New Year Debt Jubilee

The turn of a new year can often feel significant, but this one feels especially so. The vaccines for covid-19 are starting to be distributed now, and with the incoming Biden administration taking over from the catastrophically incompetent President Trump, many have good reason to feel optimistic about 2021. But covid-19 did not simply reveal the vulnerability of this country’s healthcare and pandemic response system; it also exposed the economic fragility of so many working Americans’ living situations. Despite moratoriums and ban orders, people are continuing to lose homes at unprecedented rates. And even for those who do not suffer eviction, most are still forced to pay rent even as their working hours have been reduced. Many are falling further into debt just to survive. As important as the vaccine will be in the months ahead, it will not solve the debt and homelessness crises that this year have exacerbated. But looking forward to the turn of this new year, and ahead to the inauguration of a new President, perhaps we can take some lessons from the ancient past to give us inspiration on how to recover from the immense trauma our society has recently experienced.

In the ancient Sumerian and Babylonian kingdoms, debt seems to have been invented before writing. According to anthropologist David Graeber, the concept of debt and its twin, interest-bearing loans, was likely invented by government administrators to incentivize local traders and still receive a cut. But the concept quickly jumped from commercial debts to consumer or individual debts. By around 2400 BCE, it was apparently already common practice for peasant families suffering bad harvests to take advance loans from wealthy merchants or officials, having their goods, lands, and even family members taken as collateral. People taken in this way were debt-peons: a kind of enslavement in which one is forced to work for the “lender” (merchant/official) until the “borrower” (peasant) can redeem the person in peonage with the debt owed -- but of course, this became more difficult to do as more the borrower’s assets would be seized and family broken apart. 

To make matters worse, this was not simply an individual or family-level problem, but one that threatened to rip society apart completely. Bad harvests usually result from a regional issue like drought or flooding. Consequently, every bad harvest meant that large portions of the peasant population would be thrown into complete crisis. From Graeber’s Debt: The First 5000 Years: “Before long, lands lay abandoned as indebted farmers fled their homes for fear of repossession and joined semi-nomadic bands on the desert fringes of urban civilization” (Graeber 65). Therefore, to avoid the periodic threat of absolute societal collapse, it became customary for new leaders to enact “clean slate” general amnesty to all outstanding consumer debts upon their ascensions, as well as periodically throughout their reigns. Indeed, redemption from debt-peonage appears to be the first recorded use of the word “freedom” at all.

The concept of “clean slate” debt amnesty was not unique to the Sumerian and Babylonian civilizations. In the Book of Nehemiah in the Hebrew Bible, a similar debt-bondage crisis gripped Judaea. Families were broken apart, with some children going to serve in the households of wealthy neighbors, while others being sold into slavery abroad. In 444 BCE, a Babylonian-raised Jewish governor instated policies of debt forgiveness in Judaea, the most famous of which was the Law of Jubilee: “in the Sabbath year” (i.e. after seven years) all debts would be cancelled and all those in debt-peonage would be released. This theme of liberation from bondage echoes through much of ancient Jewish history, and was taken even further in Christian theology with the redemption of Christ: “forgive us our debts, as we forgive our debtors.” 

In ancient Greek history, Solon “the Lawgiver” is viewed as an especially important early reformer who laid the foundation for Athenian democracy. By his time, the debt-peonage crisis had spread to Greece, and Athenian society was terribly divided by the few wealthy creditors and the masses of farmers forced to sell themselves and their family members to them. Seeing this primarily as a moral problem of society originating in unrestrained greed, Solon included in his famous reforms the policy of seisachtheia, the “shaking off of burdens.” All debt-peons were returned home, all current debt contracts were cancelled, and future debt slavery was forbidden. In the popular imagination, if not in fact, Solon’s reforms ushered in a golden age of Athenian civility, sophistication, and heroism which ultimately came to fend off the much more powerful Persian Empire. 

Perhaps to many of us today, the concept of debt forgiveness sounds absurd, even unethical. Don’t those people owe that money though? If they couldn’t pay it back, then maybe they shouldn’t have gotten the loan in the first place. Don’t their creditors have a right to get back what they had agreed upon? And yet, that line of thought only obscures the unjust reasons for having acquired that debt in the first place. Yet, for hundreds of years and across diverse peoples, the practice of periodically canceling all outstanding debt was commonplace, popular, and to a large degree, the practical and necessary policy to avoid massive social crises. In more modern times, the very first community land trust in the United States, started by Black civil rights activists as a safe haven for Black farmers, was foreclosed upon after years of being denied the same government debt forgiveness their White neighbors received. Americans are saddled with enormous debts, mostly from credit cards, auto loans, and student loans. Due to the overwhelming personal debt that so many Americans face today, it is not uncommon now for a college-graduate to return home to their parents for a few years. Many of those with the best training and education are financially unable to create, innovate, and enact the plans they have made. Countless couples have put off having children indefinitely for fear of an uncertain future. And now, despite ostensible legal protections preventing this very thing from happening, record numbers of people have lost their homes this year through no fault of their own. This is our modern consumer debt crisis. No vaccine will cure this cycle of debt; no vaccine will prevent evictions. Recovery from covid-19 will take so much more than mass immunization. This was a landmark year. A dramatic change in leadership is just a few weeks away. The time feels right to wipe the slate clean. It’s time to bring back the debt jubilee.

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David Graeber was a cultural anthropologist, one of the primary theorists of the Occupy Wall Street Movement, and the thinker behind many recent analyses of modern life, such as the significance of political direct action, the meaning of “bullshit jobs,” and, of course, debt. Something of a radical academic, his writing style is at once familiar and approachable while also conceptually challenging. David Graeber suddenly passed away this year at the age of 59. 

If you would like to learn more about debt-cancellation and the modern consumer debt crisis, check out Rolling Jubilee, a project of Strike Debt which formed out of the Occupy Wall Street movement (http://rollingjubilee.org/).

The South-Eastern Connecticut Community Land Trust (SECT CLT) is a nonprofit dedicated to establishing permanent affordable housing using a unique and equitable system first pioneered in the United States by civil rights activists. With a recent change in staff, SECT CLT is getting ready to renew a push to continue its mission in 2021 (https://sectclt.org/). 

If you are interested in assisting local community members who have recently lost their homes in the Norwich area, a new group has formed for that purpose. The first project is to create a directory of services and essential information, especially for those who are newly unhoused and thus might not know the systems in place to help them. Visit the Norwich Homeless Resource Volunteers group page to learn more (https://www.facebook.com/groups/658687648159825)


Sources & Further Reading:

Amadeo, Kimberley. “Current US Consumer Debt.” The Balance, updated 28 December 2020. https://www.thebalance.com/consumer-debt-statistics-causes-and-impact-3305704 

Graeber, David. Debt: The First 5000 Years. Melville House, 2011. 

Hudson, Michael. “A debt jubilee is the only way to avoid a depression.” The Washington Post, 21 March 2020. https://www.washingtonpost.com/opinions/2020/03/21/debt-jubilee-is-only-way-avoid-depression/ 

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