A Debtor’s Bill of Rights


·       Article 1: The right to a fair and sustainable economy

·       Article 2:  The right to a clean and sustainable environment

·       Article 3.  The right to democratic decision-making

·       Article 4. The right to a free, fair and vibrant market economy

·       Article 5: The right to a rich and rewarding social life

·       Article 6: The freedom to choose to labor

·       Article 7: The right to live by one’s principles and faith

·       Article 8: The right to be free of technologically intrusive manipulation

·       Article 9. The right to be free of the moral obligation to honor financial debt.

·       Article 10: The right to withhold debt payments to effect justice and fairness



The Bill of Rights to the U.S. Constitution sought to protect the minority of citizens from the tyranny of the majority.  Today the threat to our freedom lies in the concentration of wealth and power in the hands of a tiny minority and in our burden of maintaining, largely for their benefit, perpetual economic growth.  Both of these threats are rooted in an economy built on a foundation of debt and a society whose major feature has come to be its division into debtors (those who pay out more, directly or indirectly, in interest and fees than they receive) and creditors (who receive more in interest and/or dividends than they pay out). The latter comprise a tiny proportion of the population, yet own the vast majority of wealth and wield disproportionate power.

Consequently we require a Debtor’s Bill of Rights to correct the distortion of our economy created by the requirements of indebtedness and perpetual economic growth and the consequent harms that these requirements inflict on all citizens and countries of the world.  Because of our ideas of debt, interest and return on capital, the need for perpetual capital growth has come to rival all others, including the need to eat, to breathe, to ensure justice and to aid those in need. 

Our indebtedness stems from a monetary system in which every dollar that is created is someone's debt.  Money is lent into existence.  Consequently every dollar, euro, or pound must earn interest. The interest it earns goes to the bank and the people who buy the debt. This not only concentrates wealth in the hands of a few, but it also exerts constant pressure for economic growth at any cost in order to maintain the interest payments on the money lent. 

At the time of the writing of the U.S. Constitution, none of the framers could have possibly imagined an economy built on the principle of perpetual growth. Nor could they have imagined an economy built on a foundation of debt. Furthermore, the intellectual founders of the field of economics, such as Adam Smith, David Ricardo, and John Stuart Mill, never envisioned an economy that required perpetual growth; they assumed that the field of economics would help grow the economy to a point that all, in the words of John Maynard Keynes, could live “wisely, agreeably and well.”

The division of society into debtors and creditors, and the necessity of perpetual growth transforms our society into the equivalent of a company town, whose sole purpose for existence is to return invested capital to the owners and whose inhabitants are forever tied to the company by debt.  The company, in turn, exists to return capital to investors.

Debtors are disciplined to accept the repayment of debt, not only as a legal, but as a moral obligation.  Moreover creditors insist that debtors willingly accept this obligation; however without debt our present economic system cannot function. Money is privately created by debt, debt assumed, first by the government through the issue of government securities and, second, debt assumed by citizens, corporations, and governments through money lent by banks.  Given the fact that debt and the obligation to pay interest is a prerequisite for the functioning of the economy, it is only fair and just that, in return for assuming debt, there be a debtor’s bill of rights to protect debtors from the social, political and environmental harms necessitated by debt, as well as from creditors, who while benefiting economically from present economic arrangements, also suffer its environmental and social harms.

The quest for the endless accumulation of capital that debt requires rules, not only our economy, but our lives.  We must do everything that we can to ensure perpetual growth, even if it requires the sacrifice of our environment, our family and social life, political freedoms, health, happiness and well-being.  It requires that we labor more for less, create and tolerate societies of grotesque inequality and injustice, develop systems of persuasion, manipulation and surveillance that are completely foreign to the ideals on which our society was founded, and distort the true market economy to which we aspire. The requirement for interest on debt and the subsequent return on capital is responsible for the fact that we sacrifice the freedom that we have to create the kind of world that we desire for our children and for future generations.  For these reasons, and to correct the distortions inflicted on our market economy, we call for the adoption of the following articles of debtor’s rights.

Article 1: The right to a fair and sustainable economy

We have created an economy that requires for its survival perpetual growth[1].  That is, we must spend, labor, produce and profit more this year than last and more next year than this in perpetuity.  This is clearly unsustainable. If, in the United States, the national economy grew at the barely acceptable minimum of 3% a year[2], by the year 2100 we would need to increase GDP from about fifteen trillion dollars a year to some three hundred trillion, while global GDP would need to go from about sixty trillion today to a quadrillion dollars a year.[3]  Yet many see even our present level of economic activity as unsustainable.

Most modern economists and government policy makers accept the desirability of perpetual growth as self-evident.  Some have even argued that, it is not only desirable, but moral.  But none, interestingly, have tried to explain why perpetual growth is necessary; that is why, when it doesn’t occur, bad things happen.  Why can’t we spend, labor, produce and profit next year at the same rate as this?  What was wrong with the rate of spending, labor, production and profit in, say 2002, or any other year in the last 50?  Why is it never enough?

