Everybody is now talking about the student debt crisis, but nothing is being done about it. Thanks in large part to the great public amplifier of the Occupy movement, this year’s presidential contenders have been forced to embrace student loan reform as a talking point in their respective campaigns. But the debt relief being pushed by the Obama administration is a token gesture, aimed at getting some traction on the youth vote–especially the more disillusioned or alienated student constituencies. Recent bills introduced in Congress–Student Loan Forgiveness Act (H.R. 4170) and the Private Student Bankruptcy Fairness Act (H.R. 2028)–have zero chance of passing in anything like their current form. Practically speaking, no reform program of any substance is on the legislative horizon, least of all one that would regulate the predatory lending practices of Wall Street banks.
The truth is that student debt relief is too important to be left to elected officials. They are chronically dependent on the financial backing of the lending industry, and are structurally incapable of addressing this crisis, let alone resolving it. As a result, reform initiatives such as Student Loan Justice and Forgive Student Debt (to Stimulate the Economy) that have been aimed at petitioning lawmakers have very little to show for all their hard effort. The recent federal modifications in payment schedules are micro-cosmetic compared to the sea-change that is required to free debtors of their intolerable burdens and rescue higher education from its increasing use as a profit engine for financiers, asset speculators, and real estate developers. The pathway to this outcome does not lie in futile pleas for economic reform, but through a political movement, driven by self-empowerment and direct action on the part of debtors.
The Occupy Student Debt Campaign was launched at Zuccotti Park in November 2011 with the goal of building a student debt abolition movement. Our campaign is based on principles for which we believe there is widespread support:
1) Free public education, through federal coverage of tuition fees.
2) Zero-interest student loans, so that no one can profit from them.
3) Fiscal transparency at all universities, public as well as private.
4) The elimination of current student debt, through a single act of relief.
These are interlocking principles, and should not stand on their own. Imagine a world in which lawmakers were to respond positively to the current calls for debt “forgiveness” (an unfortunate term that implies the debtor has sinned). Such a measure would offer much-needed relief, but it would still disadvantage future debtors if it were not complemented by remedies that brought to an end the practice of compelling students to privately fund higher education by going into debt bondage. So, too, a singular focus on reducing interest rates (even to zero) is more likely to encourage colleges to increase their fees than to open up equitable access to education.
In light of Wall Street’s stranglehold on Congress, the Occupy Student Debt Campaign holds that alternative strategies are necessary to promote and publicize our principles. That is why it endorses the practice of debt refusal as a legitimate response to the predicament of individuals and communities targeted by predatory lenders, or by state officials seeking to pass on the costs of the financial crisis in the guise of austerity measures. Greece, Chile, England, Italy, Spain, and Quebec have all seen popular revolts against government efforts to preserve, and extend, the power of financial elites to discipline selected populations. With each new outbreak of people’s voices, the imposition of debt is publicly exposed, not simply as a means of redistributing wealth upwards, but also as an instrument of social control. Under current U.S. laws, defaulting on a student debt carries serious penalties. These laws are unjust, but they are a sharp deterrent to individuals who might otherwise consider refusing their debts. In response, our campaign advocates collective action. Even in its absence, the default rates are accelerating, with alarming consequences. Our Pledge of Refusal is framed as a debt strike threat (debtors pledge to withhold payments once a million others have signed). We welcome, and will support, other forms of debt refusal/strike that are consistent with the aim of building a broad political movement.
The culture of honoring all debts, even those unjustly incurred, is not universally respected, least of all on Wall Street. Loans and credit are new forms of money created from nothing for the ultimate benefit of the lender; they are little more than numbers on a computer screen. Bankers know this, and so they treat their own debts accordingly, as matters to be renegotiated, restructured, or written off. Only the little people are supposed to pay in full. As this double standard becomes more and more apparent, debt refusal will emerge as the most rational response to an immoral predicament.
The struggle over wages was a defining feature of the industrial era. We believe that the struggle over debt will play a similar role in our own times. Not because wage-conflict is over (it never will be), but because debts, for most people, are the wages of the future.
The Occupy Student Debt Campaign
Sign the student debt pledge of refusal here.
(N.B. Our campaign tactics differ from those who own the Occupy Student Debt domain name, and who have no relationship to Occupy Wall Street.)