Published Humanitas, Volume XXIV, Nos. 1 and 2, 2011
In an earlier article entitled “The Moral Hazard of Modern Banking,” I, in effect, warned: Beware of bankers. Bankers think they’re smarter than other people and often use their smarts to get the better of others in less than honest ways. While some readers thought I was too hard on bankers, I did not deliver a blanket condemnation of usury. In fact, I noted that a blanket condemnation of usury in the Christian West was misguided, that debt is not always bad, and that we owe most of our modern material blessings to the system of debt we call capitalism. The problem is that, in the pursuit of happiness and the fight against communism, we lost sight of capitalism’s dark side, the inherent danger of debt.
That danger is only now dawning on us once again. It is a danger to each of us individually inasmuch as we all labor under the burden of mortgages and consumer debt. It is also a danger to us collectively as a nation and even as a civilization. Every week we hear new warnings about the threat to the nation’s credit ratings. The national debt is roughly 100 percent of our gross national product, and the people who lend to the federal government are beginning to worry that they will not get their money back. Yet without continuous borrowing, the nation cannot possibly sustain its accustomed lifestyle. Something has got to give.
This is a preview. Read the full article here.