Chains of Debt
I originally wrote the following essay in late 2009, almost three years ago. I never got it published, though I did circulate it privately. At the time I theorized that debt was the common element of oppression in American life across ages, ethnic groups, geography, etc.. Debtors were the largest oppressed group in the US if only they would recognize it. Therefore teachingpeople to recognize that fact would be a way of organizing people against the current system.
One thing I was wrong about, was when I said that street protests were no longer relevant. Happily, Occupy proved that wrong.
I was very happy to see, recently, that the Occupy Debt/Strike Debt project has put out a guide to debt resistance. In that spirit, I present my original piece from 2009, edited to reflect active hyperlinks.
Chains of Debt
Americans should stop paying their debts as a form of civil disobedience. Those who have already defaulted should be proud that they are resisting a system that is impoverishing America. This is because our system has become so dysfunctional and corrupt that it is no longer responsive to the best interests of Americans. Instead, our political and economic elites have built a system where a very few enrich themselves on the backs of the very many. Our "leadership" persists in adopting policies that destroy our standard of living and impoverish Americans.The American business elite has proven impervious to the usual tools of rhetorical suasion and evidence-based policy analysis.
The business elite, represented by Wall Street, use our debt service payments to implement policies that are destroying the social fabric of America. As the recent G20 summit shows, street protests are easily ignored and marginalized. Americans must refuse to financially support those who are destroying the social fabric of our nation. We must refuse to pay our debts.
The recent turmoil of the financial crisis has exposed the weaknesses at the heart of the American system. Those weaknesses are;
1. The destruction of middle class jobs and stagnant real wages in the face of meteoric productivity increases
2. The real estate bubble and the the resulting mortgage debt explosion.
3. The education bubble and the resulting student loan debt explosion
4. Runaway health insurance costs that lead to 44,000 deaths a year
All of the above weaknesses have led Americans of all races and genders to carry unmanageable amounts of debt . And what was the response of our financial and political elite? The response was to orchestrate a massive bail out the so-called FIRE sector -- finance, insurance and real estate. The bailout handed trillions of dollars to the FIRE sector with no oversight. All that the American people received in return were some vague promises that the bailout money would improve the economy.
Perhaps the money did improve the economy. It undoubtedly improved the economy for the consumers of private jets. However, it did nothing to change the ongoing strangulation of the American people by the chains of debt.
The first link in the chain of strangulation is the disappearance of well-paying jobs in manufacturing. Those jobs disappeared because of policy decisions made at the highest levels of our government and business elite. As of September 2009, unemployment in the United States is at 17 percent. [link] However, even before the economic crisis, there has been a slow shift from a manufacturing economy to a service economy. in 1950, manufacturing jobs made up roughly 34% of the US non-farm jobs, while service jobs were roughly 59%. By 2002, manufacturing jobs were only 13% of the non-farm jobs, and service jobs were 82%. Manufacturing jobs provided the basis for a prosperous middle-class in the United States.
20 years ago when it became obvious that manufacturing jobs were disappearing, many people claimed that the service economy was going to be a good replacement for manufacturing. In 1987 the New York Times published an opinion piece by Ronald K. Shelp where he argued that workers take lower-paying service jobs because they lack the training for higher paid jobs, and not because low paying occupations are dominant in a service economy. [link]
Today we see that his assertion was incorrect-- the jobs created in the service economy have been in areas that pay poorly. Manufacturing jobs have dropped to about 13 million, or around 10% of the non-farmjob market. [Bureau of labor statistics] Today there are more jobs in retail. Around 15 million Americans working in retail, and as anyone who has worked in retail knows, the vast number of those jobs pay poorly. In Shelp's article he makes fun of critics of the service economy by writing that the service economy certainly isn't a "hamburger flipping hell." He was right-- it's not, it's actually the hell of working as an underpaid Wal-mart associate on food stamps. [insert link to wal-mart/food stamp story] insert stuff from BLS about low paying job expansion in service/food.
To be fair, other areas experienced growth as well, among them the FIRE sector and professional and technical services. The FIRE sector staffed out as the real estate market boomed, and this also directly contributed to the growth of jobs in construction. If you travel to any of the newer exurbs in California, you will see that during the 1990s and 2000s the construction industry grew rapidly as well. FIRE and construction together amount to around 15 million jobs, roughly the size of the retail sector.Unfortunately, now that the real estate bubble has popped, FIRE and the construction sector have been hit the hardest. Everyone knows someone in construction who has seen work dry up completely. If you drive around any community in the US you will see partially-completed buildings with fences around them-- and that means that the construction workers are no longer on the job.
