Debt! How Human Beings Become Enslaved to Powerful Interests
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Debt is ubiquitous. It is also insidious, since debt imposes a power relationship (amplified by the state) between borrower and creditor. We are diminished by debt. The ongoing financial crisis has revealed the degree to which most Americans (myself included, alas) are seriously indebted — and being so, we are more controlled than controlling.
David Graeber — of Occupy Wall Street fame — has written, in Debt: The First 5,000 Years, a grand intellectual project and a call for action. He investigates debt across time and across cultures and finds it to be a primary institution, preceding exchange, money and any notion of “the economy.” Debt is a building block for ever more elaborate social organization, because it creates fluid structures of subordination. Though in principle the sum of all debts should equal the sum of all credits, in practice debtors are many and creditors few. Today, there is growing concern about income inequality in America — but it is wealth inequality that captures the relation of debtors and creditors.
Debt is central to most Americans' life experience. We obtain housing, education, transport and medical services through our access to credit — and as such we spend most of our lives deeply indebted. How dispiriting debt is; it gnaws at us, this non-dischargeable burden.
But most Americans begin life woefully undercapitalized for the life we lead — we are unable to purchase homes, raise families, provide for medical care or retirement, or even buy cars and refrigerators, from our own resources. Rather, we stealthily borrow to enjoy “basic” requirements, taking comfort, I suppose, in the notion that everyone does it. And Americans are, of course, rich. The life cycle of most Americans involves getting a job and then using one’s anticipated future income to access credit, which is then used for obtaining life's necessities (and then some). The resulting debt persists thereafter; we no longer celebrate paying off mortgages, we refinance and extend up through the hour of our death.
The economy thrives when we take on debt. Indeed, assuming our fair share of debt can be seen as an American duty. Without the fuel of debt (that is, without access to credit) the American economy can and will collapse. The ongoing economic malaise results in part from the deleveraging of American households, depressing our consumption. Consumer debt drives the American economy — America is built on debt.
Yet we can imagine a better life. The root of our notion of freedom (echoed, as Graeber points out, in religious imagery) is freedom from debt — and if this is so, then by no means is America the land of the free.
Graeber's book is hardly a call for the renunciation of personal debt. He does, however, applaud his late brother's success in avoiding debt during his brief American life, and elsewhere boasts of having paid off his student loans — though he would not judge another who failed to do so.
Graeber asks us, instead, to consider the role debt plays in defining contemporary social relations. Our creditors are anonymous: the holders of our mortgages are generally hidden from our view and their nasty enforcement tasks (dunning phone calls at dinner-time, wage garnishments and the like) are delegated to agents. This practice is cunning. While we do not encounter our faceless creditors in the street (and so avoid whatever shamefacedness that follows), we are tied to our quietly desperate lives by the specter of our debts. We the respectable cannot (even in our imaginations) walk away from our jobs and communities, because we cannot run from debt. Debt ties us, debt grounds us. From the perspective of social order, this may not be a bad thing; from that of freedom and liberty and justice for all, perhaps less so.