# Author's Note: Sovereign Debt **URL:** \ **Category:** General\ **Created:** [November 17, 2024, 11:18pm UTC](https://eldraeverse.discourse.group/t/authors-note-sovereign-debt/3273 "2024-11-17T23:18:43Z")\ **Posts on this page:** 1\ **Page:** 1
**Author:** ![avatar](https://yyz2.discourse-cdn.com/free1/user_avatar/eldraeverse.discourse.group/avatar/32/2_2.png) [@avatar](https://eldraeverse.discourse.group/u/avatar)\ **Post date:** [November 17, 2024, 11:18pm UTC](https://eldraeverse.discourse.group/t/authors-note-sovereign-debt/3273/1 "2024-11-17T23:18:43Z")
Having mentioned [Gilea & Company’s policy](http://eldraeverse.com/2015/02/01/trope-a-day-mega-corp/) on this, and even [storified it](http://eldraeverse.com/2012/03/12/debt-service/), I should perhaps head off at the pass the inevitable someone pointing out that “sovereign debt doesn’t work that way”. No, it doesn’t work that way _ **here** ,_ where we are accustomed to extending a certain degree of trust and special privilege to governments. _There_, on the other hand, the bankers behind Gilea & Company and other transstellar banking institutions which follow their lead are ideologically predisposed to _not_ doing so, and would point to – to use Earth historical examples going forward in time – officially-sanctioned [commodity] currency debasement; massacring the Jewish bankers who lent you money to avoid repayment; defaulting on sovereign debt to private creditors because, well, what are they going to do and after all you are _sovereign_ and can’t be compelled to honor your own deals1; inflating the currency to repay your debts with money which isn’t worth the money you lent them in the first place; and other such charming habits as evidence that the Sovereign Client Affairs department is, in fact, dealing with the shonkiest wide-boys on the block. …as such, it behooves them to insist upon denomination hard currency _that the client, specifically, doesn’t control_, demanding significant collateral, and having a big stick handy (and visible) to deal with sovereign clients that fail to grasp that _pacta sunt servanda_, dammit, _or else_. (It also helps in enforcement that the numbers on Gilea & Co.’s, and many other starcorporations, balance sheets & P&Ls are significant orders of magnitude bigger than many polities’ Gross System Products. Still, a few newcomers to the galactic system too impressed with their own sovereignty to realize that they’re actually going to be _held_ to the obligations of their contracts get caught by this on a semi-regular basis, and thus become the instructive example for the next few would-be debtors.) [1] [ObWikipedia](http://en.wikipedia.org/wiki/Sovereign_default?ref=eldraeverse.com): “Since a sovereign government, by definition, controls its own affairs, it cannot be obliged to pay back its debt.” * * * This is a companion discussion topic for the original entry at [https://eldraeverse.com/2015/02/01/authors-note-sovereign-debt](https://eldraeverse.com/2015/02/01/authors-note-sovereign-debt)