What about information technology and other "knowledge workers" in the professional and technical services? Those jobs were supposed to be the backbone of the new economy's new middle class. As of 2008, there were almost 8 million workers in the sector. The technical and professional services were supposed to be the area of the "new economy" that replaced manufacturing as the backbone of America. Looking at the numbers, we can see that has not happened; rather, the jobs actually went to retail and the FIRE sector. Moreover, even the technical services industry has suffered some severe shocks, in the form of outsourcing and the guest worker programs.
20 years ago, the political and economic leadership set the conditions whereby manufacturing jobs exited the United States for overseas. Americans were supposed to educate themselves to move "up the value chain" into "knowledge worker jobs." Today many of those jobs are being shipped off-shore to India, China and other less developed countries. Thus, American information technology workers are increasingly subject to competition from people who are willing to work for a fraction of US salaries. The development of the internet has accelerated the process, since it enhances collaboration between spread out project teams. Even technical service people at the top end of the market are not immune. Recently, I spoke with someone who works in the design of cutting-edge consumer electronics. Even he is concerned that his job will eventually be outsourced.
Competition for information technology jobs in the United States has also increasingly driven by guest workers in the H1B program. The stated intent of the program was to help American companies find workers with specialized training. Allegedly there was a shortage of specialized technical workers in the United States. In practice the program has often been exploitive. It has been used as a threat to American IT professionals, to keep wages down within the United States. Often the contracting agencies that sponsor workers willfully misrepresent the qualifications of the H1b visa applicants. Anyone who has worked in technology in the US has had experiences with temporary workers who completely lack the competence to run an IT help desk. IT help desks are generally considered the lowest rung of the IT working ladder. The H1B program is also grossly exploitive towards the guest workers themselves. The H1B employee cannot easily switch to another employer, as a result of the complexities of the visa system. Thus, it is easy for the employer to pay lower wages since the employer knows that the employee cannot easily switch jobs.
The lower wages for H1B workers are merely symptomatic of a wider trend in the United States. Namely, the median income in the United States has stayed stagnant for 30 years, even as productivity has increased dramatically. In the United States, productivity is measured as the output per hour of labor. Since 1963 the real median household income (in 2008 dollars) has increased from $40,300 to $50,300. At the same time, productivity has exploded.
According to the calculations of economist Dean Baker, from 1973 to 2006, median hourly compensation increased by roughly 20 percent, but productivity increased by 47 percent. Who gained the benefits of the rest of the productivity gains?
Certainly a few people at the top like Donald Trump and Hollywood stars are becoming phenomenally wealthy. It certainly did not go to average Americans. You don't need statistics to tell you that. You can simply look at your own life, and the lives of people you know. Average Americans are working harder and finding it more and more difficult to afford the basics of what were previously considered a middle class lifestyle. Many people have argued that Americans feel poorer because today's families are profligate spenders who spend on frivolous consumer electronics, eating out and vacations. The data, however, tell a different story.
Elizabeth Warren has carefully tracked the spending habits of Americans. She has found that Americans today actually spend far less on cars, appliances and clothing than they were three decades ago. We do spend a little more on entertainment and computers, but that only adds up on average to fill this in. However, people today spend less on buying and maintaining cars-- when they buy them. Today people hold onto their cars longer too. Americans actually spend 30 to 40 percent less on furniture and appliances than people did 30 years ago.
Where then, are Americans spending their paychecks? During the last 30 years of the real estate boom, Americans have spent more and more money on mortgage payments. The average mortgage expense has increased by 69% over the last generation, even as the average number of rooms in a house has only increased by 7%. Warren is not the only person measuring a jump in the cost of housing. According Bureau of Labor Statistics (BLS), shelter costs have increased by 104% from 1998 to 2005. In the same time period the costs from all other items increased by 74% according to the same BLS study. Since we already know that the real median earnings for most Americans has stayed stagnant over the last generation, then logically people are putting more and more of their paychecks into their mortgage payments. Statistics bear this out across the United States. Typically personal finance gurus advise people to spend less than 30 percent of their income on housing. In well over half the states in the US, people spend over 30 percent of their income on housing.
What has driven the massive increase in housing prices and indebtedness? One major driver has been the competition for good schools. More fundamentally, rent-seeking behavior has driven the massive ramp up of real estate prices.
