What to do with the massive debt if we turn communist.

[cu247]

Hi, I was wondering earlier today (and I still am) if a country, for example Canada since I live here, became socialist via a revolution or even reforms, how would we pay off our (quite large) debt? Since we wouldn't overproduce and produce just as much as society needs. We could just not pay it, but that sure would piss the cappies we owe money to off...

So, answers, opinions?

[dernier combat]

We don't pay it. It's the fault of the capitalist classes.

[red cat]

We could just not pay it, but that sure would piss the cappies we owe money to off...


All the more reason for not paying. :D

[Terminator X]

but that sure would piss the cappies we owe money to off...

Who is this "we" to which you are referring? The working class has nothing to do with the massive debts incurred by ruling elites. The top 1% richest people in the world have enough money in their bank accounts to pay off all debts multiple times over - it's not our problem.

[ar734]

Hi, I was wondering earlier today (and I still am) if a country, for example Canada since I live here, became socialist via a revolution or even reforms, how would we pay off our (quite large) debt? Since we wouldn't overproduce and produce just as much as society needs. We could just not pay it, but that sure would piss the cappies we owe money to off...

So, answers, opinions?

It's not "our" debt. It's the debt the govt owes to the banks. Let the debt default. Russia did it, Argentina did it, Iceland did it. Probably some other countries as well. Now,if the govt really represents you, then that's another question.

[Leftie]

Hi, I was wondering earlier today (and I still am) if a country, for example Canada since I live here, became socialist via a revolution or even reforms, how would we pay off our (quite large) debt? Since we wouldn't overproduce and produce just as much as society needs. We could just not pay it, but that sure would piss the cappies we owe money to off...

So, answers, opinions?

Why should we care if it pisses the capitalists off? At any rate, there shouldn't be many capitalists left after the revolution..

[piet11111]

Don't pay it.

They would freeze any money or paid for products that your country is entitled to anyway so why should they get their money ?

[Q]

The matter is somewhat more complex than simply "we don't pay, fuck off" as it relies on the balance of forces. If one country would have a revolution for example and started to cancel debts, it might very well face military invasion by our top dog imperialist power or, in a "mild" case, effective national bankruptcy and sanctions.

Another reason to work concretely on, at the very least, continental working class forces.

[bricolage]

Didn't Iceland recently refuse to pay its debt?

[piet11111]

The matter is somewhat more complex than simply "we don't pay, fuck off" as it relies on the balance of forces. If one country would have a revolution for example and started to cancel debts, it might very well face military invasion by our top dog imperialist power or, in a "mild" case, effective national bankruptcy and sanctions.

Another reason to work concretely on, at the very least, continental working class forces.

If there was a leftist revolution that threatened capitalism then it would be invaded anyway or at the least face massive capital flight and sanctions.

[Commissar Rykov]

Isn't the whole point of a Revolution to piss off Capitalists? I mean they are hardly going to be happy when we seize their mansions and turn them into houses for the poor and homeless. Not to mention seizing their control of production isn't likely going to make them our friends either.

[Q]

If there was a leftist revolution that threatened capitalism then it would be invaded anyway or at the least face massive capital flight and sanctions.

True probably. What I'm saying is that this is a tactical matter. I rather be paying off some debts if it means staving off military invasion.

[red_rich]

i think the only option would be to refuse to pay up. Even after taking ownership of the means of production, if the workers continued to pay the capitalist banking institutions, the revolution would have somewhat failed.

Debt = slavery.

[ar734]

Invade Canada? They can't even invade Iceland (which, by the way, they would have done 75 yrs. ago.)

As far as the effect on capital, after the default in Argentina, Iceland and Russia, international banks starting lending again. Capital cannot allow any opportunity for profit to go unexploited. However, when the government does default, the Canadian people should make sure the same capitalist thieves are not allowed back in the new government.