The reason is interest on debt, and the fact that money, as it is presently constituted, must, by producing interest or dividends, always work to produce more.  There must be a constant return on capital that, in our present world, constitutes what we call “growth.”  When the expected return on capital does not occur, that is when debtor’s default, when stocks dip, assets decline in value, when labor productivity and profits decline, and consumption falls, the necessary circulation of money slows or stops, creating crises of unemployment, bankruptcies, bank failures, social upheaval and political instability.

In the United States, the amount of money in circulation is determined largely by the privately-owned Federal Reserve Bank.  The Federal Reserve creates money, first, by buying government bonds.  The money paid by the Federal Reserve becomes the base money supply.  The Federal Reserve then distributes assets to member banks.  For each dollar the bank receives, it is permitted to lend nine dollars under the assumption that not all depositors will withdraw their money at the same time.  In this fractional reserve banking system, the bank is required to hold only a fraction of what has been deposited and can lend the rest.

In addition each incremental expansion of the level of debt is an explicit assumption that the economic future will be greater than the present. And not just a little bit larger--the future will need to be exponentially larger than the present for the debts to be fully repaid. Debt, in effect, is a claim on future wealth. Consequently creditors, such as banks, pension funds, insurance companies, and governments have an enormous stake in the perpetual expansion of the economy.  Without growth, debt makes no sense, for without growth where would the interest or dividends come from?  And without the continued expansion of debt, the whole financial system would collapse. 

But the requirement for perpetual growth places an ever increasing load on individual citizens to consume, labor, and profit.  That is, not only must each person spend, labor and profit more this year than last and more next year than this, in perpetuity, the per capita obligation to spend, labor, produce and profit must also increase.  Since the rate of global population growth (1.14%) is considerably lower than the necessary rate of economic growth (3 to 5%), the individual consumption, labor, and profit load must grow. For example, since 1940, the population of the United States has slightly more than doubled from 132 million people to some 310 million; but the growth of the economy, as measured by GDP and adjusted for inflation, has increased by a factor of nine.  Some of this increased consumption, labor, production and profit load is lessened by new technologies of consumption, labor, production and profit.  Thus whereas in 1940 consumers were limited in what and where they could consume, laborers limited by what they could produce, and investors limited in the number of investment instruments at their disposal or the speed of financial transactions, some of these limits have been transcended by technological innovations (often at the cost of jobs).  However, the innovations cannot by any stretch be said to have matched the increased obligations that consumers have to spend, laborers have to produce, and investors have to profit in order for the economy to realize the return on capital required by present levels of debt.

Most economists assume that growth represents an increase in individual wealth.  This is misleading.  Growth is a necessity, not a choice.  In order to maintain the necessary rate of capital accumulation that allows creditors to receive their necessary return on capital, citizens must increase their rate of consumption, labor, production and profit or face the consequences of unemployment, bankruptcy, poverty, and social unrest.  In other words, either more individuals must be found to assume the consumption, labor or profit load required by perpetual growth (as evidenced in the growth in the United States of 2 or 3 income families), or individuals must themselves consume more goods and services, labor more, or find new ways to make money with money. 

This is why our society has the characteristics of a company town; the vast majority of inhabitants are tied forever through debt to the company, whose wages can never be sufficient for the laborer to free themselves from the debt.  Debtors, in other words, are dependent on the creditors whose fortunes and power rest on the debt owed to them.

Therefore, since debt is a requirement for our present economy to function, and since the economic rules in place require citizens to assume debt obligations (debt is not, as claimed, freely assumed), debtors have a right to be free of the ever-increasing obligation to consume, labor and profit for the sole purpose of ensuring that creditors receive their expected return on capital.

Article 2:  The right to a clean and sustainable environment

The need for perpetual growth requires, not only an ever-increasing need to consume, labor, and profit, but an increasing conversion of natural capital into money.  Consequently, our environment has suffered to the point that our access to clean air, water, and food is threatened.  Creditors can, up to a point, protect themselves from environmental devastation and resource depletion.  Their wealth allows them to live in and travel to the relatively few pristine habitats that remain.  And their wealth protects them, up to a point, from increased prices of energy, oil and land. Debtors, however,  already suffer disproportionately from the damage inflicted on the environment by the necessity of perpetual growth.

