Between Debt and the Devil : Money, Credit, and Fixing Global Finance, Hardback

Between Debt and the Devil : Money, Credit, and Fixing Global Finance Hardback

4 out of 5 (1 rating)


Adair Turner became chairman of Britain's Financial Services Authority just as the global financial crisis struck in 2008, and he played a leading role in redesigning global financial regulation.

In this eye-opening book, he sets the record straight about what really caused the crisis.

It didn't happen because banks are too big to fail--our addiction to private debt is to blame. Between Debt and the Devil challenges the belief that we need credit growth to fuel economic growth, and that rising debt is okay as long as inflation remains low.

In fact, most credit is not needed for economic growth--but it drives real estate booms and busts and leads to financial crisis and depression.

Turner explains why public policy needs to manage the growth and allocation of credit creation, and why debt needs to be taxed as a form of economic pollution.

Banks need far more capital, real estate lending must be restricted, and we need to tackle inequality and mitigate the relentless rise of real estate prices.

Turner also debunks the big myth about fiat money--the erroneous notion that printing money will lead to harmful inflation. To escape the mess created by past policy errors, we sometimes need to monetize government debt and finance fiscal deficits with central-bank money. Between Debt and the Devil shows why we need to reject the assumptions that private credit is essential to growth and fiat money is inevitably dangerous.

Each has its advantages, and each creates risks that public policy must consciously balance.


  • Format: Hardback
  • Pages: 320 pages, 18 line illus.
  • Publisher: Princeton University Press
  • Publication Date:
  • Category: International economics
  • ISBN: 9780691169644



Free Home Delivery

on all orders

Pick up orders

from local bookshops


Showing 1 - 1 of 1 reviews.

Review by

Economic Pollution Real estate accounts for more half of all wealth. That is the nub of the problem in global finance. Banks have switched from financing business to financing real estate, almost exclusively. They don’t care that this is non-productive; it is bigger, safer and more profitable. The banks have taken over from government in the creation of credit, and so control is nonexistent. We used to be afraid government would create inflation and financial crises. But government is no longer the biggest player, by a long shot. Banks continually inflate the money supply and the level of debt, even today. We are not better off for it. In Turner’s words, limited land doesn’t mesh with the infinite capacity to create debt obligations. Left to the markets and the bankers, debt will continue to flourish, multiply, and overwhelm. Excessive debt is “economic pollution”. This is powerful, damning stuff, from a man who has a seat the table. Of the sagging shelf of such books, Between Debt and the Devil is possibly the most lucid, intuitively correct and clear answer yet to the why of the financial crisis. Along the way, Turner tells us that one of the reasons no mainstream economist predicted the financial crisis is that their economic models do not include banks (!). Central banks, but not the hundreds of thousands of banks that create money by lending for real estate. Yet we base mission critical decisions on them.-We learn that real estate financing is a dead end. It does not produce new industry or new consumption; it produces more wealth for those who don’t need it, and more debt for those who can’t afford it.-Those who don’t follow this system do far better. The catch-up successes of Japan, Taiwan and South Korea resulted from banks lending only to business, not consumers. -Money is almost entirely a product of credit creation for real estate. The amount of actual government-issued cash in the system is a percentage in the low single digits.Oddly, although Turner emphasizes repeatedly that real estate speculation and lending is at the center of our financial miasma, he does not suggest the Henry George solution in his trial balloons in the Conclusion. He mentions George once, and lists his epoch-making book in the bibliography, but that’s it. George addressed the 2007 financial crisis in advance - 150 years in advance. He said if we taxed real estate, the speculators would leave, prices would fall, homeowners could not only afford their homes but have extra cash to spend, and the entire economy would benefit. Turner’s solutions, if they can be so classified, are a kludge of patches that if implemented, might temper the wild swings somewhat. But he inspires no optimism that even this little is possible. There is no global political will to tame the private sector bank beast. At least we know the why now. When it happens all over again, shame on us.David Wineberg