I have read about the prediction that if things continue as they are going, the interest payments on US foreign debt will soon exceed the GDP of the entire country. Surely, if and when that happens, the global economy will go into meltdown. So, correct me if I'm wrong, but it seems obvious that the very institution of interest itself is the root cause of all this. As interest creates a cost that is not tied to the money supply, this was all just a problem waiting to happen. It was inevitable, so how did so many people not see it coming? In any case, isn't interest an extremely inefficient aspect of the market in a capitalist economy? Shouldn't all lending and borrowing be based on a system of profit returns? Interest provides basically no incentive for the lender to contribute to overall economic development, whereas lending based on profit returns would encourage the financing of only potentially successful businesses. Even loans to households, like mortgages, could be fairly easily tied to future incomes in some way. The whole idea of interest is just to make the rich richer in the short term, at the cost of totally messing up the world economy and destroying the lives of billions as soon as we approach our global economic capacity. I would say that it is something that a lot more people should be a lot more angry about I should say that I am an economics student, by no means an expert, and I am just looking for people to point out why exactly this option seems to be considered by almost everyone to be completely out of the question. Any input greatly appreciated!