The relationship between economic growth and environmental devastation is already well-documented, particularly when it comes to man-made climate change. The diagrams below vividly illustrate the scope of resource use, depletion and destruction over the past two and a half centuries of capital growth.[4]

Of all the resources we require for perpetual growth (and there are thousands) none are as important as energy and water.  Is it possible, given our economy’s need to double at least every 23 years (at a 3% growth rate), to intensify our rate of energy and water extraction?  The global economy presently uses some 84 million barrels of oil a day (mbd), and each percent of growth requires at least a .27 increase in energy needs. We presently require 264,000 gallons per individual per year to produce our food.  Every pound of wheat that produced in the U.S. using factory-farming methods requires 1000 gallons of water.  Can these rates be sustained, particularly when counties such as China, India, and Brazil are growing at 5-10% a year and using resources at greater rates than the U.S.? 

Furthermore, with the need for perpetual growth and the ever-increasing exploitation of resources, the prices of commodities, such as oil, must increase, therefore making it more difficult to profit and further increase the consumption, labor, and profit load of debtors. 

While there is debate over how much oil remains, it is clear that the amount of energy we expend to extract it has increased—in 1930 it took one barrel of oil to extract 100; by the 1990s it was between 18:1 and 10:1, and we are approaching a situation in which it will require one barrel to produce three.   And the prospects of alternative energy development are dubious at best. In order to replace the current level of global petroleum use, we would need either 6800 nuclear plants (there are now 400), 6-17 million megawatt wind towers, nearly 13 million acres of solar pv panels, or 16 million acres of soybean, biofuel production (which is 135% of current agricultural land).

Put another way, if alternative energy sources grew at the rate of 25% a year over the next 14 years, they would supply roughly 1% of the global energy needs.

And the rapid decline of natural resources, on which our entire economy is based, is only one of many environmental consequences of the need for perpetual growth.  In the Third World, almost 80% of all deaths are attributable to environmental causes.  The increasing demand for water for industrial and agricultural purposes has left over half the world without clean drinking water.  Industrial pollutants increase respiratory illness, while our food supply is degraded by the use of chemical fertilizers, herbicides, insecticides, and other toxic substances. 

Article 3.  The right to democratic decision-making

The United States Constitution calls for some degree of citizen participation in decision-making, virtually all of the major economies of the world adhere to some sort of democratic ideal, and governmental leaders espouse that ideal for developing economies.  Yet the primacy for an ever-increasing return on capital requires governments to place the needs of capital above the needs of people.  This, in turn, requires that laws, rules and regulations be enacted that reduce the rights of citizens to democratic decision-making, particularly when those decisions might inhibit capital growth.  Democracy is not, as even economists recognize, conducive to perpetual economic growth, if only because, if given the freedom to choose, citizens will opt for life quality (e.g. a clean environment, more leisure time, etc.) over capital accumulation and the expansion of creditor wealth.

There are at least three ways in which democratic rights have been systematically reduced to ensure capital growth and the return on capital required by creditors.  The first is the rule that corporations are persons that originated with a United States Supreme Court decision in 1886 in a case involving a dispute between Santa Clara, California and the Santa Fe railroad over responsibility for a fence.  The Justice (or his recording clerk), in his finding  inserted in the decision, that found in favor of the railroad, that the 14th amendment freeing slaves, implicitly also recognized corporations as persons.  The result, of course, is that corporations now have the same political rights (although not necessarily the same obligations) as citizens, rights expanded by the recent Supreme Court decision in Citizens United that virtually removed any limits to corporate spending on political campaigns.  In 2010 virtually one-third of the almost three and a half billion dollars donated for political campaigns, came from industry.  Women and men seeking election or re-election to public office must choose to either represent industries with hundreds of millions of dollars to spend on campaign donations, or individual citizens with a fraction of potential donations.  Since success at being elected or re-elected to public office depends heavily on fund raising, our elected representatives themselves are not free to listen to the majority, but must attend to the needs of those with money.

The major problem is that corporations, unlike persons, exist solely to return profit to owners and investors; unlike persons they cannot empathize with the needy or accept responsibility for the needs of future generations.  Corporations exist in the short-term world of the bottom line, and yet we have granted them enormous power, as persons, to define that world.  And corporations, themselves, are bound to creditors whose interest they must represent.

The second way in which democratic rights are abridged is through legislation that assigns to non-democratic institutions, such as the International Monetary Fund (IMF) or the World Trade Organization (WTO), the power to impose penalties on U.S. corporations and citizens for violations of trade rules imposed by unelected bureaucrats.  Thus regardless of whether the removal of trade barriers, for example, benefits or penalizes citizens or groups, these groups have little recourse to having their case heard in any democratic forum.  Furthermore, by assigning rights to dictate economic policy to such organizations, we preclude the ability to attend to other global needs. The United States’ refusal to join in any global environmental mechanism or protocol, for example, likely arises from the fear that the rulings of such an organization would conflict with that of the WTO, IMF, or other global institution designed to assure perpetual capital accumulation. 