[Sir Comradical]

If the revolution fails to spread then Canada will face trade discrimination and sanctions if it refuses to pay off debts. The revolutionary government would eventually have to negotiate with external creditors and finance the debt perhaps by expropriating the wealth off its capitalist class. In real life repudiating debt isn't that easy as it will lead to complete economic isolation.

[Lynx]

The debt in Canadian dollars equals the Canadian money supply. If the federal government were to run surpluses, each surplus would reduce the debt until the money supply was reduced to zero. This would also devastate the economy. Canadians would be reduced to bartering for their goods and services.

The Canadian dollar did not come into existence from the sweat of rich people, it was created out of thin air by the federal government. Banks do not create money, they loan out and hold deposits of existing currency.

Government debt in its own currency is not analogous to household or private sector debt. A government that issues it own currency cannot go bankrupt.

Greece, which is not monetarily sovereign, can go bankrupt.

For Canada, US, Australia, Japan and any country that issues its own currency (and allows it to float in exchange markets), 'debt' is not an issue. A drop in the Canadian dollar relative to other currencies would make our exports more competitive.

Finally, Zimbabwe and Wiemar Germany are examples where the production of goods and services collapsed, with the government continuing to print money in amounts that far exceeded the quantity of goods and services available. Inflation, then hyperinflation were the result.
When your economy produces little, you will suffer for it, regardless of how much money there is. Without income, there is no spending. It's effect on production and consumption is a vicious circle.

[red cat]

The matter is somewhat more complex than simply "we don't pay, fuck off" as it relies on the balance of forces. If one country would have a revolution for example and started to cancel debts, it might very well face military invasion by our top dog imperialist power or, in a "mild" case, effective national bankruptcy and sanctions.

Another reason to work concretely on, at the very least, continental working class forces.

Seriously speaking, this should be our line. However, it is mostly applicable to the weaker third world countries. Canada is a powerful capitalist country itself so that it is unlikely to face invasion when the working class takes over. Furthermore, the international proletariat is most likely to move to a strategic offensive by the time imperialist nations like Canada start having revolutions.

[dernier combat]

The matter is somewhat more complex than simply "we don't pay, fuck off" as it relies on the balance of forces. If one country would have a revolution for example and started to cancel debts, it might very well face military invasion by our top dog imperialist power or, in a "mild" case, effective national bankruptcy and sanctions.

Another reason to work concretely on, at the very least, continental working class forces.
I was going to expand on my post and argue for world revolution to avoid the threat you described, but I decided against it due to my laziness.

[dernier combat]

Canada is a powerful capitalist country itself so that it is unlikely to face invasion when the working class takes over.
...really?

The United States (http://en.wikipedia.org/wiki/United_States) and Canada (http://en.wikipedia.org/wiki/Canada) have the largest trade relationship in the world. [1] (http://en.wikipedia.org/wiki/Canada_%E2%80%93_United_States_trade_relations#cit e_note-nationalaglawcenter.org-0) In 2006, total merchandise trade between the two countries consisted of $303.4 billion in imports and $230.3 billion in exports.[citation needed (http://en.wikipedia.org/wiki/Wikipedia:Citation_needed)] The trade relationship between the two countries crosses all industries and is vital to both nations’ success. Each country is the largest trade partner of the other.

You forgot the mean motherfucker that is the US military right on its doorstep.

[red cat]

...really?


You forgot the mean motherfucker that is the US military right on its doorstep.

Yes, these are also important factors, not to mention the long border of Canada with USA.

[TheLeftStar]

We should make the capitalists pay for their sins by auctioning their properties and industries, increase the tax rate, withdraw bailout/fiscal stimulus to the parasitical capitalist class and offer voluntary retirement schemes in government owned and run companies

[dernier combat]

We should make the capitalists pay for their sins by auctioning their properties and industries, increase the tax rate
Instead of simply letting others become capitalists, why don't we (the working class) simply take control of their private property and their industries, so we can, you know, produce goods and, er, live? Besides, assuming a working class revolution, there would be no currency - at least not in the form of what we have today (i.e. labour credits during scarcity and what-have-you)... and nothing that we could exchange for the US dollar or any other currency in existence.

