Are we witnessing a collapse in faith in paper currency – and hence, the very social contract society is based on? For Germany’s Die Welt, historian Michael Sturmer warns that unless a way is found to restore confidence in the currency, the days are numbered for democracy and the way of life we have all come to expect.
For Germany’s Die Welt, Michael Sturmer writes in part:
This is not just about trillions of dollars on debt. It’s about the fate of the long-time largest national economy, as well as the shape and role of the United States in the World: Social Democracy à la Obama, who on the American spectrum stands on the left, or the patriarchal austerity of the Tea Party. Republicans of course dismiss the fact that George W. Bush inherited a solid budget from Bill Clinton in 2001, waged a war without end in Afghanistan and an unnecessary war in Iraq, and on top of that lowered top tax rates.
This is about the role of the last remaining superpower for peace and balance in the world. That doesn’t happen on its own. Confidence is the key word, even in Europe. Because every currency, whether the deutsche mark or the euro, is ultimately based on a contract between the state and economic actors: The state promises that a euro tomorrow will be (almost) as good as a euro yesterday or today. And citizens adjust their behavior accordingly, either saving or going on spending sprees
How safe are our savings? How reliable are our pensions? When such questions fill the atmosphere over kitchen tables, something is seriously wrong: today, confidence in the currency; tomorrow, in the political parties; and the day after that, in democracy. That is when the social contract, upon which faith in the currency is based, falters.
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