Page 41 - #letter to son

#SangamNiti DAYLIGHT
The book chronicles the early primitive methods of borrowing and
lending and promulgates that farmers would often become so mired
in debt that their children would be enforced into debt peonage.
Furthermore, for the social strain that came with this enslavement,
kings would periodically cancel all farm debts through amnesty.

When one looks at this more closely, it is like history is repeating itself.
The past has a strong strain of similarity with the situation of successive
years where governments, coming under severe pressure from mass
farmer protests and disruptions, have waived-off farm debts. But could
the sovereign be entitled to such powers, bestowing out-of-turn reprieve
when fundamentally its principal task has been to unclog unwarranted
risks from the system? Also, if the sovereign can negate farm debt, why
cannot it apply similar principles to other sectors too that are reeling
from debt?

Graeber claims that debt and credit historically appeared before
money, which itself appeared before barter, and the basic premise of
the book is that excessive and popular indebtedness has led to unrest,
insurrection and even revolt, a situation that is playing out in the streets
today. He argues that credit systems originally developed as a means of
accounting long before the advent of coinage, which appeared around
600 BC. Credit can still be seen operating in non-monetary economies.
Barter, on the other hand, seems primarily to have been used for limited
exchanges between different societies that had infrequent contact and
often were in a context of ritualised warfare.

The historical context of debt is interesting and is intertwined with
man’s ambition and quest for supremacy. The book states that the
emergence of the Atlantic slave trade and the substantive gold and silver
extracted from the Americas stimulated the re-emergence of the bullion
economy and large-scale military violence. These developments directly
tangled with the earlier expansion of the Italian mercantile city-states
as centers of finance that defied the church ban on usury and led to the
current age of capitalism. As new continents opened new possibilities
for commercial gains, it also created a new area for militarism backed
by debt.

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