The third way that perpetual growth undermines democratic freedoms is the need to build security states and military-type organizations to mute protest that inevitably arises with the accumulation of debt and the requirement of perpetual capital growth.  These military organizations are also made necessary by the need of nations to acquire and protect markets and resources required to ensure growth.  These military organizations, fed by the ever-increasing arms trade, have led in many countries, and threaten to do in others, to militarily-controlled governments who systematically limit people’s freedoms.  In such societies, even peaceful protests, come to be seen as essential threats.  With such a development, no country is free from the threat of military domination.

Article 4. The right to a free, fair and vibrant market economy

A debtor’s bill of rights does not undermine a market economy.  It promotes and protects it.  A market economy is based on citizens freely producing and exchanging goods in exchange for money, each party in the interaction, as Adam Smith realized, gaining through the transactions.  Capitalism, as it came to be called, and as envisioned by Adam Smith, was a utopian vision. Regardless of whether Adam Smith’s “invisible hand” could have led to the kind of society he envisioned, the economy that has resulted is clearly not it. 

For example, a debt economy, and the consequent need for perpetual growth, promotes financial crises and instability.  The financial system, as it now operates, requires banks to issue more and more debt, both to maintain and increase the money supply, to increase corporate assets, and ensure creditor’s return on capital.  But the increased debt requires even greater rates of economic growth.

Given the present level of consumer, corporate, business and government debt in the United States (a total of some 60 trillion dollars) and the current amount of capital generation as measured by GDP (some 15 trillion a year), and assuming a required rate of return on all debt of 7% over 10 years, the necessary initial growth rate required to service that debt is approximately 15% a year, a rate of growth reached in the United States only briefly during World War II.[5]  It is little wonder that, given the structure of our financial system, there have been, over the past 200 years, some 250 banking crises in the developed world, lasting an average of 7 years.  Put another way, the so-called developed economies have spent approximately one out of every 4 years in a financial crisis of one sort or another.  The World Bank has identified no less that 96 major banking crises and 178 monetary crises over the past 25 years. This is not a characteristic of a healthy market economy.

Furthermore, a vibrant economy requires incentives to circulate wealth; a debt and interest economy promotes hoarding and the investment of resources in non-productive, but capital accumulating, activities.  The present global economic crisis is due less to any contraction in wealth than it is to creditors withholding capital or investing it in non-circulating or illiquid sources such as land, precious metals, or complex derivatives.

Article 5: The right to a rich and rewarding social life

The requirement for perpetual capital accumulation also undermines our ability for a rich, rewarding and meaningful social life. 

The increase in debt and the accompanying need to perpetually consume, labor, produce and profit reduces time spent on non-economic, but otherwise essential activities.  In other societies, community members allocate a portion of their time to collective actions that serve the common good.  We compensate for that by allocating a portion of our income to taxes, with which people are hired to perform necessary tasks for which we no longer have the time, such as maintaining infrastructure, teaching our children, caring for the elderly, delivering the mail, defending borders, and so on. But as debt increases, and, consequently as the need to work increases, instead of raising the share we, particularly creditors, contribute to these functions, we have, through a regressive tax code, reduced it, thus further impoverishing our community, and further accelerating the rate at which money flows from debtors to creditors. By reducing the share we contribute to the common good, we maintain the illusion of growth.  Creditors, are increasingly taking for themselves the resources that at one time would have been devoted to education, childcare, care of the elderly, community infrastructure and so forth.

The necessity for perpetual growth and the servicing of debt means that people spend less time with family; for example, the conflict between work and family is higher in the United States than elsewhere in the developed world. The typical American middle-income family works, on average, 11 more hours a week in 2006 than it did in 1979.[6]

The need for perpetual growth, and the crises of unemployment that it generates, also turns citizens against citizens, increasing gender, racial and ethnic divides.    An economy built on capital accumulation, in which citizens must generate interest on debt, means that they must somehow capture the money of others with which to pay that debt.[7]

An economy based on debt, also must increase the gap between rich and poor.  Some economists argue that economic growth is necessary to reduce poverty, and that increases in wealth will “trickle down” to the less rich. However, if an economy is based on debt, interest and the return on capital, money will not “trickle down,” but, rather, “trickle up.”  Debt is a regressive tax.  Interest and dividends flow to the top 1 to 5% of the population, that is those who earn more from interest and dividends than they pay, directly or indirectly, in interest.  It should not be surprising, that given the massive increase in debt over the past two decades, that the gap between rich and poor is greater than any time in almost 100 years and that the bottom 30 percent of American families has seen their median income fall by 29% since 1979. 

The need for increased capital accumulation must also undermine group solidarities while requiring psychologically-devastating individuation.  Sharing and cooperation is not conducive to economic growth as it reduces the need to consume and reduces the amount of time spent consuming, laboring and profiting.  Capital producing technologies, such as individualized digital devices, television, and video games, while increasing capital accumulation, promote a decline in face-to-face  interactions.  Perpetual growth requires that we devise methods to extract capital from even our most basic human activities.

