110+ Michael Hudson Quotes On Education, Government And Politics

Michael Hudson is an American professor of economics at the University of Missouri-Kansas City. He is a distinguished research professor of economics at Peking University's Schwarzman College. He is known for his research on the history of debt and the development of economic thought. Following is our collection on famous quotes by Michael Hudson on education, government, politics.

Top 10 Michael Hudson Quotes

1. We go forward with our heads held high, but look back and remember where we come from.
2. You have a choice. Either you can have more oil, or more clean water. Fracking is not good for the water supply.
3. The one sure mark of a con, though, is the promise of free money.
4. Every government, from the Obama administration right through to Angela Merkel, the Eurozone and the IMF, promise to save the banks, not the economy.
5. Nobody prefers to earn income any more, because that's taxable. Rich people prefer to make capital gains.
6. Elites play the role today that landlords played under feudalism. They levy interest and financial fees that are like a tax, to support what the classical economists called "unproductive activity."
7. One basic myth is that rich people get wealthy by earning income. But that's not how most get rich. Most of the gains of the rich people since 1945 have been "capital gains".
8. Mathematically, debts grow exponentially at compound interest. Banks recycle the interest into new loans, so debts grow exponentially, faster than the economy can afford to pay.
9. Debtors will seek to cancel their debts. Creditors will try to collect, and the more they succeed, the more they will impoverish the economy.
10. The ideological foundation of today's business schools is that economic control should be shifted out of government hands into those of financial managers - that is, Wall Street.

Michael Hudson Short Quotes

• You have the economic vocabulary turning into vocabulary of deception.
• That's the "magic" of double-taxation treaties: you can shop around for the lowest taxer.
• Either you can save the economy, or you can save the One Percent from losing a single penny.
• I think the less fracking there is, the better it is for the economy and society.
• What's bad for the frackers usually is good for the rest of the world.
• Nothing could be better for the economy than to get rid of fracking.
• Paying debt service to banks leaves less income to buy goods and services.
• Actually, high housing prices don't help the economy. They raise the cost of living.
• To the deficit commission, a depression is the solution to the problem, not a problem.
• The economy is being run primarily by the banks for their own interest.

Michael Hudson Quotes About Government

Debtor countries may postpone the inevitable by borrowing from the IMF or U.S. Treasury to buy out bondholders. This saves the latter from taking a loss - leaving the debtor country with debts that are even harder to annul, because they are to foreign governments and international institutions. — Michael Hudson

The United States Government has fought against creation of an international court to adjudicate the ability of national economies to pay debts. — Michael Hudson

Income is sucked upward to the creditors, who then foreclose on the assets of debtors. This shrinks tax revenue, forcing public budgets into deficit. And when governments are indebted, they becomemore subject to pressure to privatization of public enterprise. — Michael Hudson

Governments create money and spend it into the economy by running budget deficits. The paper currency in your pocket is technically a government debt. — Michael Hudson

I don't think that governments should permit speculation in raw materials, because they're what the economy basically needs. — Michael Hudson

The world's politics are in turmoil, not to mention the Mideast, where the US has mounted attacks from Libya to Iraq to Syria, and ISIS is attacking governments in today's pipeline rivalry. — Michael Hudson

You're having government spending on the economy being cut almost everywhere. That means that the only source of spending for growth has to come from borrowing from the banking system. — Michael Hudson

The Eurozone die is cast. Countries must withdraw from the euro so that governments can create their own money once again, and resist creditor demands to carve up and privatize their public domain. — Michael Hudson

The establishment Trump talked about wasn’t really Wall Street. He said, “When Washington got rich.” Bernie Sanders would have said, “When Wall Street got rich, the country didn’t.” So I think when Donald Trump says "Washington," what he means is the government regulatory agencies. — Michael Hudson

Michael Hudson Quotes About Politics

So the political choice today is much like the 1930s, when the global economy also broke down. The choice is between nationalism and populism on the right, or socialism reviving what used to be left-wing politics. — Michael Hudson

