Killing the Host Quotes

“Popular morality blames victims for going into debt – not only individuals, but also national governments. The trick in this ideological war is to convince debtors to imagine that general prosperity depends on paying bankers and making bondholders rich – a veritable Stockholm Syndrome in which debtors identify with their financial captors.”
― Michael Hudson, Killing the Host: How Financial Parasites and Debt Bondage Destroy the Global Economy

“Ideally, a fair and equitable society would regulate debt in line with the ability to be paid without pushing economies into depression. But when shrinking markets deepen fiscal deficits, creditors demand that governments balance their budgets by selling public monopolies. Once the land, water and mineral rights are privatized, along with transportation, communications, lotteries and other monopolies, the next aim is to block governments from regulating their prices or taxing financial and rentier wealth. The neo-rentier objective is threefold: to reduce economies to debt dependency, to transfer public utilities into creditor hands, and then to create a rent-extracting tollbooth economy. The financial objective is to block governments from writing down debts when bankers and bondholders over-lend. Taken together, these policies create a one-sided freedom for rentiers to create a travesty of the classical “Adam Smith” view of free markets. It is a freedom to reduce the indebted majority to a state of deepening dependency, and to gain wealth by stripping public assets built up over the centuries.”
― Michael Hudson, Killing the Host: How Financial Parasites and Debt Bondage Destroy the Global Economy

“In fact, they are not taught in any university departments: the dynamics of debt, and how the pattern of bank lending inflates land prices, or national income accounting and the rising share absorbed by rent extraction in the Finance, Insurance and Real Estate (FIRE) sector. There was only one way to learn how to analyze these topics: to work for banks. Back in the 1960s there was barely a hint that these trends would become a great financial bubble.”
― Michael Hudson, Killing the Host: How Financial Parasites and Debt Bondage Destroy the Global Economy

“The Godfather, Part III (1990): Vincent Mancini: Don Lucchesi, you are a man of finance and politics. These things I don’t understand. Don Lucchesi: You understand guns? Vincent Mancini: Yes. Don Lucchesi: Finance is a gun. Politics is knowing when to pull the trigger.”
― Michael Hudson, Killing the Host: How Financial Parasites and Debt Bondage Destroy the Global Economy

“Ponzi austerity schemes, just like Ponzi growth schemes, necessitate a constant influx of new capital to support the illusion that bankruptcy has been averted.”
― Michael Hudson, Killing the Host: How Financial Parasites and Debt Bondage Destroy the Global Economy

“Debt leveraging is a major reason why the United States and Britain have lost their industrial advantage. Debt-inflated costs for housing, education and other basic needs have priced their labor out of markets abroad and at home.”
― Michael Hudson, Killing the Host: How Financial Parasites and Debt Bondage Destroy the Global Economy

“Blaming the wolf would not help the sheep much. The sheep must learn not to fall into the clutches of the wolf.”
― Michael Hudson, Killing the Host: How Financial Parasites and Debt Bondage Destroy the Global Economy

“The aim of predatory lending in much of the world is to obtain labor to work off debts (debt peonage), to foreclose on the land of debtors, and in modern times to force debt-strapped governments to privatize natural resources and public infrastructure.”
― Michael Hudson, Killing the Host: How Financial Parasites and Debt Bondage Destroy the Global Economy

“Recognizing how most great fortunes had been built up in predatory ways, through usury, war lending and political insider dealings to grab the Commons and carve out burdensome monopoly privileges led to a popular view of financial magnates, landlords and hereditary ruling elite as parasitic by the 19th century, epitomized by the French anarchist Proudhon’s slogan “Property as theft.” Instead of creating a mutually beneficial symbiosis with the economy of production and consumption, today’s financial parasitism siphons off income needed to invest and grow. Bankers and bondholders desiccate the host economy by extracting revenue to pay interest and dividends. Repaying a loan – amortizing or “killing” it – shrinks the host. Like the word amortization, mortgage (“dead hand” of past claims for payment) contains the root mort, “death.” A financialized economy becomes a mortuary when the host economy becomes a meal for the financial free luncher that takes interest, fees and other charges without contributing to production.”
― Michael Hudson, Killing the Host: How Financial Parasites and Debt Bondage Destroy the Global Economy