National policies that undermine the formation and rights of labor unions may be necessary to increase corporate profits, but they destroy worker solidarity and cooperation, while reducing wages as well as safety in the workplace.  Of course, corporations themselves, are likewise trapped in the need for endless growth, even if that requires exploitation of workers and withdrawal of support to communities in which they are located.  The emergence of the corporate philosophy of “shareholder value” (and the subsequent decline in customer and community service) is a direct consequence of the requirements of corporations to maintain required growth rates and return capital to creditors.

Finally, the debt load of developing countries, debts that realistically can never be repaid, requires the increasing exploitation of land for industrial agriculture, forests for lumber products, and oil and other resources for energy. These developments, particularly in the developing world, force people off the land and forests where they might subsist into cities in search of wage labor.  Consequently more than half the world’s population now live in urban areas, with some 60-80% of those in developing countries (as opposed to 6% in the developed world) living in slums with their associated social and health problems. 

Article 6: The freedom to choose to labor

Economists argue that one of the major reasons for economic growth is the need to create jobs.  The unspoken assumption seems to be that everyone wants to labor for wages.  But that has never been true.  When colonial powers dominated areas of Africa, Asia, South and North America, one of their first acts was to use debt to force people to labor.  Great Britain, for example, facing a population in Africa who knew little of wage labor, and did not require it, immediately imposed “head,” and “hut” taxes to legislate debt that could only be paid through wage labor.  This pattern was followed by all colonial and economic powers, and even used by organizations such as the World Bank, which lent money to Third World countries, money given largely to elites, but which saddled their citizens with levels of debt which is impossible to repay and which has resulted in the decimation of health, schools and the environment of these countries.

To a great extent, the need to labor may vary directly with the level of debt.  With today’s debt levels, virtually every member of a household must labor, some at multiple, wage-paying  jobs.  Yet this was not true 40-60 years ago, when most households could “subsist” on one income.  In other words, economists concern for job creation is largely a factor of the need for people to labor to sustain the necessary return on capital to creditors.  Few people can afford not to labor in a company town.

Obviously this link between debt and labor requires, at it did for colonial powers, forcing people to go into debt.  Colonial officers did it simply by legislating it: everyone, by their virtue of having to pay a tax, was in debt.  Today the means for creating debt are more sophisticated, led largely by the use of sophisticated marketing techniques to manufacture desires which can be met only through indebtedness. 

But perhaps the most insidious violation of our right to a rich and rewarding social life occurs in the area of education, where we instill in our children almost from birth the importance of schooling, and then require that most go into debt for that same education.  In the United States the average college student today finishes college with an average debt of $25,000.  Student loans in the United States total over one trillion dollars.  Thus college graduates today find themselves incorporated into the “company town,” forced to assume debt as the price of the job thus required to honor their debt.  Even those countries in which a college education was considered a common good, are under increasing pressure by financial institutions to cut government expenses in order to service their debt and maintain the flow of capital to creditors. 

Article 7: The right to live by one’s principles and faith

The requirement for perpetual economic growth requires, ultimately, the evolution and imposition of a cultural and social system designed to maximize consumption, labor, and profit.  Consequently this cultural and social system must impose on individuals severe limits on their choices of ways of living in the world.  Some of these limits can be easily seen in the systematic destruction of the ways of life of indigenous peoples.  The confiscation of land, restrictions on livelihoods and imposition of laws has destroyed any possibility of cultural continuity of indigenous societies.  But what has been done in the name of capital growth to indigenous peoples, wealthy countries have done and are continuing to do to their own citizens. 

Relationships of interdependence are difficult to establish and maintain given the requirement of people to endlessly consume, labor and profit.  Consumption needs compete with ideals of sharing and generosity, while work requirements limit the opportunity for volunteerism.  The need to profit and the ethic of “shareholder value” limits the philanthropic impulses, once great, of businesses and corporations. 

The practice of religious faith is limited by the necessary increase in values that emphasize materialistic acquisition over spiritual development, sharing and giving.  With the continually increasing need to consume, labor and profit, there is little time or opportunity for traditional religious observance, let alone reflection, contemplation, or meditation.  How can a Muslim, Jew, Hindu, Christian or follower of any faith find the time to pray, to congregate for religious observances, or perform community services required by her or his faith? How can a Buddhist or a Quaker find time for silent sitting?  How can a lover of nature find time for a walk in the woods? It would be hard to imagine Confucius, the Buddha, Jesus or Mohammad or any of the great religious leaders of the past, countenancing the lives their followers are required to lead for the sake of perpetual capital accumulation.

The radical individualism required by the need for capital accumulation necessarily reduces any sense of mutual interdependence.  As the requirement for growth increases, our ability to meaningfully relate to others and the world around us diminishes.