The stagnant median wages for Americans have left many people in a terrible quandary where people fight desperately to be able to afford a home in a neighborhood with good schools. For two generations, Americans have defined ourselves as a ''middle class nation." Most people would agree that it represented the idea of a comfortable life with a secure job, healthcare, access to higher education for oneself and one's children, and a secure retirement. As wages have stagnated and the jobs market has become harsher and harsher, we have been told by business and political elites that the solution is education. After all, we have been lectured for the last 20 years that the United States is now a ''meritocracy" and that only the smartest and best educated will survive and thrive.
Thus, many parents look at higher education credentials as the surest way to keep their children in the middle class. In conversations with friends and family members, that is the number one concern of families who are in the market for a house. The competition for good public schools has driven up housing prices. In several studies, school quality has been found to be the single most important factor for pricing. [cite warren]. Now that the housing market has collapsed, many people have been left with mortgages that are greater than the value of the underlying home. [insert stat] Is it turning around? According to an October 14, 2009 story in the LA Times, even the usually optimistic Mortgage Bankers Association expects that home foreclosures to continue to rise through next year. [cite to Oct 14 LAT article, E. Scott Recard link]
The underlying problem is rent-seeking behavior in the FIRE sector. Rent is defined as the excess payment above that required to provide for the upkeep of a productive factor [wikipedia] Economist Michael Hudson explains it as an access charge:
“Rent-seeking” charges are paid out of prices. So taxing economic rent doesn’t add to prices. It simply collects what nature or public infrastructure spending have provided freely – site value, the broadcasting spectrum, the rights to access the internet or other technology in cases where prices exceed the reasonable cost of production... [the] economy today is increasingly about how to get a free lunch of this sort – and how to get the government to avoid taxing it, and shift the tax onto labor and industry instead. This loads down the economy with unnecessary costs and higher prices, especially when rent-yielding assets are bid up on credit. "
In essence, the real estate bubble overall was driven by investors trying to capture a free lunch of rising real estate prices. California is a good example of what happens when the taxes on land are slashed. Before the 1980s, California, like most states, derived the bulk of its governmental operating revenue from taxes on land. After voters approved Proposition 13, the state froze land taxes. Thus, we created an incentive for people to invest in real estate and drive up land prices. The rent that would have gone to the people of California, went instead to the FIRE sector in the form of mortgage payments. Average people who were just trying to build a better life for their children found themselves caught in the middle, as mortgage debt went through the roof.
Since the housing bubble collapsed, many people have pinned their hope on loan modifications. The Obama administration, in an effort to help people avoid foreclosure, encouraged banks to participate in a voluntary program of loan modification. Unfortunately the vast majority of home loan modifications involved increasing the amount of money due! A study of over 3 million mortgages showed that the average amount added to loans was $10,800! [Connecticut Law Review, Vol. 41, p. 1107, 2009 , Alan M. White] In some kind of cruel joke, the loan modification efforts have been worse than useless. The modifications have increased the amount of money that people owe.
At the same time, the massive bank bailout continues to enrich the bottom line of Wall Street. Wall Street institutions have borrowed money from the government (from all of us) at almost zero interest, and are in turn lending it out at a profitable rate of interest. While average Americans carry an ever larger debt burden, Wall Street gets rich. Something is wrong with this picture.
As if the housing collapse was not enough of a burden, the sons and daughters of indebted homeowners are facing rampant increases in educational debt. Since the 1980s the primary advice for young people was to pursue higher education. Higher education was supposed to prepare people to become knowledge workers in the new economy. For the past 30 years, authority figures in the media, schools and politics have pushed students to attend some kind of post-high school education.
Unfortunately, our nation decided that students should pay for their higher education via student loans. On average 60% of bachelor's degree recipients borrow to finance their education. The average debt for borrowers in 2007 was $22,700. Certainly some people will argue that families should support their children by saving for college, and students should also work during school. One can argue that hard working people shouldn't need loans-- only the lazy have to resort to borrowing money.
That argument might actually make sense if it were not for the facts. People making the "hard work" argument should work a little harder themselves. They should examine the statistics before opening their mouths. The median income has remained stagnant for decades while housing prices have gone through the roof. Thus, average Americans have less and less money left over to save for their children's college education.
Adding insult to injury is the fact that the price of higher education has also escalated dramatically. Even at public universities, the cost of education has gone up by 5% a year for the past decade. In the 90s it was 4% a year, and in the 80s, 3% a year. [link] In California, even the UC system is raising tuition dramatically-- 9.3% in May. The UC administration proposes raising fees another 15% in the Spring, and another 15% in fall of 2010.
