"00:02:53 My entire life ever since I became an economist in the 1960s was to realize that debt was the major problem that was going to be growing exponentially and stifling society." - Michael Hudson (On his core realization)
"00:08:33 The given interest rate was 1/60th per month or the decimalized equivalent of 20% a year. A debt doubles in years, quadruples in years, octuples in years, all the way up to times in years." - Michael Hudson (Explaining Babylonian mathematical models)
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"00:24:45 The Western economies are de-industrializing today... because it's easier to make money by financial means by creating a monopoly or by buying housing and commercial buildings that are bid up on debt." - Michael Hudson (On Western de-industrialization)
"00:41:43 I've been told by former members of the Treasury Department that all they need to do to get European leaders to support US positions instead of their own position is give them an envelope full of a lot of money." - Michael Hudson (On the corruption of European politics)
"00:46:24 The value of a house is whatever a bank will lend against it because you can sell your house for however much a new buyer can take out a mortgage." - Michael Hudson (On real estate valuation mechanics)
"00:57:37 If you really visualize your economy as your real economy of production as shrinking and the reported economy is all being economic overhead—a kind of tumor on the real economy—that will help you think." - Michael Hudson (On redefining GDP)
2. Executive Summary
In this extensive interview, economic historian Michael Hudson argues that modern Western economies are being hollowed out by a parasitic rentier class—bankers, landlords, and monopolists—who extract wealth via compound interest and economic rent.
Drawing on his translations of ancient Near Eastern texts at Harvard, he demonstrates that early civilizations survived by regularly canceling debts ("Clean Slates") to prevent the rise of oligarchies.
Hudson asserts that the West's departure from this model toward absolute creditor rights has resulted in "Debt Deflation," artificially inflated real estate bubbles, and a distorted GDP metric that mislabels wealth extraction as growth. He advocates for reclaiming classical economic principles, urging nations to tax unearned rent and treat credit as a public utility to avoid global economic collapse.
[00:56:01] - Post-Classical Neoliberal Economics & GDP Fraud
[01:03:37] - Final Recommendations & Closing Remarks
4. Key Takeaways
The Inevitability of Debt Collapse: Debt naturally grows at compound interest (exponentially), while the real economy grows in an "S-curve." Without periodic debt cancellations, the financial sector eventually absorbs the entire economy [00:08:51].
Clean Slates as National Security: Bronze Age rulers canceled debts not for charity, but to ensure citizens remained free to serve in the army and perform public labor ("Corvée"), preventing creditors from monopolizing the workforce [00:10:51].
The Rentier Shift: Modern land rent is no longer collected by feudal lords but by banks. Mortgage interest is simply the modern form of land rent, which makes Western industry uncompetitive due to high housing costs [00:22:34].
Tax Code Bias: Current tax systems favor the "Rentier" class over labor. Real estate investors often pay zero income tax through "depreciation" and "depletion" allowances, while labor is taxed heavily [00:25:32].
Political Capture: European and Australian leadership effectively act as "satellite" branches of US neoliberal interests, often bribed or pressured into policies that lead to domestic economic austerity [00:40:57].
A New GDP Metric: Hudson argues for recasting GDP accounts to treat interest, late fees, and rent as "Economic Overhead" or a "Transfer Payment" rather than a productive "Product" [00:56:29].
5. Detailed Summary by Topic
The Mathematical Logic of Ancient Debt [00:02:53]
Michael Hudson explains that since the 1960s, his work has focused on the fact that debt grows faster than the economy's ability to pay. He notes that the 18th century BC Babylonian models were more sophisticated than modern US models. They understood that if you do not cancel agrarian debts, the population will flee or defect to invaders who promise to liberate them from debt bondage.
The Harvard Research & The "Jubilee" Year [00:06:09]
Hudson details his work at the Harvard Peabody Museum, where he organized a group of scholars to write the first economic history of the ancient Near East. They discovered that "Clean Slates" occurred as early as 2500BC in Sumer. The biblical Jubilee in Leviticus was directly based on these Babylonian laws brought back by Jewish exiles.
Subversion of Classical Economics [00:15:05]
Hudson critiques Henry George for rejecting the classical theory of value and price. He argues that George protected the banking monopoly by focusing solely on land tax while ignoring interest as a form of unearned rent. This allowed the banking class to become the primary recipient of the economy's surplus, leading to the "Financialization" of land rent.
The Greek/Roman "Dark Age" & Oligarchy [00:28:05]
Western civilization is unique because it developed without a central authority capable of canceling debts. Following the Bronze Age collapse in 1200BC, Greece and Rome emerged as "Creditor-Oriented" societies. This lack of a "Clean Slate" mechanism led to a permanent land-owning oligarchy, the foundation of European feudalism and modern Western law.