Article 8: The right to be free of technologically intrusive manipulation

We are taught to believe that debt is freely assumed; that people, as so-called rational actors, choose debt as the instrument through which to obtain what they desire.  But desires are relative; what is considered desirable in one society, may not be desirable in another.  What is desired by one person, needn’t be desired by another.  We clearly are not born with specific wants, other than those, such as food, shelter, care and companionship.  Desires are manufactured.  The acceptable inventory of material things is socially defined.  And in a society of perpetual growth they must be incessantly enhanced. 

The fabric of our culture certainly plays a major role in defining our wants.  What do we need to be accepted by acquaintances?  What material items must we possess to signal to others the kind of person we want to be or be seen as?  Every society requires some material base through which people signal their identities and their connections to others.  But in a society of perpetual growth, there can never be enough of these “things.”  Consequently, it is necessary in a society of perpetual growth to constantly invent new and better ways to increase desires and wants.

A society in which people must believe that perpetual increase in consumption is a virtue, that perpetual capital accumulation is progress, that material possessions provide happiness and that there is no such thing as enough, requires the development of highly sophisticated technologies of manipulation and control.  Whether we call it marketing, public relations, or propaganda, we have secured the research, skills and creativity of biologists, psychologists, engineers, anthropologists, artists, musicians, writers, educators and others to explicitly develop instruments of persuasion to create the desires, tastes and values most conducive to the patterns of consumption, labor and profit required to ensure perpetual capital accumulation. In a society of perpetual growth we must assign to the most creative among us the job of intensifying the wants of others.

Marketers, freed from governmental regulation, have devised methods to manipulate children to buy or “nag” their parents to buy, more and more.  Public relations have advanced to the point that politicians can brag that “we create our own reality.”  Political campaigns become “spin” competitions or “selling” campaigns.  Technologies designed to help cure illness or repair broken bodies, such as magnetic resonance imaging devices, are used to increase the wants of children by studying the brain’s reaction to specific marketing stimuli.

Banks systematically promote mortgage, credit card, and automobile loans, often resorting to unethical or fraudulent means to convince people to assume debt.  First-year college students are met on campus by other students paid to convince the new-comers to acquire credit cards (whose balance banks generally assume will be honored by parents); banks use mass mailings (subsidized through the U.S. Postal Service by taxpayers) to invite young people to obtain credit cards or loans; or use deceptive practices, as they did to sell home mortgages, to convince people to assume debt.  Of course, banks themselves, are under the same pressures to grow as everyone else.  The development of complex security instruments whose collapse in value contributed to our present economic crisis, were motivated, in part, by a desire to increase the amount of capital available for investment and the need for investment banks to grow and maintain their clients. 

Article 9. The right to be free of the moral obligation to honor financial debt.

Why is it that people have a moral obligation to repay their debts, while banks do not have a moral obligation to extend credit, even when the money they lend is created by them and when the withholding of credit leads to individual suffering, as well as financial, social and political chaos?  And how can people be said to have a moral obligation to repay their debts when corporations, national or local governments can unilaterally cancel or reorder debt obligations or unilaterally cancel negotiated pension rights, as they have done?

How can debtor’s have a moral obligation to repay debts, when at least 30 members of the U.S. House of Representatives and 33 U.S. Senators, attempting to force budget cuts, voted against the government repaying its debt obligations?[8]

Legally we differentiate loans from liabilities, assuming that loans entail a legal (and moral) obligation to repay, but allow governments to label similar obligations as “liabilities,” that do not entail any legal obligation.  Thus Social Security in the United States, funded by citizen’s contributions, is considered only a “liability” and can be and has been unilaterally modified by a Congressional Act by raising the retirement age. 

Lending and investing requires risk to justify a demand for a return on capital.  If risk is nullified through the idea that debt entails a moral, as well as a financial obligation, then there is no justification for interest and/or dividends.  Yet government policies, particularly over the past two decades have virtually eliminated all risk by having taxpayers “bail out” investors and financial institutions.  Thus creditors are protected from loss, leaving debtors to assume the burden. There is no morality in this.

People must accept debt to function in the current economic world.  In effect, we have far more of an obligation to assume debt that we have an obligation to repay it, for without the assumption of debt, there would be no money, and therefore no economy.

Article 10: The right to withhold debt payments to effect justice and fairness

The founders of the United States recognized that people were “endowed by their Creator with certain unalienable rights” and could, therefore, alter or abolish government “destructive” of those rights.  As outlined in this document, all citizens of the United States, and increasingly the world, are being systematically denied specific rights in the name of capital accumulation.  Clearly money has become more important than a clean environment, a rewarding social life, and individual political freedoms.  However, it is not government, per se, that is solely responsible for this development.  Rather it is a financial system that has developed over the past three or four centuries in which money is created by debt and whose primary function is to make money with money.  To be sure, government ceded these rights to private financial institutions as a way to eliminate debts accrued largely in war.  But if governments ceded those rights, they can surely reclaim them in order to lift the burden imposed by debt and the need for perpetual growth. 

At one time it may have been reasonable to issue money as debt.  Theoretically such an arrangement reduces the possibility of excessive issues of currency and the monetary inflation that could ensue.  Debt-based money is also a means of disciplining people to labor.  However, debt-based money does not foster long-range thinking, does not motivate people to contribute to the common good, and is certainly not conducive to solving our environmental, social and political problems.

To reclaim financial rights and protect a true market economy, governments must themselves issue currency, rather than leaving that right solely to banks.  This is not a radical request.  This was done by some American colonies and is done by countries today.  While a modest interest could be charged, most issues of currency should be through grants.  Existing debts must be modified; the current debt level of countries, governments, businesses, and financial institutions is unsustainable and must be renegotiated.  Student loan obligations, specifically, must be modified. Limits on interest rates must be lowered, laws regarding bankruptcy must be loosened, and the debts of developing countries must be renegotiated or, in some cases, eliminated.  In a world not ruled by capital, we would have recognized that most of these countries are owed more by developed countries than they owe to multilateral institutions and global financial institutions.  Local communities should be encouraged to develop their own currencies and economies.  There are, of course, financial systems not founded on debt, most notably Islamic finance, and these, while imperfect, can serve as model for others. Reforms such as these would provide a path to the kind of societies envisioned by our founders and by classical economists. 

The problem, of course, is that those who make the laws are those who, currently, benefit from the existing state of affairs.  Therefore the question is, how do we initiate reform?  Violent revolution is both immoral and fruitless, particularly given the technologies of surveillance and violence developed by nation-states in order to maintain the present state of affairs.  Educational institutions and public demonstrations of dissent are useful, but depend on the willingness of corporate-controlled media to report, and, ultimately on legislative bodies to enact the required reform.  The problem, of course, is that legislative bodies in virtually all countries are controlled by financial institutions; as one U.S. Senator put it in regard to the U.S. Congress, “The banks own the place.”

There is, however, one right that we maintain and that has the potential to promote changes that, in the long run, benefit everyone, and that is the right to withhold one’s debt payments.  People are told, of course, that repayment of debt is a moral obligation; but debt, as outlined above, is not freely entered into.  As our economy is presently constituted, without debt, there would be no money.  Furthermore, if governments and municipalities can, without penalty, default on pension obligations or renounce obligations to protect children, the poor and the elderly, surely we retain the right in the name of a just society to withhold our debt payments.  By doing so, we deprive creditors, a small minority of our society, a source of their power and impel them to consider the harm that present arrangements inflict on all.  A debt strike must not constitute a refusal to pay debts; rather it must be considered an act of civil disobedience to withhold debt payments, particularly on securitized debt (e.g. mortgages, automobiles, credit cards and student loans), until action is taken to reform the presently unsustainable financial system.  This would not be a strike against finance, per se; some means of moving money from where it is to where it is needed is necessary for a thriving economic system.  However, a financial system founded on debt and interest and the resulting need for perpetual growth is clearly unsustainable.

The mechanics of a debt strike are relatively easy to institute. A date in the future, perhaps a year off, should be set, at which point, unless there is significant movement to reform the financial system, citizens will withhold their debt payments.  Until that date, there will be a good faith effort, perhaps led by some existing legislative or citizen group, or by a citizen group formed for the purpose, to draw up a series of reforms, such as some of those outlined above.  The effort must be global in scope.  The requirement for perpetual growth is not one faced only by the United States; it is faced by every country that has adopted a western-style financial system. 

This group will need to decide what changes in the financial system or in the rules through which financial systems are created, constitute significant progress.  If such progress does not occur, debtors will begin to withhold debt payments.

There will, naturally, be some concern on the part of debtors that their withholding of payments will result in some negative consequence (e.g. foreclosure or repossession of assets, fines, lowered credit rating, etc.)  It is not against the law, however, to miss a debt payment, or two, three or four, for that matter.  There will be an additional fee for late payments, but that is all. Moreover, it will require only a small minority (e.g. some 20%) to begin the strike to make it impossible for creditors (or the government or financial institutions) to effectively impose penalties.  A debt strike action will immediately highlight for everyone the critical function of debt and, at the very least, initiate discussion on the consequences of debt and perpetual growth, the extent to which a tiny minority benefit from a debt economy, and the necessity to reform the financial system. This will not be, as mentioned above, a refusal to pay debts, but rather an act of civil disobedience to effect change that will not only benefit all, but save our economy from recurrent crises and collapse.