What about trade schools? Certainly those must offer a more practical education that will turn into cash right away? After all , goes this argument, a lot of private school types are probably studying "useless" things like English and Political Science. Unfortunately, this is not the case. Private, for-profit trade schools have been heavily investigated by the Department of Education for misrepresenting the nature of post-school job prospects. For example, I have spoken to people in the culinary vocational field. Tuition for culinary school can easily add up to $47,000 for a little more than a year of classes. Unfortunately the jobs that most people get pay in the range of $10 an hour. [link]
If undergraduate programs are faring poorly, what of graduate school programs? In law, medicine and pharmacy, over 80% of students borrow money, in the range of $80,000 to $127,000.
One would think that law students should be able to pay back their loans, since law is reputed to be a high paying profession. However, that bit of conventional wisdom is proving to be untrue. Salaries in the profession are now split between two groups-- those making very good salaries, and those making very little. Some might choose to mock law students with high debt loads. After all, don't we have too many lawyers? And aren't lawyers just evil parasites who just make life more complicated?
This view is exceptionally foolish because high levels of indebtedness among new attorneys is a contributor to shady behavior. When someone owes over $100,000 in loans he is unlikely to rock the boat. If his firm or government agency is engaged in shady practices, he knows that speaking out puts him in great jeopardy. Speaking out puts him in jeopardy because it jeopardizes his ability to pay back his loans. The United States is a nation that is ruled by laws. By and large the legitimacy narrative of our nation rests on the perception that the laws are fairly administered. For an example of the law-based legitimacy narrative, take a look at any hot button issue. Debates around abortion, gay marriage, the income tax and environmental standards all hinge around arguments about rights, fairness and Constitutionality.
Thus, the the professional people who interpret and contest the laws play a crucial role in the governing of the United States. When society places them in an inherently financially compromised position, it compromises their consciences.
People who rejoice in the situation are equivalent to those who stab themselves in the stomach because they have a stomach ache. It's stupid, self-defeating and suicidal -- for America.
Law is only one example. A similar situation is in play in every workplace where many of the employees have heavy student debt. Employers with heavily indebted employees know that they can mistreat their workers, and ask them to do things that anyone with a conscience will know is wrong. However, since the majority of us are chained by debt, we know that speaking out can jeopardize our ability to pay our loans. Thus we silently acquiesce, to things that we know are probably wrong.
Education debt is not the only thing keeping people in debt slavery. The rampant and frightening increases in healthcare costs are also to blame. A 2007 study showed that 62.7 bankruptcies were medical. Of those, 92% had medical debts over $5000. Most disturbingly, three out of four of the medical debtors had health insurance. [E. Warren, Medical Bankruptcy in the United States, 2007: Results of a National Study ]
What about people who don't have serious medical problems? Just like costs for housing and education, healthcare costs have risen dramatically. Average people are paying more and more of their stagnant incomes toward health insurance premiums. According to a Kaiser Foundation study, the costs of health insurance have risen by 131% since 1999. Inflation during that period was only 28%. Between 2008 and 2009, the average family policy offered by employers jumped 5% in cost, while wages rose only 3%.
As if things are not bad enough for those with insurance, those without insurance face something worse than bankruptcy -- death.
Almost 45,000 people die every year because of lack of health insurance. [American Journal of Public Health, Health INsurance and Mortality in US Adults, 2009] That is more than 10 times the number of people who died as a result of the 9/11 attacks. People are so desperate for medical care that this year in Southern California, over 6,000 people were seen at an 8 day free clinic. [link]
Despite the fact that over a hundred people a day die from lack of health insurance, Congress remains paralyzed. President Obama advocated healthcare reform while a candidate. President Obama and some of the Democratic party have not pushed for a national single-payer system,but rather some kind of public option in conjunction with existing private plans. The idea is that a public option would force healthcare companies to control costs, by providing fairly priced competition for private plans. Nonetheless, 9 months after taking office, there is still no meaningful healthcare reform.
Contrast 9 months of inaction with the rapid action after 9/11. On October 26, 2001, President Bush signed the Patriot Act into law. The Patriot Act added new laws and an entirely new federal agency, the Department of Homeland Security. After 9/11 cable news shows were full of belligerent commentators and elected officials, all of whom insisted that we had to adopt the Patriot Act because of 9/11. Many commentators insisted that the 3,000 deaths in New York justified the rapid legislative process. These commentators arrogated for themselves the right to speak for the dead.
