Debtors, Unite! You Have Nothing to Lose but Your Shame.
Conversations about debt are never purely about economics. They are always, also, conversations about power, morality and shame. The debate over President Biden’s student loan relief plan is no exception.
Immediately after the initiative was announced, opponents of debt cancellation began denouncing “slacker baristas,” overeducated Ivy League lawyers and impractical “lesbian dance theory” majors. Immune to accusations of hypocrisy, Republican members of Congress who had received hundreds of thousands, even millions, of dollars in federal relief castigated student debtors who might receive $10,000 to $20,000 in aid.
It was a stark reminder that shame, like wealth, is not evenly distributed in our society. For working-class people, insolvency is often seen as a sign of profligacy and personal irresponsibility, while large corporations and the wealthy routinely walk away from their obligations and are celebrated as savvy for doing so. Donald Trump can boastfully call himself the “king of debt” for his string of strategic bankruptcies; the average debtor would never dare.
Debts are, first and foremost, financial burdens. But most people in arrears must shoulder a boulder of shame, as well. This is the factor most commentary about Mr. Biden’s student debt relief plan has missed.
The mass cancellation of federal student loans will not only remove a crushing economic weight for tens of millions of people, it will lift a significant emotional one, too. This psychological shift could, in turn, have further political implications, by emboldening those who find their obligations overwhelming to engage in collective action aimed at winning more relief and changing the policies that make indebtedness so pervasive.
To understand what a pivotal moment this is, we must first appreciate just how profoundly the moral decks are usually stacked against regular debtors. Even the seemingly innocuous phrase “loan forgiveness” implies culpability and blame, when in reality the majority of debtors are simply struggling to make ends meet — a problem likely to be most acute for Black and brown people, who tend to lack family wealth and access to credit on fair terms.
Why is our society so invested in steeping debtors in shame? The answer lies in debt’s role as a core building block of our economy and unequal social order. Debt is wrapped around every necessity of life: We use credit to make daily purchases and pay for medical care, take out mortgages, finance our cars, and borrow for college; cities and states issue debt to pay for roads and schools. Monthly repayments are often a form of wealth transfer to the affluent investors who hold these debts as assets, fueling inequality.
If debt is a dual source of profit and power, shame is its handmaiden. Shame isolates and divides, making class solidarity more difficult. The kneejerk anger at the idea of student debt cancellation in some circles, while ostensibly about fairness, reflects the common though misguided view that when one persons gains, another loses. Imagining a zero-sum game, some ask why student loans were eliminated and not, say, medical debt — a reasonable question. But medical debt, too, should be erased, as a way to ease the unjust financial hardship that getting hurt or sick often entails. For example, Mr. Biden could, and should, take executive action to cancel all medical debt owed to veterans hospitals.
Meanwhile, the fever pitch of opposition to debt cancellation among conservative and centrist elites reflects a different fear: that debt’s utility as an instrument of social control may be weakening. Consider the reaction of Representative Jim Banks, Republican of Indiana, to Mr. Biden’s cancellation news: “Student loan forgiveness undermines one of our military’s greatest recruitment tools at a time of dangerously low enlistments.” Student debt, or the fear of it, pushes people into certain careers and limits their life choices.
No wonder soaring student debt became a catalyst for protest, though only after borrowers began to overcome their shame. Under pressure from a growing coalition that traces its origins directly to the Occupy Wall Street movement a decade ago, Mr. Biden was forced to act — an outcome that is all the more remarkable given his previous allegiances. When he was a senator from Delaware, which is home to the nation’s biggest issuers of credit cards, Mr. Biden tended to side with lenders over debtors. He was a driving force behind the 2005 Bankruptcy Abuse Prevention and Consumer Protection Act, which made it harder for distressed borrowers to discharge their student loans.
Now, Mr. Biden appears to be switching sides in time for the midterm elections. Tweeting moving stories from people eligible to receive loan cancellation, he seemed as though he were hosting a debtors’ assembly — an Occupy-inspired forum where people share their financial tribulations out loud, thus transforming burdens of shame into bonds of empowerment — in the Oval Office.
The president’s actions are certainly a break with the political status quo, but they are not unprecedented. In his groundbreaking work on debt, my friend, the anthropologist David Graeber, reported on the periodic debt amnesties, or “jubilees,” of the ancient world. Seeking to quell unrest, Sumerian and Babylonian kings periodically wiped away debts and liberated people from peonage, often over the objections of creditors. The Code of Hammurabi, written around 1750 B.C., proclaims that if a “storm wipes out the grain, or the harvest fails, or the grain does not grow for lack of water, in that year he need not give his creditor any grain in payment.”
For these leaders, debt relief had little to do with the guilt of individual debtors. Jubilees were a practical way to recover from crises and avert societal collapse. Now, as then, inequality and insolvency imperil economic and political stability. Wiping the slate restores balance.
Many of today’s debtors have more in common with unlucky Mesopotamian farmers, subject to forces beyond their control, than it may initially appear. In a society where the federal minimum wage is stuck at $7.25, public services are paltry, and racial and gender discrimination run rampant, a majority of Americans have no choice but to borrow to make ends meet. Where student loans are concerned, the steady erosion of state funding for higher education, and the resultant debt-for-degree system, is to blame, not individual borrowers.
Prominent critics of Mr. Biden’s plan have pointed out that granting relief this once will not permanently solve the student debt crisis nor the attendant problem of rising college costs, and here they are correct. The only permanent solution to the problem of runaway student debt is to make public education free for all (a model that was relatively common in the United States a few generations ago, which is why so many older people graduated debt-free). Only then can students who lack wealth avoid indenturing themselves for the chance to learn.
Though I believe Mr. Biden’s plan is inadequate in terms of the monetary relief it offers, his actions have already dealt a blow to debt’s symbolic, shame-inducing power. Everyone now knows federal student loans can be canceled with the flick of a president’s pen. And instead of feeling guilty and unworthy, millions of regular people suddenly feel entitled to relief, an entitlement previously reserved only for society’s elites.
Hundreds of millions of people are not in debt because they are immoral and live beyond their means, but because they are denied the means to live. Debt jubilees are part of righting this wrong, but as Mr. Biden’s student debt relief plan shows, they won’t happen unless debtors rise up and demand them. The first step is abolishing the shame that makes us reluctant to fight for what we deserve.
Astra Taylor (@astradisastra) is a filmmaker and co-founder of the Debt Collective, and the author, most recently, of “Remake the World: Essays, Reflections, Rebellions.”
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