De-dollarization & Global South Resistance [00:34:06]
Hudson frames de-dollarization as a struggle to escape the IMF's predatory system, which forces countries to privatize infrastructure to pay dollarized debts. He argues that China's success stems from keeping banking and money creation as a public utility, preventing the rise of a domestic financial oligarchy.
Australia and the Real Estate "Ponzi" Scheme [00:45:28]
Australia is described as a "hopeless US satellite" and a "real estate bubble economy." Hudson explains that Australian banks inflate property prices by lending increasing amounts of debt against the same land, essentially turning land rent into bank interest. This makes the country uncompetitive for domestic industry.
The "Slow Crash" and Debt Deflation [01:00:24]
Hudson predicts a continued "slow crash" as debt deflation crowds out spending on goods and services. He identifies the lack of a "Left-wing" economic alternative, noting that parties like the UK Labor Party have "out-neoliberalized" the Conservatives, leaving voters with no way to challenge the rentier overhead.
6. Data & Figures
Data Point
Value
Context
Timestamp
Standard Interest Rate
1/60th per month
The ancient Babylonian rate, equating to 20% annually.
The Babylonian Training Texts: Hudson reveals that we have the actual test questions used to teach ancient scribes. The students were asked to calculate how long it takes for a debt to double, proving their mathematical understanding of exponential growth surpassed modern economists [00:08:13].
The "NINJA" Mortgages: Hudson recounts how US bankers laughed at European and German community banks, calling them "naive" for buying "NINJA" (No Income, No Job, No Assets) mortgages during the 2008 lead-up [00:51:03].
Donald Trump and Depreciation: Hudson uses Donald Trump as an example of the rentier class, noting how Trump "loves depreciation" because it allows real estate owners to avoid income tax even as the land value increases [00:25:32].
Jesus’s First Sermon: Hudson explains that Jesus's first sermon was an advocacy for the "Jubilee Year" (forgiving debts), which triggered a class war in Judea and led to the Roman attempt to redefine "debt" as "sin" [00:12:10].
8. References & Recommendations
Books:
Super Imperialism: The Economic Strategy of American Empire, Michael Hudson [00:01:08].
Temples of Enterprise: Creating Economic Order in the Bronze Age Near East, Michael Hudson [00:02:16].
The Collapse of Antiquity: Greece and Rome as Civilization's Oligarchic Turning Point, Michael Hudson [00:02:24].
A Philosophy for a Fair Society, Michael Hudson (Shepheard-Walwyn) [00:01:30].
The Destiny of Civilization: On Finance Capitalism and Earthly Violence, Michael Hudson [00:09:27].
Progress and Poverty, Henry George (Critiqued by Hudson) [00:15:05].
Articles/Research Papers:
Harper’s Magazine (2006 Article), Michael Hudson - Predicting the real estate collapse [00:48:57].
People:
Nomi Prins - Mentioned for her work on the intermarriage of banking and politics [00:23:50].
Carl Lamberg-Karlovsky - Head of Harvard’s Archaeology department who supported Hudson [00:05:20].
Adam Smith, David Ricardo, John Stuart Mill - Cited as the original classical economists [00:15:14].
Tools/Platforms:
michaelhudson.com - Hudson's research archive [01:03:42].
IMF (International Monetary Fund) - Critiqued for imposing austerity [00:34:56].
9. Speakers & Credentials
Jonathan Brown (Host): Representative for Shepheard-Walwyn Publishers, an ethical economics campaigning publisher based in London [00:00:12].
Michael Hudson (Guest): Classical economist, economic historian, and author. Former balance-of-payments economist for Chase Manhattan and research fellow at Harvard’s Peabody Museum. He is widely considered one of the world's leading experts on the history of debt [00:00:55].
10. Actionable Next Steps
Redefine GDP Analysis: Researchers should investigate Hudson's proposal to remove "Economic Rent" (interest, late fees, and rent) from GDP to reveal the true state of the production economy [00:57:01].
Advocate for Public Banking: Explore the Chinese model of keeping credit allocation and money creation in the public domain to prevent a domestic financial oligarchy [00:33:40].
Reform Land Taxation: Shift the tax base from labor and industrial profits to unearned economic rent (natural resources and land) to lower the cost of living and increase industrial competitiveness [00:39:59].
Demand Political Transparency: Investigate the capture of European and Australian political representatives by US neoliberal interest groups [00:41:43].
Jul 16, 2026
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Global Debt/GDP
331%
The current level of global debt mentioned by the host.