Divestment vs. Debt Strike
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Eric Sanders
Nov 14, 2011, 4:30:26 PM11/14/11
to debt-strike-...@googlegroups.com
Hey everyone,
2. Debt Strike
The more I've been following our recent threads and thinking about this, the more clear it seems to me that there are two distinct movements going on:
1. Divestment
- Pull money out of major banks and put it in local credit unions
- Use #divest on Twitter
- Bank Transfer Day is just the start: http://www.facebook.com/Nov.Fifth
2. Debt Strike
- Create a platform/movement to get people to use their debts as leverage to bargain with the banks, much the same way the banks held the U.S. government hostage before the bailout
I think these are both exciting, viable movements, but I also think it's clear they're separate things.
Let's try to be clear about which ones we're each interested in working on. Ultimately this may spin off into two different groups. I'm more interested in being involved with #1, for now, but I'll definitely come help out on December 2 if we all meet up to work on the Kickstopper idea!
Best,
Eric
Thomas
Nov 14, 2011, 5:30:42 PM11/14/11
to Debt Strike /Kick-Stopper
This is also how I see things, that there is an inner tension between
a general debt-strike and targeted campaigns. I think we could build a
platform that can accommodate both.
On #1 Divestment
I don't think there is any need to recreate the Move Your Money
Project (http://moveyourmoneyproject.org/) which is doing fine on its
own. There is also a balance transfer day scheduled for Dec. 11th
(https://www.facebook.com/balancetransferday) where people will
transfer their credit card balances from credit cards operated by the
big banks to credit cards operated by local banks or credit unions (I
just applied for a credit card from my local credit union today).
These campaigns are great and worth supporting. We need to articulate
how our divestment project adds to these campaigns, how it can take
them to the next level. Right now these are the two steps that I can
come up with that we could provide, but I'd be interested in hearing
what, specifically, other people have in mind.
First, there is some debate as to how much moving our money is hurting
the big banks. Back when Move Your Money first launched I read an
analysis (I wish I could find it now but I haven't been able to) that
said even if every single American moved their personal savings out of
the big banks it would certainly effect their bottom line (I forget
the exact figure), but the vast majority of these bank's profit's
comes from areas other than personal checking and savings accounts. We
need to identify those sources and target them. That's how I think a
divestment project could really help take things to the next level.
For example, I work for Syracuse University and they have several
endowments of various sizes as well as dozens of other accounts in
many different banks. SU also has a special relationship with JP
Morgan Chase and has many financial ties there too. If we could create
a platform that allowed people to target SU and force them to move
their money, then I think we could make a larger impact. Now I don't
know exactly what that means, and this is where I think we need some
professional economists to help us out, and I don't know what entities
would be best to target. I have read that there are some campaigns
popping up to get local city and state governments to move their
money. It might be worth starting there.
This would require understanding more about how these big banks work
and how they make their money. If we learned, for example, that a
major grocery chain held the largest bank account at Bank of America
for example, we could basically build a platform that would help
organize a boycott of that grocery chain until they move their money
out of BoA.
Second, one big limiting factor that is stopping some people from
moving their personal banking is the convenience of working with a big
bank that has thousands of ATM machines in every major city around the
world. If you switch to a small bank you end up having to pay higher
fees to use ATM's operated by other banks. One thing we could to is
start a networked ATM system for small banks and credit unions. My
local credit union has I think only four ATM machines in our city and
none anywhere else. If we could link those four machines up to every
other ATM machine owned and operated by other small banks it would
help shift the convenience factor in favor of small banks.
#2 Debt-Strike
This is what I'm personally more interested in trying to create. After
reading Sarah's article a few times the idea seems to come into focus
and then go back out of focus for me. I think we need to hash this
idea out more preciesly with some professional economists. For now we
can certainly start building a platform, but it would help if we had a
really clear idea of what we are trying to do, how it would actually
work, which strategy to use, etc. I just don't have the right skill-
set to think through all of these issues and I think we need to get
the people who do involved as soon as we can.
Maybe in addition to a co-labathon we could organize some kind of
discussion between economists and activists who know this area inside
and out. I'm not entirely sure who those people are or how to go about
arranging this.
-Thomas
a general debt-strike and targeted campaigns. I think we could build a
platform that can accommodate both.
On #1 Divestment
I don't think there is any need to recreate the Move Your Money
Project (http://moveyourmoneyproject.org/) which is doing fine on its
own. There is also a balance transfer day scheduled for Dec. 11th
(https://www.facebook.com/balancetransferday) where people will
transfer their credit card balances from credit cards operated by the
big banks to credit cards operated by local banks or credit unions (I
just applied for a credit card from my local credit union today).
These campaigns are great and worth supporting. We need to articulate
how our divestment project adds to these campaigns, how it can take
them to the next level. Right now these are the two steps that I can
come up with that we could provide, but I'd be interested in hearing
what, specifically, other people have in mind.
