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Hey millennials! How’s it going? Sorry, what’s that?
Every moment of the last 30 or so years of your life has been pure agony? That’s okay!
Look, this episode is for you!
Gen-Z may only be on its way to having the most student loan debt, the fewest shorelines,
and the most ring-lights per capita. But for now, you’re the star of the show! You’re the
generation with the biggest cut of the $1.7 trillion dollars of student loan debt! Go you!
No wait, actually it’s Gen X. Nevermind, you’re not special.
In this episode we’re going to talk about that.
Not the not being special thing, student loan debt. But also, debt in general.
Debt occupies a pretty central role in the history of humanity. Today, you mostly hear about national
debt and how it's always getting bigger, or student loan debt and how it's always getting
bigger, or mortgage debt and how it's always getting bigger until it doesn’t so we all have a
bad time for a couple years and then we all forget and it starts always getting bigger again. Every
time we hear about debt, whether it be our own or someone else’s it's usually not because things are
going well. We generally don’t like debt, but it seems like we can’t get enough of it. Why is that?
When it comes to student loan debt, you’ll usually get a pretty simple answer.
College just keeps getting more expensive. Every year, costs go up and outpace inflation,
most dramatically at private schools. Higher costs and a student body that has been growing
for decades means that more people have to borrow more to afford higher education,
so debt grows. It’s not a particularly complicated or unique observation to point this out.
And while all of that is true, looking at student loan debt within the narrow scope of costs and
supply and demand detracts from the fact that student loan debt, at the end of the day,
is just that: debt. And debt has a much longer history than
colleges deciding to charge tuition at some point in the last 80 years.
So let’s actually look at debt. Looking at debt more generally, and the kind of role it has in
our neoliberal economy, helps us understand why student loan debt is probably not going to go away
any time soon. And although we can argue about the precedents and legal authority of student
loan forgiveness, and we absolutely should, anything to get loan forgiveness done is good,
we should also explore the fact that our inability to end student loan debt thus far
doesn’t just come from how difficult it is to convince Biden to do the right thing
but from the entire economic and political structure that maintains debt in place.
And the key factor keeping debt so present in our everyday lives is its intimate connection
to violence and to control. That is the thesis of two academics, anthropologist David Graeber
and sociologist/philosopher Maurizio Lazzarato in their two books Debt:
The First 5000 Years and Governing by Debt. Let’s start with Graeber.
There are a lot of insights in Graeber’s book but the one that’s most relevant to this video
is the idea of the “military-coinage-slavery complex.” Beyond being an absolute banger in
a sophomore socratic seminar, the MCSC as I’ll call it this one time only, refers to the way
that money and debt more generally became associated with violence, war, and force.
The story goes, according to Graeber, that the beginning of economic relationships
wasn’t bartering (I give you my yams, you give me your cow), instead the beginning of economics
was debt. I give you my yams and because I know you well enough and you’re not going anywhere,
we have an informal IOU system going so that when you get something that’s roughly worth
those sweet sweet yams I gave you you’ll just give it to me. Eventually we’ll just settle our debts.
These kinds of relationships demand a lot of trust to really work but they were able to
sustain really quite impressive economies and Graeber, alongside other anthropologists, is
pretty confident that this is how human societies actually exchanged for centuries, not through
discrete resource for resource transactions in barter, and not through coinage. So why do coins
ever appear and why does money, the way we know it now as paper with an ugly guy on it or numbers on
a computer screen, ever make any sense to have? Graeber’s answer is that there are some kinds
of debt that just aren’t as good with trust and IOUs alone, and one of the big ones is war debts.
When it’s time to do a war, you need to pay soldiers, and soldiers that walk far away
from home and have every single spear you’ve ever seen in your life don’t love IOUs. It’s easier to
give them little circles of metal and then find a way to make those circles of metal mean something
by making them a guarantee of value. In a way, those coins are a token of the debt you owe them.
But that’s not all, you also have to worry about the other guy’s soldiers.
