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Title: Our Depraved Future of Debt Slavery- Parts I & II
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URL Source: http://www.marketoracle.co.uk/Article33333.html
Published: Feb 27, 2012
Author: Ashvin Pandurangi
Post Date: 2012-02-27 14:46:38 by Capitalist Eric
Keywords: None
Views: 245
PART 1: It is almost surprising that the concept of slavery is very foreign to those living in the developed world, especially the U.S., since it was extensively practiced as recently as 70 years ago. What’s more disturbing about this ignorance is the fact that the system of post-Civil War slavery in the U.S. was not so different than the systems of slavery many Americans and Europeans will be experiencing in upcoming years. Indeed, I’m sure many people will probably take offense to such a comparison even being made, as they feel it demeans the atrocious acts committed in the past. I would argue, however, that we demean history by failing to understand it and learn from it. Many people refer to debt slavery when referencing current policies of the West, especially in Greece right now where the concept has become very real, but they perhaps still under-estimate how bad it can get. These systems of slavery are primarily borne out of deeply-rooted economic structures which foster high levels of dependency, greed and malice by those with unchecked levels of political power. In the late 19th and early 20th centuries, these powerful groups consisted of wealthy Southern agricultural and industrial elites. In his book “Slavery By Another Name” [documentary here], Douglas A. Blackmon documents how very few of the 4 million slaves that existed at the end of the Civil War were actually allowed to realize their freedom until decades later. As the white middle class of the South grew from 1870-1950 (with the exception of some years encompassing the Great Depression), due in no small part to the success of Southern industry, the blacks were kept in their chains through various mechanisms, such as convict leasing and debt peonage, over and above the outright discrimination and violence that they also suffered. The Southern convict leasing systems were a means of extending slavery for African Americans well past the Civil War, Emancipation Proclamation and the 13th and 14th amendments. Southern laws were crafted to guarantee that the now “free” African Americans would be incarcerated at much higher rates than whites. Blacks were picked up, hauled off and locked up for ridiculous crimes such as “vagrancy” (being homless or unemployed), loitering in public, speaking loudly in the company of white women or selling farm products after dark, to name only a few. Once these people were matriculated into the prison system, they had effectively become slave laborers again. The state allowed convicts to be leased out to private corporations for little more than a pittance - convict laborers were rented out at monthly rates that represented a 50-80% discount over the wages paid to free laborers. They were forced to work in some of the most dangerous environments at the time, laying railroad and mining coal, and a significant percentage developed severe illness/injuries and died in the course of such work. It is estimated that at least 9000 convict workers were murdered or died of “natural causes” over a few decades under this system alone. As one historian described it, the system was “brutal in a social sense, but fiendishly rational in an economical sense”. That is really the crux of the matter – the Southern plantation economy, as well as newly developing transport industries, was very dependent on extremely low-cost labor, in both an economic and psychological sense. Convict leasing proved to be even more profitable than slavery in many cases, since there was really no need to keep the workers healthy and alive for very long. Many African Americans were also placed into peonage or “debt servitude”, despite the fact that the federal government made it illegal after the accession of New Mexico into the U.S and the Civil War. These blacks were typically accused of falsely owing money or trivial sums, given sham trials and quickly sold off by the courts into a privatized system of debt slavery. The peonage contracts contained horrifying terms, allowing the employer to trade, confine, whip and beat workers as long as the debt was deemed unpaid, which could practically last forever. It was established that some of the wealthiest Alabama farmers had their own “justices of the peace” who would fraudulently try and convict blacks on charges of unpaid debts. The federal government launched an investigation into these practices, and an Alabama court convicted a few of the farmers of public bribes and illegal debt peonage. However, they were given minimum sentences and then pardoned by President Theodore Roosevelt shortly after. Despite the investigation and state court ruling, this practiced continued in many Southern states for years after. Another less explicit form of forced labor was sharecropping, in which the poor black farmers theoretically received a percentage of the profits from sale of a certain crop grown by them. However, these workers were forced to take out relatively large loans just to meet daily expenses and these loans sometimes carried interest rates upwards of 50% or 60%. At the end of day, many of these sharecroppers were treated just like slaves and received very little compensation for their work, besides the basic necessities of life. It is probably quite obvious to most readers how all of these mechanisms of forced labor and debt slavery are still being practiced today and are only getting worse. The prison-industrial complex in the U.S. has become more extensive than ever, as the list of petty crimes for which people are incarcerated has grown longer (but still does not include corporate/banking fraud or political corruption at the highest levels). There are, of course, many serious offenders in the system, but the point is that it is becoming ever-easier for our modern “slavemasters” to blur the line. Foremost among the petty punishment is for drug use and addiction, which, as Dr. Gabor Mate has insightfully explained (h/t El Gallinazo), are conditions that primarily develop from environmental influences at an early age (as opposed to genetics). The socioeconomic structures and growing wealth inequality embedded in our society, especially at this time of economic depression, places enormous amounts of stress on its poorest members and can literally re-wire their brains in ways that eventually lead them down a path of self-defeating drug addiction and associated behaviors. U.S. Department of Justice – Prisoners in 2010 In 2009, the most recent data available, 53% of state prison inmates were serving time for violent offenses, 19% for property, 18% for drug, and 9% for public order or other offenses. About half (51%) of federal inmates in 2010 were serving time for drug offenses, 35% for public-order offenses (largely weapons and immigration), and less than 10% each for violent and property offenses. Instead of working to change our fundamental economic structures and mitigate the stress triggers, our society has sought to “punish” and “rehabilitate” these people by placing them in environments of unprecedented fear and stress, such as prison. Given the amount of money and resources poured into the “war on drugs” in the U.S. over decades, there is never any shortage of people that can be easily sucked into this prison complex and then become a part of an enslaved labor force. Maintaining prisons and their populations has become very costly to taxpayers, but that’s the whole point. The growing and increasingly outsourced U.S. prison workforce is frankly a wet dream for private corporations, just like the convict leasing system was for Southern corporate elites. They have already been stripped of almost all their freedoms through the system of incarceration, and can be forced to work for a very low wages in poor working conditions, under very strict levels of order and discipline. This pool of enslaved labor exploded since the early 1970s, as shown above, and therefore has already been thoroughly exploited by private corporations for many years. On top of that, the entire business of building and running both state and federal prisons has been in the process of being outsourced to private corporations as governments come under fiscal pressure. These private interests now have even more incentive to help state and federal governments maintain the currently elevated number of prisoners. In recent years, the annual percentage increase in prisoners has dropped off, but that’s a “problem” which can be easily solved by the powers that be. In addition to inevitable increases in crime rates associated with economic depression, the list of jailable offenses can simply be expanded along with their associated sentences, like they were for blacks after "Reconstruction". Right now, we have millions of people up to their eyeballs in housing and consumer debts, paying upwards of 20% interest on their credit cards and “payday loans”. It is an entrenched system that forces people to work longer hours for fewer benefits and wages over time. But, even as such, the titans of industry and owners of concentrated financial wealth are finding it difficult to squeeze enough blood from the stones. So what’s to stop the corporate elites and their political/judicial flacks from manufacturing debts out of thin air and exacting excessive wealth/punishment from those with debts owed? In the follow up to this piece, we will look at the other ways in which the era of global indebtedness today has come to resemble that of the post-Civil War enslavement of African-Americans, except at a much larger scale. Is it really so unimaginable that an average lower or middle class American family, of all different races (although the racially-divided inequality of the past is still with us in many real ways), could find themselves in literal contracts of debt peonage, despite the technical “illegality” of such contracts at this time? What is the likelihood that laws will be re-written and/or ignored and how easy is it for the line between financial harassment/abuse and physical enslavement to simply disappear? Part 2: There have been many forms of “debt slavery” throughout history, and almost everyone is chained to the oppressive financial, corporatist system now in one way or another. Although, this fact has not even remotely sunk in for millions of people who, unfortunately, have absolutely no clue how bad it can get. The real issue here, however, is not necessarily what people will have to do to survive the upcoming storms. Rather, it is what they will be forced to do to remain a functioning part of the system under threat of excessive monetary punishment, physical confinement or violence to them and/or those close to them. So, one must be financially/coercively attached to the system to be a “debt slave”. If you are allowed to voluntarily downsize your living standards and retain some freedom of movement/action, then you are not really a slave. And that's not meant to demean the existential struggle of the chronically unemployed and/or homeless people living on the streets or in the subway, whose numbers are bound to increase and many of whom will die of sickness, cold and hunger, but it's hard to say that they are “attached” to our economic system of complicity and coerced participation. The most obvious way this slavish attachment forms is through personal debts/obligations. That’s why it’s very important to pay off your mortgage(s), car loans, student loans, outstanding balances on past bills, etc., throw away your credit cards and generally avoid taking on debt at all costs. However, that is not a panacea for avoiding debt slavery by any means. One reason is that, as mentioned in Part I, creditors and third party debt collectors may literally conjure up debts for people who never agreed to take on those debts, by failing to account for payments, illegally jacking up interest rates, retro-actively inserting penalty clauses