“Just as the drivers in Gatsby and Bonfire responsible for crashes left others to bear the blame, so the One Percent seeks to shift responsibility onto the financial victims (“the madness of crowds”). Governments are blamed for running deficits, despite the fact that they result mainly from tax favoritism to the rentiers. Having used FICA paycheck withholding as a ploy to cut progressive tax rates on themselves since the 1980s, the One Percent blame the indebted population for living longer and creating a “retirement problem” by collecting the Social Security and pensions. This is financial warfare – and not all wars end with the victory of the most progressive parties. The end of history is not necessarily utopia. The financial mode of conquest against labor and industry is as devastating today as in the Roman Republic’s Social War that marked its transition to Empire in the 1st century BC. It was the dynamics of debt above all that turned the empire into a wasteland, reducing the population to debt bondage and outright slavery. Livy, Plutarch and other Roman historians placed the blame for their epoch’s collapse on creditors. Tacitus reports the words of the Celtic chieftain Calgacus, c. 83 AD, rousing his troops by describing the empire they were to fight against: Robbers of the world, having by their universal plunder exhausted the land … If the enemy is rich, they are rapacious; if he is poor, they lust for dominion; neither the east nor the west has been able to satisfy them. … To robbery, slaughter, plunder, they give the lying name of empire. They make a wasteland and call it peace. The”
― Michael Hudson, Killing the Host: How Financial Parasites and Debt Bondage Destroy the Global Economy

“Europe’s war against debtor countries was turning into class war, which always ends up being waged on the political battlefield. One financial analyst noted that the money raised for putting up islands and public buildings, ports and the water system for sale “will barely put a dint in Greece’s now-unpayable public debt.” Creditors simply hoped to take as much as they could, in the absence of public protests to stop the selloffs. That is why bankers resort to anti-democratic methods in opposing any political power independent of creditor interests. The aim is to centralize financial policy in the hands of “technocrats” drawn from the banking sector – not only Lucas Papademos in Greece, but also Mario Monti in Italy almost simultaneously (as described in the next chapter). The fear is that democratically elected officials will act “irresponsibly,” that is, in the interests of the economy at large rather than catering to the demands of banks and bondholders. The”
― Michael Hudson, Killing the Host: How Financial Parasites and Debt Bondage Destroy the Global Economy

“Opinion polls showed that two-thirds of Greeks rejected the conditions attached to the bailout, but wanted to stay in the eurozone. Demonstrations spread throughout Greece advocating a “No” vote. So the Germans and French tried to frame the issue in a narrow way designed to get a “Yes” answer: Did voters want to be part of Europe? The aim was to avoid asking the really important question: Did Greek voters want to impose a decade of depression on themselves, cut public services, impose anti-union labor “reforms,” and sell off the Athenian water supply, its port, their beautiful islands and their gas rights in the Aegean to Germans and other creditors?”
― Michael Hudson, Killing the Host: How Financial Parasites and Debt Bondage Destroy the Global Economy

“The collapse of Inter-Ally debts and German reparations in the 1920s showed that “debts that can’t be paid, won’t be.” What blocks this awareness among neoliberal economists is their fantasy is that all debts can be paid by squeezing out a large enough fiscal surplus. Neoliberals are incorrigible in preferring to indulge their pro-creditor and anti-labor sentiments in the face of the reality that fiscal austerity shrinks the economy and hence the ability to produce a surplus to pay creditors.”
― Michael Hudson, Killing the Host: How Financial Parasites and Debt Bondage Destroy the Global Economy

“To enable lending to proceed when the IMF’s sustainability criteria were not met, its bureaucrats designed the “systemic risk waiver.” It was a model of circular reasoning that might well be taught to philosophy students. “Severe debt crises all carry the risks of systemic spillovers,” notes Schadler. The global financial system was deemed to be endangered if a debt payment was missed or a haircut imposed on bondholders, because “confidence” was threatened. Any haircut for bondholders might cause panic and “contagion.” So it doesn’t matter what IMF economists say regarding debt sustainability. The IMF is committed to preserving “confidence” at all costs – confidence that the troika will lend governments enough to pay their bondholders and speculators in full (but not pension funds). The systemic risk waiver means that no bondholder should lose. Labor and taxpayers must pay for the losses from risky loans, or else there will be “contagion.”
― Michael Hudson, Killing the Host: How Financial Parasites and Debt Bondage Destroy the Global Economy

