Enter the Debt Jubilee

Enter the Debt Jubilee

The following article comes out of the ongoing discussions within the newly formed Green Socialist Organizing Committee (GSOP), which was formed in the wake of the 2020 Howie Hawkins/Angela Walker presidential campaign.  GSOP states:

“We need to build a political party that brings issues and constituencies around a common program and mutual support.  Building that party must become a common effort of Green and other independent socialist and progressive parties and groups who want a united mass party of the working people and all who love peace, justice, freedom, and the environment.

“Uniting the existing independent left is not enough. We must organize into the party of the people who now vote in low numbers because they feel the two corporate parties don’t represent them.  These people are disproportionately working class, people of color, and young.  They are the future mass base of an independent party of the green and socialist left.


Debt is what is holding the American Empire together.  It is also what is destroying it.

At the personal and family level, there is medical debt, student debt, rent, mortgages, car payments, credit card payments, water and electric bills, and insurance.  Add on bank loans just to stave off all the other debts.  Once payday rolls around, millions are left with deciding whether to stick to an all Kraft macaroni-and-cheese diet (hold the butter), or start fighting it out with the creditors jangling their phones off the hook.  The one thing you can’t give up is the roof over your head.  At this point, CBS News reports:

“Millions of middle-class Americans are just one missed paycheck away from poverty, with 4 of 10 considered “liquid-asset poor,” or without enough money socked away to cope with even a sudden disruption in income.”

 

All that keeps the very fabric of society at all manageable is the Covid eviction moratorium.  But that tick-tick-ticking you hear as you stare at the ceiling during another sleepless night is the explosion of evictions and other arrears coming when the moratorium ends and the chickens come home to roost.  The new term for what was once the working class is the “Precariat.”  The precarious ones.  Not simply the employed.

Middle and corporate America isn’t in much better shape.  It just looks shinier.  The stock market itself is little more than a measure of that debt which they have cleverly renamed “assets,” since it is supposed to represent money that somebody has to pay someday.  At least they don’t have to worry about a macaroni-and-cheese diet, as they hire more and more personal security guards lest the torches and pitchforks arrive at their own front gates.  “Oh Dear God,” they pray kneeling at their bedsides, “may the printing presses of the Federal Reserve keep cranking forever.”

The tick-tick-ticking our lesser oligarchs at their pool sides hear and fear is that when the next bubble bursts, they might not get out in time as the whole corporate edifice unravels.

The “Dear God” they pray to is the “rules-based international order,” aka, the American Empire.  Long may it keep defending the Almighty Dollar!  They think that as long they can just keep the Federal Reserve’s printing press cranking, they can keep perpetuating the world’s banking system and flood it with debt.  Their Ponzi scheme requires keeping their claws into Europe and U.S. “allies” in Asia.  The European share comes from looting the rest of the so-called “developing” world.

The Reserve-based cash pipeline chain makes available low interest loans to the rest of the world.  “An offer they can’t refuse” in gangster-speak.  Since these loans are knowingly not intended to be fully repaid, they provide the creditor nations leverage to demand brutal austerity imposed on those defenseless populaces held in line by various military regimes, the IMF, the World Trade Organization, and the like.  Similar to Milo Minderbinder’s Syndicate” in Catch-22, everyone gets a share.”  It’s just that some get bigger shares, and some are lucky to get a bubble-gum wrapper.  The Empire requires limitless expansion into every corner of the globe, as it devours all in its path.

Finally, there are the “truly powerful,” the ones who lurk in the hushed corridors of Washington, London and the Pentagon, the ones who determine (or think they determine) life and death for the entire planet.  Huddled deep in their underground bunkers, the tick-tick-ticking disturbing their blissful slumber is their knowing that their rules-based international order is hitting the final wall.

More transactions are transacted with currencies other than the dollar.  China’s massive economy is breathing down the neck of the U.S. for world leadership, making the world much better offers that more and more countries are not refusing.  Like canaries in the coal mine, around the world, governments and businesses are chafing at the bit.

We are now on a precipice.  Says economist Michael Hudson:  “It’s a fight of economic systems. It’s a systemic fight. You can’t fix it at the margin.  The problem goes deep to the core.”  As the ticking becomes thunderous, the powers-that-be ponder whether to save their own individual hides, or blow the whole thing up.  If we find ourselves in a world gone mad, this is the foundation for that very real madness.  It is a very scary moment all around.

