One of my favorite things in the world is a simple solution to a complex and seemingly impossible problem. I love it when one person sees a population suffering from generation upon generation of debilitating and painful goiter and eradicates the problem entirely simply by introducing iodized salt into their diet. Or when faced with needless preventable deaths due to an epidemic of malaria in Africa, people simply introduce mosquito nets saving thousands upon thousands of lives. Problems which have seemed impossible and overwhelming for so long can sometimes be solved with just one simple idea. This is why I love Strike Debt and Rolling Jubilee.
In the Fall of 2011, Occupy Wall Street took the nation by storm when they set up an encampment occupying Zuccotti Park in the heart of lower Manhattan's financial district drawing attention to the crimes that had been committed on Wall Street which led to the collapse of the nation's economy in 2008 ushering in the worst economic down turn since the Great Depression. With their protests, marches, occupations and outreach, OWS did more to shine a light on the root causes of our financial strife than any reporter, expert, politician, or economist did in the previous four years. They caught for a brief period of time the imagination, desperation, and outrage of much of the American public.
But, American sensibilities and attention spans being what they are, the occupiers were eventually evicted from what had become known as Freedom Park and their cause seemed to have died out. The main criticism of OWS was their amorphous organization, their lack of any stated goals or plans to achieve such goals. It seemed that OWS would go down as a blip and footnote to the financial scandals which brought about the financial bailout and recession of the late naughts and early teens of the 21st Century.
However, what OWS accomplished during their encampment and went unreported by the media who never could understand the movement, was the sharing of ideas of passionate and committed individuals who had the energy and know-how to put these plans into action. One of those plans grew into the group Strike Debt and their movement Rolling Jubilee.
Strike Debt saw the staggering problem of consumer debt and decided to use the exact same practices which lead to and perpetuate that system of debt to eliminate the debt entirely. Here's how debt works in a nutshell. A creditor whether it be a bank, credit card company, or institution such as a hospital lends a consumer debt which the consumer uses to purchase goods or services with a promise to pay that debt back over a period of time. The creditor makes money on the transaction by charging and collecting interest on the debt. However, many creditors will sell their right to collect the debts owed to them for a variety of reasons, usually because the consumer has defaulted on the debt and the likelihood of collecting further payment has diminished to the point where there is no longer any profit in the transaction for the original creditor.
What happens at this point is when things usually go horribly badly for the consumer. The original creditor will now sell the debt to the highest bidder so that they can realize some return on their remaining investment. Usually these are purchased by collection agencies. Collection agencies are the bottom feeders of the financial world. They buy bad debts for pennies on the dollar and then do absolutely everything they can get away with in order to collect on that debt. Anyone who, like me at one point in my life, has ever had to deal with these poor excuses for humanity, knows the type of abuse and stress that having a collection agency hound you can involve.
When I was in civil practice, I used to take great pleasure in throwing every conceivable legal roadblock up in front of these agencies to cost them as much money as I possibly could in order to collect their money. When possible, I took even greater pleasure in making life incredibly uncomfortable for any of these agencies I could prove engaged in illegal debt collection practices. My absolute favorite involved one insipid agency which had purchased a debt which was more than a decade old and was for all intents and purposes uncollectable. What they did to get around the impediment of the statute of limitations was to send a new credit card offer to the drug addled and mentally ill debtor. A new credit card offer for someone whose credit was destroyed for years would be seen as a gift from God for any such individual. However, what transferring the old uncollectable debt to the new credit card would make it collectable again. Fortunately, the debtors elderly parents intercepted the offer and brought it to me. After a very tersely worded letter offering to forego suing the pants off of the collection firm for illegally trying to collect an uncollectable debt if they would forego ever contacting my client again, they discharged the debt from their books.
But, the genius of Strike Debt is that they looked at the process by which these scum sucking maggots known as collection agencies buy the debts and realized that they could do the exact same thing. Strike Debt formed a 501(c)(4) corporation which serves essentially as a debt collection agency and bids against other debt collection agencies in auctions of distressed consumer debt. Because these debts are worthless to the original holders of the debt, they can be bought for substantially less than what is owed. In fact, they found that for every $1 paid, as much as $20 of debt could be purchased.
Once the debt was purchased, however, unlike the circling carcass gorging vultures known as collection agencies, instead of trying to collect on the debt, Strike Debt would simply extinguish the debt. That's right, the debt would simply no longer exist. In the financial world, this is known as "forgiving" debt. Strike Debt doesn't use this term because in their view, rightly, the debtor has nothing to forgive as they haven't done anything wrong.
This became known to some as the People's Bailout and with good reason. What Strike Debt had done was similar to what the government and the Federal Reserve had done to wipe out the toxic debt held by the Too Big to Fail financial institutions and apply it instead to ordinary debtors. What's even more ingenious is that they used the exact process which had shackled millions of Americans in a spiral of debt and financial ruin, to subvert the system and free those same Americans from those shackles.
But, Strike Debt doesn't stop there. There is also the Rolling Jubilee, a movement which brings this process to the next level and has the potential for permanent debt relief for America and across the world. The term "jubilee" refers to the year in the Biblical Dueteronomic Code in which land and property were returned to its original owner and slaves were freed. Because Strike Debt is purchasing debt and then extinguishing it, thereby returning it to its owner, it is in some fashion acting similarly to this traditional Hebrew law. The term Rolling Jubilee refers to the movement which encourages those receiving a benefit from this purchase and extinguishing of debt to then pass it on and contribute to the purchasing and extinguishing of debt of others.
For example, if you have a medical debt of $40,000 for an operation that you had to have but have no means to pay for it and have defaulted on your debt, your debt will most likely be sold and purchased by a debt collection agency in a debt auction. If you are fortunate enough to have your debt purchased by Strike Debt (they have no way of choosing which debts or debtors they purchase and extinguish, they are simply purchasing a block of debt) you would be notified of this fact. Rolling Jubilee is based on the hope that those whose debts have been extinguished will then use the money that has been freed up to donate back to Strike Debt in order to allow them to purchase and extinguish more debt.
This is what makes Strike Debt and Rolling Jubilee a community building, community empowering self-help organization rather than a charity. If this movement works, it could seriously change the nation's entire economic power structure which causes and perpetuates the economic inequality we see today. So far they have raised over $7 million. With this they can potentially buy $140 million in debt. If those whose debt is eliminated donate just 10% of what was extinguished back, with that $14 million, Strike Debt could purchase $280 million in debt, and so on, and so on.
Right now, this is an infinitesimal amount when looking at the staggering level of consumer debt currently owed in this nation, which the Federal Reserve estimates stands at approximately $2.4 Trillion. However, this movement can have incredible influence if it grows and reaches its potential. The affects of this will be felt throughout our entire financial and political structure. This has the potential to literally change our world.
Not bad for a bunch of dirty, unwashed hippies hanging out in a New York park banging drums, huh? Simple ideas can have incredible effects. It makes me excited to see what other ideas have been planted in the garden of Zuccotti Park that are just waiting to emerge and blossom.
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