Walking the streets of New York City this spring, you would have been hard-pressed not to come across posters promoting the Occupy Wall Street-led May Day general strike. “A day without the 99 percent,” is how it was billed. With the strike, the group was attempting to light a fire that might bring down capitalism and launch the US into an American Spring. However, Occupy's rallying cry fell on deaf ears, as the rally had poor attendance and limited impact. Looking back, it seems like that was the moment that the pied pipers of political and economic discontent’s critical mass finally dissipated. The group's momentum seemed to have run its course, and the fickle media's attention turned to the sideshow that was the 2012 presidential election.
After May Day, Occupy had to find itself all over again. Call it an identity crisis. But in an organization as decentralized as OWS, where individual efforts and actions are constantly emerging as branches and nodes of a shape-shifting whole, identity is a fluid concept anyway. The post-May Day breakdown was a chance for rebirth—a function of Occupy Wall Street's built-in eternal recurrence mechanism. It was in this ferment that Occupy forged its next project: Rolling Jubilee, a plan to buy anonymous medical debt, thus offering relief to Americans burdened by exorbitant healthcare costs.
“From the very beginning of Occupy Wall Street, the question of crippling debt that people are forced to carry has always been part of the agenda,” says Yates McKee, a member of Occupy's Strike Debt team, which is leading the Rolling Jubilee project. “Student debt, mortgage debt, medical debt, and municipal debt—all of that has been a part of Occupy from the very beginning.”
Activists within the Occupy Student Debt Campaign, an early sub-group of Occupy focused on the debt crisis, had the idea of using Occupy's I Am The 99 Percent Tumblr to present real people who were debtors and break the silence around debt. It was a issue that was close to their hearts, as many of the original Occupy campers were debtors of all stripes.
As Yates explains it, the Occupy Student Debt Campaign went on to create the Pledge of Refusal, which many Occupy participants signed. “It wasn't about forgiveness,” Yates emphasizes. “It didn't say, 'Let's come up with a piece of legislation that forgives our debt.' Rather, it noted that going into debt is systematic. In order to live, you have to enter into this predatory debt. So the Pledge of Refusal was non-compliant with the debt system. It was similar to a debt strike.”
Originally, the debt strike concept gained a lot of traction within the Occupy movement, but people across the country weren't ready for such an idea and conditions across the country couldn't support a mass default. So in the post-May Day void, where Occupy's idealism finally gave way to reality, they knew they had to take another approach to fighting debt. Luckily, the Occupy Student Debt Campaign movement still had a great deal of enthusiasm behind it, even after May Day.
“The only campaign that still had a lot of energy was the Occupy Student Debt Campaign,” observes Yates. “So over the summer, we decided to have what we call 'thematic assemblies,' where in one assembly we talked about the environment, and in another assembly we talked about labor. And then we did one on debt. And we made sure to invite everyone from the Occupy Student Debt Campaign, Occupy Universities, Free University, and Occupy Labor.”
The larger assembly then got together and discussed what would it mean to build a political movement around debt in all its forms and not just on certain types of debt in isolation, like student loans. This ultimately lead to the transformation of the Occupy Student Debt Campaign into Strike Debt, the sub-group which now healms the Rolling Jubilee.
“One phrase we started to use was 'Debt is the tie that binds the 99 percent'” says Yates. “There is something structural about the debt economy we're forced to go into in our lives. And this was when we flipped the idea of a debt strike to Strike Debt. What would it mean to strike debt, to attack debt from all these different angles and metaphorically cross it out?”
Occupy describes the vast swaths of America's debtors as “an invisible army of defaulters.” What if this invisible army were to come out of the shadows and become a political force? Out of this thought experiment came debt memes like “You are not a loan” and ultimately the Rolling Jubilee program.
Jubilee, as laid out in the Bible's book of Leviticus, was a time when debts were forgiven. Strike Debt appropriated the concept in a symbolic way and used it as the namesake for its first major project, in which a fund—financed by donations—buys debt.
“Right now with the Rolling Jubilee we're only buying bundles of charged-up medical debt,” says Yates. “It's very complicated to enter into the debt market.” The ironic twist to Rolling Jubilee's early genesis in the Occupy Student Debt Campaign is that student debt, since it is backed by the federal government, cannot be canceled. Medical debt, as a result, was arrived at as the ideal entry point. Free of debt, individuals and families could get back on their financial feet, and, in doing so, help the economy at large.