8 years later, many of the same ilk have argued that healthcare reform is too important for Congress to move quickly. Many commentators have argued that a public healthcare option would cost too much money. Apparently 45,000 deaths a year aren't a sufficient impetus to fix the system.
On the other hand, many would argue that the American people are simply too conservative to embrace any kind of public option. However, that idea is incorrect. A recent ABC News poll found that 57% of Americans support a public option. If the public option is limited only to those that cannot afford private insurance, the number jumps to 76% of Americans. [ABC NEWS/WASHINGTON POST POLL: HEALTH CARE AND POLITICS October 19, 2009].
In the American system, a 66% majority is known as a super majority, because it is generally considered difficult to get 2 out of 3 people to agree to anything. Compare that to the fact that 76%, or 3 out of 4 Americans want a public option in some form. The public option is thus overwhelmingly popular, and yet it is still a "contentious issue" in Congress and the television media.
Why could this be? One of the top opponents of the public option is Senator Max Baucus of Montana. Perhaps Sen. Baucus is opposed to the public option because of his concerns over the cost to the public. Maybe Sen. Baucus is a brave voice standing firm against the rabble. On the other hand, a quick examination seems to tell a different story. Of Sen. Baucus' top 5 contributors for the last 5 years, three are health-care related-- Shering-Plough, AIG and Aetna. Schering-Plough is a drug maker, while AIG and Aetna are insurance companies. Together they have donated about $160,000 to Sen. Baucus over the last 5 years. (http://www.opensecrets.org/politicians/s...) If you think about it, $160,000 isn't much money, considering the fact that health insurance company profits rose 428 percent from 2000 to 2007.
What kind of plan has Sen. Baucus proposed instead of a public option? The Senator has pushed a bill with price controls on insurance. Under the Senator's plan, Americans will have to buy mandatory insurance. [link] Unfortunately,the plan may still over charge families. In some cases, up to 55% of family income beyond basic expenses (rent, car, food, utilities) will go to to health insurance. The proposed House plan is barely any better. Even the bills that propose a public option leave most Americans ineligible for it, and force them instead to buy pricy private insurance from an industry that is bleeding Americans dry.
It is an outrage that 45,000 Americans die from a lack of health insurance every year. It is an outrage that despite overwhelming support for a public option, powerful Congressmen support plans that lack a public option. It is an outrage that in the proposed plans may force most Americans to pay huge amounts of their discretionary income to healthcare companies. It is an outrage that the proposed public option is so weak.
Americans should be angry that our political and economic elite continue to twiddle their thumbs while we are bankrupted by stagnant incomes and massive bubbles in education, housing and healthcare.
There is an argument that anger is a bad part of public life. This school of thought holds that anger is counterproductive. What we really need is some more dry policy discussions. After that, perhaps someone Very Important can write a strongly worded letter expressing unfortunate dismay at the continuing failure of the business and political elite to implement more rational policies. One could characterize this school of thought as milquetoast liberalism.
Milquetoast liberalism often claims that the best course of action is just to give way in the face of argument, because engaging in confrontation will only make the other side stronger. Milquetoast liberals often like to invoke the late Dr. Martin Luther King to support their view that anger is counterproductive.
Giving way in the face of confrontation is a milquetoast liberal trope that is especially common on the West Coast of the United States. This is probably because the New Age movement that arose in California embraced a twisted and incorrect view of so-called Eastern spirituality. Allegedly this principle was embodied in the martial art of aikido. Under this theory, a person would simply turn and give way to their attacker, and then prevail without making any effort. While this is a seductive theory, it simply isn't true. Adherents of this viewpoint point to the founder of aikido, Morihei Ueshiba, as an exemplar of this idea. Unfortunately, what the New Age hippies failed to understand was that Ueshiba's personal expression of the art was based on an enormous amount of highly specialized physical conditioning training that allowed him to appear effortless. In his day, Ueshiba was known to have prevailed against sumo wrestlers and strong college judo players. Without the specialized conditioning, later day practitioners could only mimic the movements. They would not be able to actualize the principles of their art in a forceful confrontation.
In a similar way, the milquetoast left has completely misconstrued the legacy of Dr. King. They have tried to portray King as a passive person who said some nice things about having a dream.
That viewpoint is totally incorrect. In a speech honoring Dr. W.E.B. Dubois, King said that "...the supreme task is to organize and unite people so that their anger becomes a transforming force." [Honoring Dr. DuBois, speech by Dr. Martin Luther King February 1968]
King was no stranger to confrontation. In Birmingham, Alabama he and the Southern Christian Leadership Conference (SCLC) brought the city's business community to its knees. He did this by organizing an economic boycott and direct action sit-in protests that shut down the city. As a result the city leaders agreed to most of King's demands to desegregate Birmingham.
