We can finally see a light at the end of the tunnel of the awful pandemic which has claimed nearly three million lives. But this is not waking up from a nightmare. Quite the opposite — the pandemic itself should have awoken us to the nightmarish reality we have been sleeping through for too long.
In an essay written just before his untimely death in 2020, David Graeber wrote:
“[I]n reality, the crisis we just experienced was waking from a dream, a confrontation with the actual reality of human life, which is that we are a collection of fragile beings taking care of one another, and that those who do the lion’s share of this care work that keeps us alive are overtaxed, underpaid, and daily humiliated, and that a very large proportion of the population don’t do anything at all but spin fantasies, extract rents, and generally get in the way of those who are making, fixing, moving, and transporting things, or tending to the needs of other living beings. It is imperative that we not slip back into a reality where all this makes some sort of inexplicable sense, the way senseless things so often do in dreams.”
David Graeber — After the Pandemic, We Can’t Go Back to Sleep
When we wake up we will find the banks calling in their overdue mortgage payments, landlords calling in overdue rent, the moratoriums on foreclosures and evictions (never really enforced effectively) lifted, displacing thousands, perhaps millions, from their homes. Student loan payments will become due, even if there was no real “education” provided. The medical bills from COVID-19 will be piled on top of the already sky-high medical costs under our absurd system of private health insurance. Nearly one-in-five U.S. adults — 18%, about 46 million people — report that if they needed access to quality healthcare today, they would be unable to pay for it, with Blacks nearly twice as likely as Whites to be unable to pay for medical care. The disparities created by systemic racism, which have always been there, will be magnified exponentially.
The stimulus checks, rent assistance, unemployment benefits, and all the other proposals circulating in Congress and state and local bodies, offer no more than band aids for a patient bleeding to death. They are as useless as running away from the monster in our dreams — our legs pump furiously, but we go nowhere.
There is a real solution, and it is thousands of years old.
It is time for a Jubilee!
“Every seventh year you shall practice remission of debts — and this is the manner of the release: every creditor shall remit the due that they claim from their fellow; they shall not exact it of their fellow or kinsmen; for the remission proclaimed by God.” Deuteronomy 15:1–2.
“You shall count off seven weeks of years — seven times seven years . . . a total of forty-nine years. Then you shall sound the horn loud; in the seventh month, on the tenth day of the month — the Day of Atonement [Yom Kippur] . . . You shall proclaim release throughout the land for all its inhabitants. It shall be a Jubilee for you; you shall return every one unto their possession, and return every onto unto their family.” Leviticus 25:8–12.
The Torah (Old Testament) was not the first to express the idea of a Jubilee — a regular remission of debts. The practice had already existed in Babylon, Mesopotamia, and probably every civilization which had the idea of debt. See David Graeber, Debt: The First 5,000 Years (Melville House 2011). The concept is repeated in the Christian New Testament and in the Muslim Qur’an.
Inspired by the Biblical Jubilee, the regular remission of debts is part of the U.S. Constitution. Among the powers given Congress in Article I § 8 is the power to “establish . . . uniform laws on the subject of bankruptcies throughout the United States.” The problem is that the “laws on the subject of bankruptcies” adopted by Congress work to the opposite of the original intent of the remission of debts embodied in the Jubilee.
Modern bankruptcy law in this country is just another vehicle to move wealth from the workers who create it to the rich who only take it.
A non-human for-profit business entity, such as a corporation, can easily shed its debts, along with pesky union contracts, through either a Chapter 7 liquidation, or a Chapter 11 payment plan. Donald Trump has done this dozens of times with his “Trump” companies. Here are the results of my search on the federal courts’ PACER system for bankruptcies by entities whose name starts with “Trump” :
Who do you think gets paid when a non-human business, such as the Trump Taj Mahal, files bankruptcy? Not the workers who created any value in the company. First in line are the banks and other financial institutions that are “secured” creditors, followed by the attorneys who bill the estate at exorbitant rates for protecting the interests of the business owners. See 11 U.S.C. §§ 506, 330 and 503(b)(2). Let me give you an example from one of the many cases where I had the quixotic task of representing the interests of the workers in bankruptcy proceedings:
The Van de Kamp Bakery, originally owned by the family of that name, was once a California icon. The company traded hands several times before it fell into the hands of two investors, who purchased it through a “leveraged buyout.” What that means is that a bank loaned money into their shell company, in return for a “security” interest (like a mortgage) in all “assets” of that company (which then was nothing). They used that money to purchase the assets of the real Van de Kamp Bakery. The investors then effectively owned, through the shell, the entire bakery, while the bank who gave the loan held a security against all of its assets. Neither the bank nor the investors actually put money into the operation itself. Soon after, they filed bankruptcy, paying their bankruptcy lawyers to file the petition, while skipping the payroll of the workers who were baking the pastries. The company attorneys then claimed that the union wages and benefits paid (or not paid) to the working bakers was too high. In the next breath, they submitted their own bill for over twenty times the workers’ rates, and argued for a golden parachute for the owners who had just driven the company into bankruptcy. The company eventually liquidated, and the bank who owned everything wouldn’t even let the union in to prepare the final W-2s for the workers. See my article, Carrion Eaters: How the Bankruptcy Business Feeds on Workers and the Public, in 8 Village View №2 (8/13/93).