“The idea that the euro has “failed” is dangerously naive. The euro is doing exactly what its progenitor – and the wealthy 1%-ers who adopted it – predicted and planned for it to do. … Removing a government's control over currency would prevent nasty little elected officials from using Keynesian monetary and fiscal juice to pull a nation out of recession. “It puts monetary policy out of the reach of politicians,” [Robert] Mundell explained]. “Without fiscal policy, the only way nations can keep jobs is by the competitive reduction of rules on business.” … Hence, currency union is class war by other means. — Greg Palast, “Robert Mundell, evil genius of the euro.” Unlike”
― Michael Hudson, Killing the Host: How Financial Parasites and Debt Bondage Destroy the Global Economy

“Bankers are seeking to capture government and make financial policy immune from democratic choice. What promised to be a progressive social democratic Europe half a century ago is turning into a power grab by financial predators. The EU has confronted Greece, Cyprus and other indebted economies with an option of suffering debt deflation or leaving the eurozone. Since Greece’s Syriza coalition took the electoral lead in opposing the financial and fiscal austerity, the creditor response has been to dare Greece to withdraw – and to suffer a transitional financial chaos if it tries to save itself from being crushed by unemployment, bankruptcy and emigration.”
― Michael Hudson, Killing the Host: How Financial Parasites and Debt Bondage Destroy the Global Economy

“A return to classical bank policy would deem loans fraudulent and annul debts when creditors do not lend with any reasonable calculation of how the debt can be paid in the normal course of economic life. Loans made without such a calculation should be considered predatory. The natural check on such behavior is to permit mortgage debtors to walk away from their homes, free of the debts attached to them, letting title revert to the banks that over-lent.”
― Michael Hudson, Killing the Host: How Financial Parasites and Debt Bondage Destroy the Global Economy

“Bank-friendly writers and lobbyists fostered a myth that the economy needed its investment banks to remain solvent to keep the economy functioning. But many former officials, including Bair, SIGTARP‘s Neil Barofsky, and Reagan Administration budget director David Stockman, rejected the claims that public guarantees for reckless bank loans was needed to protect insured depositors. Retail savings and checking accounts were never threatened by the bad gambles that banks made. But this myth had to be promoted in order for Paulson, Geithner Bernanke and other bank protectors to persuade Congress to overrule Bair and make government (“taxpayers”) pay. Their aim was to save the banks from being nationalized, and to protect bankers from being prosecuted for fraud or reining in the exorbitant salaries and bonuses they had given themselves. No attempt was made to change the system that had led to the crash. If”
― Michael Hudson, Killing the Host: How Financial Parasites and Debt Bondage Destroy the Global Economy

“The disabling force of debt was recognized more clearly in the 18th and 19th centuries (not to mention four thousand years ago in the Bronze Age). This has led pro-creditor economists to exclude the history of economic thought from the curriculum. Mainstream economics has become censorially pro-creditor, pro-austerity (that is, anti-labor) and anti-government (except for insisting on the need for taxpayer bailouts of the largest banks and savers). Yet it has captured Congressional policy, universities and the mass media to broadcast a false map of how economies work. So most people see reality as it is written – and distorted – by the One Percent. It is a travesty of reality.”
― Michael Hudson, Killing the Host: How Financial Parasites and Debt Bondage Destroy the Global Economy

“The euro and the ECB were designed in a way that blocks government money creation for any purpose other than to support the banks and bondholders. Their monetary and fiscal straitjacket obliges the eurozone economies to rely on bank creation of credit and debt. The financial sector takes over the role of economic planner, putting its technicians in charge of monetary and fiscal policy without democratic voice or referendums over debt and tax policies.”
― Michael Hudson, Killing the Host: How Financial Parasites and Debt Bondage Destroy the Global Economy

“finance was to become a public utility, situated in the public domain or at least alongside a public banking option. Instead, the past century’s expansion of predatory credit has been reinforced by de-taxing interest, land rent, financial speculation, debt leveraging and “capital” (asset-price) gains.”
― Michael Hudson, Killing the Host: How Financial Parasites and Debt Bondage Destroy the Global Economy