The obvious part of King's campaign were the marches, since those were documented by photos and film. However what is less documented is the preparatory work. In the years leading up to the Birmingham campaign, the churches of the SCLC spent years training their members in the methods of nonviolent confrontation. Like Ueshiba's aikido, the direct action of the Birmingham protesters was supported by fundamental practices.
While the civil rights era protesters were effective in their time, street protest no longer has the impact that it once had. For one thing, the legal environment is much more hostile to large scale demonstrations that shut down cities. Law enforcement often uses a co-ordinated effort before the demonstrations to shut them down by arresting key organizers in advance. Furthermore, in today's media environment, protesters are given little coverage unless they are part of a right-wing movement. A good example of this is the Tea Party protests. The basic impetus of the Tea Parties came from a variety of right-leaning think tanks and lobbying shops. Fox News is driving a lot of the television coverage. Although there were massive protests against the Iraq War (insert link), they did not receive anywhere near the kind of coverage that the Tea Parties receive.
The other issue is, to whom should protesters address their demands? In King's time, it was clear who to address. Local businesses and government institutions enforced segregation. In today's situation, it is the FIRE sector that is tightening the chains of debt around the American people. Although there have been some limited protests on Wall Street and at some bank industry conferences, none of them have had any effects. It is pretty clear that the management of the FIRE sector does not care that it receives massive public approbation. This is obvious from the fact that FIRE sector management continues to defend enormous bonus packages in the face of regular public outcry.
Since all the FIRE sector management cares about is money, then taking away their money is the best leverage to force them to the negotiating table. We can take away their money by refusing to continue paying them. It is pretty clear that the political leadership of the United States is almost wholly owned by the FIRE sector. Government policies with respect to jobs, health care, housing and education are skewed to benefit the FIRE sector at the expense of ordinary Americans. Since our government is owned by the FIRE sector, and FIRE sector leaders do not care about public approbation, civil disobedience is the last option on the table.
Some might argue that it will be difficult to gather a critical mass of people who will choose not to pay their debts as a form of civil disobedience. After all, failure to pay one's credit card, medical debts or student loan can have bad consequences for one's credit. Although many do not realize it, failure to pay one's civil (non-tax) debts is not a crime. No one is going to go to jail for refusing to pay a credit card or student loan.
What the above analysis neglects to understand, is that there are _already_ tens of millions of Americans who have defaulted on their debts already. The key issue is how to organize the existing defaulters into a movement of debt resisters. There is already a critical mass of people who are non-violently resisting the FIRE sector. However, many of these people are currently silent about their plight out of shame. To organize them will require a narrative change that converts shame into anger and anger into a transforming force.
Part of the reason people feel shame is because our mass media has pushed a view that individuals who are struggling with debt are personally at fault for everything that has happened to them. There are individuals that have made bad decisions and spent their money on vacations, overpriced SUVs and video game consoles. The truly bad decision that we have made as a people is to trust our economic and political leadership to do the right thing. As this article has shown, Americans today live in an economy that is structured to keep them chained in debt. It is important to spread this message to as many people as possible, to allow them to convert their shame to anger.
To change the narrative, people who are already defaulting should be proud rather than ashamed. If debt resisters let other defaulters know that they are not alone, more and more people can identify themselves as part of the debt resistance movement. As the movement grows, some people who can afford to pay their debts but are angry about the financial crisis will feel more comfortable about repudiating their debts. The debt resistance movement should demand that large scale debt forgiveness for all indebted Americans.
The availability of the internet makes self-identification with social movements an easy task. The real task is to change the narrative so such a movement can grow large enough to force the FIRE sector to relinquish its hold on the American people.
For almost 8 years under the Bush Administration, Americans worried about the threat of terrorism. We were concerned about threats to our way of life from suicide bombers, airplane attacks, chemical weapons, anthrax and rogue groups wielding nuclear weapons. Despite the rhetoric of the cable news talking heads, the real threats to the well being of Americans are stagnant wages and the chains of debt. Americans starting their careers today face a bleak earnings future and are burdened by student debt and the potential for catastrophic healthcare costs. Parents and grandparents should realize that if the current situation continues, their descendants will almost certainly face lifelong struggles with low pay and escalating indebtedness.
How far are we, as a people, willing to go to break the chains of debt?