festivals over the next few months. ..

>> there's a piece in the "new york times" about the debt limit drama in there, and the reporter explained, a think piece as they call it in journalism, that the parties were fighting over the moral high ground. i didn't see very much moral high ground in it at that point, but there's also an interesting point that's about being made by the reporter that an awful lot of discourse around debt is about morality and austerity which frequently follows the busting of a bubble is often presented as a moral renovation, a program of moral

renovation. bubbles in the past had been followed by "what were we thinking" kinds of things. david, you write about debt and morality and what one owes society. how did debt, which, you know, conventionally is thought of a economic mechanism, get wrapped up in issues of morality? >> well, we don't really know because it seems 20 have happened so early that it's almost beyond the reach of the historical record, but the earliest documents seem to already have them conflated. i mean, in hebrew, the words for debt and guilt are the same word. it's a curious thing because in all the ancient religions all start the same way like plato's republic starts, what is justice? not just a matter of paying debts? no, actually it's not. that doesn't work, and then the

rest of the book figures out that it's not that. religions are the same. they say morality is just debt, it's the same thing, then they say, but, wait, that doesn't really work, so what it ends up being varies a lot and the subscript texts conclude that recognizing you don't owe a debt to your parents is actually the way you resolve and the bible is about forgiveness and debt cancellation is the metaphor for debt morality. the interesting thing is they feel they have to start that way. the conclusion i finally came to is the only way to explain it is they are struck with this language because that was the politics and power at that time. we don't know what people in ancient india were arguing about in talking politic, but it seems from the evidence we have that that is it, these languages and leftover political debates that

we don't know anymore exactly what they were. where debt and the language of debt forgiveness reckoning redemption was the every day language of politics, and was swept into moral language, and that's been left of us ever sifns. it's the language of power, and people in power have always discovered that it's the easiest way to take a situation of two arbitrary authority and make it seem the victim is to blame. conquering armies understand this. you have power over somebody, you conquered them, the easy thing to do is say, look, you guys owe us your lives because we didn't kill you. we're going to demand this, name something they can't pay, and then say, i'm a nice guy, letting you off the hook this month, and then you have a moral

high ground and they have to run around feeling rotten about themselves. who owes what to who which is, in fact, what people invariably did, and what we discover while it was a very effective way of refraining power relations to seem the victims are to blame to the extent that most people who ever lived were told they were debtors at some point in their lives, but it's also the focus of vast majority of insurrections and rebellions over history. there's basically one revolutionary, and that's can set the debts and redistribution in that order. what owes what to who? it does happen all the time, but once you say that, of course, you're using language of debt so people are stuck with that argument about what is debt and who owes what to whom, and the

great moral philosophers have to start with that language only to transcend it and kick it away. >> you mentioned the jubilee. i remember pat robertson running for president in 1998, he suggested a jubilee, and that disqualified him as a serious candidate for president, and prompted stern lectures 234 the "wall street journal" editorial page. christian morality is prevalent in the politics, but that seems 20 disappear. >> it's interesting. pat robertson argued the federal reserve system of money creation is actually the first divine system money creation because making up money and giving it to capitalists reproduces the divine act of creation. it's like not a materialist thing. >> government doesn't trust money; right? >> yeah, yeah. credit comes --

>> from to believe. wrapped up in matters of faith. >> he recognized that, but just took it too seriously for the people in charge. [laughter] >> another element of religious traditions, relations have found usury and now that seems to be largely forgotten as well. what happened? >> well, that's a really interesting story. in fact, one of the things that came out when i was researching this book, and you can say it's one of my major discoveries is history flows back and forth between periods dominated by virtual credit money and periods where gold and silver are what money really is and where coins or other material object, actual metal is being used in every day transactions. the funny thing is we think this world of virtual credit money we are moving into now is a brave new world and unprecedented. the o opposite is true. it's the original form of money. in ancient days, credit was the form of money.