Drastic measures are called for.  So, says Hudson:

Enter the Debt Jubilee.

To put it simply, the concept is to cancel all major personal debt —medical, student, mortgage, credit card, bank, car, etc. — and have everyone start with a clean slate.  Michael Hudson relates that in fact the notion is a very old one:

“Debt jubilees occurred on a regular basis in the ancient Near East from 2500 BC in Sumer to 1600 BC in Babylonia and its neighbors, and then in Assyria in the first millennium BC.”

But the problems it would solve sound strikingly modern:

“The common policy denominator spanning Bronze Age Mesopotamia and the Byzantine Empire in the 9th and 10th centuries was the conflict between rulers acting to restore land to smallholders so as to maintain royal tax revenue and a land-tenured military force, and powerful families seeking to deny its usufruct to the palace.  Rulers sought to check the economic power of wealthy creditors, military leaders or local administrators from concentrating land in their own hands and taking the crop surplus for themselves at the expense of the tax collector.

“By clearing the slate of personal agrarian debts that had built up during the crop year, these royal proclamations preserved a land-tenured citizenry free from bondage. The effect was to restore balance and sustain economic growth by preventing widespread insolvency.”

Things were of course simpler in the days of Hammurabi than they are today, and “Radical Times demand Radical Solutions.  Such a movement is beginning to take root, with different organizations challenging oppressive debt on a variety of fronts.

 

Student Debt:

The Debt Collective is a debtors’ union that’s been fighting since 2012 dedicated to the complete forgiveness of the $1.7 trillion of federal student debt.  Their Biden Jubilee 100 campaign is demanding that President Joe Biden cancel that debt and invest in free public college for all.  They use dues to directly support debtors and fight for economic justice.  They engage in a mix of protests and campaigns, to support “debt disputes, debt clinics and other administrative costs.”

Congresswoman Ayanna Pressley was joined by Democratic Representatives Ilhan Omar, Maxine Waters, Alma Adams, Madeleine Dean, Pramila Jayapal, Barbara Lee, and Jahana Hayes in putting forth a resolution calling for Biden to utilize his executive authority to cancel $50,000 in student loan debt for every borrower.

Medical Debt:

Medical debt and lost income for medical reasons is a major factor in more than 60% of personal bankruptcy filings.  It provides grist for the predatory debt collection industry, which scoops up, for pennies on the dollar, piles of “bad” debt that larger lenders are required by federal law to sell.  It then makes a bundle by preying on people who are temporarily down on their luck, and have gotten loaded up with debt.

The Rolling Jubilee, a project of Strike Debt, strikes at the heart of this multi-billion dollar industry.  It simply buys up those debts and then … cancels them.  Strike Debt admits their efforts are “just a drop in the bucket.”  But “we are developing tactics to help build collective forms of power that will allow us all to resist illegitimate debts.  Throughout history, when debtors have banded together, they have won.”

“RIP Medical Debt” uses similar tactics to have wiped out $4 billion in medical debt (“Every $100 you donate forgives $10,000 in Medical Debt”).

Religious institutions and other organizations have stepped in and filled the chasm left by a lack of medical infrastructure that is accessible to the people who most need it in this country.  There are proposals in Congress to address the way medical debt is handled by collections agencies.

Utility Debt:

Electricity, Gas and Water are life and death matters.  Keeping one’s utilities on has been highlighted by the COVID-19 pandemic.  This winter’s massive freeze, highlighted by the collapse of the Texas power grid, has left 100 people frozen dead in their cars or in their homes.  This tragedy is replicated every day on a small scale across the country.  It is estimated that there is over $40 billion in utility debt in arrears.  Some states are talking about limited debt forgiveness or other emergency measures, as utilities are supposedly state-regulated.

“Starting in March, many states and utilities suspended power shut-offs for nonpayment.  State-mandated or voluntary utility shut-off moratoria are now in place for 51% of the U.S. population (167 million people) across the country through Jan. 31, 2021,” states Utility Dive.  But like the moratorium on evictions, unpaid bills may run as high as $1,500 to $2,000 when everything comes due once we return to “normal.”

Credit cards, Car Repossessions, Insurance, Child Support, Clothing:

These and so many other forms of debt create a spider-web of toxic debt.  Which to pay next?  Miss a car payment and hide the vehicle in your neighbor’s garage?  Skip the rent for a couple months?  Drop the insurance and pray that nothing bad happens?  Let your credit card balances double and triple, while your phone keeps ringing?

