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The Debt Resisters’ Operations Manual

Chapter Fifteen

Prospects for Change: Join the Resistance!

The chapters of this manual highlight the inherent injustice of the kinds of debt that afflict most people living in the United States and around the world today, and provide some advice about what to do about them. If anything should be clear by now, it’s that all of these forms of debt are connected. They didn’t all just somehow happen. This is a system that’s been built to keep money flowing from our pockets into those of Wall Street, corporations, and creditors, with the hope that we won’t do anything about it.

Being in debt can be isolating and demoralizing. Understanding the debt system holistically is just the first step toward collectively envisioning and enacting its abolition. The reason you have tens of thousands of dollars in medical bills is that we don’t provide medical care to everyone. The reason you have tens of thousands of dollars of student loans is because the government, banks, and university administrators have contrived to cut government subsidies that support education while driving college costs through the roof. Unlike fifty years ago, it’s simply impossible for all but the wealthiest to attend college without them. Bubbles drive housing and food prices up, wages are kept artificially low so that they don’t keep up with inflation, and more and more of us rely on proliferating forms of “casual,” “flexible,” and part-time employment.

The moment we can make these connections in our own lives, we can stop being ashamed and start getting angry—and most of all, we can turn our outrage into action. Any way that you are able to fight back is important. But what those running and benefitting from the debt system are really afraid of is that a large number of us might start to join together. That’s why it’s so important to them that debtors feel ashamed and alone. Because they know that by keeping us isolated, we have no power. They also know that the moment large numbers of debtors start talking to each other, joining forces, and fighting back—they’re in big trouble. The whole system is built on the assumption that we won’t.

There is strength in numbers. Individually, our debts overwhelm us; collectively, a debt resistance movement can overwhelm the system. We are not looking for debt “forgiveness” because we didn’t do anything wrong. We seek the abolition of debt profiteering and the creation of a new financial system, a new economy, and a new way of life based on justice, self-determination, and concern for the common good.

Movements for debt resistance have a very long history. From ancient times, people have challenged the harsh penalties visited on defaulters, including branding, torture, imprisonment, and even slavery. In ancient Athens, the first known democratic constitution came about largely as a result of an outright rebellion of debtors (who, at that time, were primarily male heads of household) outraged at seeing their wives and children seized and carried off in chains to slavery.

As for the United States, imprisonment for debt was common here well after the War of Independence (two signers of the Declaration of Independence themselves later ended up imprisoned for debt!). The 1780s saw a huge wave of foreclosures and debt imprisonments. There were various forms of debt resistance at this time, with the most dramatic being Shays’s Rebellion, a group of veterans who banded together to stop foreclosures. It took many campaigns and mobilizations throughout the first half of the nineteenth century to abolish debtors’ prisons (though people are still incarcerated because of debt—see Chapter Nine). After the Civil War, there were outright insurrections waged by small farmers being foreclosed upon against the “Trusts” that were the ancestors of giant U.S. corporations.

During the 1920s, there was an expansion of credit and rampant speculation that led to the 1929 Stock Market Crash. The ensuing Great Depression made the consequences of extreme inequality and unchecked capitalist exploitation clear. The limits of capitalism and the possibilities for alternative ways of organizing society were deeply felt. People banded together to block home evictions and farm foreclosures, workers organized their own credit and mutual aid associations, labor unions were a force to be reckoned with, and the Communist Party couldn’t be denied as a genuine political presence. As a desperate move to shore up faltering confidence in a capitalist system, politicians brokered a compromise between an insurgent left and a nervous capitalist class in the form of the New Deal. The new rights and services established under this compromise provided a baseline of respect for human life and some modicum of dignity for many Americans, but they were systematically denied to Black people, who were not considered to be among those worthy of receiving them. The state and the banks largely took over the job of organizing pensions (social security), mortgages (Fannie Mae), university education (the GI Bill) and, in the 1960s, health care (Medicare).

During a series of financial crises in the 1970s, business and financial interests took advantage of workers’ weakened position to reassert their power and begin a decades-long walk-back of this postwar compromise. Overall, the defunding of government programs and the long decline of labor unions resulted in a massive increase of debt and suffering, and economic inequality has once again returned to the extraordinary heights of pre-Depression days. And yet, despite the capitalist classes’ shredding of this tacit social contract, we’re just now seeing the first glimmers of a people’s movement here in the United States that demands the space to imagine and experiment with postcapitalist ways of life and rejects the debt system that disciplines us. Thankfully, there’s much inspiration to be found in movements for economic justice across the world.

Debt resistance movements have cropped up just about everywhere across the planet. The Global Justice Movement that emerged in much of the global South in the 1980s, 1990s, and early 2000s was a broad constellation of social struggles against paying “odious” national debts (that is, debt for things no person or country should have had to pay for to begin with) to international banks. In many ways, it was brilliantly successful, forcing banks—both private lenders and institutions like the World Bank and International Monetary Fund—to renegotiate the loans by cutting their interest rates, reducing the principal, and, in some cases, simply canceling loans outright.