and other similar tactics. Or, they may simply doctor up brand new “contracts” that never existed. The U.S. financial industry and government “regulators”, at both the federal and state level, have already taken the first steps towards such practices through the illegal transfer of mortgage titles in the MERS system and the “robosigning” of fraudulent loan documents by law firms employed by the major banks, which sought to “prove” ownership of such titles and therefore the right to foreclose. Once these illegal foreclosures came to the mainstream public’s attention, the federal government launched a sham investigation and effectively forced state attorney generals and prosecutors to go along with a tiny and symbolic settlement, which will primarily be funded by taxpayer money. Jose Suarez explores this issue for the Huffington Post and brings up some key points: However, the settlement will only help a small percentage of the millions of Americans who still are deeply underwater on their mortgages. Victims of fraudulent foreclosure robo-signings look to receive only about $2,000 in compensation. That amount is paltry compared to the amount of pain, desperation, and despair of millions of Americans, and so many Floridians, dangling precariously at the unlikely mercy of banks and their improper, illegal foreclosure processes. $2,000 wouldn't even come close to covering moving expenses or the "first, last and security deposits" for folks forced to downsize from their own homes to rentals. Another highly troubling aspect of the settlement is the potential spike in new foreclosures predicted by various real estate and financial industry analysts. The banks were delaying foreclosing on great numbers of homes until details of the settlement were finalized. They may not power up the illegal "robo-signing" machines again, but they are now clear to fire out the foreclose notices. This is the buzz I hear from real estate professionals in South Florida these days. While it certainly has a big impact on their day-to-day business, a bigger question is: How will these trends affect the momentum of the overall economy? The tentative recovery has yet to reach a large portion of the individuals hit first and hardest by the recession; these residents, in particular, are still struggling mightily -- and yet another downturn could be exponentially catastrophic for many of these families. The settlement frees the banks from any potential civil charges from the 49 states, though individuals can try to sue (in the chance you had the time and resources), and federal and state officials may wish to pursue criminal charges against the banks. But don't bet on the latter, unless you're interested in "wrist slaps." Snug relationships between so many politicians and big businesses, especially the banks, are telling. This settlement essentially gives the banks free license to go on a rampage of financial harassment and foreclosure without any interference from state governments. That’s why it was noted in Part II that traditional protections found in contract law have been rendered completely worthless for the vast majority of people on this planet, including all but the wealthiest individuals in the West. These protections were rooted in decades of British common law that developed through judicial precedents during the so-called “Enlightenment” era. They offered the average white male citizen a way to protect himself from having to make payments or perform under a contract if it was generally secured in one of the following ways: 1) Duress (economic or physical) – i.e. You are put in a position, physically or monetarily, in which you have no other choice but to agree to the terms of a contract. 2) Fraud/misrepresentation – i.e. You agree to the terms of a contract based on a material misrepresentation or omission of facts. 3) Unconscionability – i.e. You are a disadvantaged party (very asymmetrical knowledge of the business) to a contract which contains extremely unfair terms on its face. If a court established one of these situations to exist in any given case, then the complaining party had a right to void the contract. The problem for victimized debtors now is that the legal system only performs this protective function well when the economy is growing and wealthy private interests can claim an increasingly large share of the pie despite these common law hurdles-turned-artifacts. In an era of widespread economic contraction and deleveraging by consumers and businesses, the large private interests will instead seek to extract value through the seizing of assets (“foreclosure” implies a legitimate process) and the subjugation of distressed debtors. Human labor, after all, is simply a form of energy that can be applied to various inputs and productive processes, including the harvesting of other energy sources and the development of infrastructure necessary for large-scale societies. Most middle to upper-middle class Americans have forgotten all about the labor expended and the lives lost by their not-so-distant ancestors in the course of such work. Yet, they may very well be forced into laying railway tracks and mining coal or constructing/repairing roads, highways, bridges and canals in the near future. College and graduate students steeped in debt who are expecting cushy office jobs that no longer exist will find out they have effectively been sold into slavery by their system of “education”. At a time when the net energy returns afforded by the extraction of fossil fuels is quickly disappearing, the industrial corporate elites will once again rely on what can only be called “slave labor” to perpetuate a system of large-scale exploitation and wealth extraction. This time these pools of labor will not only be confined to minority groups or third world countries, and we will all find out just how little control we have over our own lives and our own bodies. When faced with the threat of arbitrary imprisonment and/or being stripped of all your earthly possessions, it will be very difficult to resist making a deal of debt servitude with the