“We've already done our first stage of buying,” says Yates. “We used $5,000 to buy $100,000 worth of charged-up medical debt, and the mechanism definitely works. We're buying the debt for pennies on the dollar.”
“The banks make very little money on the deal,” Yates adds. “But then the collectors come along and they hound you for the full amount. On the off chance that they can force you to pay, they actually get the full loan back, whereas the originator of the loan doesn't get much at all. They're vultures that go around trying to squeeze money out of people.”
The process essentially works like this: A bank realizes that a person is not going to pay their loan back, and is losing money on the debt, so they sell the debt on secondary and tertiary markets for pennies on the dollar.
“We're basically doing the same thing that an organized debt buyer does on the secondary market,” says Thomas Gokey, one of Yates's team members on Strike Debt. “Banks are mandated by law to charge off defaulted debt after 180 days. It's kind of like a mini-bailout for banks that have created this bad debt. They're stuck with it on their balance sheets and the government gives them a way out, and they're actually able to write it off on their taxes.”
“The same Wall Street banks then actually lend money to debt buyers to buy that debt on the secondary market,” adds Thomas. “They sell it for pennies on the dollar, and trade it back and forth with each other.”
As Gokey describes the process, one of the buyers will eventually contact a third-party debt collector (though they may have their own debt collection agencies), who will then try to collect the full amount. “It's like other markets,” says Gokey. “You buy for 4 percent of the principal and try to sell it to somebody else for 5 percent of the principal. The debt collector will collect until they have 10 percent of the principal and then sell it off to someone else. It's a very lucrative industry. People are literally getting rich by keeping other people in debt.”
With Rolling Jubilee, Strike Debt enters the market like any other buyer. The difference is that after they buy the debt, they “obliterate” it. To do this Strike Debt had to find contacts within the industry who would be willing to sell the debt for 5 percent on the dollar. The Rolling Jubilee Fund, a non-profit 501(c)(4), then becomes the owner of people's debt. “These people's medical bills are a piece of their lives, a piece of their misery that we now own,” says Gokey. “And we're going to tell them, ‘You don't have to pay because you shouldn't have to pay.’ None of these debts should exist in the first place—they're illegitimate.”
Strike Debt generally views its Rolling Jubilee program as an experiment, but one that's working so far. There is also talk of entering into buying mortgage, small business, and private student loan debt, as well as targeting geographic locations for debt cancelation, but not in the immediate term. Strike Debt also offers The Debt Resistor's Operations Manual, available at StrikeDebt.org. It's a piece of collective research on how individuals and families can resist debt, whether it’s medical, credit card, or student debt. Add to this resource Strike Debt's teach-ins and assemblies on debt, and it becomes clear that the team is building a nationwide network of debt resistance affiliates in Detroit, Los Angeles, Philadelphia, and elsewhere.
Another type of lending has infuriated Occupy as a whole and the Strike Debt team in particular: the lending of money from banks like JP Morgan and Goldman Sachs to Hurricane Sandy victims, whether they are home or business owners.
“[The Sandy victims] are being offered a debt-financed recovery,” observes Yates. “Strike Debt wants to invoke something affirmative. What would it look like not to go into debt? One thing we've been witnessing—and this is not a formalized project—is people helping out their neighbors, friends, family, and, indeed, local businesses rebuild. They're donating time and labor. That's a form of mutual aid that is helping people from going into debt.”
To pursue a mutual aid vision, Strike Debt put on a telethon to raise awareness and funds for Rolling Jubilee last night at Le Poisson Rouge in New York City. It featured performances from musicians and comedians like Jeff Mangum, Lee Ranaldo, Janeane Garofalo, Tunde Adebimpe, and Guy Picciotto. The event sold out in no time and Rolling Jubilee easily eclipsed its initial goal of $50,000. It made $294,422 as of the writing of this article and climbing. That's peanuts in the debt market, but an impressive figure for such a novel idea.
Yates and others in the Occupy movement believe—and it's hard to disagree—that one can get a glimpse of what it would mean to help each other out by refusing the debt system. In place of predatory lending and disaster capitalism, Strike Debt envisions a world of mutual aid where assistance is not predicated on one's ability to pay back another for help.
“It's just the beginning,” says Yates. “We actually don't even know what's to come at this point, because the effort has exceeded our expectations in terms of media and the conversations we've been able to foment.”
Regardless of the monumental task before Strike Debt and its Rolling Jubilee program, the purchasing of anonymous bundles of debt expresses a not-so-radical notion: the random act of kindness.