On cancelling ECB debt – open letter to 100 politicians, economists and campaigners

Cancel the public debt held by the ECB and ‘take back control’ of our destiny (www.euractiv.com, 08.02.2021):

”It is time for the European Central Bank to cancel a large portion of the public debt it holds, say more than a hundred economists from across Europe, including Aurore Lalucq, Nicolas Dufrêne, Jézabel Couppey-Soubeyran, and Laurence Scialom.”

Dear economists,

”The continuous reduction in the level of average public debt in the European Union between 2015, the date of the onset of negative rates, and the onset of the health crisis, shows that, contrary to expectations, weak or even negative rates are not sufficient to push states to borrow to invest.”

If you have failed in your expectations already prior, now would be a good moment to look in the mirror and consider why more of the same would solve any problems.

You claim that you ”do not take the cancellation of public debts – even debts held by the ECB – lightly. We are well aware that debt cancellation events are foundational moments.”

and propose

”Let it cancel the debts that it holds (or transform them into perpetual debts with 0% interest rate) and let the European states commit the same amount to a widespread social and ecological recovery plan.”

”The deal struck between the states and the ECB would prevent the states from evading their duties.”

What you fail to understand is that lax money is the deal which has been struck between ECB and the states which has made it possible for them to evade their duties, as that is exactly how democracy operates.

Democratic governments do not use money to make reforms, they use it to postpone reforms until the next election.

Instead of handing out blank checks to the governments, ECB should tie debt forgiveness to executed reforms. E.g. If a country succeeds in curbing unemployment, corruption or reducing poverty, ECB would issue a one time bonus of X billion euros to that country.

Economics is the science of incentives, perhaps you should consider applying the science to decision makers as well, not only to the working class.


Amos Ahola
Liberal Party of Finland

Liberaalipuolue Helsinki

Olen 38-vuotias ohjelmistotuotannon diplomi-insinööri, jolla on takana 10 vuotta suomalaisessa teollisuuskonsernissa sekä parissa ohjelmistostartupissa. Viimeisten hallitusten kyvyttömyys vähentää työttömyyttä muuten kuin julkissektorille työllistämällä sai minut mukaan politiikkaan ja Liberaalipuolueen aktiivijäseneksi. Suomi on todella syvällä suossa, ja ihmettä ei ole varaa enää odottaa. Liberaalipuolueen Helsingin piirijärjestön puheenjohtaja, varavaltuutettu: amos.ahola@liberaalipuolue.fi

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