So what happens to the workers who lost their jobs, their wages, and their health insurance, because their employer filed bankruptcy? If they also seek bankruptcy protection they are not treated as kindly as their defaulting, non-human employer. Unlike non-human business entities, workers are generally required to file for a Chapter 13 payment plan, rather than liquidate their debts in Chapter 7. 11 U.S.C. §§ 109(e) and 707(b). Before human beings can file anything, they must complete a “credit counseling” course, where they are lectured on their failure to pay their bills. 11 U.S.C. § 109(h) and 521(b). While foreclosures and evictions are temporarily stayed when a human being files for bankruptcy, their bank or landlord just has to jump through a few more hoops to make them homeless. And if they fail to come up with a sufficient payment plan, their homes, cars and other “secured” assets will be taken away. See 11 U.S.C. §§ 521(a)(2), 521(a)(6), and 362(h). Even if they make it through the process without becoming homeless, there are some debts which they cannot get relief from at all. This includes:
· Student loans. See 11 U.S.C. § 523(a)(8).
· Fees imposed on prisoners, and restitution imposed for federal crimes. See 11 U.S.C. §§ 523(a)(17) and 523(a)(13), respectively.
· Certain taxes. See 11 U.S.C. §§ 523(a)(1) and (a)(14A).
· Certain credit card cash advances before filing bankruptcy. See 11 U.S.C. § 523(a)(2)(C).
Let us not mince words here. There is only one word which truly describes the net result of this backwards system:
Debt was and is a form of slavery, enforced by the courts, and ultimately, the guns of sheriffs and marshals. The weight of debt has proven more effective than physical chains in keeping people enslaved. Try to escape from your debts, and you will lose your home and your means of survival. Debt, like Slavery, is just a way to move wealth away from the ones who produce it.
Debt slavery, through the sharecropping system, was how Southern plantation owners managed to continue the same system of slavery over African-Americans, in form if not in name. See W.E.B. Du Bois, Black Reconstruction in America and Eric Foner, Black Reconstruction: America’s Unfinished Revolution. In some ways, enslavement by debt may be even worse. The slaveholder of old at least had to make sure his “chattel” was kept alive and healthy, for them to be of any use to him. The non-human debt slaveholders have no such motivation.
Our chains of debt are getting heavier and heavier. Household debt rose from 15 percent of U.S. gross domestic product (GDP) after World War II, to close to 100 percent on the eve of the 2008 financial crisis. See Kuhn, Schularick and Steins, The Great American Debt Boom, 1949–2013 (9/8/2017).
Household debt was nearly $15 Trillion at the end of 2020. Most of this is mortgage debt, at over $10 Trillion, followed by student debt at nearly $1.6 Trillion. See Federal Reserve Bank of New York, Quarterly Report on Household Debt and Credit 4Q 2020. The current GDP is $21.48 Trillion, so our household debt is two-thirds of all the wealth produced. See Bureau of Economic Analysis, Gross Domestic Product, 4th Quarter and Year 2020 (Advance Estimate). Personal income in 2020 totaled $19.7 Trillion, so that our household debt is 74% of our annual income. See Bureau of Economic Analysis, State Annual Personal Income, 2020 (Preliminary).
What this means is that our chains of debt are getting heavier. No matter how hard we work, we cannot be free of them.
As Walter Mosley put it:
“Today the neoslave is made to carry her own chains to and from the job. She has to clothe herself and feed herself, look after her own health, and make sure she’s on time. She must look after her own old-age pension, and even arrange her own funeral. In return she is paid a salary, which she can dispose of in any way she pleases. But she doesn’t set the prices on goods; she doesn’t devalue the dollars that never seem to stretch far enough. . . . She sells her labor cheap and buys at full price.” Walter Mosley, Workin’ on the Chain Gang: Shaking Off the Dead Hand of History (Random House 2000).
