Gazing into the Abyss of Indebted Society: The Social Power of Money and Debt
| Author | Andreas Antoniades |
| DOI | 10.1177/1478929918757135 |
| Published date | 01 November 2018 |
| Date | 01 November 2018 |
| Subject Matter | Articles |
research-article2018
Article
Political Studies Review
2018, Vol. 16(4) 279 –288
Gazing into the Abyss of
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Indebted Society: The Social
https://doi.org/10.1177/1478929918757135
DOI: 10.1177/1478929918757135
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Power of Money and Debt
Andreas Antoniades
Abstract
Ever larger parts of life and nature are integrated in our socio-economic system as future cash
flows, augmenting obscure, unstable and unsustainable debt structures. The larger and deeper these
debt structures grow, the larger, more multifaceted and destructive the inequality divide in our
societies becomes. It is now normal for people to live indebted, as it is normal for young students
to have their future monetised through student loans, the debt implications of which may never
escape. What forces normalise these abnormal and unsustainable patterns and our rather admissive/
submissive response to them? How our lives and future have been monetised and where have our
social consent and agency been in these processes? Is there a way out, before crossing the boundary
of social sustainability and environmental collapse? The three books examined here offer refreshing
and complementary perspectives on these ‘big questions’ on which our monetised future depends.
Di Muzio T and Robbins RH (2016) Debt as Power. Manchester: Manchester University Press.
Lazzarato M (2015) Governing by Debt. South Pasadena, CA: Semiotext(e).
Soederberg S (2014) Debtfare States and the Poverty Industry: Money, Discipline and the Surplus
Population. London: Routledge.
Keywords
debt, debtfare, financialisation, money creation, social studies of finance
Accepted: 17 May 2017
The global economic crisis has triggered a wave of major contributions on debt analysis
from across the range of social sciences and humanities. Examples from the last 2 years
include, Kenneth Dyson’s monumental volume, States, Debt and Power (2014), written
from a politics perspective, that offers a unique history of the politics of debt and its illu-
sions in the European context and beyond; Atif Mian and Amir Sufi’s work, House of
Debt (2014), written from an economics perspective, that pioneers the use of new data on
household debt in the US and demonstrates why and how our ‘save the banks’ response
to the global financial crisis has been disastrously counterproductive; and Odette Lienau’s
Department of International Relations, University of Sussex, Brighton, UK
Corresponding author:
Andreas Antoniades, Department of International Relations, University of Sussex, Brighton BN1 9SN, UK.
Email: A.A.Antoniades@sussex.ac.uk
280
Political Studies Review 16 (4)
book Rethinking Sovereign Debt (2014), written from a law perspective, that exposes the
intrinsically political and historically variable nature of the ‘sovereign debt continuity’
norm. This surge on debt-related research is of course no accident. During the last global
crisis, the global economy momentarily collapsed as a result of destructive, pushed-to-
the-limits financialisation and securitisation techniques that exposed the massively
indebted nature and workings of advanced economies. How to conceptualise and trans-
form the destructive power, workings and implications of this new ‘debt model’ is a, if not
the, key intellectual challenge of our age.
It is also a very urgent challenge. Less than 10 years after the global financial crisis
that broke out in 2008/2009, a new financial crisis builds up (Antoniades, 2018; Keen,
2017; Turner, 2016). In the US, all categories of household debt are back on the rise, and
in June 2017, household debt at US$12.84 trillion was above its 2008 peak (Federal
Reserve Bank of New York, 2017). Similarly, in the UK, the household debt-to-income
ratio has started to rise again, and household debt is projected to reach 153% of household
disposable income by the start of 2022, thus approaching its 2008 peak 160% high (Office
for Budget Responsibility, 2017) (see Figure 1).
The severe ways in which these debt dynamics generate inequalities are hard to
exaggerate. It is indicative that only 2% of UK households have deposit holdings in
excess of £5000 (Carney, 2015). Furthermore, according to the latest Office for National
Statistics (ONS) data for the period 2012–2014, individuals with debt aged 16–24 in the
UK have the highest level of debt compared with their income, while half of adults in
debt in the lowest net income quintile in the UK report debts of 83% or more of their
annual income (Office for National Statistics, 2016). These are not UK-specific trends.
The Institute of International Finance (IIF) estimates that global total debt (comprising
government, non-financial corporation and households) from US$144 trillion in 2006
reached an all-time high of US$216 trillion in 2016, which is 325% of global gross
domestic product (GDP) (Institute of International Finance, 2017; see also the Bank for
International Settlements (BIS), 2017 estimates in Figure 2, and International Monetary
Fund (IMF), 2016: 1–14).
The ways in which these debt dynamics crash everyday livelihoods and monetise their
future is unprecedented. This is nowhere clearer than in the case of student loans. In the
US, student loan debt has been significantly increasing after the financial crisis and has
become the largest category of consumer debt after mortgages, with total outstanding
student loan debt over US$1.3 trillion in December 2016 (Federal Reserve Bank of New
York, 2017). Equally worrying is the fact that delinquency rates in US student debt have
deteriorated significantly over the last years and are first in the category of serious delin-
quency (90 or more days delinquent) from 2012 onwards, having replaced credit card
delinquencies (Federal Reserve Bank of New York, 2017). Respectively, students in
England are now more indebted in comparison to their US counterparts after graduation,
facing debts of over £44,000 at graduation compared to £29,000 for graduates of US
private for-profit universities (Kirby, 2016). Thus, young people are now exiting the uni-
versity as monetised subjects entwined in powerful debt structures and relationships.
These worrying dynamics call for a fundamental rethinking of the principles and pro-
cesses on which our societies are based. The books reviewed here try to do exactly this,
coming from different...
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