“John Stuart Mill was called a Ricardian socialist because classical economists were moving toward reforms they themselves characterized as social – and hence, as socialist. Most reformers referred to themselves as socialists of one kind or another, from Christian socialists to Marxist socialists and reformers across the political spectrum. The question was what kind of socialism “free market” capitalism would evolve into.”
― Michael Hudson, Killing the Host: How Financial Parasites and Debt Bondage Destroy the Global Economy

“Proclaiming Clean Slates to restore economic balance – annulling the accumulation of debts when they grew beyond the ability to be paid – kept pre-Roman civilization financially stables. Mosaic Law placed this principle at the core of Jewish religion (Leviticus 25). Yet modern Christianity all but ignores the fact that in Jesus’s first sermon (Luke 4) he unrolled the scroll of Isaiah and announced his mission to proclaim the Year of the Lord, as the Jubilee Year was known. Restoring the Jubilee Year became the basis for early Christians to break away from Rabbi Hillel, whose prosbul clause was used by creditors to force debtors to waive their rights to a Clean Slate. Jesus’s position – reflected also in the Dead Sea scrolls of the Essenes – prompted the wealthy establishment to fight so strongly against him.”
― Michael Hudson, Killing the Host: How Financial Parasites and Debt Bondage Destroy the Global Economy

“demonstrate that taxing rent re-captures for society the natural resource patrimony and rising site value. This rental valuation is created not by landlord efforts but by society’s overall prosperity and public investment in transportation systems, schools and other infrastructure that define “location, location and location.”
― Michael Hudson, Killing the Host: How Financial Parasites and Debt Bondage Destroy the Global Economy

“Chapter 7 has shown that banking was on its way to becoming a public utility in the years leading up to World War I. A public option survives in the Post Office banks of Japan and Russia. By providing deposit and checking accounts, loans and credit cards at rates reflecting the actual cost of such services (or even at subsidized rates instead of today’s interest charges, fees and penalties), a public option could free the economy from the monopoly rent now enjoyed by banks. Most important, public banking would have been unlikely to extend credit for the corporate takeovers, asset stripping and debt leveraging that characterizes today’s financial system.”
― Michael Hudson, Killing the Host: How Financial Parasites and Debt Bondage Destroy the Global Economy

“Taxing land rent (and also natural resource rent and monopoly rent) has three positive effects. First, it keeps property prices low by preventing this rent from being capitalized into bank loans. Second, it frees labor and industry from taxes on wages, profits and sales, alleviating most family budgets. Third, banks will be obliged not to create as much new debt that merely becomes a cost of transferring ownership rather than contributing to real output and productivity. Taxing rent is administratively easy. The United States has over twenty thousand appraisers whose job is to assess the market value of buildings and land separately.”
― Michael Hudson, Killing the Host: How Financial Parasites and Debt Bondage Destroy the Global Economy

“In effect, he ruled that no writedowns are legal. No government’s debt can be written down if any holder disagrees, regardless of how voluntarily they may be negotiated or how reasonable they may be.”
― Michael Hudson, Killing the Host: How Financial Parasites and Debt Bondage Destroy the Global Economy

“The starting point of the 2014 BIS report is the main theme of the present book: We are not in a typical cyclical downturn, but have reached the culmination of a long buildup of cycles. Each recovery since 1945 has added more debt, increasing carrying charges that divert spending away from current goods and services (debt deflation, as Chapter 8 has discussed).”
― Michael Hudson, Killing the Host: How Financial Parasites and Debt Bondage Destroy the Global Economy

“Neoliberal enzymes aim to sedate the industrial host into believing that the financial sector is part of the real economy, not external to it and extractive. That is the first myth. Modern national income and GDP accounting formats treat tollbooth systems and other rent seeking as “output.”
― Michael Hudson, Killing the Host: How Financial Parasites and Debt Bondage Destroy the Global Economy

“In place of classical political economy, today’s foundation myth is that all income and wealth is earned productively – as if there were no economic rent (unearned income) as a legacy of feudalism’s rentier privileges, and no inherited wealth or insider giveaways. Yet these have been the shaping forces of history. That is why they were the focal point of classical political economy – to free society from such privileges and bias. A society’s analytic concepts determine the kind of reality it creates. That is why parasites start by taking control of their host’s brain.”
― Michael Hudson, Killing the Host: How Financial Parasites and Debt Bondage Destroy the Global Economy