There have also been some remarkable struggles against personal debt during those same years, like the movement of El Barzón in Mexico. In 1994, the Mexican peso dramatically lost value compared to the U.S. dollar, which set off a steep inflation that increased the interest on variable-rate loans and often made loans, including mortgages, that were denominated in U.S. dollars ten times larger. This brought nearly 30% of the people indebted to banks into default (Williams 1996). The El Barzón movement began by claiming that the loan repayment conditions after the collapse of the peso were the fault of the government and the banks, and that it would be unfair to hold the debtor responsible. Their slogan was, “Debo, no niego, pago lo justo” (“I owe, I don’t deny it, I’ll pay what is fair”). The movement grew rapidly across the country and was known both for its practical approach (by setting up legal consultation services for debtors) and its riveting tactics. It forced the government to come to the aid of the embattled debtors and had a definitive, positive impact on their situation.

Still, the battle is far from being won. In 2008, the world’s poorest countries were paying $23 million a day in interest payments to the rich industrial world, for loans where the original principal had often already been paid back several times over. For much of the 1990s and 2000s, one of the most popular refrains was that the real solution for “Third World poverty” was not less debt but more. Hence the craze for “microfinance,” the practice of making small cash loans without collateral to rural women as well as the urban poor. For a while, this new model swept the world, as it seemed to provide a magic bullet out of poverty. But as time went on, it became clear these microcredit banks weren’t charities; they charged interest and were followed by other banks charging even higher rates of interest. Intense shaming and repossessions began, and in recent years, India and Bangladesh have seen a mass wave of suicides of “beneficiaries” of microcredit loans unable to face the disgrace of inability to pay. There have been popular movements that have risen up to fight microcredit. Mujeres Creando (Women Creating) is a Bolivian anarcha-feminist collective that participates in a range of anti-poverty work, including propaganda, street theater, publishing, radio programming, and direct action. In 2001, they occupied the Bolivian Banking Supervisory Agency on behalf of people indebted to microcredit agencies.

The Mujeres also helped a group called Deudora (Debtor)—made up largely of poor women from the barrios—infiltrate a special luncheon attended by the Banking Supervisory Agency’s Superintendent and microcredit lenders. They took the opportunity to sing and shout about their suffering and denounce the bankers in front of several television cameras. After three-and-a-half months of near-daily protests, the Mujeres and Deudora managed to sit down with the large banking and financial associations and reach an agreement whereby the debtors whose houses were being auctioned would have their debts excused.

Changing the financial system may seem wildly ambitious, but in fact, financial systems change all the time. The question is whether it will change for the better.

Anti-debt movements exist and they’re growing stronger. Around the world, popular movements are beginning to rattle the chains, seeing debt for what it is—a form of domination and exploitation—and collectively rising up against it. From Chile to Québec, students have challenged the bondage of educational debt traceable to cutbacks and privatization and scored major victories. In Greece, Spain, and now Italy, we’re seeing veritable uprisings against governments demanding austerity so that tax money can flow exclusively to foreign bondholders. These movements are growing ever more effective. And governments have been forced to backtrack.

It’s important to note that when these movements win, it’s almost never by lobbying the politicians or playing the games of the creditor class. We’ll never win so long as those in power make up the rules and so long as we concede to them. The aim is not just to cancel debts but to fight the conditions and values that got us into debt in the first place. And increasingly, people are starting to realize that the way to do that is not to ask for anything, but to start creating new institutions of our own by which we can collectively provide for our needs. Bankers and politicians are frightened by direct challenges to power that would render them irrelevant.

As our movement gets stronger, we can be sure the politicians will make concessions that undermine substantial change. We’ve already seen a little of this in the United States. The Obama administration has set up the Consumer Financial Protection Bureau and has begun talking about tinkering with the student loan system. But—inadequate as these measures may be—the Obama administration never would have done any of this were it not for the growing wave of defaults and increasing signs of organized debt resistance. In the end, as was the case with the New Deal, the aim of reform is not primarily to help people, but to preserve the existing structure of power. This doesn’t mean that we shouldn’t fight the government on its own terms (for example, by opposing cuts to social programs or further tax cuts for the rich). But we’ve seen over and over again that the only way to make the government and the elite take notice is to set our own terms, by being clear about what values matter to us—health, housing, education, our environment, and our relationships.

Strike Debt, an offshoot of Occupy Wall Street, emerged out of a series of open assemblies in the spring of 2012 with the aim of sparking conversations about debt as a global system of domination and exploitation. Debt resistance can take many forms, and Strike Debt is developing tactics, resources, and frameworks for generalizing the fight against the debt system. Underlying all of Strike Debt’s projects—from this manual to the Rolling Jubilee to various direct actions and examples of mutual aid—is support for a jubilee: a full cancellation of all debts. The cancellation of debts is not a new notion, but rather one that is deeply rooted in many faith traditions including Judaism, Christianity, and Islam. Historically, civilization after civilization has recognized that when debt gets unmanageable, it must be cancelled. And jubilees still work today. For example, there was a kind of jubilee in Iceland after the 2008 economic crisis: instead of bailing out their banks, Iceland canceled a percentage of mortgage debt (see Chapter Thirteen).