We're in a chronic debt-deflation. There's no way we can recover unless you write down the debts. And that's what the IMF basically is implying (and it was explicit regarding Greece), but its not spelling it out, because that's not what can be said in polite company. — Michael Hudson

Europe is creating the flight of refugees that's tearing it apart politically, and leading rightwing nationalist parties to gain power to withdraw from the Eurozone. — Michael Hudson

Michael Hudson Quotes About Banks

Money is not a factor of production. But in order to have access to credit, in order to get money, in order to get an education, you have to pay the banks. — Michael Hudson

The United States and Europe are in a state of debt deflation, where people and businesses have to pay banks instead of spending their income on goods and services. So markets shrink, sales and profits fall, and the stock market turns down. — Michael Hudson

The IMF acts as the collection agent for global bondholders. Its projections begin by assuming that all debts can be paid, if economies will cut wages and wiping out pension funds so as to pay banks and bondholders. — Michael Hudson

Needless to say, banks and bondholders do not want to promote any arguments explaining the limits to how much can be paid without pushing economies into depression. — Michael Hudson

When you say "paying the banks," what they really mean is paying the bank bondholders. They are basically the One Percent. — Michael Hudson

In fact, there's no way that banks can be paid everything that they're owed. — Michael Hudson

To save the banks, you would have to turn the entire Eurozone into Greece. — Michael Hudson

Most banks - with Deutsche Bank at the top of the spectrum here - have decided that they can't make money lending to barrowers anymore, so they're going to the second business plan: They lend money to casino capitalists. That is, to people who want to gamble on derivatives. — Michael Hudson

Small banks that lend to consumers are fine. — Michael Hudson

The banks' product is debt. They try to tell customers that "debts are good for you," but the customers can't afford any more debt, so there's no way the banks can continue their current business plan. — Michael Hudson

Michael Hudson Famous Quotes And Sayings

Today, people are having to spend so much of their money, to acquire a house and to get an education that they don't have enough to spend on goods and services, except by running into yet more debt on their credit cards and other borrowings. — Michael Hudson

The biggest industrial sector next to real estate is oil, gas and other mineral resources. They don't report any taxable income, because if you depict yourself as earning a profit, you have to pay a tax on it. So, it's all about what accountants choose to declare as profit. — Michael Hudson

Deflation means a slowdown of income growth. Markets shrink, new capital investment and employment also taper off, so wages decline. That is what's happening as deliberate policy in Europe and the United States. Falling or stagnant prices are simply the result of having less income to spend. — Michael Hudson

People tend to think that paying a debt is like going out and buying a car, buying more food or buying more clothes. But it really isn't. When you pay a debt to the bank, the banks use this money to lend out to somebody else or to yourself. The interest charges to carry this debt go up and up as debt grows. — Michael Hudson

It's amazing that Europe says, "What are we going to do with these refugees?" It's as if it doesn't realize that being part of NATO and bombing these countries forces them to choose to live by fleeing, or to stay and get bombed. — Michael Hudson

When there's deflation, it means that although most markets are shrinking and people have less to spend, the 1% that hold the 99% in debt are getting all the growth in wealth and income. Deflation means that income is being transferred to the 1%, that is, to the creditors and property owners. — Michael Hudson

When they say inflation is bad, deflation is good, what they mean is, more money for us 1% is good; we're all for asset price inflation, we're all for housing prices going up, and we're all for our stock and bonds prices going up. We're just against you workers getting more income. — Michael Hudson

The only way people can repay the debt is by cutting their living standards very drastically. It means agreeing to shift their pension plans from defined benefit plans - when you know what you're going to get - into just "defined contribution plans," where you put money in, like into a roach motel, and you don't know what's coming out. — Michael Hudson

The problems of 2008 were never cured. The Federal Reserve's solution to the crisis was to lend the economy enough money to borrow its way out of debt. It thought that if it could subsidize banks lending homeowners enough money to buy houses from people who are defaulting, then the bank balance sheets would end up okay. — Michael Hudson

