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Debt Moratorium with 1%Tax? The Arctic Mouse that Roared
The late Cal Plimpton, Harvard MD, then President of Amherst College before accepting dangerous assignment in Beirut as President of American University there, wrote a letter on 29 April 1969 to President Nixon. He wrote that the 16 year war and draft lottery were causing great foment among students across the nation, many of whom were taking time off from classes to protest in Washington, DC.
Amherst 1971 student Dan Whittaker recited Dante’s dictum that the hottest part of hell is reserved for those neutral in a time of moral crisis.
The New York Times made the letter front-page news.
President Nixon’s response was to show the draft dodgers by announcing the invasion of Cambodia on TV the next day. Less than a week later, four Kent State students were shot dead by the Ohio National Guard, prompting a moratorium student strike on campuses across the country and memorialized in song by Neil Young as Four Dead in Ohio.
The Class of 1969 was the only college class in Amherst history to not have a yearbook.
A year later, Amherst Professor Benjamin DeMott described the moratorium with George Kateb and Leo Marx as Seven Days in May: The Teacher in Apocalypse.
Now we may face an economy in apocalypse despite reassuring headlines from Washington, DC and certain corporate leaders.
Is so, what might an American Debt Moratorium or Capital Strike look like?
To respond to that hypothesis, it is first important to realize that by far, the majority of capital in this age of derivatives, some $454 Trillion according to the most recent 2Q 2009 Bank for International Settlements data available. These are largely hidden and unregulated Over the Counter Derivatives between multinational banking corporations with little or nothing down.
Like most exchanges of derivatives, the open interest on these contracts dwarfs the underlying capital, commodity or contract.
