Debt began life as one strand of reciprocity, socialization, co-dependence. Every friendship came entangled in bonds of mutual indebtedness. When a stranger’s helping hand elicited the response ‘I am in your debt’, this alluded to the intimate connections between solidarity, obligation, gratitude and reciprocity. Paying back a debt could be anything from a benign inner need to a legal obligation that could land someone in permanent bondage.
As with every human emotion, product or relation, debt was depersonalized, commodified and utterly transformed by capitalism and, in the process, shaped the modern world.
Under feudalism, the production of a society’s economic surplus proceeded in three steps: Production → Distribution → Debt. Put simply, in the first instance serfs worked the land and produced harvests (production). Then, the feudal lord sent his sheriff to extract his share, if necessary by force (distribution). Finally, the lord sold any goods that were left over, which allowed him to buy things and, also, issue loans (debt).
But as soon as land and labour were commodified, the great transformation that begat capitalism from feudalism’s belly reversed the sequence. It became, instead, Debt → Distribution → Production. In short, before production could even commence, the entrepreneur had to borrow the money to pay for