A debtor’s strike is not without its dangers.  If the strike succeeds and there is a refusal to implement financial reform, the economy will collapse in a credit crisis.  A debt strike, in that regard, is no different than a labor strike.  As in a labor strike, all parties have a vested interest in changing a situation that threatens the firm with collapse.  However without some form of financial reform, we remain in a world in which ephemeral economic gain can occur only by abandoning visions of free societies thriving in hospitable environments.

------- Richard H. Robbins


A selection of works particularly relevant to a Debtor’s Bill of Rights

Brown, Ellen Hodgson. 2010. The Web of Debt: The Shocking Truth About Our Money System and How We Can Break Free. Third Millenium Press

Daley, Herman. Beyond Growth: The Economics of Sustainable Development. Beacon Press

El Diwany, Tarek 1997. The Problem with Interest. London: TA-HA Publishers

Garson, Barbara. 2001. Money Makes the World Go Around: One Investor Tracks Her Cash Through the Global Economy. Penguin

Graeber, David.. 2011. Debt: The First 5000 Years. Brooklyn, NY: Melville House

Hallsmith, Gwendolyn and Bernard Lietaer. 2011. Creating Wealth: Growing Local Economies with Local Currencies.  New Society Publishers

Jackson, Tim. 2009. Prosperity Without Growth: Economics for a Finite Planet. Earthscan

Kamenetz, Anya. 2007. Generation Debt: How Our Future Was Sold Out For Student Loans, Credit Cards, No Benefits, And Tax Cuts for Rich Geezers—and How to Fight Back.  Riverhead Books

Kennedy, Margrit and Declan Kennedy. 1995. Interest and Inflation Free Money: Creating an Exchange Medium that Works for Everyone and Protects the Earth. Philadelphia: New Society Publishers

McKibben, Bill. 2007. Deep Economy: The Wealth of Communities and the Durable Future. New York: Times Books

Martenson, Chris. 2011. The Crash Course: The Unsustainable Future of Our Economy, Energy, and Environment. John Wiley & Sons

Polanyi, Karl  1957 [1944]. The Great Transformation.  Beacon Press: Boston

Reinhart, Carmen M. and Keneth S. Rogoff. 2009. This Time is Different: Eight Centuries of Financial Folly. Princeton University Press

Robbins, Richard. 2011. Global Problems and the Culture of Capitalism (5th Edition). Pearson Publishing

Speth, James Gustave. 2008. The Bridge at the End of the World: Capitalism, the Environment and Crossing from Crisis to Sustainability. New Haven: Yale University Press

Williams, Brett. 2004. Debt for Sale: A Social History of the Credit Trap. University of Pennsylvania Press


[1] The term “growth,” of course, is highly misleading.  Its opposites, such as “stagnation,” “recession,” “decline,” or “reduction,” tend to be negatively valued.  We are, in fact, talking simply about capital accumulation.

[2] Economist Milton Friedman put the acceptable minimum at 5% real GDP a year.

[3]  it is difficult to conceptualize what these huge numbers mean and what the difference is between, say,  millions, billions and trillions, let alone quadrillions.  To illustrate, if in the year 0, you had a trillion dollars (1012  or 10E12 in U.S. scientific notation) to spend, and you spent it at the rate of one million dollars (106 or 10E6) a day, you would spend a billion (1012   or 10E12) within 3 years, but, in 2012 you would still have almost 700 years remaining to spend the trillion.  A quadrillion is 1015th (or 10E15).  At one million dollars a day, it would take 2.74 million years to spend.  Even if you spent at the rate of a million dollars a second, it would still take almost 32 years to spend a quadrillion.  And if the U.S. economy grew only at the average rate since 1870 (1.8%), by 2100, a rate that economists characterize as “stagnant,” it would be 75 trillion (5 times what it is today) and the size of the global economy would be 300 trillion or more than 4 times what it is today.

[5] See Michael Hodges, http://grandfather-economic-report.com/debt-summary-table.htm; Richard Robbins, 2011. Global Problems and the Culture of Capitalism)

[6] See The Three Faces of Work-Family Conflict: The Poor, the Professionals, and the Missing Middle. Joan C. Williams and Heather Boushey. http://www.americanprogress.org/issues/2010/01/three_faces_report.html

[7] There is the story of the “eleventh round,” told by Gwendolyn Hallsmith and Bernard Lietaer (2011:19), in which a mysterious stranger introduces a monetary system into a small community by distributing 10 small circles of cowhide, each with the value of one chicken, to each family to facilitate the exchange of goods.  The stranger imposed only one requirement on the community; that each family, after a year’s time, return to him, an extra circle (the eleventh round).  The result, of course, is that each family can realize the eleventh round (the “interest”) only by taking it from another family.

[8]http://www.senate.gov/legislative/LIS/roll_call_lists/roll_call_vote_cfm.cfm?congress=113&session=1&vote=00011; http://projects.washingtonpost.com/congress/113/house/1/votes/30/