What if to get his soldiers even shinier, RGB-lit spears that kill twice as well,
he took on a lot of debt? Now your spears are going to look really dumb, and when he takes over
your countryside, submits your people into eternal servitude through taxation, peonage, or slavery,
he’s going to be able to pay back his debts and you’re going to be world’s biggest loser.
So you better start minting coins and you better start accruing your own massive, massive debt,
and then indebting all the people you don’t like and conquered using that debt, forcing a good
chunk of them to mine the resources you need to make the coins you’re using to keep track of all
of it in the first place and taxing or enslaving the rest to produce the wealth your kingdom needs
to sustain itself. And the best part is that those people will absolutely take that deal.
It’s their money or their lives, you’re being a nice guy by giving them a choice.
For Graeber, then, the origin of money wasn’t to satisfy the awkwardness and inefficiencies
of a barter economy that probably never really existed; money, markets,
and the state all emerged in tandem, when debt needed to grow and became a matter of force.
Whether any of this happened or not is up for debate. Graeber has a trove of historical
records he’s pulling from, case studies from different parts of the world that replay this
trajectory almost to a T every single time, and the support of a lot of his fellow academics,
but it’s ultimately still a theory connecting dots that don’t have a well-documented straight
line between them. But that’s fine. The point of this book isn’t to give a definitive historical
account of debt, but to peel back the nature of debt and give us a little peek into how it works.
The two big conclusions are that, one, debt is one of the ways we take two formally equal people and
create a legitimated domination. Because you owe me in ways specifically quantified and backed up
by the state whose currency we are trading in, I have violence on my side and hold power over you.
Or, because I borrowed and you didn’t, I have the means to exert violence and you don’t.
The other ways in which we relate to one another fade into the background when money becomes the
way we think of, and actually use, debt. Two, for debt to grow violence needs to grow too. War
is just a good way for this to become the norm because you can always find people to justify
spending and borrowing more for war, using war to get more resources, putting those back into more
war and so on. It’s not as simple as the creditor is the bad guy and the debtor is the good guy,
it’s that in order for debt to grow in orders of magnitudes, you need violence.
And whoever is on the side capable of doing the violence will use that debt for their benefit.
This is a really complicated argument and an even harder one to summarize in a single
chapter of a 15 minute youtube video written in a week, so if you’re wondering what all
this is about, there’s links to Graeber's book, summaries, and critiques in the description.
For now let’s move on, because we started out with student loans and just spent like five
minutes on medieval wars and slavery. The reason to go so in depth on debt with David, though,
is because the connection between violence and debt, or in other words violence and the economy,
has persisted. On the international scale, it’s hard to distinguish the mythical debtor
and creditor states of old timey medieval Europe and Asia with the US’s current national debt,
a massive chunk of which is inherited from our involvement in past wars and the yearly
ritual of feeding, with nearly a trillion imaginary dollars we’ll definitely pay back,
the flames of the world’s largest military budget.
Similarly, the creation of debt traps across the developing world,
mainly in Africa and Latin America, so that our domestic markets and industries could
produce incredible wealth for the few with a stake, really resembles the colonial and
expansionary methods that made money and debt the currency of violence Graeber spends an exhausting
500 pages on. Debt has de facto become the logic of government.
Just using debt to fund wars isn’t enough, though. Because sometimes, when an expanding state and a
rapidly industrializing economy love each other very much, some people get the funny idea that
money can become more than a way to exchange things easily, they start to think that the
whole point of money is to make more of it. If only there were a name for that! Ah, who cares.
The kinds of markets that popped up during war times and gave meaning to
all those metal circles get repurposed. The relationship between creditors and debtors,
this is where Lazzarato’s book comes in by the way, starts to permeate all the different
spheres of society, not just trade and war. All of social life comes under the purview of debt.
Wanna buy a house? Take out a mortgage. Wanna buy a car? Here’s a 36-month, $0 dollars down loan.
Don’t want to buy or take out a loan? Just start renting, silly! Here’s a credit card,
it’s nothing like a loan at all, just don’t forget to pay it back every 30
days and depending on how well you’re able to do that maybe we can give renting a shot.
