Politics Debt is a tool of oppression
Treasury warns of need to deal with national debt limit
WASHINGTON (AP) — The Treasury Department says it will employ measures to avoid an unprecedented default on the national debt this summer, but officials say those measures could be exhausted “much more quickly” than normal given the unusual circumstances of the global pandemic. Treasury officials on Wednesday urged Congress to pass either a new borrowing limit or another suspension of the debt before a July 31 deadline. The Treasury will continue to initiate the types of bookkeeping maneuvers it has used in the past to keep the government from breaching a level that would trigger a default on the massive national debt.
It has beenthat debt is often used as a tool of oppression. Across centuries and geographies, powerful elites have used debt not only as a means to extract profit, but also as a means to silence and coerce the working class.
When theof indigenous peoples in 1542, colonists circumvented that mandate by placing indigenous peoples under debt peonage to ensure that they would remain in a state of servitude. was used as a tool for all colonists to maintain power and steal land from indigenous communities across the Americas. Certainly indigenous peoples' debt peonage is an egregious example of how debt was the foundation of one form of oppression, but examples abound of how this plays out on a daily basis in our own lives.
Huge Treasury cash pile might delay debt limit ‘drop-dead’ date
The Treasury Department on Wednesday made its perennial plea to lawmakers for timely action to avoid hitting the nation’s borrowing cap, after which the agency would only be able to finance government operations out of cash on hand and whatever tax receipts come in each day. But Treasury is projecting that the cash balance will […] The post Huge Treasury cash pile might delay debt limit ‘drop-dead’ date appeared first on Roll Call.
Take, for example, student debt. The unreasonable cost of even formerly-public college requires loans of incapacitating principal and compounding interest. Although interest rates for federally held student debt are set by Congress, theyfrom 4.53 percent for undergraduate loans to 7.08 percent for parent, graduate or professional loans. These rates are shocking on their own, especially given that the for a 30-year fixed mortgage is 2.8 percent. Meanwhile, privately held student loan interest rates - ranging anywhere from - are not. In both cases, interest rates can compound over time, burying people further into debt that becomes increasingly impossible to ever repay, much like the debt peonage of the indigenous peoples in the 16th century. Fast forward to the present day, indigenous students who took out loans for their education are also dealing with the impact of and the trauma and financial effects of intergenerational - including indigenous land theft - and are again, disproportionately affected by these issues.
In Nevada, drivers can be arrested for unpaid tickets. Activists are fighting that.
Her $4,431 in traffic tickets ballooned to $20,000 in debt and the threat of arrest. The system is “money hungry," she said.Then the police began stopping her.
Or considermore broadly, now at a harrowing $14.6 trillion. Credit card interest rates are so under regulated by both federal and state governments that the credit card industry has driven people further into poverty by masquerading extractive debt as the democratization of credit. Current interest rates sit at , with one-third of borrowers paying . Those paying interest rates of 20 percent or higher are most often the least paid and most marginalized among us. Usurious interest rates - which could be better regulated or abolished entirely - compounded with poverty wages, form the perfect storm for keeping people overworked, exhausted and imprisoned in a largely inescapable cycle of debt and repayment.
A recentfound that people dealing with debt are more likely to face health issues brought on by stress, anxiety and depression. According to the same study, 64 percent of graduate students report that their debt inhibits them from performing at their best. Even more disturbing, with high principals has considered suicide. Debt is debilitating for the old and young alike, obstructing the young from the reasonably free development of their abilities and the old from the enjoyment of their "golden years."
Debt Collectors Spending Big to Block a Crackdown
By David Sirota Two months ago, debt collectors won a victory when congressional lawmakers allowed stimulus checks to be garnished by creditors and government agencies. Now, as the credit industry hits a jackpot during the pandemic, the leading lobby group for debt collectors has more than tripled the amount of cash it funnels to lawmakers as it campaigns to block upcoming Democratic legislation to protect millions of Americans from the repo man.At issue is a package of bills designed to restrict the $13 billion debt collection industry, as new Federal Reserve and Census Bureau reports show consumer and medical debt has skyrocketed during the pandemic.
Perhaps the most jaw-dropping and obvious example of debt being used as a tool of oppression in the United States is when the state of California cut public funding to the University of California higher education system and increased tuition rates all to quell ever-growing student uprisings in the 1960's. During a campaign speech in 1966, former President Ronald Reagan, then running for governor of California, admonished protestors of the Vietnam War and the newly enacted university fees by labeling them as
Not long after being elected governor of California, he oversaw the increasing privatization of the schooling system beginning in 1969 with the institution of tuition and acut in state funding, in addition to firing the president of the university system, who had been supporting the students' protests. Instituting tuition, cutting state funding and thereby shifting the burden of financing higher education to the individual, all served Reagan's goals of political disempowerment and social control. Moreover, as Black and brown students demanded access to public higher education in the wake of the civil rights, Black power and Chicanx movements of the 1960s and 1970s, debt-financed college hit their families particularly hard. To this day, student debt affects Black and brown families to their white counterparts.
Permanently suspend the debt limit
While at the New York Fed, I forecasted Treasury’s finances and advised officials on the debt limit. I know that Treasury and Fed officials have taken steps to prepare for terrorism, disasters, and more. But contingency planning is never foolproof. Could the New York Fed conduct Treasury auctions? Could market participants bid? Could their payments settle? It's impossible to be certain and should not be risked.Even if the debt limit is eventually re-suspended without alarm, the risk of default still harms our public credit.
In the last stimulus package, Congress recently had an opportunityto , in the United States, offsetting the need to use credit cards to purchase the necessities of life. When wages do not meet costs of living, we are forced to take on more debt to make ends meet. When our society demands that its citizens have a college degree in order to secure decent jobs but without the means to pay for it, we are forced to take out predatory loans. The failure to cancel student debt, the failure to reasonably regulate interest rates, and the failure to raise the minimum wage leads to only one conclusion: Those in power have something to gain by keeping us in debt. That something is our labor, our time, our wellbeing and our freedom.
Let's be clear. The cancellation of student debt, the reasonable regulation of interest rates, the raising of the minimum wage represents a stark choice. It is the choice between the oppressor and the oppressed. It is a choice between servitude and freedom. It is the choice between an exploitative society and a decent one.
Amy Czulada is a research analyst for a labor union and a member of the Debt Collective. Follow her and the organization on Twitter at @aczulada1 and @Strikedebt.
When Congress wastes money, let red states use it to pay down the national debt .
Democrats, when they control Congress, like to lay a peculiar spending trap. © Provided by Washington Examiner First, they propose unnecessary federal spending — some pipe-dream boondoggle or something redundant with existing federal, state, or private-sector spending. Then, after defeating Republicans in Congress, the Democrats wait to see what Republican governors do, knowing that they can pounce on those flyover states one way or another. If a red state takes the cash — hey, free money! — the chorus rains down cries of hypocrisy.