Category Archives: finance

Anti-Debt Struggles, Occupy and the State: A reply to Maisano

In a new Jacobin article, Chris Maisano takes issue with the way Occupy is supposedly approaching the issue of consumer debt. He writes:

As Doug Henwood pointed out in his critique of Strike Debt’s Rolling Jubilee initiative, debt is not a system. It’s a symptom of the restructuring of the U.S. state and its priorities away from social provision toward capital accumulation, both at a national and a global scale. If the scourge of student debt is to be confronted in any kind of meaningful way, Occupy and its offshoots will need to struggle on a terrain that they have assiduously avoided – that of politics, public policy, and the state.

True, debt is not an independent system, but rather a critical component of the neoliberal accumulation regime. And this has implications for political strategies. But like many critiques of the Occupy movement, Maisano slips into simple mischaracterizations. Yes, Occupy has expressed its desire to be an autonomous movement. But in practice, the movement is less ideological.

Look, for example, at the Principles of the Occupy Student Debt Campaign (OSDC), one of the group’s behind Strike Debt!. It explicitly calls for policy changes that Maisano might agree with: Tuition-Free Public Higher Education, Zero-Interest Student Loans, Private Colleges Must Open Their Books, Student Debt Written Off In The Spirit of Jubilee.

Maisano’s alternate suggestion, that Occupy should focus on reforming bankruptcy laws to “make it easier for student debtors to file for bankruptcy and to win at least a partial discharge of their debt” is nothing qualitatively different than the demands of the OSDC. Both are demands on the state; both seek policy reform. While OSDC’s demands are further going than that called for by Maisano (and Henwood), I imagine Strike Debt! and other Occupy activists might applaud such an initiative, and would welcome its inclusion in their own literature and campaign.

The only major difference then, between the position of OSDC/Strike Debt! on the one hand, and Maisano, on the other, is of political strategy. I don’t think Occupy and Maisano necessarily disagree with the need to “struggle on [the] terrain […] of politics, public policy, and the state”. Or rather, the difference has more to do with how and in what form this struggle ought to advance.

Here it is true that OSDC and Strike Debt! are vague; they are inspired by the anarchist movement’s desire to fight at a distance from the state, rather than through direct reform strategies, but this doesn’t mean they want to leave politics and the state alone, and merely want to build a harmonious new society in the interstices. In fact, OSDC says this explicitly that it is a matter of the form of struggle:

The pathway to this outcome [ie, towards free public education, zero-interest student loans, fiscal transparency, and cancellation of student debt] does not lie in futile pleas for economic reform, but through a political movement, driven by self-empowerment and direct action on the part of debtors.

Yet while many criticize the anarchist influenced form of struggle that OSDC and Strike Debt! take, most Occupy participants would probably agree with Maisano on the value of the Quebec student movement’s victory for struggles in the U.S. Yet, theirs was a clear and limited struggle against a particular, and harsh policy reform. The Quebec movement did not emerge with the notion of using politics and the state to advance class struggles. It was a direct response to an example of political class struggle from above, just as Occupy‘s precursor in the Wisconsin uprising of early 2011 was. The situation of debt and student debt in the U.S. is however clearly different, trends which have developed over the course of three decades. In this context, you are going to have to build a base for long-term struggle, and can not simply chip away at the debt-based aspects of this accumulation regime.

Maisano’s problematic might therefore be reframed, with the help of OSDC’s emphasis on direct action: How can forms of self-empowerment and direct action be developed as both forms of struggle towards the achievement of political reforms, and as new robust forms of mutual aid and self-governance in everyday life?

A closer look at the Occupy movement reveals that it is not dominated by an anarchist purity of purely outside struggles, but seeks deep transformations of both civil and political society. Instead of false portrayals and false dichotomies, this question is on the horizon.

Occupy, Debt, Finance, and Class Struggle

This is the text of a talk I gave in October 2012, “Occupy, Debt, Finance, and Class Struggle”.

I was asked to talk about Occupy, the crisis and class struggle. I work on the topic of the Occupy movement as a form of social contestation within the context of the neoliberal crisis. In this talk I want to hone in on the movement’s recent organizing projects around debt, and to connect them to theory about finance and the financial crisis. The intention of this is to clarify some questions about political strategy in the current conjuncture. This is, as you will see, somewhat experimental, so I look forward to the discussion.

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Reclamations Journal: Circulation and the New University

During the 1990s, a rationalization of the workplace in American universities occurred, a process that critics described with terms like privatization, neoliberalization, financialization, and commericalization. By the late 1990s, however, the leading edge of this restructuring shifted from the university’s rationalization to its integration as a site of accumulation and investment in the circulatory system of capital. Notably, however, our discourse hasn’t changed, and today we continue to talk as if all that was happening in the university was the same process of rationalization. This is not to say that words like neoliberalization or privatization have nothing to tell us, but rather that, because the majority of gains were received from these changes by the end of the 90s, these words no longer capture the leading edge of change in universities today. [….] What we want to do here is to briefly outline the new insertion of the university into the reproductive circuits of capitalism.

The university is no longer primarily a site of production (of a national labor force or national culture) as it was in the 1970s and 80s, but has become primarily a site of capital investment and accumulation.

There are two key mechanisms through which the university has been coupled into circulation—or, to be technical, coupled into the circulation of both productive capital and money capital. The first is the cycle of wealth transfer that moves federal dollars directly into corporate and bank coffers. [….]

The second mechanism, the emergence in the post-crisis context of capital over-accumulation—that is, a surplus of capital with no profitable investment outlet—has helped to transform universities into privileged sites of capital investment. Due to market conditions and credit availability, universities have been able to increase tuition without limit (for example, at the University of Michigan, tuition has gone up 297% since 1990), which in turn has driven up their credit ratings and made borrowing cheap for them.[6] As a result, banks, hedge funds, and institutional investors have begun investing heavily in and through universities, buying up construction and other bonds as well as student loans. In this way, some of the money that once was put into the faltering credit and mortgage markets has found a new home in the student loan and secondary student loan markets.

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Labor’s Location and Power in Finance

From Bryan and Rafferty, “Deriving Capital’s (and Labour’s) Future” in Socialist Register 2011: 215-218.

“[L]abour itself is being incorporated into capital in new ways, not just via workplace discipline but via the process of securitization. Some have sensed this new development, but have cast it in terms of growing household debt, with the appropriation of interest payments out of labour’s income being treated as a further ‘take’ on surplus value. But this is not the critical aspect of the development, and it is certainly not new…. The critical development is the recasting of labour as the provider of income streams for securities, to facilitate asset diversification and the search for yield. The rapid growth of mortgage, auto, credit card and student loans, as well as contracts on telephones, energy and healthcare, all provide the raw materials on which securities are built to meet the demands of global investors. Continue reading

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