What does it mean to understand debt as a systemic problem in contemporary capitalism? Basic statistics give us one answer: Medical debt—people unable to pay their medical bills—is the number one contributor to bankruptcies in the United States. Outstanding student debt is over $1.2 trillion, and nearly one million student debtors default on their loans every year. Across the country, people continue to lose their homes to predatory lending, foreclosure, and refinance schemes. The low-income neighborhoods disproportionately affected by these schemes are also often saturated by fringe finance—payday lenders, check cashers, rent-to-own stores, and pawn shop loan operations—where interest rates can range from 200 to 1000 percent and more. One in three Americans is currently being pursued by a debt collector.
Of the hundreds of millions of indebted Americans, only a small fraction of us are indebted because we buy luxuries we can’t afford. Rather, we incur debilitating debt to pay for basic needs—education, housing, and health care. And every debt exacerbates the others: We take out second mortgages to pay for a family member to go to college, or for medical procedures. Families use credit cards to buy groceries because other bills have drained their bank accounts. Credit scores and consumer reports then ensure that people with lower scores pay higher interest rates, thus reproducing cycles of debt and inequality.
Despite this mass indebtedness, people continue to deal with their debt in isolation and often in shame. Strike Debt—a nationwide movement of debt resistors with which I work—receives countless emails from individual debtors, each narrating a story of seemingly exceptional exploitation and pathos: chemotherapy treatment made mortgage payments impossible, and the house was foreclosed on as I lay in bed; my student loan debt ballooned as I worked an unpaid internship and a part-time minimum wage job, and I can’t pay off even the compounding interest. These stories are not exceptional, but ordinary. We fail to realize our shared predicament because debt remains private, shameful, and guilt-ridden. In order to see debt clearly, we have to reframe it, not as an issue of individual isolation and shame, but as a platform for collective action and political mobilization.
Rethinking Debt: Collectivity, History, Morality
What might it mean to experience and analyze debt collectively? One concrete strategy is to hold debtors’ assemblies at which participants “come out” about their debt. Since its emergence in 2012, Strike Debt has been organizing such assemblies in San Francisco, Oakland, Portland, Philadelphia, New York, and beyond. When people talk openly about debt, and begin to share associated fears, anxieties, and confusion, we begin to see our shared burdens as a potential source of shared power. For instance, we realize that we are all debtors, whether or not we have personal loan agreements. As infrastructure crumbles in our cities and towns, as music and art programs are cut from public schools, and as the social safety net rips open wider, we cannot pretend that some of us are debtors while others are not. In my home city of Oakland, California, the 2012 annual debt service was 20 percent of the city budget. We have to bring austerity politics, municipal debt, and even sovereign debt into the same analytic and political frame, not to conflate them with individual debt, but to see how debt is currently used as a tool to ensure that profit moves to the richest while risk and precarity move to the poorest. Debtors’ assemblies allow us to dwell together in debt as an immersive, systemic problem, which, in its ubiquity, holds the seeds of its own solutions.
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