Government Debt Markets as Slave Markets

Colonel Robert Gould Shaw: It stinks, I suppose.
Trip: Yeah, it stinks bad. And we all covered up in it too. Ain't nobody clean. Be nice to get clean, though.
--Glory

Bond buyers exchange an amount of capital today for the borrowers' promise to pay back principal and interest in the future. Essentially, the borrower is obligated to work for the lender in the sense that a portion of future production, to the extent that it is valuable, legally must go to the lender to settle the debt.

In the private sector this exchange is voluntary, meaning that the lender does not force the borrower into the arrangement of servitude. When buying corporate bonds, for example, creditors do not hold guns to the heads of companies and say, "we order you to sell us your bonds and work for us." Corporations voluntarily enter into this arrangement. Stakeholders in corporations, such as shareholders, employees, customers, and suppliers, who do not like the terms of a debt arrangement are free to walk away.

The same is true of individuals who borrow to fund, say, a house. Servitude is entered into voluntarily.

It is different, however, in the realm of government debt.

Government debt can only be repaid on the backs of the citizenry. When buying government bonds, creditors are relying on government force to coerce citizens into working for the creditor. Taxpayers who do not like the terms of a government debt deal are not free to walk away. Instead, they are forced into the arrangement with guns pointed at their heads.

Because the exchange is not voluntary, are not government bond buyers essentially contracting with strong armed government agents to force people into conditions of servitude? Is not the market for government debt a market for slavery?

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