First, there is some debate as to how much moving our money is hurting
the big banks. Back when Move Your Money first launched I read an
analysis (I wish I could find it now but I haven't been able to) that
said even if every single American moved their personal savings out of
the big banks it would certainly effect their bottom line (I forget
the exact figure), but the vast majority of these bank's profit's
comes from areas other than personal checking and savings accounts. We
need to identify those sources and target them. That's how I think a
divestment project could really help take things to the next level.
For example, I work for Syracuse University and they have several
endowments of various sizes as well as dozens of other accounts in
many different banks. SU also has a special relationship with JP
Morgan Chase and has many financial ties there too. If we could create
a platform that allowed people to target SU and force them to move
their money, then I think we could make a larger impact. Now I don't
know exactly what that means, and this is where I think we need some
professional economists to help us out, and I don't know what entities
would be best to target. I have read that there are some campaigns
popping up to get local city and state governments to move their
money. It might be worth starting there.
This would require understanding more about how these big banks work
and how they make their money. If we learned, for example, that a
major grocery chain held the largest bank account at Bank of America
for example, we could basically build a platform that would help
organize a boycott of that grocery chain until they move their money
out of BoA.
Second, one big limiting factor that is stopping some people from
moving their personal banking is the convenience of working with a big
bank that has thousands of ATM machines in every major city around the
world. If you switch to a small bank you end up having to pay higher
fees to use ATM's operated by other banks. One thing we could to is
start a networked ATM system for small banks and credit unions. My
local credit union has I think only four ATM machines in our city and
none anywhere else. If we could link those four machines up to every
other ATM machine owned and operated by other small banks it would
help shift the convenience factor in favor of small banks.
#2 Debt-Strike
This is what I'm personally more interested in trying to create. After
reading Sarah's article a few times the idea seems to come into focus
and then go back out of focus for me. I think we need to hash this
idea out more preciesly with some professional economists. For now we
can certainly start building a platform, but it would help if we had a
really clear idea of what we are trying to do, how it would actually
work, which strategy to use, etc. I just don't have the right skill-
set to think through all of these issues and I think we need to get
the people who do involved as soon as we can.
Maybe in addition to a co-labathon we could organize some kind of
discussion between economists and activists who know this area inside
and out. I'm not entirely sure who those people are or how to go about
arranging this.
-Thomas
Sarah Jaffe
Nov 14, 2011, 5:40:45 PM11/14/11
to debt-strike-...@googlegroups.com
As far as divestment goes, there's a lot of really great work being
done on that issue already--I wrote about that as well, here, which
includes the stuff Thomas mentions like getting large entities to
divest from the big banks.
done on that issue already--I wrote about that as well, here, which
includes the stuff Thomas mentions like getting large entities to
divest from the big banks.
Regarding debt strikes: I'd love to help put together a day, separate
from the collab-a-thon, where we can get together with economists,
organizers, and other thinkers who've been working on this issue. I've
been in conversation with many people who are interested in it, and
they'd all bring various kinds of expertise to the table.
If there's some interest in that, maybe we can pick a different day
and try to organize that as well...
--
Sarah Jaffe
ohyouprettythings.net
@seasonothebitch
Thomas Gokey
Nov 14, 2011, 5:57:43 PM11/14/11
to debt-strike-...@googlegroups.com
That's a great article. It's so good to learn that some of these tools already exist. I especially liked the Divestment Resolution which is exactly what I was trying to describe.
I suggest that we propose a class on divestment/debt-strike through The Public School in addition to the colab-a-thon. This would be a place where we could get economists involved, a kind of teach-in on the idea run by experts. Maybe we could should hold it in Zuccotti as a regularly scheduled teach-in. This would also be a great way to pull some more people in. I'm not sure how many people are really reading these Google group messages and I worry we're loosing people. We need to be recruiting more people to get involved.
Last I knew David Graeber was going to be in NYC for at least part of December. It would be great to get him involved.
-Thomas--
____________________________________________________
Thomas Gokey
The Art School in the Art School | Department of Wonder and Joy
Syracuse "University" | VPA Foundations
Time Arts | Two-Dimensional Creative Processes
w: thomasgokey.com
e: thoma...@gmail.com
____________________________________________________
This e-mail is a handmade object, all errors of spelling and grammar give it a sense of character and authenticity.
Gmail's algorithms search the contents of our e-mail for keywords which it uses to customize the advertizements it shows us. Google tries to be sensitive, however, and disables the ads if you are writing about tragic subjects. If the algorithm finds keywords like "massacre," "slaughter," "bloodbath," or "murder" it will not show you ads. Since I just used them here, in my signature, I'm ad free.
