Re: on money substance and abstract labor

From: Rakesh Bhandari (rakeshb@STANFORD.EDU)
Date: Mon Jun 07 2004 - 17:37:56 EDT

At 2:51 PM -0400 6/7/04, Allin Cottrell wrote:
>On Mon, 7 Jun 2004, Rakesh Bhandari wrote:
>>     If governments could force the acceptance of a money merely by
>>  collecting taxes in it, then why do governments even bother
>>  borrowing money from abroad to finance their deficits?
>Governments borrow from abroad to finance external (trade) deficits.
>They are not generally in a position to levy taxes on foreigners.
>Allin Cottrell

yes I mis-stated the source of skepticism; perhaps I shall do so
again. But why then--to take a presently  important case--would
foreign lenders be willing to accept that the debt be denominated in
the currecy of the borrowers? I of course would not deny that state
power can have something to do with borrowers  successfully demanding
such an arrangment, but it does not seem to be the whole story of why
they have been able to pull it off. This arrangment would (or rather
is) com(ing) under pressure to the extent that the borrowing
country's profitability prospects dim. This would suggest that money
is deriving its power from the claim that it represents over surplus
value, not from a state's declarations.

Yours, Rakesh

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