Their Opportunity, Our Crisis

From Evernote:

Their Opportunity, Our Crisis

This is a translation of a piece by Pablo Bustinduy, originally published in Madrilonia. It occurred to me while translating it how little the notion of debt has been present in the Fiscal Treaty Referendum campaign, or at least what I have seen of it.

The reason the Irish State is under a bailout programme is because its lenders did not believe it had the capacity to repay the level of bank debt it had committed to pay under the banking guarantee. And thus the central contentious point of the debate thus far, narrowed down in these terms so as to depoliticise the debate as much as possible has been the question of where the money is going to come from for the next bailout. But somehow this appears disconnected from the overwhelming problem of debt! As well as this there are the conditions imposed by the treaty itself: the whole point of having a constitutionalised ‘debt brake’ is not to put a limit on the amount of debt as such, but to ensure that insuperable legal priority is given to the repayment of debts over anything else, for instance hospitals, schools, welfare spending…so that political pressure to raise spending in these areas is rendered ineffective. 

The ‘politics of the ongoing bailout’, as De Sousa Santos puts it, in the case of Ireland involves a gradual normalising of the immense debt burden, generated through the private speculative activity of Ireland’s banking and property elites, and now heaped on the shoulders of the population of Ireland. One prominent economist recently declared that he was tired of the ‘Not Our Debt’  ‘meme’, apparently because the debt had indeed been formalised as ‘our debt’. As the article a bit further down will show, this drift into accepting these debts as legitimate burdens will not make the task of servicing them any lighter: in fact, the logic of debt is boundless when it comes to enforcing dispossession and subjugation. It is not until every marrow has been sucked dry, every protection cast to the wind, that the logic of debt will come to an end, and not even then. The point then, should be to blow the logic of debt to bits.


The situation is looking grimmer by the day in Spain as regards its banking sector and how the public will end up shouldering the burden of a NAMA-style arrangement for bad banking loans. The main concern at the moment is Bankia, now part nationalised by the Spanish government. Bankia, which has been turfing people out of their homes as if there were no tomorrow, until very recently was headed up by Rodrigo Rato. 


Rato was Finance Minister in the right-wing government of José Maria Aznar, and subsequently went on to become Managing Director of the IMF, preceding Dominique Strauss-Kahn in the job. And now it looks like the debt taken on on account of Bankia and other banks may drive the Spanish State into the clutches of the IMF, who, along with the ECB and the EU, will see to it that Spain is looted on behalf of the same goons who have caused the crisis. Although, with the presence of former IMF boss Rato on the board of Bankia, one is reminded of the following from Animal Farm:

 "No question now, what had happened to the faces of the pigs. The creatures outside looked from pig to man, and from man to pig, and from pig to man again; but already it was impossible to say which was which."


‘-Perspective can play tricks. What you see from down below as a disaster can be clearly perceived up here as an opportunity.’

Breaking Debt

At the end of each year a new deficit. After the lapse of four or five years a new loan. And every new loan offered new opportunities to the finance aristocracy for defrauding the state, which was kept artificially on the verge of bankruptcy – it had to negotiate with the bankers under the most unfavorable conditions.

Karl Marx, The Class Struggles in France, 1848 to 1850

Some weeks back, the IMF delivered an apocalyptic message about the unsustainability of our pension system. “Living longer is good, but it carries a considerable financial risk”: this was how their Monetary and Capital Markets Department’s Director explained that the rise in life expectancy in rich countries will mean an unsustainable burden on the current investment models. It scarcely matters that the very premise of the sentence is a lie, and that in the Ländern of the East of Germany, where exactly these solutions suggested by the IMF were applied (cutbacks in payment, delay in the retirement age, flexibilised labour rights), life expectancy of the citizens with the lowest incomes has fallen in the past decade from 77.9 to 74.1 years.

The ideological obscenity of the sentence is on its very surface, in how naturally it confuses two movements that appear antagonistic and in opposition to each other. On the one hand, the sentence places life against finance (that symptomatic and confrontational ‘but’: living is fine, just as long as it does not interfere with the logic of the markets), as two factors of an inverse relation. On the other, it is near unconsciously categorical in saying that life is in itself a financial object, and not any object, but the favourite form of speculative grammar: a risk. Together, these two movements describe a fundamental fact about our present: wherever life ceases to be productive it becomes a potential threat. When social force does not allow itself to be integrated or subsumed within financial logic, life itself becomes an interference that must be neutralised.

The government continues to camouflage this process beneath the logic of sacrifice, and it claims it is excluding immigrants without a residency permit from the right to health (just as it destroys labour rights, the university, research and welfare) in order to win the confidence of the markets. The markets, any time they get caught with an open microphone, explain with complete sincerity what they think of this sacrifice: whilst Goldman Sachs explained that we were living at ‘the best moment in a generation’, Carmel Asset Management claimed in black and white, in a report on the state of the Spanish economy, that ‘Should the Spanish crisis flare up in 2012 as we expect, we can generate a 300% return on the annual premium’. 


The reality is that the bankruptcy of the State is a business opportunity for the financial casino of derivatives, where huge sums of money are bet against the very survival of a country which, since the property bust, has ceased to be profitable. The moral: the blood of the sacrifices is real, but the ideological fiction that sustains them, all that cheap rhetoric about austerity, national emergency and the confidence of the markets, is a grotesque construction that is incapable of sustaining its own weight.

This is why trying to mix the two stories, the financial one and the one about the political and social future of the country, is to refuse to understand the very essence of the problem. There is no longer an "exit" to the crisis; what there is is a fundamental incompatibility between the two logics fighting each other for their own survival. As long as the real terms of the conflict are not taken into account, as long as it goes unrecognised that this incompatibility is neither fleeting nor coincidental, but the very heart and the decisive fact of our present, we will do nothing apart from go down time and time again the same sick spiral of debt- until there is nothing left to sacrifice.

The key is really in understanding that debt is not an economic concept, but a paradigm of rule. Debt is the logic that directs the sacrifice: dismantle what remains of Fordist systems of social protection in exchange for absolutely nothing. Debt is the horizon of this conflict between financial capital and social life that cannot be sewed together, and hence does not propose any solution or project for society at all, apart from the unlimited reinforcement of mechanisms of coercion and repression of everything that stands in its way. It is the authoritarian drift that turns retirees and girls at secondary school into the "enemy", it produces death by rubber bullets, it incentivises snitching on one’s neighbour and not only does it enable the police to repress bodies, but it also generates its own discourse and imposes its own objectives on itself.

Faced with an infinite regression in cutbacks, faced with this dystopia of violence and misery, the idea of mass rebellion comes to the fore. In an interview published in Madrilonia, the anthropologist David Graeber explains that the first known word to mean "freedom" is amargi, which in Sumerian means "free of debts". Debt is a political grammar that must be attacked at its root, torn apart, broken into a thousand pieces. The battle is not over debt: it is over what will happen when we break its spell and reset society’s timer to zero.

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