When you say "bank," a bank is a building, a set of computers and chairs and things. The bankers are the people running these banks. They're the chief officers, and they push the loans because they don't care if they go bad. For one thing, they may package these bad loans and sell them off to gullible institutional investors. — Michael Hudson

Economic polarization is also occurring between creditor and debtor nations. This issplitting the eurozone between Germany, France and the Netherlands in the creditor camp, against Greece, Spain, Portugal, Ireland and Italy falling deeper into debt, unemployment and austerity - followed by emigration and capital flight. — Michael Hudson

There are so many currency exchange rate problems that people are buying gold as a safe haven. Right now, gold looks like a safe haven if international exchange rates break down. — Michael Hudson

The aim of promoting low down payments is to push prices back up so that fewer houses are going to be in negative equity and fewer people are going to walk away from the mortgages. That will save the from taking a loss on their junk mortgage loans. — Michael Hudson

When I say the economy is shrinking, it's the economy of the 99%, the people who have to work for a living and depend on earning money for what they can spend. The 1% makes its money basically by lending out their money to the 99%, on charging interest and speculating. So the stock market's doubled, the bond market's gone way up, and the 1% are earning more money than ever before, but the 99% are not. They're having to pay the 1%. — Michael Hudson

Everybody would be better off if they could buy housing for only, let's say, a carrying charge of one-quarter of their income. That used to be the case 50 years ago. Buyers had to save up and make a higher down payment, giving them more equity - perhaps 25 or 30 percent. But today, banks are creating enough credit to bid up housing prices again. — Michael Hudson

In real estate you can avoid ever having to pay a capital gains tax, decade after decade, century after century. When you sell a property and make a capital gain, you simply turn around and buy a new property. The gain is not taxed. It's called "preserving your capital investment" - which goes up and up in value with each transaction. — Michael Hudson

From 2008 to 2016 all the growth in the American economy, all the growth in national income, was earned just by the wealthiest 5% of the population. So they got all the growth. 95% of the population didn't grow. If you can get a flat tax or other lower tax, as Trump is suggesting, then this richest 5% will be able to keep even more money. That means that the 95% will be even poorer than they were before, relative to the very top. — Michael Hudson

There are two definitions of deflation. Most people think of it simply as prices going down. But debt deflation is what happens when people have to spend more and more of their income to carry the debts that they've run up - to pay their mortgage debt, to pay the credit card debt, to pay student loans. — Michael Hudson

When Mr.Trump says he wants to help all Americans, he means he wants to help all Americans in the 1% by really letting Wall Street get a huge debt from the 99% of the Americans. It's just the opposite of what people believe. — Michael Hudson

Since 2008 you've had the largest bond market rally in history, as the Federal Reserve flooded the economy with quantitative easing to drive down interest rates. Driving down the interest rates creates a boom in the stock market, and also the real estate market. The resulting capital gains not treated as income. — Michael Hudson

Today's national income statistics make it appear that Goldman Sachs is productive. As if Donald Trump plays a productive role. The aim is to make it appear that people who take money from the rest of the economy without working are productive, despite not really providing any service that actually contributes to GDP and economic growth. — Michael Hudson

Stocks always go down much faster than they go up. That's why it's called a crash. People who put their money into the stocks will find, all of a sudden, that stock prices are no longer being supported by the debt leveraging that's been holding them up. — Michael Hudson

If the economy is growing, people want to employ more workers. If you hire more labor, wages go up. — Michael Hudson

A stand in is a politician who can deliver her constituency to her Wall Street backers. That's what a politician does in America. You get a constituency; you make them believe your promises, and then you turn them over to your financial campaign backers. That's what politics has become and that's as much an art of deception as economics is. — Michael Hudson

So we are in for years of debt deflation. That means that people have to pay so much debt service for mortgages, credit cards, student loans, bank loans and other obligations that they have less to spend on goods and services. So markets shrink. New investment and employment fall off, and the economy is falls into a downward spiral. — Michael Hudson

