Coronavirus: A One Time Payment of $1200 is Not Enough...Time To Cancel Debt

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Duane Townsend

Truthout - April 5, 2020

"We urgently need a Jubilee Year, a massive debt forgiveness like the one described by anthropologist David Graeber in his Debt: The First 5,000 Years***. He told*** Democracy Now that during social crises, it was traditional for debts to be forgiven. “In the ancient Middle East, often new kings would simply declare a clean slate and cancel all debts,” he said. “The Jubilee was a way of institutionalizing that.”

Silence fills New York City like ancient ruins. Stores are closed. Restaurants are closed. Behind shut doors, millions are panicking. Calls to suicide hotlines have spiked. My phone vibrates with constant anxious texts: “All my work shifts are canceled,” “Mom is in the hospital,” and “How can I pay rent?”

The U.S. is in free fall. The economy is collapsing and politicians of both parties, terrified of national disintegration, quickly passed a $2 trillion stimulus. Soon $1,200 payments will arrive. Unemployment will be extended. Corporations will be bailed out.

But. It. Is. Not. Enough. And when the stimulus check money runs dry, Americans will be plunged deeper into debt.

The giant stimulus exposed the cruelty of the United States allowing generations of people to be crushed by debt and poverty. The student loan debt of $1.6 trillion, the medical debt of $88 billion wrecked lives; it could have been paid off. When the coronavirus pandemic subsides, we cannot go back to business as usual. The mass solidarity growing in social distancing can develop into a call for a new socioeconomic system. That system could begin with abolishing debt in a Jubilee Year.

The Downward Debt Spiral Is Upon Us

The coronavirus is like a deadly pollen blown by coughs and sneezes, then accidentally rubbed into mouths or noses. Most of those who get it won’t know it. Maybe a mild fever. Maybe a dry cough. It is the old and those with weak immune systems who may die. The surge of sick has overwhelmed hospitals, and even if quarantine “flattens the curve,” an Imperial College Report said the U.S. will see 1.2 million deaths. In order to save lives, governments around the world shut down their economies.

“Right now, I have $100 in the bank,” said Kryshana De Herrera to the New York Post, “I hope to file [for unemployment]. I hope to get something.” The sudden stop of the economy exposed our fragility; a few missed checks and we sink into debt. Over 3 million Americans filed for unemployment in March, and in April it could be tens of millions. We may see 37 million jobs vanish, specifically low-wage work like waitressing and manual labor. An omen for the future is the long lines growing longer as people wait for free food at St. Bartholomew’s Church.

Even after the $1,200 checks are cashed, they won’t last long. Many will fall further into debt. The unpaid cell phone bills, car payments and rent deepen the financial hole that whole swaths of Americans are trapped in. In chasing the “American Dream,” generations of youth took out loans that total $1.6 trillion. Seeing no way to pay it off, some kill themselves in hopelessness. Many suffer in silence. After medical treatment, 137 million Americans face severe debt. It is the top reason for bankruptcy filing. It drove 11 million into poverty in 2015. The new poor joined the 93.6 million who scrape by on low incomes; the 38.1 million poor in 2018 that include 17 million in deep poverty. ...
Read full report at Truthout

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