What Happens When You Cancel Rent, Mortgages, And Debt?

Authored by Joe Jarvis via The Daily Bell,

In Ancient Greece around 600 BC the commoners had fallen into heavy debt.

First they mortgaged their land, and delivered the majority of their crops to the lender.

But after a bad harvest, the farmers needed to borrow more in order to afford another planting.

With nothing left they used their freedom, and the freedom of their family as collateral.

Many were sold into debt slavery after defaulting on this second loan.

That’s when a poor aristocrat, Solon, was elected ruler by appealing to both the landowners and the heavily indebted commoners.

He canceled the commoners’ debts and ended debt slavery.

The commoners were free of their debts and servitude. But they still needed to eat.

Suddenly they had no one to loan them money to plant crops. And the wealthy didn’t have the labor to make full use of their farmland.

Greece was hit with food shortages. Any resources the commoners may have saved on their debts had to be poured back into feeding their hungry family.

Meanwhile, many of the wealthy became poor– except for Solon’s friends who he told about the debt cancellation in advance so they could seize the best lands before it happened.

Debt cancellation didn’t make the commoners more wealthy, it just made the wealthy poorer, and everyone hungry.

It was the type of lose/ lose deal the Bolsheviks call for today.

Already the federal government has instructed the Department of Housing and Urban Development, as well as Fannie and Freddie loans, that no one will be evicted or foreclosed on during this crisis.

New York, California, and many other states and cities have followed suit, pausing evictions for the next two to three months.

It was the government in the first place who stopped most of these people from working, so it’s hard to place blame on the people who can’t pay rent.

But now a growing movement is calling for a rent strike.

These activists don’t just want a pause on evictions. They want Governors to invent the dictatorial power to simply forgive rent and utility payments for three months. Just erase them.

I mean why not, they have invented plenty of other powers during this emergency.

The Bolshevik attitude is, of course, that the evil rich landlords can afford to go without collecting rent for a few months.

That might be true in some cases. But even the biggest landlords have bills– like paying maintenance employees, sewer, water, and the mortgage.

And in other cases it will bankrupt the little guys, the landlords who are just starting out, or only have a few properties.

The Bolshevik solution is to simply go further. Rent strikers want the government to also force banks to forgive three months’ worth of mortgage payments for landlords.

In New York a bill is already in the works. But #RentStrike2020 is a national movement.

And now Congress has taken up the cause. Sovereign Man explains a bill in the works:

Congress is now considering the Rent and Mortgage Cancellation Act which would cancel all rent and mortgage payments for the duration of the pandemic, and possibly beyond for up to a year.

And the law would be retroactive, so they’d go back in time to March 13 to cancel rent.

The government would then set up a fund for landlords and mortgage holders “allowing them to recoup their losses, so long as they agree to abide by a set of fair renting and lending practices for a period of five years.”

Some of those conditions include not raising the rent for five years, and not denying renters based on credit history, or criminal record.

This is insane. First the government will tell landlords that the contracts they signed are void. And then, if someone wants to rent your property who has a history of not paying rent, you’re not allowed to reject them.

But as long as you bend the knee to DC, they’ll print the money to pay you.

This is extortion. Do you want your money? You gotta play by our rules.

And based on the amount of money being printed right now, a five-year freeze on rent could be catastrophic. Who knows what the dollar will be worth in five months, let alone five years.

This is the type of policy that destroys economies. It is something you would expect of Venezuela, not the “Land of the Free.”

We can’t simply wave a magic wand and get out of our debts. There will be, at some point, very real consequences.

For example, it doesn’t matter how many dollars are printed if enough food isn’t grown. But right now the supply of money is massively expanding while the supply of goods and services is shrinking.

But the government still thinks it can print it’s way to prosperity.

And we are just at the beginning of this. These will not be the last calls for debt forgiveness and canceled obligations.

The first $2.2 trillion bailout will take us out to about the beginning of summer. Then what?

After that it seems like the solution everyone has settled on is to abandon all sense of reason, and simply cede dictatorial power to the government to control the economy.

And we’ll ignore history and everything we know about economics to pretend the negative consequences won’t reverberate to every corner of the economy.

We can’t stop the asinine actions of our governments and peers.

But we can absolutely take control of our own situation, and rise up to rebuild when the government promises inevitably fall flat.