₦airaland Forum

Effects of a United Nations take over of all sovereign debts across the world.

In the US, Japan, Western Europe and all high income nations that are steeped in debt, the effect will be that those nations will be able to lower their cost of living since they will no longer need high taxes from high wages in order to pay interests on sky rocketing sovereign debts. They can do this by fixing the value of real estate at construction costs only using countries like Ethiopia, Nigeria, Ghana etc as templates. A lower cost of living will lead to a much higher productivity in those economies. Imagine a Londoner, New Yorker, Berliner or someone in Tokyo having the same cost of living as a worker in Ilesa, Nigeria. That is the vision. It will propel an increase in the productivity and competitiveness of all those economies returning them to how they used to be decades ago. The Gross Domestic Product (GDP) figure will come down drastically while productivity itself rises acutely.

In the other parts of the world like Nigeria, India and other less technologically developed or advanced nations, the immediate effect will be that imported tech goods will become cheaper by maybe over fifty percent if not more than that. Automobiles, smart phones, batteries for electric vehicles, payment for satellite services by telephone companies and others, power generators, laptop computers and etc will become greatly cheaper. Maybe up to ten percent of the consumption of a typical nation is imported.

Farmers across the world will also have their purchasing power more equalized with that of wage earners in the cities especially in western cities. A farmer or farm hand in Ere Ijesa will be more equal to a bank worker in Lagos or New York city for instance because cost of living will be equalized. How it used to be in Yoruba land was that produce farmers would be able to sponsor their children to US or European universities comfortably out of their income. It will return to being like that as a result of the new equality that can result from my proposal.

The United Nations will be able to own and pay all the debts after those debts have been restructured to reflect the new purchasing power or value of the dollar which may go down by up to ninety percent. The United Nations can also have income in form of a percentage of national revenue of member states say five or ten percent, then from all the resources in the high seas as well as fossil fuel on the land everywhere before fossil fuel becomes irrelevant within a few years. Pay ups by member states to the United Nations can be reviewed upwards when income from fossil fuel dries up. A major expense that the UN should defray will be the defense budgets of the USA, Russia and China since those expenses are to keep the peace for all.

The price of oil will crash immediately if the global restructuring suggested is effected but all crude oil income should still go to the United Nations.

Do you have any evidence that debt forgiveness was good for Nigeria, and that what you describe above happened?
https://www.cgdev.org/page/debt-relief-nigeria


By the way, United Nations does not do debt since they can not compel payment.
https://www.cato.org/policy-analysis/united-nations-debt-who-owes-whom

budaatum:
Do you have any evidence that debt forgiveness was good for Nigeria, and that what you describe above happened?
https://www.cgdev.org/page/debt-relief-nigeria


By the way, United Nations does not do debt since they can not compel payment.
https://www.cato.org/policy-analysis/united-nations-debt-who-owes-whom

Maybe you did not read the post. It is not asking for debt relief of the type Nigeria was granted but a take over of sovereign debt across board so that everybody can breathe. Maybe you should read the post again. It is a proposal or a way forward

lawani:
Maybe you did not read the post. It is not asking for debt relief of the type Nigeria was granted but a take over of sovereign debt across board so that everybody can breathe. Maybe you should read the post again. It is a proposal or a way forward

First, you are asking for the $33 trillion that the United States owes be forgiven. Does that mean paying all those owed like China and Japan? Those countries would likely refuse payment since the debt provides them with a comfortable income and a tool for balancing their own currency, and they got nothing better to do with the money.

Besides, nations would quickly accumulate new debt because their tax revenue does not cover expenditure. And that's apart from the immediate inflation that's bound to ensue in all things including crude oil and maize because sellers would demand payment upfront since no debt.

United Nations does not do debt. Those owed debt would never forgive it. And one should consider Nigeria's debt forgiveness and it's outcome, I'd think, since it's been experienced already and has not provided the outcomes you've outlined.

Lawani, please know that while my opinion might differ to yours on this topic, you've created a thread that is making my mind work, and that I appreciate.

I've been thinking about debt, in general, and America's specifically, since it's the most indebted nation, but first let's cancel UN and replace it with the World Bank, or IMF, though since lending is their business they might need cancelling too.

America has "Fractional reserve banking, a system in which only a fraction of bank deposits are required to be available for withdrawal. Banks only need to keep a specific amount of cash on hand and can create loans from the money you deposit".

If banks get all their loans paid they'd have lots of money to supply for lending, so interest rates will drop and terms longer to increase demand. As demand for money grows and chases asset, prices will inflate, and more will be poorer.

It's rather a lot more complex than that, and there's various ways and numerous things to consider, but let me address your key points so you know I read your's.

lawani:
Effects of a United Nations take over of all sovereign debts across the world.

Where would any organisation find slightly below $300 trillion to pay off the Sovereign debt as of 2022?

Well, probably from Saudi Arabia and co, who are so swimming in crude oil that money money everywhere but nothing to spend it on applies. And from America that has dollar printers, and China, and Europe, since they can't just stand by while some own the world, plus Britain since lawyers would be required, and Japan, and Ru..... Let's just say the G7, or G15 max will lend UN money to pay off the debt, and you must have heard they who pay the piper call the tune, or interest, as the case might be here.

lawani:
In the US, Japan, Western Europe and all high income nations that are steeped in debt, the effect will be that those nations will be able to lower their cost of living since they will no longer need high taxes from high wages in order to pay interests on sky rocketing sovereign debts.

Actually, those countries will immediately return to the debt market to borrow even a lot more is what I think, because you still got to buy somethings from somewhere since you don't make your own, and you can't pay cash unless you are getting it from the people whose tax doesn't currently cover expenditure.