Want to go to school? Don’t worry, it’s so easy, just sign
right here. Every major milestone in life is put behind the same wall: debt.
Now, can you live without taking out any sort of loan? Of course. But if you aren’t from a wealthy
family, living without any kind of debt usually means little more than subsisting, saving for
years and years for anything that can materially improve your life. You can choose not to take
out student loans, a mortgage, not build a credit score, roll the dice on never needing to take out
money for a medical procedure, but you probably can’t do all of those and live a normal life.
What debt offers, then, is predatory inclusion. You can come play with the rest of us and have a
good time, but only at the cost of a constant need to make sure you pay the loan back.
Because you can’t not pay the loan back. Even if in real terms you’ve given way
more money back than you’ve ever taken out, so long as the bank says you have
to pay you’ll have to pay. You signed the contract after all. No one made you.
Since there’s really just one way to pay the loan back,
work and make money, that is precisely what you’ll do. And since the things that make you the most
money are usually the things that make someone else the most money, that’s where you’ll go.
So long as that loan isn’t paid back,
you get nothing. You get poverty, you get anguish, you get the constant threat looming over you
that you could be destitute tomorrow morning. You can get police officers that show up at your door.
There is a tremendous amount of violence that goes into maintaining and paying back debt.
The more unpayable these loans become, in the case of student loans either because
the price of college keeps growing or the jobs that graduates can find aren’t paid as well,
the more that violence grows and affects more people. With $1.7 trillion dollars
waiting to be collected, there’s plenty of violence to go around.
The magic of debt, in such an economy, is that it gives a lot of legitimacy to that violence.
Not paying back your debts is tangled up with so much moral judgment that it seems
impossible to think of an alternative to paying it all back or losing everything you have trying to.
You have to pay it back, after all, it’s the right thing to do. Governments not only know this fact,
but they also know that pinning all this violence and coercion on the back of debt
and on your presumed moral failure for not paying it back is a whole lot easier than
wielding that violence directly. It’s not the government making you work overtime,
you “decided” to take out those student loans. Debt has de facto become the logic of governance.
You might be wondering what this lens of analysis ultimately does. What’s the point of thinking
about this issue in this abstract, structural manner? The point of understanding the role of
debt as a form of predatory inclusion, an entrance into a system of exploitation tangled up with and
backed up by an extensive network of structural violence, allows us to give up on the wrong idea
that borrowers are just one financial literacy class away from making “good” debt decisions.
Really understanding debt means understanding that this isn’t a case of people failing in a
fair system and so why should we ever do anything to help them, this is people routinely denied a
normal life unless they purposefully follow the path that makes them an excellent source
of compulsory labor. The fact that they can “fail” on that path just contributes more to its success.
So, “why is student loan debt so hard to forgive?” Because debt is too good to give up.
As one final parting thought, it is interesting to think about what might happen if the majority
of indebted Americans simply refused to pay back their absurd debt. Would
we see the capitalist regime arrest and imprison millions of Americans?
That seems hard to believe. After all, these are just made up numbers on a spreadsheet somewhere.
There is literally nothing stopping the president from canceling student debt,
or most forms of debt for that matter, with the stroke of a pen. As someone who has managed to
pay off my own student loans, it is simply unconscionable that anyone else should ever
have to suffer that same punishment. One way or another, the American debt system needs to go.
If you want to learn more about that or any of the topics discussed in this video, including
some of the more technical ways we can end student loan debt, those sources are in the description.
I mentioned at the beginning of this video that this kind of content is made possible
by my patrons on patreon. Thanks to viewers like you, I’ve not only been able to keep up my weekly
videos, but also start a new podcast with two other great YouTubers. Hakim, Yugopnik, and I
started The Deprogram because there was a real lack of a truly international socialist podcast,
and what better way to fix that than having three socialists from three different parts
of the world come together to discuss our unique perspectives on important topics.
That and it’s just fun to hang out and talk commie stuff for an hour or so each week.
As of today, we’ve released 11 episodes, so you’ll have plenty of fun topics to choose from,
like how to win people over to the left, the failures of past socialist experiments,
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