Alexander Hamilton left us with two important messages when he took over as our first Secretary of the Treasury under George Washington: 1) No country that cannot issue and sell its own debt can survive as a country, and 2) It is very important to involve the moneyed interests of a nation in the country’s health and well-being through the buying of bonds. If the rich do not care, the country will not survive. We have taken Hamilton’s advice, some would say to extremes. We approach this fall’s election with roughly $34 trillion of national debt, every dollar of which must somehow be dealt with. Half of the country is in a panic over this mountainous obligation. The other half figures that we will muddle through somehow. How do we come to a reasoned conclusion? An important first step is to recognize that national debt means different things to different people. This course will look at four of the most resource-rich countries in our hemisphere: Venezuela, Argentina, Brazil, and the U.S.A. itself. Each of these countries has had a dramatically different relationship with its own debt, and that relationship has largely determined the country’s destiny. What we will find, I think, is that there are no fixed rules about indebtedness. What drives a satisfactory policy towards debt is faith in the currency, constancy of institutions, and historical experience – sort of a broadly based question of confidence. This class will involve five two-hour sessions, with the last two classes devoted to the United States. This comparative approach to national debt should be an interesting exercise, and I hope you will join us. There is no assigned book, but I will send out articles that I hope you will find helpful.
Class Recordings