Debt is a powerful force that keeps us as slaves. In this episode I will show you an older and better alternative, “Social Credit”, and do my best to explain the difference. For Social Credit is a liberating and useful force in the emerging post-Jump and Networked Social Economy.
How we used to borrow
Traditionally people borrowed money to purchase a “productive asset” such as a tool or against a predictable event such as the harvest. What this means in practice is that traditionally debt was self-liquidating. The productive asset, such as a loom, increased the value of the business and threw off enough cash to pay off the loan. Or the harvest came in and the seed loan was paid off.
This idea of a productive asset included the home. Traditionally, people mainly worked from home. So your house was also a work space and so it was a generator of income. Your lodging was a productive asset.
The big idea here is that we usually only borrowed money to finance a productive and self-liquidating asset. Only in desperation, or if we were an aristocrat, did we borrow money to finance consumption.
How we borrow today
Today, we mainly use debt to finance the consumption of items that lose their value quickly. These include clothes, furnishings and even cars. We even borrow for events, such as meals and vacations, that have no lasting value at all. Central to this now is borrowing for education. A BA in History has no direct connection with paid employment. But a plumber’s ticket does.
With ever increasing debt but no productive assets, we climb onto a treadmill where there is no payoff or release. This is even true for our homes. Today most of us work away from home and so our homes, this definition includes places that we rent, have become a net-cost and so a drain that never goes away. Rent or domestic mortgage payments are amongst our most significant never ending chains of financial obligation.
Using this approach to borrowing, we never escape. So, if you step back and examine how we use debt today, we see that much of it is in our choice. We can choose not to finance mere consumption or things and events that are in themselves transitory.
What we can do is to change our approach to borrowing and return to a more traditional way of seeing the use of debt.
It is hard to do this if you are caught up in the pre-Jump belief system of proving your status by “show.” It is much easier to do this if you no longer are captured by this external vision of your worth as a person.Read More