Slavery

The above-mentioned forms of debt, of course, fall most heavily on our Black, Indigenous, Brown and working-class white communities.  But one is most heinous.  I mean actual Debt Slavery:  Yes, “Slavery.”  Gene Sperling writes in the February 16, 2021 New York Times:

“While controversial calls to ‘defund the police’ have grabbed headlines, we urgently need to examine how we fund the police today.  The increasing use of excessive fees, fines, and surcharges to fund parts of our criminal justice system is creating punitive debt traps for millions of low-income Americans leaving prison.  Many find themselves in an economic prison: prevented from paying down their debts by the debts themselves.  Others are so entrapped that they are actually re-incarcerated for unpaid debt.”

 

Prisoners and former prisoners are forced to pay for minor traffic infractions, court costs, their own actual incarceration, their probation, frequent drug tests, costly electric monitoring, and expensive mandated classes.  There are other “poverty penalties,” including late fees, interest charges as high as 12%, and collection fees.  Florida and Tennessee assign unpaid criminal justice debt to private collection firms, which tack on a 40% collection fee.  Texas jailed over half a million people in 2017 for failing to pay fines and fees.

A tangled web.

Demanding a Debt Jubilee is a good place to begin.  But first, we have to acknowledge that we do not live in the relatively primitive agricultural societies of 3,000 years ago.  Michael Hudson, in Jubilee Perspectives with Steve Keen, gives us a taste of the ramifications that an across-the-board cancellation of debt would entail:

“[I]f you leave the restaurants owing the rent debt, if you leave the businesses is owing the rent and back debts when they don’t have any and if you leave the states and localities; New York City is broke, the transport system is broke, the transport system doesn’t have the money now for the subways, to fix the signals that are dating from the 1940s and the trains don’t run, there’s an almost complete breakdown.  Unless you write down the state and local debt or somehow pay it off or fund it with a property tax, you’re going to have a close down on the state and local infrastructure and, without transport, nobody can get to work or out to get a job so we’re in a systemic crisis that is very close to paralysis.”

Etc., etc., etc.  If the Precariat were truly in power, the “people armed” could make the dramatic moves required to deal with the shock waves in their own interests.  But the Precariat is not in power.  Not now, and not next week.  We cannot just talk about Pie in the Sky.  People need Radical Solutions, and they need them now.  So the demand for a Debt Jubilee throws down the gauntlet:

“When human needs come into conflict with corporate profit, corporate structures, corporate laws, human needs are the bottom line.”

We demand:

In that vein, the Green Socialist Organizing Project demands, for the duration of the Pandemic and 6 months thereafter:

  • Cancel all medical debt across the board.
  • Cancel all student debt across the board.
  • Cancel all housing rent currently in arrears.
  • Cancel all mortgages for owner-occupied housing now.
  • Cancel all arrears on home utilities, with a 6-month Utility Jubilee.
  • For all personal Credit Cards, freeze any accumulation of arrears, interest or any other penalties, and cut all Credit Card arrears by 25%.
  • Any prisoner released with their sentence served must have all court or other system-related debts erased, plus provide a stipend of $500, to give them a fresh start.
  • To alleviate collateral damage to small entrepreneurs and landlords, impose an emergency corporate income/capital gains tax of 20% to keep small enterprises from being cast into the Precariat.  Let corporate America fight it out among themselves as to how the business/finance powers deal with the details.  Doing so at the public’s expense is forbidden.
  • To keep unpayable Student and Medical debt from recreating the current crises, immediately implement Medicare for All, and Free College Tuition for All.
  • Repeal Chuck Schumer’s vicious 2002 “Bankruptcy Reform Act,” and streamline the bankruptcy process to be simple, fair and timely.

A practical operative principle is laid out by Michael Hudson:

“The whole idea is that when there is an economic interruption, you don’t leave people in debt. You wipe out the arrears that have mounted up. You simply wipe out the tax arrears, the rent arrears and other payment arrears.”

Per the Wisdom of the Ancients, throwing all that debt to the bottom of the ocean “would be a good start.”

— Angela Walker
2020 Green Party Vice Presidential candidate

— Jeff Roby
Green Party of Florida

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