Linking US debt ceiling crisis in 2012-13 to Spain’s similar crisis in 1575..

Fascinating history again.. Carlos Álvarez-Nogal and Christophe Chamley point how the recent debt ceiling crisis has parallels way back in Spain in 1575:

The recent showdown over the US debt ceiling can be thought of as a game of chicken over the repayment of sovereign debt, with potentially severe consequences. This column describes an analogous historical episode in Spain, in which city delegates in the Cortes resisted tax increases, and Phillip II responded by suspending payments on a portion of the sovereign debt. By the time the cities caved to a doubling of their tax contribution two years later, the resulting bank failures and credit freeze had caused lasting economic damage.

The write-up could have been a little simpler though. Gets complicated to figure..
 
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