Jump to content
  • entries
  • comments
  • views

Mo' Money Mo' Problems: Credit and Debt.



It occurs to me that, putting aside cryptocurrency and it's many potential benefits and problems, the benefit of 'blockchain' technology or something similar could have another really important use in finance (and doubtless it is one of the reasons why banks are getting more interested in the tech). I am sure most people by now have heard of the necessity of checking your 'credit report' (and all the shady sites who are trying to sell you what you should be able to get for free form the government somewhere), how it could have mistakes and how you need to make sure you get a good 'score'. There are lots of complected ways your credit history is kept and used, and most people aren't quite able to keep track of it all. It's no secret that a vast number of people are in debt up to their eyeballs, but some of them might not even realize it until it's too late.


So here is the question that popped into my head: Can we make a better system of handling, or at least communicating, people's debt? I am not sure using blockchains are the only or even best way of doing it, but one of the advantages of it is that it basically keeps a list of all transactions and their details. It might be a lot easier to make a program that tabulates and easily displays up to date information about someone's debts and available credit with such technology. Imagine having an app on your smartphone or on your PC which people can look at and see all their due bills and debts and lines of credit. It could even be programed to help you manage them and pay them off automatically. Would this be prone to abuse? Maybe, I am not sure. It might be worth a try though.


It also made me thing a little about, if the theory that money is just another form of credit is accepted and a system for tabulating debts were to be commonly agreed upon, would it lead to a whole new sort of paradigm shift in how economics works for most people? Could a whole economic system be based purely on shuffling debt around rather then acquiring capital? Who would benefit in such a system and who would suffer? Is it really any different then the system we use today? After all, one of the biggest ways banks and governments make money is by trading debt. Maybe debt and money really are two sides of the same thing.


Though I have to admit, I personally never use 'credit' anyway. I pay for most everything with cash and that cash comes pretty much entirely from social programs. I do kinda advocate for a basic flat living wage to be payed to everyone. Maybe that will just be the equivalent of simply slowly clearing a value of debt. Maybe as technology and AI take over and more and more people are displaced it will be more practical to do so then using big bureaucratic programs. I am not sure. I guess I will see.