money was invented after 2,000 years with compounded interest rates and things like that, however, in periods where you have credit as the main form of money, while it's hard to think of money as something which is quite as set in stone as it is in periods where people are actually in physical stock, so it's understood that money is a social creation, and there's a mechanism to make sure the system doesn't go crazy. for example, the jubilees -- periodic cancellation. kings often simply canceled all debts on taking power and said, all right, new king, new world, new society. let's start over. that became institutionalized in the 49 year cycle in the bible. in the middle ages, another period of virtual credit, reverts to bullion, debts are not forgiven generally from 600

b.c. to 600 ad. with the middle ages, we go back to credit systems, and once again, there's vast overarching institutions designed to protect debtors, in this case, in islam and christianity. christianity was stricker than islam at first. along with other things like debts a name along with it. it was considered critical to prove -- to assure society didn't polarize and split apart. the rise of the economic system we have now which comes after 1492, bullion comes sweeping back into europe again, and most of that ends in china, but swept through europe on the way. they go back to an idea that money really is gold and silver and change the idea of what money is, and interest sort of warms its way back in. it's interesting how they did it. it was through a suberfuse.

it goes back to the latin interessay, but what it actually meant was a penalty for late payment. the idea was while renting money was a sin, you could charge people for not return something by the date they said they would because it was assumed that if these people being merchants, starts with commercial law, if you had the money, you put it out to a profitable enterprise so it would be growing at maybe 5% a year, thus they could pay you a penalty. that was the legal out they used. >> italian bankers invented complex derivative instruments in the 13th and 14th century to disambiguous interest, so financial innovation goes back a long, long way. >> mortgages are another way. if you can't charge interest, you say, i'm buying your house

and representing it back to you. -- renting it back to you. [laughter] >> this is funny just coming after the news that lloyd of goldman sachs highed a defense -- hired a defense attorney. it seems like the ones serving us to pay their debt to society are not the profitable ones. they live on high collecting interest. funny. how do they get away with that? >> well, you know -- all right -- this is my reading. [laughter] there's an obvious answer which is debts are social constructs, and debts between rich people have always been a little different than debts between poor people and each other where people tend to help each other out, a disguised form of mutual aid, or, you know, but debts between rich and poor, they are kind of different. that's where the exact morality

of debt really comes in. as i mean, rich people can be incredible generous and forgiving when dealing with each other as you recently saw in 2008. not so much when dealing with us, and this has always been true. the funny thing though 1 that we seem to be experiencing another turn of the cycle. there's another one of my major conclusions in the book actually. all right, we had virtual credit and gold and silver in the and -- ancient world, and then back to credit. in 71, officially the dollar was detached from gold, and since then it's been happening at breakneck pace. placic replaces currency in every day transactions. we had financialization of capital and we've had the rise

of 401(k)s and credit is supposed to save the world. on all fronts, you are moving towards losing ideology of credit and the actual use of virtual money. >> the american pop pewlation is in love with credit. >> it's the only thing saving us since wages were stagnating. let them eat credit. the problem was that when you go into a period of virtual credit, historically what happens is one is how to prevent this thing from spinning out of control if money is just an iou and promise, well, what's to keep people from making any old kind of crazy promise, and even more, what prevents people from falling into debt traps and becoming enslaved in that was the great fear of most of human history, our terrible moral disaster that rips the society apart was, you know, small percent of the population enslaves everybody else by

trapping them into debt and people are forced, you know, to sell off members of the family and into slavery ultimately sell themselves. now, this was -- thus there were always mechanisms to prevent that from happening. the jubilees, antiusury laws, various other things, buddhists, for example, in the middle ages didn't believe in abolishing interest, but they invented the pawnshop. that was supposed to be saving people from the local loan sharks. the first pawnshop, buddhist temples in china, and then france adopted it in europe. now, what did we do this time around? well, true, we're only 40 years into probably what's a 500 year cycle if history is true, so you can't expect to know what's going on. >> president bachman will handle

it. [laughter] >> the first global administered assistant if you want to think about it because you have the ims, trade bureaucracies, wto, e.u., nafta, and other various institutions, and now, what the guys do instead of protecting debtors, they are there to protect creditors which is insane. >> conceiving the imf it should be forced to the surplus, to the the debtors. >> they turned it around. king studied economics -- >> an immoralist too, okay. >> yeah. there's morality and there's morality. yes, so what they did is exactly the opposite of what historically you would imagine they should have done, and the result was predictably

