I think you’re missing the OPs point. He’s saying that the ability to lend and borrow with interest is a fundamental precondition for human economies. That’s why economic growth is not optional.
Just look at the past 100 years. We have observably created tremendous value since 1922. We can make the whole pie bigger, it’s not just one set “value” pie that never changes.
Actually, the opposite point: once you lend/borrow with interest, you are locked into a cycle of "conventional economic growth" that is extremely difficult to escape from.
The argument/debate described in TFA is that we may or do need to escape from this cycle; my point was that if Graeber's argument is correct, this is made all the more difficult by the presence of interest-bearing debt.
Yes, this makes perfect sense if we assume everything has a fixed value over time. If you trade one pig now in exchange for two later, obviously more work will need to be done to raise two compared to what was originally done to raise one. However once you introduce currency into the equation the nominal value is de-coupled from actual value of goods. I think that's what GGP is getting at: doesn't inflation provide exactly the escape hatch where you can nominally charge interest but still not have true economic growth?
If there's inflation but no corresponding increase in the monetary supply, it becomes more difficult (in aggregate) to pay for things, which means that "actual economic growth" becomes necessary to pay the debt.
If there's inflation and a corresponding increase in the monetary supply (e.g. where banks just print money and prices rise, in either order), then (in theory) paying off the debt becomes easier.
If there's an increase in the monetary supply but no inflation, then (in theory) paying off the debt becomes easier.
However, all these scenarios are unusual: in general, inflation is assumed to be controlled, and roughly known, and the interest rate will already include the assumed rate of inflation. When things go upside down w.r.t. inflation, you can certainly get unusual conditions around debt. But that's not the normal situation, even when there is actual inflation.
In theory lenders are supposed to set their rates to get the desired real return. If inflation is 10% they'll add 10% to their rates to make sure they stay ahead of it. (This actually happened in the 1970s, and is a major reason why rates were so high.)
