the same old cycle over again? Or do we take this opportunity to make a fundamental change. The government is the only body that can legally create money, but they don't. They create the money in the banks and then borrow it back at interest essentially giving the banks control of the currency. We need to take back control of our currencies and declare general debt amnesty for all governments and citizens at all levels. Business can carry on as usual; they get to keep their debt. Governments should never be in debt again.
With governments out of debt the economy starts moving again. In Canada, the largest employer in the country is the Government of Canada, and in each province the largest employer is the respective provincial government. Not hard to see the benefits of a government able to spend enough money to fix the roads, schools, parks, and all the other shared services we use.
Of course the banks won't like this idea. However, if the government creates enough money ONE TIME to cover the debts that are being erased then the banks are made whole. Basically, the banks get one chance, just like everyone else, to sort themselves out and figure out how they plan to operate post-amnesty. But they won't rule the world anymore.
What we do after debt amnesty is critical. Do we just start the same old cycle over again? Or do we take this opportunity to make a fundamental change. The government is the only body that can legally create money, but they don't. They create the money in the banks and then borrow it back at interest essentially giving the banks control of the currency. We need to take back control of our currencies and declare general debt amnesty for all governments and citizens at all levels. Business can carry on as usual; they get to keep their debt. Governments should never be in debt again.
With governments out of debt the economy starts moving again. In Canada, the largest employer in the country is the Government of Canada, and in each province the largest employer is the respective provincial government. Not hard to see the benefits of a government able to spend enough money to fix the roads, schools, parks, and all the other shared services we use.
Of course the banks won't like this idea. However, if the government creates enough money ONE TIME to cover the debts that are being erased then the banks are made whole. Basically, the banks get one chance, just like everyone else, to sort themselves out and figure out how they plan to operate post-amnesty. But they won't rule the world anymore.