catastrophic. you have the third world debt crisis, and now that latin america, east asia liberated themselves from the imf, they kicked them out basically, the same thing is happening here, and, in fact, another point i like to make that idea of the terrible debt crisis where 1% or 2% of the population is in debt -- everybody's in debt, everybody working extra jobs, working in jobs they would otherwise never want to be in in order to pay back those debts. if aristotle was in the present, he would not take the distinction between renting yourself out to someone else to work for them and selling yourself for them to work for them as being more than legal. he would conclude people are slaves. >> other options may have been catastrophic to the debtors, but they are good for the

creditors. if we go back to the first modern debt crisis and austerity scheme, the fiscal crisis of 1975, the bankers took over the city, cult back on essential spending and social sector, and they were conscious that if we can get away with this in new york, a very volatile environment, we can do this anywhere. there was an op-ed in the "new york times" back in 1975 that said that. that succeeded. the question of the 80s, and that was used as a lever to open up all these economies, open up to trade and finance, privatization, really the club of neoliberalism. >> right. >> a quote from an illusive money saying money has one face, that of the boss. the croaters intern -- creditors has been successful in 40 years in using debt to enslave and impoverish and

increasing in power. down the luck is running out? >> yeah. i think 2008 let the cat out of the bag because, you know, they can do this partly because people are still following the morality of a bullion-based money system where by it seems debts have to be paid. what everybody discovered in 2008 where they blew up their own system of sheer complete greed is that debts don't have to be paid if you're big enough. that's the lesson of the virtual money system. if money is a promise, an iou, why does it have greater moral standing than any other promise? the argument is if you don't pay the debts, the economic system falls apart, but, in fact, the whole economic system did fall apart, and the culprits didn't have to pay their debts even

then, so as a result, i think, that people realize -- i mean, there's a moment of lucidity right after the crash. in fact; people were willing to rethink almost anything. i remember even the economist ran a headline, capitalism, was it a good idea? [laughter] they just put a band aid over the thing and said, okay, move along, move along, nothing to see here. [laughter] band-aids fall, and it's starting to happen, and people came to the realization that the line they tell us about neoliberalism is nonsense. markets don't run themselves. nobody can believe that at this point, and debts don't have to be repaid, and if they make $13 trillion, a dark economy money that was flushed away, if they can make that money disappear, that debt disappear, well, there's no reason they count do

the federal debt, my debt, it's all a political thing, and the question of who has the most power. now, once you realize that, then a democracy is to be in anything. everybody has to have a say over that, and i think that's exactly why you see these movements in spain and greece. that's what they are essentially saying, and that's why they frame it as back to grass roots democracy. >> well, the dominant political discourse still seems to assume that the elderly need to tighten their belts, and the poor need to give up medicaid so that rich bikers can get another jag. doesn't seem to be any challenge that the orthodox is falling apart, maybe fraying, but -- >> depends where you are. in europe they are ahead of us in terms of the austerity. we how things might well look like in year and a half. i was told by friends in greece it's to the point of argentina in 2001 when politicians couldn't go to restaurants without wearing false noses and

mustaches because people attacked them. politicians can't go on the street anymore in greece. i think that might well happen after it actually hits. >> a couple economists who studied the european record over the last 40 years found out austerity programs lead to a great upsurge in riots. >> cheers. >> proven by economists. [laughter] speaking of economists, in their marvelous icy hearts, they long have been viewed that money is very insignificant, a lot of cliches in the economic session, money is avail, john stuart mill says nothing could be more insignificant than money. the idea that money is neutral, dominating mainstream economics. wherever did that idea come from? >> it's really odd because it has nothing to do with what economists actually do. yeah, there's this since that all economies are really barter

economies, money is a convenience, look away, look away. another one of those nothing to see here kind of moments, and it goes back to adam smith actually. there's a fascinating story that would also we all learn about where money is supposed to come from, originally there's barter, and everybody saying, you know, i'll give you 20 chickens for that cow. i don't need chickens now, but firewood or eggs. eventually you hit on something the guy needs, or you give him money. we all learn this. being an anthropologist, this is a personal pet peeve because we have been looking for 150 years if there's any place in the world that they did that, we would have found it by now. it's not true. they do lots of other things, but never do. that it's amazing considering there's not that many things 245 -- that nobody ever does.

