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the rulers of 2000 B.C. understood economics better than some of today’s Nobel Prize winners. “They realized that debts tend to grow in excess of the ability to pay, and when the debts did that in antiquity, the ruler would cancel the debts.” Though today’s web of creditors is far more complex than anything Sumerian leaders had to deal with, Hudson maintains that “one way or another the debts are going to have to be written down to the ability to pay. Otherwise, they’re not going to be paid!”

Barack Obama promised change, but Hudson doesn’t believe he’ll achieve any meaningful economic progress as long as he’s employing the same team of insiders who helped break the Russian economy in the 1990s. In the wake of his midterm defeat, will the President finally begin to draw on the lessons of the past, or is he doomed to repeat it?

via: newDeal_02: Michael Hudson: Applying 3000 Years of History to the Modern Debt Crisis