Devil. Where can any of these people turn to for relief or protection? Can they seek help from their local police departments or court systems? Traditionally, those have been potential avenues for at least a modicum of justice. Soon, however, even these institutions will be well into the process of being privatized in the name of “fiscal responsibility” and “market efficiency”, which is really code for corporate control over all facets of the modern state. Wealthy corporate conglomerates will not only have seized the “power of the purse”, but also the state’s dispute resolution mechanisms and its monopoly to use coercion and violence in pursuit of vaguely-defined goals. When a sizeable portion of the police force in any major city is trained, armed and managed by private security firms such as Erik Prince’s Blackwater (now known as… Academi), we may find it rather difficult to defend our homes, assets, friends and families from the wrath of our financial oppressors. They will be our creditors and debt collectors, as well as our judges, juries and executioners. One does not only become a debt slave by being underwater on private debts, though. As we are clearly seeing in the Eurozone periphery, external public debts that are in the process of being redeemed through austerity and “structural reform” can be a force equally capable of enslavement. If you are any worker, taxpayer and/or retiree living in the shadows of the wealthiest members of society, then you are rapidly losing your freedom as I write these words. Your savings and disposable incomes are being run down to pay the salaries and bonuses of corporate executives and directors, while your democratic elections have taken an indefinite leave of absence and your government will be confronting your resistance with steel cages and the barrel of a gun. At the same time, the Eurozone crisis perhaps offers us some signs of hope, albeit ones that are few and far between. First and foremost is the fact that the process of systemic credit collapse in our highly inter-connected environment can occur at a pace that is not necessarily capable of being out-paced by those who seek to take full advantage of it, or in ways that are completely unexpected by them. We see this revealed in the repeated inability of the IMF, EU and ECB (and their corporate masters) to come up with policies that will keep Greece in the monetary union and prevent contagion from spreading to other peripheral markets. It is also true that extensive systems of slavery can only sustain themselves with a certain amount of complicity and passive acceptance within the population. When it is a clear majority of people in a given location, rather than a minority, who are being pushed into slavery, there will most certainly be forceful pockets of resistance and the slave masters will require the slaves’ help to squash these movements. Indeed, that is exactly what we saw in European countries occupied by Nazi Germany, and even then many of the resistance movements made significant headway towards unlocking their peoples’ chains. The slave masters will especially require the unwavering support of civil servants tasked with carrying out orders of oppression from above. In Greece, we recently witnessed the country’s largest police union issue a statement of its intention to refuse to continue aiding the elites in the enslavement of the Greek people, and even threatened to issue symbolic arrest warrants for Troika officials stationed in the country. It is not hard to imagine similar occurrences in Portugal, Spain, Italy and even Ireland, as their policemen and women are squeezed of pensions and salaries, and forced to face the reality of their role as slaves to the system. Closer to the “core”, there were also acts of defiance in Brussels, Belgium by firefighters who sprayed foam from their hoses onto central streets and government buildings. In a separate display, these protesting firefighters also hosed down the Prime Minister’s office and the police units protecting it. Perhaps we can expect these pockets of official resistance to grow larger over time and act as a barrier between the corporatist slave masters and the populations they seek to enslave. Which then begs the question - what will the military forces of Westerns countries do? Will they remain a cohesive, unified force that carries out orders as they have been for many years now, or will pockets of resistance materialize within their ranks as well? It is a mistake to assume that the men and women in the U.S. military, for example, are guaranteed to bring slavery and death to their own people when they are commanded to. As USA Today reported, people who actively work for the military donate more to Ron Paul’s campaign more than any other candidate, and he is certainly not someone known for advocating imperialism and oppressive government authority. That reflects an attitude that is anything but closed-minded and uncritical of current policy trends. So, while the global population’s future of debt slavery is a very real and ongoing threat, there are also reasons to believe it may not sustain itself for very long. Then again, the number of slaves is growing by the day and the time may come when many of us are forced to either fight for our freedom or learn to live with our chains. These are obviously very serious issues and very serious possibilities. It is no longer acceptable for anyone to pretend that the concept of systemic slavery in the developed, “civilized” world has been relegated to the history books. It took the upheaval of the Great Depression and the Second World War to truly rid the U.S. of its enslavement of African Americans only 60-70 years ago. What will it take for the indebted masses now? And is anyone really willing to find out?
Poster Comment: People need to understand the debt slavery system... "Buying" a car on credit, where you don't actually OWN it for 5-6 years, is NOT an improvement, but further indebtedness.
Banks Take It Easy, While Miami Struggles Against Foreclosures
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