[laughter] but, there's one. occasionally barter rules like people you hate or would assume kill or steal, but not right now. the question is why, and i think the real reason is because money is credit, credit is a social relation, and economists had a problem with credit because it -- >> also had trouble with social relations. >> exactly, because of social relations. social economics, a domain into itself, there's a sphere of human connectivity that people just think about stuff. in human life, we are never just thinking about the stuff. it's what economists were doing. adam smith and people like that came from a class where they thought maybe we should be able to walk into the butcher or the baker plop your cash, take your stuff, walk out, and never see the guy again or never know his name. that's not how it worked at the time.

it's not from the ben nevada lance of the butcher or baker. it was not true at the time. all transactions were credit. they asked favorrings of butchers and bakers all the time, but there's a feeling they shouldn't. >> britain was run by hard money nuts. >> well, they -- they had a problem with credit money, getting out of hand, the problem was they thought everybody should be using coins, but they didn't have the means to make them. it was the 1830s and 40s where they produced enough cash that people could go to the store and buy things. for a long time, shops produced their own money. now, so why tell the story? it makes no sense if you think about it. here's a guy, his neighbor, he wants his cow. he says, i'll give you chickens, the guy says no. well, these guys are neighbors in a small community presumably,

but the economists saying they are interact with each other on spot trade, you know, something for something right now, and we walk away. i mean, what sense does that make? these guys are neighbor. you don't want the chickens. he's got to have something. in fact, that's what happens. you say, hey, nice cow, you like it? take it. now you owe him one. he'll come back later. he says, you know, my son is in love with your daughter or whatever he comes up with -- [laughter] so, you actually have rough inform mall credit system, but, again, that involves things like my son is in love with your daughter falling outside the domain of economics so they made up a story where everybody swaps stuff on the spot and money is a way of facilitating that. money is always secondary and arises from the basic business of swapping stuff.

>> you say that a lot of -- what do we call them? precapitalists? older societies, money didn't serve an economic function. >> that's called human economy. >> had richer symbolic value more than we think of money now. >> yeah, you finds things like cash in stateless societies, but you don't find markets though. wonthom was like money -- >> across the road for $24. >> they had beads too which seemed to be received as a token of good will, a gift of rare ex. they had been manufacturing stuff, and using it to trade.

television weight in purple beads made from clams. it was legal tender in the colonies in pennsylvania, new york, and massachusetts. colonists used to trade with each other. cash was hard to come by in those days, but there's no record of any coy using it to tried with each other, map people from different tribes involved with the settlers. they used it to make treaties, promises to arrange marriages, and to pay fines, you know, a give away of what happens with the origins of money. what is money? money's a system where you can make proportional comparisons, 27 of these equals three of these. it's hard to see how that can come out of a system of gift exchange like nice cow. if somebody gives you something back which you think is not

worth your cow, you might think the guy is cheap and make fun of him, but you don't figure out a math formula to figure out just how cheep he is. money emerges when people are really angry. it comes from penalties and fines. you know, if you have a fight and he kills your brother, that's when ewe say, hey, 27 heifers. i want it exact. they better be good ones. that's a circumstance where there's exact proportions. when you look at medieval law codes, it's very clear. i quote the welsh law codes where they could put a price on every single october in the average house even though there were no markets, but it was for paying penalties. >> you mentioned in passing there's no states, so therefore no markets. i was thinking of milton friedman cowriting a book of

monetary history of the united states in which he pledged allegiance to the doctrine that money was insignificant, didn't matter, even though he was writing a 600-page book. he made one exception which is when the state gets 234 and screws things up. the great depression, for example, was the federal reserve screwing things up. none of the other fundamental issues, inequality or retrospeculation, massive increases of productivity without the means to purchase, and none of that interested friedman, it's just how the federal reserve screwed up, but you say repeatedly throughout the book that there's no markets without states. >> not as far as we know. markets are centered in states beyond them. even then, they operate in completely different means. where you have truly stateless societies, there's no markets

unless they are brought in from outside, and that's a fascinating thing because it flies in the face of all of our custom ways of thinking, and you spend 100 years thinking about the division between markets and governments, and that's the big political stakes. it's the big historical philosophical argument, and it's a false dichotomy. you don't find markets where you don't have states or even really vice vice versa you can argue. >> europe created money without a state. >> yeah. >> it didn't work out so well. >> they had that in the middle ages, too, credit money, imaginary money, because it didn't exist. they used roman denominations to do calculations. shillings and pence go back to the money that they intended to make, but never did. they manipulated some of it, but the larger denominations they

