With 200 trillion dollars of debt held worldwide and over a dozen countries in crisis because of their inability to repay borrowed money, John and Ken take up a pressing question: the ethics of international debt. First, the two analyze the concept of debt. While it all seems straightforward on an individual level, things start to get complicated on the international level, when entire countries become the borrowers. Ken raises the problem that when a country borrows money, the people who take the loan may not be the same people who pay the loan back—for instance, when loans are paid back generations later, or when a president or dictator takes loans in their own self interest and forces their subjects to pay back the debt.
John and Ken take a break to turn things over to Shuka Kalantari, who files the week’s Roving Philosophical Report on how debt can cripple entire nations (see below). Afterwards, the hosts welcome the week’s guest, Julie Nelson, a professor of economics at University of Massachusetts Boston and author of Economics for Humans. Professor Nelson helps the hosts understand how the situation of international debt has become a crisis, and who is affected. She explains that many of the problems associated with debt come from poverty and the “Wild West” of the international financial system.
After a short break, the John, Ken, and Professor Nelson talk about ways to model the concept of debt on the international level, and then take questions from callers in the radio audience. After questions about how debt might affect dominance and inequality in the international system, John asks Professor Nelson a big question: if she had power over all international debt, how would she solve the problem? Nelson said she’d first cancel debts, and also shift the way loans are given. The three end up the show discussing how the simple version of ethics of a debt—where it’s ethical to repay one’s loans—might be more complicated.
- Roving Philosophical Reporter (seek to 7:21): Shuka Kalantari looks into the debt crisis of Puerto Rico, where the government is 72 billion dollars in debt—but, unlike the rapper 50 Cent, Puerto Rico cannot file for bankruptcy.
- Sixty-Second Philsopher (seek to 46:38): Ian Sholes talks about his own understanding—or lack of understanding—of debt, from the movie The Big Short to headlines advertising the debts held by cities and companies around the world.