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Finance as warfare

To simple people it is indubitable that the nearest cause of the enslavement of one class of men by another is money. They know that it is possible to cause more trouble with a rouble than with a club; it is only political economy that does not want to know it.
— Leo Tolstoy, What Shall We Do Then? (1886)

The financial sector has the same objective as military conquest: to gain control of land and basic infrastructure, and collect tribute. To update von Clausewitz, finance has become war by other means. It is not necessary to conquer a country or even to own its land, natural resources and infrastructure, if its economic surplus can be taken financially. What formerly took blood and arms is now obtained by debt leverage.

The creditor’s objective is to obtain wealth by indebting populations and even governments, and forcing them to pay by relinquishing their property or its income. Direct ownership is not necessary. Fully as powerful as military force, debt pressure saves the cost of having to mount an invasion and suffer casualties. Who needs an expensive occupation against unwilling hosts when you can obtain assets willingly by financial means – as long as debt-strapped nations permit bankers and bondholders to dictate their laws and control their planning and politics?  

Such financial conquest is less overtly brutal than warfare waged with guns and missiles, but its demographic effect is as lethal. For debt-strapped Greece and Latvia, creditor-imposed austerity has caused falling marriage rates, family formation and birth rates, shortening life spans, and rising suicide rates and emigration.

Michael Hudson – Finance as warfare


  1. November 4, 2016 at 5:36 am

    It is all about mind control and maintaining the population in a state of stupidity.
    So we need to wake up from the stupor.

    • November 4, 2016 at 6:25 am

      Perhaps everybody knows that the game is rigged, but pretends otherwise because we feel powerless against it. In any case, would people act any differently if they knew, as long as they got to keep slight privilege over others? It takes more than ‘knowledge-of’ to change things; one must also have a reason to change things and the courage to change things. The system of control takes care of all these aspects, it seems.

  2. David Chester
    November 4, 2016 at 8:23 am

    The suggestion that one can cause a slow-down, reduced prosperity or even financial damage to the national economy by the introduction of a seemingly harmless policy change, is one that we should be taking more seriously. For example, the sudden demise of communism in the USSR had its drawbacks as well as its gains. I am sure that most “Western” countries, with their free-market/capitalism thought it was a good thing. However, as we can see today Russia is struggling with its current dictatorial alternative and has not shown anything like the rate of progress that would be expected. In fact (as suggested in my opener) certain aspects have taken a backward step.

    So my question is about the way that international influences have affected ourselves and in particular, since I am British, did the EU really do us much good that we could not have achieved without them? It is time that the science of macroeconomics was tuned to comparing the effects of these different and various one-time beneficial policies in the light of their potential for doing long-term damage.

  3. Enquiring Mind
    November 4, 2016 at 3:13 pm

    Tolstoy knew of the Arenda System and other examples of financial control in what we now call Eastern Europe. Subjugation of the locals through various means for private enrichment takes many forms, and evolves to meet the needs, that is, take advantage of the moral laxity, of the age.

  4. November 4, 2016 at 4:09 pm

    Quote Frederick Soddy, “… every monetary system must at long last conform, if it is to fulfil its proper role
    as the distributive mechanism of society. To allow it to become a source of revenue to private issuers is to create, first, a secret and illicit arm of the government and, last, a rival power strong enough ultimately to overthrow all other forms of government.”(The Role Of Money[1932].

  5. November 4, 2016 at 10:19 pm

    I think that one way out of the hole we’re in is to rebuild activism from the bottom up, starting at the municipal level with taxpayers’ associations. We have one in my local area.
    Check our website: http://www.clearwatercountytaxpayers.ca. People at large also need to get a handle on how the financial system works and how it has been hijacked by special interest groups.

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