never got around to. william -- [inaudible] >> something changes with capitalism in money. we certainly draw long parallels with credit money versus commodity money, and say these things have been around for thousands of years, but the system in which you produced sale in a market is qualitatively different than what went before it. how does money figure in that? that difference? >> in the -- >> what is it about capitalist money different from other money? >> first, look at the continue csh continuities in order to see the differences thing. one of the interesting things and it actually is quite similar to the situations in the empires where money comes from the need to pay soldiers with coins, money. there's credit systems earlier,

so there's whole state of art craft, you see it in india, china, traces of it in greece, where there's techniques of profit seeking through the government making a war. the interesting thing about capitalism is that you still have that relation between giant empires, war making states, and money, and the idea that money should be gold and silver and gold and silver predominates in periods of intense violence and empire, but at the same time, there's a strange hybrid relationship between the merchant and the warrier. i mean, bodel really hit it, i think, the nail on the head when he tried 20 -- to make the distinction between markets and capitalism. markets develop originally as a side effect of military operations, but they develop

independently on their own with certain circumstances within states or between them, but what the ultimate spirit of a market system according to bodel is a money to commodity and what a commodity is to another commodity. cmc prime, the famous formula. if you have chickens, and you want a cow, you can do that through the medium of money. now, capitalism he says is using moneys to or m to m prime, lending money, a variation on that, and this was the interesting point he makes that you can well make an argument that rather than being an extension of the market or inevitable product of the market or identical to the market which is what we're now taught to think, in fact, capitalism is on the market. it's what happens when people with a lot of money want to use it to turn it into more money

ally with heads of state or powerful, usually rather violent political authorities to create monopolies. you really need monopolies of one sort or another r in order to do so. china the counterexample of europe. throughout almost all of its history from the hahn dynasty, they loved markets. they had markets more developed than any other place in the world at the time, higher standards of living as well, but they were controlled and sustained tightly by the government who, you know, horded various commodities and bought them up to keep prices from getting out of hand. they did the opposite of what you do to ma nip plait prices and make money on the market. what happened in europe according to the world systems analysis people are, you know, coming out of this tradition that you had princes fighting it out and cracks and holes in it

where merchants could grab a hold of stateses and make their own laws. that's how the states came first, so you can have a huge political advantage because princes were competing for resources, and they eventually started granting them incredible advantages. capitalism emerges from a strange alliance between war making states and the financiers who make the profit off the deal. >> how does the gold figure into it? >> that's interesting. actually, as i say, a lot of it only kind of passes through europe and goes straight to asia. that has a strange history, actually, because really the turn to back from credit money to gold and silver as bullion money starts before the americas are invented. i saw this happening in europe around 1450, but more importantly, it starts happening

in china, and the reason for this is the outmarket of population. in china, it happened because the monopolies gulls used the system of paper money, and people start as a credit system, and it's quickly nationalized and they do it in china, and they can't suppress it, so the government does it themselves. there's a paper money, and there's a tax system where people are stuck in certain occupations. some people are soldiers, others craftsmen, very unpopular when the ming have a revolution overthrow, the moguls, nobody likes it, there's silver mining, peasants create an alternative cash economy independent of the government, and timely the government says, fine, we'll get rid of the cash stuff, pay taxes

in silver, and we won't coin money, just use the stuff you are already using. then they want as much silver in the country to keep taxes down. there's not many silver in china, use all of it in japan in 20 years. they look for new sources of silver when the conquistadors stumble into the new world. the new world would have never been viable economically were it not for the fact there's enormous demand for silver coming from china which is eventually where the exports go. first through europe, and then they send directly across the pacific. now, a lot of that money passes through europe, but it becomes the basis for crediting services. the governments, people are just using paper money like crazy based on speculation of the bullion trade, and that causes