To promote this concept and raise awareness about how the wealthy profit from our indebtedness, Strike Debt launched the Rolling Jubilee in November of 2012, and it has been our most visible project so far. Strike Debt raised over $600,000 from thousands of individual donors, many deeply indebted themselves, to purchase defaulted debt for pennies on the dollar and keep it out of the hands of collectors. We have entered this market not to make a profit but to help people by abolishing $15 million worth of debt all over the country to date, while highlighting how the debt system preys on our families and communities.

Like the manual you are reading, the Rolling Jubilee was designed to expose and undermine the ways that debt works. Few people realize that their debts are sold on shadowy markets to speculators hoping to cash in on suffering and misfortune. The Rolling Jubilee effort was never intended to be a solution to the debt crisis. Strike Debt recognizes that the impact of debt cancellation, even on a mass scale, would be negligible unless it was coupled with a far deeper restructuring of our economic system. We need a jubilee and a total transformation of the current financial paradigm. We need a final jubilee to end the need for jubilees.

Debt resistance is not the final goal of the movement; it is just a beginning. We must ensure that these new structures sustain the environment that has always sustained us. What will these structures look like? How will we build them? We do not have all the answers, but the questions have to be asked. Traditionally, alternative economies have focused on local forms of mutual aid that operate under and within capitalism. While these models are desirable, it will be important for us to increase their breadth and scale if we are to challenge and eventually replace our failed economic system. Our values will serve as our North Star: putting people and nature before profits; meeting need and not greed; empowering all and not just a few; becoming less alienated from our work and from each other; and creating more leisure time to spend with our loved ones. As the content of this manual has demonstrated, another world is both possible and necessary.

Small-scale examples already abound. Community-supported agriculture is a growing alternative to the industrial food system. Community land trusts offer a model of affordable housing that prevents foreclosures of homes and property speculation. “Really, Really Free Markets” based on fair trade are dedicated to sharing resources on the basis of a gift economy in which the exchange of used furniture and clothing, childcare, and skilled labor are just a few examples. Employee-owned companies and worker-controlled, democratically run cooperatives are flourishing. To support these endeavors we need a new banking system that offers non-exploitative forms of credit and that is run for the benefit of all, not just the lenders who extract income from loans, investments, and rent. We must remember that as part of the ongoing bailout of the financial sector, billions if not trillions of dollars of loans were handed out at 0% interest, millions of dollars of which ended up as Wall Street bonuses. One of many possible solutions worth investigating is public banking (see Chapter Twelve), where states, cities and local communities finance individual initiatives and communal enterprises.

What other forms can debt resistance take? That is something we need to figure out together. We must work to understand the intricacies of our debt-driven economy. We also need to listen to and learn from the people around us so we can understand how debt affects our lives in both similar and uneven ways, paying keen attention to the ways that it intersects with factors like race, gender, age, ability, nationality, and so on. As we have seen, predatory lending, from subprime mortgages to payday loans to for-profit colleges, disproportionately impact low-income communities and communities of color. The issue of debt also affects us as workers, connecting this movement to fights for higher wages and better benefits. Debt resistance also dovetails with broader struggles for racial equality and economic justice, and we need to make these connections more visible and powerful.

For now, there are countless ways to “strike” debt: demanding a people’s bailout and an end to corporate welfare; collectively refusing to pay illegitimate loans; targeting and shutting down collections agencies, payday lenders, or for-profit colleges; regulating loan speculators out of business; reinstating limits on usurious interest rates; defending foreclosed homes; fighting tuition hikes and school budget cuts; resisting austerity policies; fighting militarism, which accounts for half of our nation’s discretionary spending; organizing debtors’ associations and unions; and more. On the constructive side, building an alternative economy run for mutual benefit is a long-term goal. To get there we must experiment with everything from education, counseling, direct action, financial civil disobedience, and, importantly, building relationships among ourselves to create broad social movements. Debt resistance needs to spread far and wide and be adapted to different contexts and communities.

In contrast to the recklessness and manipulation by the individuals who sit atop our financial system, those of us who advocate debt resistance take our collective responsibility very seriously. By dissolving the bonds that bind us to corporations, financial institutions, and governments all over the world, we seek to forge new bonds with one another based on equitable and sustainable forms of exchange.

At the time of this writing, examples of financial manipulation continue to arise. Matt Taibbi recently wrote an article revealing another scandal equal to or greater than Libor. It is titled, “Everything Is Rigged: The Biggest Price-Fixing Scandal Ever.” The subtitle goes on to report, “The second huge financial scandal of the year reveals the real international conspiracy: There’s no price the big banks can’t fix.” But this is no aberration of capitalism; this is its essence.

Remember: we don’t owe Wall Street anything, we owe each other everything. The possibilities of organizing around debt resistance are only beginning to be realized. Strike Debt, like Occupy Wall Street, hopes to inspire both autonomous action and collective resistance.

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