It is time to shake off the chains of debt.
It is time for a REAL Jubilee!
While my own preference is to completely end the rule of the capitalist system which creates these chains, there are some less radical changes which can be implemented within our current system, in the spirit of the Biblical Jubilee.
· Enact true single-payer health insurance, aka Medicare For All. This would eliminate the two-thirds of personal bankruptcies filed due to medical issues. See American Journal of Public Health, March 2019, Vol 109, №3.
· Allow human beings to choose between a payment plan (Chapter 13) or liquidation (Chapter 7) just as non-human entities can choose between a Chapter 11 and Chapter 7 bankruptcy.
· Eliminate the credit-counseling requirement for human beings in bankruptcy. Instead, we should impose an extra tax on lenders to be used to fund education on predatory lending practices, the same way tobacco companies are taxed for education about the dangers of smoking.
· Reinstate and enforce usury laws (limiting interest rates) for all loans to human beings.
· Prohibit foreclosure or eviction of human beings from their home during bankruptcy, whether or not they come up with a “plan” to pay back rent or mortgage.
· Allow the discharge of all interest and penalties on home loans and home rent in bankruptcy. Allow human beings to shed or modify their rent and mortgage obligations on their home, as employers can shed or modify union contracts in bankruptcy. See 11 U.S.C. § 1113.
· Impose a high tax on profit from real estate transactions and rental income (over a certain threshold) and use the funds to create low-income housing. It was speculation on land value which brought about the 2008 crash, and is still increasing our housing costs and debt. Going back to the Bible, we are not allowed to “own” the land anyway. See Leviticus 25:23; Qu’ran 2:255. If we can’t eliminate land ownership, we can at least tax it so that speculation will no longer be profitable.
· Allow student loans to be discharged completely in bankruptcy. It is shameful that we send our young people out into the world already weighted down with debt. The purpose of education should be to allow them to contribute to society; that should be the only “debt” they carry.
· Provide greater forgiveness of taxes and fees on prisoners, for human beings who need a fresh start. These fees, imposed disproportionately on people of color, have been used to curtail voting rights as well as perpetuate slavery.
· Establish a lien on all assets of an employer, superior to all other liens, for wages and benefits owed employees. Banks and lawyers should never be paid before the workers who created the wealth these vultures are picking at. See, e.g., California Code of Civil Procedure § 1205.
· Shed security interests on non-human businesses in bankruptcy, where the loan did not go to business operations or workers. Banks who financed leveraged buyouts should get nothing in bankruptcy.
Those who contribute nothing to society, but only take from those who produce, will undoubtedly scream that these would be unconstitutional “takings” under the Fifth Amendment. But the Fifth Amendment is subject to the power of Congress to “establish . . . uniform laws on the subject of bankruptcies” under Art. I § 8 of the Constitution. The Bankruptcy Code already provides for “taking” of security interests made within 90 days of the petition. 11 U.S.C. § 547(b). More importantly, all of these laws, and the rest of the Constitution itself, must be subject to the Thirteenth Amendment:
Neither slavery nor involuntary servitude, except as a punishment for crime whereof the party shall have been duly convicted, shall exist within the United States, or any place subject to their jurisdiction.
Slavery still exists and flourishes within the United States. We need a Jubilee to finally cut the chains of slavery.
If our politicians will not take action to enact a real Jubilee, then perhaps we may need to do it ourselves. Slavery was not ended by the Emancipation Proclamation, and the Civil War was not won by soldiers. Rather, as DuBois explained in Black Reconstruction in America, “The Southern worker, black and white, held the key to the war.” Those workers, blacks held in slavery, joined by some poor whites, engaged in what DuBois characterized as a “General Strike” — They stopped working to support the plantation and war economy of the Confederacy, and many travelled to work for the Union forces instead. Without their labor, the Confederacy fell apart.
We can do the same today. If enough people stop paying their mortgage, their rent, their student debt, their loans for medical and living costs, the entire system of debt slavery would fall apart.
Si Se Puede!
David Graeber, Debt: The First 5,000 Years (Melville House 2011) — Debunking the myths of debt, money, and the “market.”
Strike Debt, The Debt Resisters’ Operations Manual (PM Press 2014) — Practical advice from a radical perspective on dealing with and resisting Debt.
Strike Debt — a nationwide movement of debt resisters fighting for economic justice and democratic freedom.
Debt Collective — a debtors’ union fighting to cancel debts and defend millions of households.
Jubilee USA Network — A faith-based coalition of Jewish, Christian and Muslim religious groups called for tackling the structural causes of poverty and canceling the debt of poor countries around the world.