I suggest that we propose a class on divestment/debt-strike through The Public School in addition to the colab-a-thon. This would be a place where we could get economists involved, a kind of teach-in on the idea run by experts. Maybe we could should hold it in Zuccotti as a regularly scheduled teach-in. This would also be a great way to pull some more people in. I'm not sure how many people are really reading these Google group messages and I worry we're loosing people. We need to be recruiting more people to get involved.
Last I knew David Graeber was going to be in NYC for at least part of December. It would be great to get him involved.
-Thomas
____________________________________________________
Thomas Gokey
The Art School in the Art School | Department of Wonder and Joy
Syracuse "University" | VPA Foundations
Time Arts | Two-Dimensional Creative Processes
w: thomasgokey.com
e: thoma...@gmail.com
____________________________________________________
This e-mail is a handmade object, all errors of spelling and grammar give it a sense of character and authenticity.
Gmail's algorithms search the contents of our e-mail for keywords which it uses to customize the advertizements it shows us. Google tries to be sensitive, however, and disables the ads if you are writing about tragic subjects. If the algorithm finds keywords like "massacre," "slaughter," "bloodbath," or "murder" it will not show you ads. Since I just used them here, in my signature, I'm ad free.
Matthew Skomarovsky
Nov 14, 2011, 11:26:51 PM11/14/11
to debt-strike-...@googlegroups.com
Thank you Thomas, Sarah, and Eric for pushing the conversation forward.
FWIW, I'm still reading these googles with eager eyes and think organizing a divestment/debt-strike class through The Public School would be just super. I'm also into a hackathon and have some technical time to contribute but hesitate to dive in without more confidence about the economics and strategy behind this and a better sense of how well it would be received beyond our circles.
I don't quite get Balance Transfer Day. It seems like it only works if you have a healthy credit relationship with your big bank. Otherwise you're not going to get a good rate from another bank, right? At least not for very long? And even if you move your balance, you're basically borrowing from another bank in order to pay off your big bank debt in full, which hands them a bunch of cash and seems a little like the opposite of a debt strike. Anyhow, it confuses me and I imagine it would confuse many others.
Random thought: even if moving our deposit accounts doesn't make a significant dent in big bank profits, it seems the less we are dependent on the big banks in our daily lives the easier it is to disregard their threats of financial chaos the next time they're demanding bailouts-or-else.
Thomas Gokey
Nov 15, 2011, 12:00:15 AM11/15/11
to debt-strike-...@googlegroups.com
@Mathew, as I understand it there is a balance transfer process whereby the debt that you have on your credit card and are currently paying interest on to the big banks gets transfered to the small bank/credit union. I don't know how it works elsewhere, but at my local credit union they offer a very reasonable interest rate when compared to most credit cards, and there aren't hidden scammy fees or other dirty tricks which have become common. You still have to pay off the debt, and you still have to pay interest, but now the interest goes to the local credit union. My local credit union is really great, and this program is partly to try to help people with less than perfect credit get out from under their debt and improve their credit. They're willing to talk to people to find out why their credit is bad, find out if they're in a tough situation or if they are just being irresponsible. They don't accept everyone, but they're willing to work with most people if they can establish some kind of good faith relationship.
My local credit union is fantastic. It's just down the block and as I walked there today my wallet fell out of my pocket without me noticing. A couple hours later I had a call from the credit union, one if the workers had found my wallet. The $30 cash I had was still there.
-Thomas
Samuel Rose
Nov 15, 2011, 12:37:58 AM11/15/11
to debt-strike-...@googlegroups.com
Debt strike:
This was the idea that attracted me as well. In my estimation, it is "predatory" and unfair lending practices that need to be targeted here.
I am thinking of the following:
1. Medical bills for the uninsured. Laws have been changed in the last few years to allow debt collectors to seek judgements against debtors for medical bills that are incurred when the patient possesses no insurance. In this case: hospitals and doctors over-charge for services and medication, over-prescribe unneeded procedures. When patients cannot pay, hospitals and doctors sell the debt to collection agencies, who increasingly fast-track the debt to law firms. Law firms in turn fast-track judgements against patients, which then allows law firms to seek liens against property (homes, cars, etc). No payment arrangements, no working with people. Straight to judgment, liens, garnishments. Stripping people of property for vastly overpriced medical services that people needed to stay alive. MILLIONS of people are now dealing with this reality. In this case, the debt strike is against collection agencies and lawyers.
2. Predatory lending targets. Despite laws having been passed that were supposed to stop "predatory lending", the activities are still taking place. And, there are still millions of people owing debt on loans that were established before any existing laws passed.
There could be other inequitable situations related to debt worth addressing, too.
