Whose Debt?

It is remarkable that the debts of the state apparatus are usually regarded as the responsibility of the rest of the population. For this purpose the state is us, and when we say that the "the UK's debt (or deficit) must be reduced" we mean the debts incurred by the state. Yet, as Italy reminds us, the population can be productive and fundamentally healthy, but the state unable to deal with its spending and utterly unable to generate its own income through the sale of goods and services to willing rather than coerced purchasers. Indeed the state in these situations is only able to borrow because of the health of its supporting population and economy.

It is obvious that these debts were incurred in order to fund public spending, and it may be argued that the supporting population was the beneficiary of this spending. However, since the population was coerced into obtaining these goods and services, it seems that they need not acknowledge any responsibility. Those in government and employed by the state, are not only responsible, but in a defensible sense the ultimate beneficiary of state expenditure, since they end up with cash in hand to spend as they wish.

It is a curious possibility, therefore, that one way out of the horrific impasse of the public finances is for the non-state population simultaneously to repudiate the government and its employees and their debts, and say, in effect, "You, personally, borrowed this money and spent it on yourselves while palming us off with junk; it's your problem."