by Kevin Alfred Strom
The shipwrecked men of the island thought they were lucky when Abraham Glucksterlingmann washed up on the shore and offered to “help the economy” there by creating a money system for them. It was all supposedly based on the gold Abe held in his “vault,” a sealed and hidden barrel. The money system Abe gave them was based on debt — just as our money system is. He lent each of the five men $200, a total of $1,000, at 8 per cent. interest, with their possessions as “security.”
At first, all went well. The economy expanded now that they had a money system. But the trouble began when the men figured out that, including interest, they owed Abraham $1,080 at the end of the year — and there was only $1,000 in total on the island, for that was all that Abe had created. Abe’s only answer was to “lend” the men more money to make today’s interest payments, putting them even further in debt and even more in danger of having their properties seized by Abe.
Let’s look in on the little community and see what’s happening now. Listen: