by OLIVIA SCHWOB
Moral thinking about debt has fluctuated throughout U.S. history. Today’s calls for cancellation suggest it may be poised for transformation once again.
“I wanted to go to college to avoid being a third-generation janitor.”
The man on stage at this California town hall tells a familiar story. He’s now a beloved high school principal, but to finance his education, he took out a loan—$80,000. First, repayment according to plan—a strain, but not impossible. Then, a medical catastrophe; default; bankruptcy. Next, depression; a second default; a debt nearly twice the volume of the original loan. It became a family affair: the man’s parents, cosignatories on the original ticket to the American dream, now bear the consequences of its falling through. They may see their wages garnished, he reports, their social security under lien. Sympathy rises up, palpable, from the crowd.
Moral laws derive their power from a sense of natural order. But in moments of crisis, the morality and mathematics of debt have proven fungible.
The town hall is a presidential campaign event for Bernie Sanders. On June 24 Sanders announced his intention to cancel all $1.6 trillion of outstanding student loan debt, following Elizabeth Warren’s proposal for more limited cancellation in April; three months later he announced the same for medical debt—$81 billion in 2016, carried by an estimated one in six U.S. adults. Here there are even more gruesome facts behind the figures: single mothers, sick elders, sued for unpaid medical bills, in foreclosure for unpaid medical bills, arrested for unpaid medical bills.
Today the phrase “debtors’ prison” is often invoked to describe this experience of punitive indebtedness. Sometimes it is meant literally. Consider Melissa Welch-Latronica, a thirty-year-old single mother, who in February was wrenched from her minivan and thrown into a jail cell in Porter County, Illinois, over failure to pay an ambulance bill. Her story is unusual but not unique. A 2018 ACLU report documented a thousand cases of the “criminalization of private debt” and compiled a dozen of the most extreme stories. Most of the people featured ended up in jail because they failed to appear in court over unpaid debts, resulting in a warrant. And then there is the abominable, systemic cycle of incarceration and reincarceration of poor people—and particularly poor people of color—unable to pay fines and court fees.
What appears as common sense today could be deemed cruel and unusual tomorrow.
Still, the debtors’ prison as such—a prison specifically for the detention of those unable to pay their private debts—is long gone. The more common experience resembles that of the California principal: punitive collection takes the form of liens, garnishments, and foreclosures. For most, the story ends not in detention but in default and bankruptcy—possibly homelessness, or impossible choices between food, shelter, medicine, and payment.
The abolition of the debtors’ prison figures in a larger evolution of debt in America. Moral laws derive their power from a sense of natural order. But in moments of crisis, when insolvency has become the norm, the morality and mathematics of debt have proven fungible, susceptible to thoroughgoing change. We may look to this history for hints of how the moral calculus of debt might be poised once more for transformation—and for confirmation that what appears as common sense today could be deemed cruel and unusual tomorrow.
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