THIS IS NOT A CREDIT CRISIS - IT IS A DEBT CRISIS

Author: Bezemer, Dirk J.

Source: Economic Affairs, Volume 29, Number 3, September 2009 , pp. 95-97(3)

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Abstract:

Using an analogy with ancient Babylonia as its leading theme, this viewpoint argues that the credit crisis is the symptom of an underlying problem. Fuelled by government policies, unprecedented debt levels were run up in industrialised countries over the last quarter century. Present policies of financial sector bailouts are not only an unwise use of taxpayers' money; they maintain economic structures opposed to what classical liberals such as J. S. Mill envisaged as a free-market economy.

Keywords: Credit crisis; debt; Babylonia; Mill; liberalism

Document Type: Research article

DOI: http://dx.doi.org/10.1111/j.1468-0270.2009.01929.x

Publication date: 2009-09-01