[IndependentCitizen]

The debt is a lie.

There is no debt. It's an excuse to advance the free-market ideas of Milton Friedman and his scumbag friends, the Chicago boys.

Capitalism is about accumulation of capital by any means necessary (Yes, war is included) through competitive business. The "debt" is used as an excuse to punish the working class, and push through the ideology of 'laissez faire', or "free market economy". The only way to acquire a laissez faire society is to bust the organised working class who stand in the way of this dream. The capitalists use shock in order to push through huge cuts, and 'reforms'. The current shock is the economic crisis. Which is when banks and global investors gambled with their money by investing in certain industries that later collapsed, and the banks were lending mortgages and personal loans to people who couldn't afford it. By this, they were hoping that by giving loads of loans to people with high interest rates (short term profit) they're accumulate the lost capital through the high rates of interest. It didn't work, and banks didn't have money. Which is one of the reasons for the massive global bank bailout. (I personally believe this was orchestrated so they can push through the laissez faire dream).

The bailout was paid by taxpayers' money, to the banks and global investors who we supposedly owe the money! But how can we owe money to those we bailed out? There is no debt.

The deficit (which is where the country's spending exceeds its income) was created by the bank bailout, not by public spending! (which here in the U.K fell under labour).

[Rjevan]

True probably. What I'm saying is that this is a tactical matter. I rather be paying off some debts if it means staving off military invasion.
I see three problems with this approach. The first is basically what red_rich says, a successful working class revolution shouldn't have to bother and waste potential on satisfying capitalist interests. Accepting and playing along their rules would also give legitimization to their system, based on the assumption that it's their rightful money and the proletarian state is obliged to pay them as its predecessor was. Expropriating the expropriators to use the money on strengthening socialism at home and movements for national liberation and socialism/communism internationally sets a very different signal and is using the money for the advancement of those who really own it.

Second, if we'd be ready to pay a little to avert military invasion it may be worth to gamble and assume that we'd pay more for the same purpose. Chances for aggressive intervention would be very high anyway and paying won't eliminate that threat but at best make it adapt more subtle forms and call for more and more concessions, weakening the dictatorship of the proletariat and making sure that in the end there won't be much left of socialism.

Which leads to the third problem: how far could we go, where to draw the line? Nationalisation of foreign assets, advocating our ideology and supporting workers' rights, anti-imperialism and world revolution be it in words alone, even the mere existence of a socialist state would enrage the imperialists. They'll never have a benevolent or even neutral line on their nemesis, no matter how much you pay them.

[Rafiq]

Then it should be the duty of the International working class to assure that if a Revolution should occur, it should occur in an imperialist nation.

Revolution in the first world is more important than revolution in the third world.

"What? You're Racist! You think that 'brown people' aren't smart enough to handle revolution or sumthign? Eurocentric racist!"

No, listen.

If revolution is to occur in an Imperialist nation, than not only could they say "Not my problem, fuck off" to debt, they could assure international revolution, including the third world.

The most important place for revolution is the United States. Second, I would say, Is China, or both, equally important, but remember, the US has much more military bases abroad, ect.

I think the importance of revolution relies completely on how powerful/Imperialist the nation is.

[Q]

The most important place for revolution is the United States. Second, I would say, Is China, or both, equally important, but remember, the US has much more military bases abroad, ect.

I think the most important place today is Europe actually. The US has a garbage workers movement, despite the recent developments in Wisconsin. China is economically getting there, but still doesn't have quite the same weight yet and its police state makes it very hard for workers to effectively organise. Europe both has strong traditions (and here and there very lively traditions too!) and the Eurozone is actually the biggest economy on the planet.

Any successful revolution needs to include Europe, or go bust.

[DiaMat86]

For once, the bosses take the losses.