The real estate interests and banks are in a kind of symbiosis. They're the largest-growing part of the economy. This is the sector that backs the political campaigns of senators, presidents and congressmen, and they use this leverage to make sure that their people dominate the Federal Reserve, Treasury and the federal housing agencies. — Michael Hudson

Throughout history, the only way of restoring stability is to write down the debts. That is treated now as if it's something that can't be done. But it's the only thing that's going to revive the economy. — Michael Hudson

The companies aren't hiring, because consumers don't have enough money to buy the goods and services. — Michael Hudson

In order to be an economist these days, you have to participate in this fairytale that somehow we can recover and still make the banks rich. And it is a fairytale. — Michael Hudson

Debts grow and grow. And the more they grow, the more they shrink the economy. When you shrink the economy, you shrink the ability to pay the debts, so it's all an illusion that the system can be saved. The question is, how long are people going to be willing to live in this illusion? — Michael Hudson

The problem is indeed that one party's debt finds its counterpart in some other party's savings. Not paying debts therefore involves annulling some other party's financial claims on the debtor. — Michael Hudson

Most of the European leaders look at themselves as having to follow the United States, because if the US opposes them, there will be a regime change. — Michael Hudson

That's the problem with the financial sector. Banks and the financial sector live in the short run, not the long run. In principle the government is supposed to make regulations that help the economy over time. But once it's taken over by the financial sector, the government lives in the short run too. — Michael Hudson

When Hillary Clinton said she's going to do just what Obama does and we're going to continue to recover, most people know that we're not recovering at all. We're shrinking. — Michael Hudson

That's why Apple, Microsoft and the big information technology companies have kept so much money registered abroad (although in US dollar accounts with a nominal foreign address's owner). They pretend to make their global income in Ireland. They have an office, which could be simply a postal drop box in Ireland, and claim to make all their money there, not in America. — Michael Hudson

The financial time frame always has been short-term. Projects with long-term paybacks are cut back, because CEOs and financial managers simply want to take their money and run. That is the financial mentality. — Michael Hudson

If you have to pay about forty to forty-three percent of your income for housing, you also have to pay fifteen percent of your paycheck for the FICA for Social Security wage withholding. You have to pay medical care, you have to pay the banks for your credit card debt, student loans. Then you only have about twenty-five or thirty-five percent, maybe one-third of your salary to buy goods and services. That's all. — Michael Hudson

America needs an ineffective president. That's much better than an effective president that's going to go to war with Russia, that's going to push for the Trans-Pacific Partnership, that's going to protect Wall Street, and that's going to oppose neoliberal austerity. I would much rather have an ineffective president than someone who's going to do these bad things that I fear is going to come from Hillary and the Democratic Party. — Michael Hudson

The most serious problems lie in the financial sphere, where the economy's debt overhead has grown more rapidly than the 'real' economy's ability to carry this debt. [...] The essence of the global financial bubble is that savings are diverted to inflate the stock market, bond market and real estate prices rather than to build new factories and employ more labor. — Michael Hudson

Economists often define their discipline as "the allocation of scarce resources among competing ends." But when resources or money really become scarce, economists call it a crisis and say that it's a question for politicians, not their own department. — Michael Hudson

Most people think of the economy as producing goods and services and paying labor to buy what it produces. But a growing part of the economy in every country has been the Finance, Insurance and Real Estate (FIRE) sector, which comprises the rent and interest paid to the economy's balance sheet of assets by debtors and rent payers. — Michael Hudson

Inflation usually helps the economy at large, but not the 1% if wages rise. So the 1% says that it is terrible. — Michael Hudson

Debt deflation is when there's less money that people have to spend out of their paychecks on goods and services, because they're paying the FIRE sector. Oil going down is a function of the supply and demand of oil in the market. It's a separate phenomenon. — Michael Hudson

Wages for the ninety-nine percent have gone down, steadily, since 2008. They've gone down especially for the bottom twenty-five percent of the population. This means that they've gone down especially for Blacks and Hispanics and other blue-collar workers. Their net worth has actually turned negative, and they don't have enough money to get by. — Michael Hudson

If you increase living standards, you make labor more productive. This is why Asia today is becoming more productive than the United States. — Michael Hudson

We're at the end of long cycle that began in 1945, loading the economy with debt. We're not going to be able to get out of it until you write down the debts. But that's what the IMF believes is unthinkable. It can't say that, because it's supposed to represent the interest of the banks. — Michael Hudson

The myth is that if housing prices go up, Americans will be richer. What banks - and behind them, the Federal Reserve - really want is for new buyers to be able to borrow enough money to buy the houses from mortgage defaulters, and thus save the banks from suffering from more mortgage defaults. — Michael Hudson

Trump's claims that he's making taxes more democratic for the people, but it actually is a vast sucking of income and wealth upward. — Michael Hudson

As you have to pay more interest and amortization on what you owe, you're left with less and less money to buy goods and services - unless you borrow even more and go further into debt. — Michael Hudson

One of the big problems in America's economic polarization and shrinkage is that pensions can't be paid. So there are going to be defaults on pensions here, just like Europeans are insisting in rolling back pensions. You can look at Greece and Argentina as the future of America. — Michael Hudson

People have to pay so much money to the banks that they don't have enough money to buy the goods and services they produce. So there's not much new investment, there's not new employment (except minimum-wage "service" jobs), markets are shrinking, and people are defaulting. So many companies can't pay their banks. — Michael Hudson

If a lot of money goes into the stock market, it'll push up prices, making money for stock speculators. Then the insiders can decide that it's time to sell out, and the market will plunge. — Michael Hudson

If you're a wealthy heir with a trust fund, and you sell stocks, make your 10% gains since Donald Trump, and then you buy other stocks, you can avoid paying taxes. And if your accountant registers your wealth offshore in a Panamanian fund, like Russian kleptocrats do - and as more and more Americans do - you don't have to pay any tax at all, because it's not American income, it's foreign income in an enclave without an income tax. — Michael Hudson

Almost all of the demand for oil that suddenly pushed prices up was speculative demand. People began to speculate not only in stocks and bonds and real estate, but also in commodities. The market went up for old tankers, which were used simply to store oil in. A lot of the oil was simply being stored for trading, not used. — Michael Hudson

US opposition to Russia and China has entailed sanctions against Russia, and Russia in turn has made counter-sanctions against Europe. So Europe is essentially sacrificing its opportunities for trade and investment in order to remain part of NATO. It is also agreeing to bomb Syria and the Near East, creating a wave of refugees that it doesn't know what to do with. — Michael Hudson

Deflation is a leakage from this circular flow, to pay banks and the real estate, called the FIRE sector - finance, insurance and real estate. These transfer payments leave less and less of the paycheck to be spent on goods and services, so markets shrink. — Michael Hudson

To save the banks from making losses that would wipe out their net worth, you'll have to get rid of Social Security. It means that you'll essentially have to abolish government and turn it over to the banking system to run, with an idea that the role of governments is to extract income from the economy to pay to the bondholders and the banks. — Michael Hudson

Oil is a special case. Saudi Arabia is trying to drive U.S. fracking rivals out of business, while also hurting Russia. This lowers gas prices for U.S. and Eurozone consumers, but not by enough to spur economic recovery. — Michael Hudson

The natural geopolitical arrangement is for Europe to be part of Eurasia, especially for Germany to develop trade and investment relationships with Russia. — Michael Hudson

A derivative is a bet on whether a stock, or a bond or a real estate asset, is going to go up or down. There's a winner and a loser. It's like betting on a horserace. — Michael Hudson

You have to abolish pension plans. You have to abolish social spending. You have to raise taxes. You have to have at least fifty percent of the European population emigrate, either to Russia or China. You would have to have mass starvation. Very simple. That's the price that the Eurozone thinks is well worth paying. — Michael Hudson