It's in the cost of living, you see. Most countries do not currently cover their expenditure with tax, and while it's likely removing debt servicing might just about allow it to, it wouldn't stretch as far as leaving much for capital investment, so countries would need to borrow again or tax it's people more, and either or both will increase the cost of living a la inflation.

Capital investment is the key, as it not only covers new investments, which could be cancelled to save expenditure, but also the cost of maintaining old investments.

lawani:
They can do this by fixing the value of real estate at construction costs only using countries like Ethiopia, Nigeria, Ghana etc as templates. A lower cost of living will lead to a much higher productivity in those economies. Imagine a Londoner, New Yorker, Berliner or someone in Tokyo having the same cost of living as a worker in Ilesa, Nigeria. That is the vision.

This just doesn't make sense.

The cost of building a house in "Ilésà, Londoner, New Yorker, Berliner or someone in Tokyo" differs wildly. The expertise required to build in those diverse places differ wildly, the building regulations differ wildly, the training and competence and ability of builders in those diverse places differ wildly, the value of the land differs wildly, so why would anyone settle for wages in Ilésà if they don't live in Ilésà when most wouldn't even settle in Lagos for Ilesa wages?

lawani:
A major expense that the UN should defray will be the defense budgets of the USA, Russia and China since those expenses are to keep the peace for all.

This is the bit I love most about your imagination and which I hope you continue to value, for this is the stuff that makes blockbusters. You write your thought well.

The "defense budgets of the USA, Russia and China" are not to "keep the peace for all", but are actually the main drivers of conflict and debt, since from forever has it been that countries must borrow to buy bullets to fight wars.

Read the following to see other perspectives and where you are agreed with and how greed and competition fuels debt.
https://www.politico.eu/article/european-union-ukraine-war-debt-crisis-aid-loans-18-billion/

budaatum:
Lawani, please know that while my opinion might differ to yours on this topic, you've created a thread that is making my mind work, and that I appreciate.

I've been thinking about debt, in general, and America's specifically, since it's the most indebted nation, but first let's cancel UN and replace it with the World Bank, or IMF, though since lending is their business they might need cancelling too.

America has "Fractional reserve banking, a system in which only a fraction of bank deposits are required to be available for withdrawal. Banks only need to keep a specific amount of cash on hand and can create loans from the money you deposit".

If banks get all their loans paid they'd have lots of money to supply for lending, so interest rates will drop and terms longer to increase demand. As demand for money grows and chases asset, prices will inflate, and more will be poorer.

It's rather a lot more complex than that, and there's various ways and numerous things to consider, but let me address your key points so you know I read your's.


Where would any organisation find slightly below $300 trillion to pay off the Sovereign debt as of 2022?

Well, probably from Saudi Arabia and co, who are so swimming in crude oil that money money everywhere but nothing to spend it on applies. And from America that has dollar printers, and China, and Europe, since they can't just stand by while some own the world, plus Britain since lawyers would be required, and Japan, and Ru..... Let's just say the G7, or G15 max will lend UN money to pay off the debt, and you must have heard they who pay the piper call the tune, or interest, as the case might be here.


Actually, those countries will immediately return to the debt market to borrow even a lot more is what I think, because you still got to buy somethings from somewhere since you don't make your own, and you can't pay cash unless you are getting it from the people whose tax doesn't currently cover expenditure.

It's in the cost of living, you see. Most countries do not currently cover their expenditure with tax, and while it's likely removing debt servicing might just about allow it to, it wouldn't stretch as far as leaving much for capital investment, so countries would need to borrow again or tax it's people more, and either or both will increase the cost of living a la inflation.

Capital investment is the key, as it not only covers new investments, which could be cancelled to save expenditure, but also the cost of maintaining old investments.



This just doesn't make sense.

The cost of building a house in "Ilésà, Londoner, New Yorker, Berliner or someone in Tokyo" differs wildly. The expertise required to build in those diverse places differ wildly, the building regulations differ wildly, the training and competence and ability of builders in those diverse places differ wildly, the value of the land differs wildly, so why would anyone settle for wages in Ilésà if they don't live in Ilésà when most wouldn't even settle in Lagos for Ilesa wages?


This is the bit I love most about your imagination and which I hope you continue to value, for this is the stuff that makes blockbusters. You write your thought well.

The "defense budgets of the USA, Russia and China" are not to "keep the peace for all", but are actually the main drivers of conflict and debt, since from forever has it been that countries must borrow to buy bullets to fight wars.

Read the following to see other perspectives and where you are agreed with and how greed and competition fuels debt.
https://www.politico.eu/article/european-union-ukraine-war-debt-crisis-aid-loans-18-billion/

Yes I mean that all sovereign debt including the 33 trillion owed by the US be taken over by the UN and UN granted income in form of payups by member states then all crude oil revenue. Those debts will be restructured because major economies will shrink when cost of living goes down. US debt may stand at less than 5 trillion dollars which will still have the same purchasing power as the old 33 trillion dollars in the USA. I hope you understand. Then many houses in Ilesa here cost more in materials than their counterparts in New York, Berlin or London but the value is like one hundredth of the house in New York, Berlin or London. Rent in western Europe and North America are sometimes more than one hundred times of what it should be given the cost of construction materials. This is what I am saying should be corrected as it is causing an unnecessary distortion in world economy that affects everybody on Earth in different ways. It can be corrected. A two bedroom flat anywhere in the world should not be rented out at more than 400 dollars per annum. It can be cheaper if it is an apartment building that is a highrise.
Then If everybody is contributing to sustain the UN then the UN should subsidize the nations whose defense budget is keeping the peace. That is the point. No peace is free. It always costs money.

Also no reason for any government to have budget deficits. A government like other individuals should have surplus and invest it and the US could have done it. There is no need for any government to be spending more than it's revenue because if individual citizens were doing that everything would collapse. Such should not be the norm.