massive inflation in europe paving the way for capitalism. people are doing well in europe economically. basically the number of working people goes way down by a third; right? >> clears the slate. >> clears the slate in terms of population. >> like world war ii. >> yeah, yeah, and suddenly wages shoot up. a number of holidays 1 the easy way to see what's going on. i say if you want to know how the class struggle is going in in particular time and place, look at how many days people have to work. in the 14 # 50 and -- 1450s, half the days of the year were holidays, and they spend it on carnivals and public sell vaitions of various kinds. suddenly with the infusion of the bullion, there's a huge inflation, and it's not just caused by gold and silver, but this creation of credit

instruments reallocates all the capital back to the sort of emerging boo waw see, and that is metaphor for what people get, wage laborers, really sets the stage for creating capitalism. >> and i guess we're thinking in the long view, it's been 40 years and a week since nixon shut the gold window and we live in pure credit money world. we have another 460 years to go, or is this the end of the credit phase and on to something else? >> no, well, the cycle is tighter, but not that much tighter. we have a few centuries of this one i think. [laughter] >> okay. i think we'll answer some questions. anyone?

>> richard? >> take the microphone. oh, sorry. >> i hadn't read the book -- the number of references with currency is in the old testament and i mean that much quoted an eye for an eye, a tooth for a tooth, is at least what i was taught was not, you know, you get your eye gouged, you gouge the gouger's eye out. it's monetary action, a value that's owed, and there's other references 20 other monetary transactions in which it's money opposed to credit. you know, shekels or some type of currency that is to restore value, and, you know, that's about 3,000 years old. >> something like that.

well, okay. your basis of saying shekels are currency is? that's the thing. we just assume that. if there were coins, we would have found them. in fact, coinage shows up almost simultaneously in china, india, and the eastern mediterranean some time later. why it's confusing because we assume in talking denominations of money, we think something is physically there. sometimes there is. money really begins in the middle east as an equivalence of a certain measure of this equals that, and you use that to measure everything else. now, the question is how people were actually paying each other. the thing that i thought was the big give away is that the smairians didn't make scales accurate enough. they had the technology to do so, but they didn't bother

making scales accurate enough to measure out silver that would have been required to buy pots and pans and things like that. somehow they were getting it in some other way. if you look at what happens in lots of markets around the world, there's a credit system. they use silver as a way 6 denominating that, and shekel is a weight. shekel comes from silver. weight system comes from a system used in temples. it corresponds with the amount a worker will eat in a month of grain. it starts as a measure, but, in fact, a dollar is the same thing. it's a measure. it's not a physical object. you measure a dollar, but can have coins that equal a dollar. no one's ever touched a dollar anymore than anybody touched a pound or an inch. it's a measure. >> well, it's the holy trinity of money? >> yeah, right, and economists assume the median comes first,

and the people who assume -- it starts as unit account, chartists, credit theorists, they are considered crack pots, but not necessarily, but off to the side, 5 sub strain of economics, definitely not mainstream other than by archaeologists and historians since all evidence indicates they are right. [laughter] >> what about the ethics and the integrity to pay a worker on a daily basis? >> yes, there was, you pay them grain usually. there wasn't currency. with a system of measurement, you can pay them anything that they'll agree to be paid. >> is it true the word "salary" comes from the -- >> it is true, but they didn't pay them just a salt. >> okay. richard? >> you mentioned -- you talked about the imf, and around the same time of virtual money in

the 1970s, a lot of things that people used to -- in the third world people used to pay for are now monetized, and it happened rapidly over the last 30 years. you talked about this in the radio interview. what i wanted to ask and when you mentioned that, the question that spoon in my mind is how much of that had to be imposed by the force of the state, and how much of that was market spreading sort of on their own accord? you say there's no market without the state, and is this -- is this viewed as a creation of new markets or just a different way at looking at something that's already been going on? >> interesting history. in fact, one way we've been able to reconstruct what must have happened in the far past is looking at the history of colonial world because there's a theory money arised spontaneously and money is a unit of accounting imposed by the state through taxation was

considered marginal. what the guys did was what was said. the history of madagascar because i spent years there, in madagascar, it's clear. french government took over, and they said, well, you know, it's an economically self-financing colony, and the only way you owe us a lot of money for the cost of the expedition we outfitted to conquer you, so, you know, these armies don't come cheap, so we're going to impose a tax, and you have to pay that tax. it's critical to be in the money we now coin, and they actually called it moralizing tax, to teach them the value of work and educational tax, and they didn't provide much education. it was educational in itself. [laughter] the idea was that -- they were careful about this.