Seventy-eight percent of millennials are worried about not having enough good paying job opportunity to pay off their student loans. Seventy-four percent can't pay the health care if they get sick. Seventy-nine percent don't have enough money to live when they retire. So, already, we're having a whole generation that's coming on, not only here but also in Europe, that isn't able to get good-paying jobs. — Michael Hudson

More and more money is being extracted from of the production and consumption economy to pay the FIRE sector. That's what causes debt deflation and shrinks markets. If you pay the banks, you have less to spend on goods and services. — Michael Hudson

There really isn't a recovery, and no signs of it on the horizon, because people have to pay the banks. It's a vicious circle - or rather, a downward spiral. — Michael Hudson

When we say "people worry" about inflation, it's mainly bondholders that worry. The labor force benefitted from the inflation of the '50s, '60s and '70s. — Michael Hudson

People think of a business cycle, which is a boom followed by a recession and then automatic stabilizers revive the economy. But this time we can't revive. The reason is that every recovery since 1945 has begun with a higher, and higher level of debt. The debt is so high now, that since 2008 we've been in what I call, debt deflation. — Michael Hudson

Trump's junk economics is the illusion that if we cut the taxes on the wealthiest brackets, it'll all trickle down. But it doesn't trickle down. — Michael Hudson

Basically, unless you're willing to write down debts and save the economy, you're going to have deflation and a steady drain in purchasing power - that is, shrinking markets. — Michael Hudson

What do the 5%, or the 1% actually use their money for? They lend it back to the economy at large, they load it down with debt. They make their money by lending to the bottom 95%, or the bottom 99%. When you give them more after-tax income, it enables them to buy even more control of government, even more control of election campaigns. They're not going to spend this money back into the goods-and-services economy. — Michael Hudson

Trump has said that he wants to remove the tax deductibility of interest. If he can do that, fine. But I hope that Trump knows that it's not the President that sets tax policy. It's Congress. — Michael Hudson

Europe is acting in a very self-destructive manner, but is doing so because it's trying to be loyal to the United States. — Michael Hudson

The price decline is a result of having to pay debts. That drains income from the circular flow between production and consumption - that is, between what people are paid when they go to work, and the things that they buy. — Michael Hudson

What's the best gamble in the world, right now? Its betting that Deutsche Bank stock is going to go down. Short sellers borrowed money from their banks to place bets that Deutsche Bank stock is going to go down. Now, it's wringing its hands and saying, "Oh the speculators are killing us." But it's Deutsche Bank and the other banks that are providing the money to the speculators to bet on credit. — Michael Hudson

We've turned the post-war economy that made America prosperous and rich inside out. Somehow most people believed they could get rich by going into debt to borrow assets that were going to rise in price. But you can't get rich, ultimately, by going into debt. In the end the creditors always win. — Michael Hudson

If bankers can push the loans and make more profits for the bank, they get paid higher bonuses. They often also get stock options. If the bank goes under, they get to keep all of these salaries and options - and the government will bail out the bank. These guys will take their money and run, which is pretty much what they're doing now. — Michael Hudson

There are many ways to create economic suicide on a national level. The major way through history has been through indebting the economy. Debt always expands to reach a point where it cannot be paid by a large swathe of the economy. This is the point where austerity is imposed and ownership of wealth polarizes between the One Percent and the 99 Percent. — Michael Hudson

Textbooks don't teach people how to avoid paying any income tax. But that's what an army of tax lawyers and corporate tax accountants do. — Michael Hudson

Life Lessons by Michael Hudson

1. From the work of Michael Hudson, we can learn that economic inequality is a result of the power dynamics between creditors and debtors, and that it can be addressed through policies that promote debt relief and financial regulation.
2. We can also learn that the current economic system is designed to benefit the wealthy and powerful, and that a more equitable economic system can be achieved through progressive taxation and public investment.
3. Finally, Hudson's work emphasizes the importance of understanding the historical context of economic policies in order to develop meaningful solutions to address inequality.