[ELI5] How countries could technically erase any debt they have?

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On Twitter I saw some post about universal income, some mentions that would add even more debts to countries (but that’s not the point of this) and some answers that countries, well their central banks actually, can just say “nope” to any kind of debts applied to them.

Is it technically true? And if so, what are the reasons it’s not applied, diplomatic, economic, capitalist unwritten rule?

In: Economics

6 Answers

Anonymous 0 Comments

If a country was to say, “We don’t have debt now. We just magic waved it away,” then 5 minutes later when they go, “Oh, we still need to borrow money,” the rest of the world would tell them to get lost.

There’s also the possibility that they might even get invaded by their neighbouring countries who want the money they’re owed.

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