they said we need to make sure people, after they pay their tax, you know, they have to work on the plantation or grow pineapples or coffee to sell into the market; then they have to have some left over, and there's shops set up. they are the lone sharks. make sure they have enough that they can buy lipstick and candies, and, you know, nice little things, and they'll get hooked. this is very self-conscious. they wrote about this all the time. it was very clear that they knew what was going on. most people are not dumb. they were on to the administrators so for years many refused. they would pool all the money leftover and buy cattles to sacrifice and not go near the shops at all. eventually, you know, after centuries, a century, how long can you keep up resistance when

that's the only game in town? it was self-conscious. it answers, you know, once you understand what's going on, they were trying to create markets, and particularly labor markets in this case. it becomes, you know, you can realize one of the great mysteries if you believe the adam smith version of history where money comes from, spontaneous created from below, is why did kingsment taxes and money at all? if gold and silver is money, they can grab the mines. what's the point of taking it and stamp your picture on it and then say, okay, everybody give it back. that doesn't make sense. however, if you create a market, and particularly if you are trying to create a market to pay for soldiers, it makes sense. the problem you have is here's 40,000 guys, how do you feed them? they eat everything within a mile of where they are living immediately, so if you don't want soldiers attacking your own community, you have to employee another 40,000 to feed those

guys unless you just take bits of gold and silver which is what they lute anyway, stamp your picture on it, give it to the soldiers and then say everybody has to give the king one back. you give them what they want or need, but at the same time, you create markets. the first places that used markets tended to develop around armies and military operations. >> [inaudible] >> wait for the mic. >> the 1970s and the most recent times, these are in states that are neoliberal and monetized things that previously were not were not directly in the colonial grid, like parts of africa, and post colonial area, and yet they still moved into the neoliberal policies and no longer had free services offered by the state before that. how did that happen? >> largely through the imf. i mean, they had neoliberal

orthodoxy imposed directly. i mean, you know, i, again, turned 20 mad madagascar. madagascar had three accounts of nonviolent revolution in 20 years. the first one, the guy in power thought he was running the place, so he went to the imf, which, you know, they kicked out the previous guy of north korea but new enough about power to do what he was told. they kicked out him. the new guy was a brain surgeon and went to the imf and said, well, name one country that did what you say and is now rich? they said, shut up and do what you are told. he said no. if you don't have a treaty, the world bank doesn't give you money, then there's no american aid, if no american aid, you can't get export credit. basically, it was the economic

equivalent of dropping a nuke on the place. people died. they have that power to do that to people who don't play along. >> go back to the new york city fiscal crisis, one said they have to start charging tuition at universities. free under referendums in 1847, and they said i know this is not fiscally important, but it's important for the shock value. >> uh-huh. >> it's also -- as thatcher said, you need to remake people's souls. there's soul remaking going on. >> yeah, and that's why i think a jubilee would be helpful because it would be the opposite. it would be a real shock value, but a way of saying, okay, after 2008, we learned money is something made up, it can be reshuffled any old way, well, you know, let's bring that home. >> hi, thanks too so much. it was really great. one question -- is that an invention that's neat came upon

once and then went throughout the world, or is it something permanent everywhere? in your research did you find, i don't know, hawaii is a place not involved in the world economy until much, much later, did you, you know, was it discovered in 1778 or something, and so did they -- is it something that everyone does? or something that spreads, and if not, what would -- is that a possibility of a debtless society? >> well, i guess that depends on how strictly you want to define the term. when i think of debt, it's a moral obligation that's perverted by numbers and violence, but to put it somewhat less politically, you know, it's an obligation that can be exactly quantified, and which it is depersonalized. it's not between two people, but between whoever the debt is owed to. you can transfer it.

now, there are definitely places that do not have quantity fieble and transferable obligations. it's not a human universal. i think it's a potential human universal, and that's a concept that could be easily understood in any context. it's sort of like money. you know, i mean, it would be hard to eliminate money of any sort because if you imagine money as a way of comparing values of things in a proportional fashion, it's an idea anybody could understand easily enough so it's a universal in that sense, but it doesn't create everywhere, but people make proportional calculations like that. it's hard to imagine it would be completely gotten rid of. the key thing is not to assume any time people make promises to each other, promises involving material things, that that's a debt, and therefore debt is universal because then you assume the rest of the package just naturally flows out from it, and i don't think that's the case.

>> time for one brief question and answer. >> this is the housing crisis where we -- >> coming out of it? we are? [laughter] >> [inaudible] >> i didn't know. [laughter] >> we saw the guys of easy access to debt pushing up the idea of increased value. do you have any more antedotes from history where that happened? easy access to credit, buys houses, pushing up the supposed value of houses. >> oh, the system -- scams? >> yeah. >> yeah, scams are all throughout history. [laughter] yes, i mean, that's why you have these forms of economic regulations. the debt trap is just something very easy to fall into. you know, look in the bible, almost anywhere, people with

lots of money will figure out ways to trap people into debt. the idea that capitalism manipulates the market, once institutions are there, people always try that thing, hence why religious codes are strict about ensuring it doesn't happen. the idea that you can have a market and people will not fall into that is the utopia. i think of utopian argument as one where you say how things should work, and then it doesn't, you say, well, the individuals are to blame. well, you know, the true economic system is built for individual z as they exist, and individuals as they actually exist if you set up a system makes scams fall for them. this we know. >> okay. i think that's it. thank you. [applause] >> is there a non-fiction author

or book you want to see on booktv? e-mail us or visit our website or send us a tweet. now, former mayor of new orleans counts the days hurricane katrina and the aftermath. presenting "katrina's secrets" in atlanta. [applause] >> thank you, thank you so much. well, good afternoon, everyone. it's my pleasure. i am excited about being in hotlanta as you guys called it. i want to thank you for the warm introduction and thank a cappella books and the presidential library for inviting me to speak to you, but first, you know, i'm a former mayor, so i got to do this.

let me bring greetings from one of america's most interesting creative and resilient city, new orleans. you know, we are the birthplace of jazz, home of louis armstrong, jackson -- oh, forgetting my people now -- [laughter] >> [inaudible] >> no, that's domino who i'm drawing a blank on. you name it, and we have it. they say music and culture oozes up from the pavements of new orleans. for you hip hop fans, i'm not leaving you out. [laughter] we're also the home of cash money records and grahmmy award winning lil' wayne. we have it all in new orleans, and i'm sure most of you have been there or have heard about us, and it's a wonderful, wonderful city, and i'm going to spend about the next 20-30 minutes or so to tell you a

little bit about an incredible story that most of you have probably followed, but you may -- there may be things you were not aware of that i hope to share. now, the first question i get is it's almost six years after, ray, why are you writing the book? well, to be honest with you when i got out of office in may of 2010, i was not looking to write a book. i just wanted to put together what i was calling my own private library of my eight years in office, but, you know, when i got to the katrina section, i said, oh my gosh, this is some kind of story, and what got me also is that if you were to google hurricane katrina, you get as many as 56 million search results at the peak, but what i was starting to understand a little bit better 1 is that the entire story had not been captured. as a matter of fact, there's some things that have been reported that just don't quite get what actually happened, so i

decided to write this book because this is much bigger than new orleans. there's a very constructive story about resilience, about tragedy, about love and hate -- you name it, and it's every kind of emotion in there. now, you mentioned earlier that i talked to some publishers, and i did. i talked to some agents, and i did. at the end of the day, they said turn the script over to us, guess what? we have the time say on how the book ends up. well, you know me, i don't like that kind of stuff. [laughter] i like to tell my own stories, so i decided to self-publish, and one thing led to another, and i found amazon and create space, and, you know, we put this partnership together, and it's been a really good experience. any of you would-be authors out there thinking about it, charles kroger, lord have mercy on him, way back, but anyway, i

encourage you if you're thinking about it, but it's a lot of work. it took me over a year to put this project together. there's writes and rewrites as you know, but i'm going to keep going. this story that i put together basically is taking the reader on a front row seat journey into one of america's, i think it's been classified as the worst natural and manmade disaster ever in the history of the united states. i interacted with everyone, george w. bush, governor kathleen, all the military leaders, the john wayne dude as i coined him, and i ended up being the last leader standing which is not necessarily the best thing after the disaster. if you study cease and cease and disasters, most leaders normally run out of office, out of town,