Kleptocracy: debt as a method of legalized robbery

by Raimundo Viejo on July 26, 2012

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Debt is the mechanism that makes legalized robbery possible. This is why stopping the payment of our debt is an imperative in the defense of a decent life.

By Raimundo Viejo, originally published on Diagonal, nº 179, p. 33. Translation by Richard McAleavey (here).

‘Cutbacks announced by Rajoy will deepen recession until 2013’. Thus read the El País headline on the package of austerity measures kicking off the imperial economic protectorate of the EU and the markets. The headline, however, could have been another one, no less consistent or resounding: “It’s not a crisis! It’s a scam!” After all, what we are witnessing is surely the worst extortion we have ever seen.

Extortion, let’s recall, is an ‘offence that consists of forcing — through violence or intimidation — the commission or omission of an act or commercially motivated legal transaction with a view to making money and with the intention of causing material loss to the victim or a third party’. In this case, the intimidation is that exercized by the markets, and the act or commercially motivated legal transaction is the package of measures approved in Las Cortes with the goal of ruining the lives of the 99% to the benefit of the 1%.

But is there really a crisis?

The explicit awareness that the measures not only do not remedy, but prolong and deepen the crisis, reveals something far more insidious, if this were even possible, than the obvious irresponsibility of misrule. Namely, that 1) the nation state is no longer the center of modern sovereign power; 2) liberal democracy and representative government have failed institutionally to reconcile capital and labour; 3) the authority that rules us today operates somewhere midway between supranational institutions like the EU and financial institutions like the rating agencies (to cite two obvious examples of a far more complex network).

With things this way, what kind of (mis)government is it that is based on continuing to deliberately aggravate the suffering of its citizens? An illegitimate government, no doubt. It is also, as we have pointed out, a government that is nothing of the sort, but instead the transmission belt of decision-making bodies no less illegitimate, given that they evade all democratic control. But above all, it is a (mis)government that responds to a logic that must be diagnozed in its functioning, denounced in its effects and fought with an effective strategy.


The neoliberal logic of (mis)government can be identified with a type of regime that is established with each measure that gets approved: kleptocracy. From the Greek kleptēs or theft and kratos or rule, it can be defined as “government of those who steal”. Given that we are speaking of an illegitimate robbery, one can say, straight out, that we are facing a “government of thieves”. This is a matter of a kind of regime that consists not of government of, by and for the demos (as in democracy), but of government in the service of the logic of the priva(tiza)tion of resources that were once public.

A simple example: if university fees go up and only a minority can pay them, but we all fund public universities with our taxes equally, where is the redistribution of wealth? Where is the equality of opportunities? Where are the principles of the welfare state? Where is the Constitution? This, however, is how kleptocracy works: it subtracts from the 99% to give to the 1%.

Debt is the mechanism that makes legalized robbery possible: the private debt which through illegitimate means is converted into public debt; the debt which, like a deus ex machina condemns us to poverty. Debt today consumes the future and, equally, reduces people’s existence to its merely vegetative dimension. This is why stopping the payments is an imperative in the defense of a decent life. Faced with a rule that appears before us as a financial automatism, it is today urgent to move forward along the route of disobedience, in autonomous empowerment, towards the political regime of the commons.

{ 2 comments… read them below or add one }

Brian July 26, 2012 at 20:28

Debt, itself, is not theft. Debt is how money is created (http://quantiger.wordpress.com/how-does-a-bank-create-money-out-of-promises/) so that the masses of people can live outside of slavery (http://quantiger.wordpress.com/banking-ending-slavery-and-kings/).

But control fraud perpetrated through the money creation system – THAT is theft. (http://www.huffingtonpost.com/william-k-black/the-two-documents-everyon_b_169813.html)

The USA’s banking system is now the hard core of control fraud that is bilking the world. The center is not in Europe, it is in New York, with tentacles out to London and huge influence peddling in the EU. Your problems in Spain are ripples sent out from the dark center.

The president of the United States has acted for the past 4 years as the protector of the criminal elite that has wrecked the world economy. Congress has aided and abetted him with few exceptions. That criminal elite is continuing to enjoy absolute control of the banking system. But they are not content to have a sock puppet president in the White House. The USA now has an election choice between the servile Obama and an actual member of the criminal class, Mitt Romney.

Mr. Romney made his hundreds of millions by legalized theft, stealing pensions and wrecking companies, leaving the taxpayer to pick up the cost. He skirted just past the edges of the letter of the law.

If you want to know the root of the problems in Spain, it is here in the USA. The bankers and businessmen of Spain are just bit players who danced to the tune of played in New York and London. They did not know what they were doing.

The greatest challenge the EU faces is rooting out the men from Goldman Sachs who have infiltrated the ECB’s operations and give “advice” designed to line their pockets.

Iceland. Look to Iceland, and understand where your real enemy is. It is not in Madrid. It is not in Brussels. Your enemy is in New York, with tentacles in London and it has turned the USA into a banana republic run by a criminal class that threatens the globe.

Don’t kid yourself. Look at history. This end game is war on a global scale.

Look to Iceland.
Jail the bankers. Arrest the men of Goldman Sachs on European soil. Arrest their imitators in the EU. Use every resource of the EU to go after the crime bosses of New York who now rule Wall Street and the banks. That includes every government resource, intelligence services, Interpol. Raise your voice against the criminalization of the White House and Congress that is evidenced in their protection of these men. This matters. Don’t think it is your fault. It isn’t.

Look to Iceland. Save yourselves, and by doing so, save us, the citizens of the United States of America.


jkelvynrichards August 5, 2012 at 11:39

I want to agree that ‘debt is the mechanism that makes legalised robbery possible’.
Loans and debt are the means whereby new money is created.
But we have become tuned to accept that loans and debt attract interest payments.
The mechanism of interest payments is legalised robbery!………legalised because it is approved by governments.
I want to borrow $1000. The bank agrees to lend at 7% for ten years. I pay back to the bank $1967: almost twice as much as I borrowed. If I wanted to borrow for 20 years, the pay back is $3870.
A company wants to borrow $,1000,000: at 7% for 10 years. The payback is $1,967,000; for 20 years it would be $3,870,000 It is clear that the interest paid is robbery! particularly, when you realise that the LIBOR rate may be 2%. Or that the bank gets the money from the Central bank for 0.05%. And of course, the higher the interest rate – 10%, 15% – the greater the con, and the higher the robbery. Many individuals, companies, corporations, countries are able to repay the loan, but not the interest.
We are caught in a banking/funding/money system that is based on robbery. It is puzzling why we all carry on with it. I do accept that if I wanted to borrow $1000, there is no reason why I should not pay an agreed fee. But there is no reason, other than greed, why I should have to pay back twice the amount borrowed. Perhaps we should be asking countries like Greece, Spain, Italy, Ireland if they had paid the principal. If they had, then the interest payments are robbery and should not be paid. Let us all abandon contracts that demand interest payments.


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