If people were to try and use their debt as leverage to bargain with banks, I think it would be difficult to get results out of existing banks to whom the debt is currently owed. Instead, it could possibly be more effective to get a new bank, credit union, collection of banks, or even p2p lending to buy out the debt for a lower cash settlement, then offer repayment terms of the lower settlement. If the goal is to get the banks to completely forgive the debt, then it would probably be more effective to target specific banks that debt strikers owe debt to a few at a time with concentrated actions and resources applied towards pressuring the bank to forgive the debt.
--
--
Sam Rose
Hollymead Capital Partners, LLC
Cel: +1-(517)-974-6451
email: samue...@gmail.com
http://hollymeadcapital.com
http://p2pfoundation.net
http://futureforwardinstitute.com
http://socialmediaclassroom.com
"The universe is not required to be in perfect harmony with human ambition." - Carl Sagan
--
Sam Rose
Hollymead Capital Partners, LLC
Cel: +1-(517)-974-6451
email: samue...@gmail.com
http://hollymeadcapital.com
http://p2pfoundation.net
http://futureforwardinstitute.com
http://socialmediaclassroom.com
"The universe is not required to be in perfect harmony with human ambition." - Carl Sagan
Greg Belvedere
Nov 15, 2011, 12:07:13 PM11/15/11
to Debt Strike /Kick-Stopper
I'm much more interested in the debt strike aspect of this project.
Should we try and get the advice of economists before the collab-a-
thon, or should we try and get some to attend? I think we should get
some feedback as early on as possible, so we don't start working on
something that we later need to abandon. I would welcome Sarah's idea
to put together a separate day to meet with economists, especially if
we can do it before the Dec. 2nd, which seems to be the date set for
the collab-a-thon. But if we can't get any economists on board before
then we can always meet after. How does everyone else feel about this?
> email: samuel.r...@gmail.comhttp://hollymeadcapital.comhttp://p2pfoundation.nethttp://futureforwardinstitute.comhttp://socialmediaclassroom.com
Should we try and get the advice of economists before the collab-a-
thon, or should we try and get some to attend? I think we should get
some feedback as early on as possible, so we don't start working on
something that we later need to abandon. I would welcome Sarah's idea
to put together a separate day to meet with economists, especially if
we can do it before the Dec. 2nd, which seems to be the date set for
the collab-a-thon. But if we can't get any economists on board before
then we can always meet after. How does everyone else feel about this?
Thomas Gokey
Nov 15, 2011, 12:44:08 PM11/15/11
to debt-strike-...@googlegroups.com
I guess my ideal preference would be to meet with economists first and clarify our ideas before we build too much. But is that realistic? Do you think we can organize something in time? Maybe Dec 1st, or maybe it should be folded into the colab-a-thon?
-Thomas
-Thomas
Matthew Skomarovsky
Nov 18, 2011, 12:19:53 AM11/18/11
to debt-strike-...@googlegroups.com
There's a student debt strike about to launch, I hadn't heard about it until today:
Sarah Jaffe
Nov 18, 2011, 9:22:59 AM11/18/11
to debt-strike-...@googlegroups.com
I spoke with one of the women coordinating this and have her contact
info. When I'm recovered a bit from yesterday I plan to reach out to
her and will share her info with the group if that's OK with her.
info. When I'm recovered a bit from yesterday I plan to reach out to
her and will share her info with the group if that's OK with her.
--
Sarah Jaffe
ohyouprettythings.net
@seasonothebitch
Greg Belvedere
Nov 18, 2011, 10:35:19 AM11/18/11
to Debt Strike /Kick-Stopper
I spoke to a guy yesterday in Union Square who was handing out flyers
about this. I told him about this group. He wrote it down and I'm
guessing he will join sometime soon.
On Nov 18, 9:22 am, Sarah Jaffe <sarah.ja...@gmail.com> wrote:
> I spoke with one of the women coordinating this and have her contact
> info. When I'm recovered a bit from yesterday I plan to reach out to
> her and will share her info with the group if that's OK with her.
>
> On Fri, Nov 18, 2011 at 12:19 AM, Matthew Skomarovsky
>
>
>
>
>
> <matt...@verypolite.com> wrote:
> > There's a student debt strike about to launch, I hadn't heard about it until
> > today:
> >http://chronicle.com/article/Protesters-Plan-a-National/129810/
>
> > On Tue, Nov 15, 2011 at 12:44 PM, Thomas Gokey <thomasgo...@gmail.com>
> >>> > samuel.r...@gmail.comhttp://hollymeadcapital.comhttp://p2pfoundation.nethttp://futureforwa...
>
> - Show quoted text -
about this. I told him about this group. He wrote it down and I'm
guessing he will join sometime soon.
On Nov 18, 9:22 am, Sarah Jaffe <sarah.ja...@gmail.com> wrote:
> I spoke with one of the women coordinating this and have her contact
> info. When I'm recovered a bit from yesterday I plan to reach out to
> her and will share her info with the group if that's OK with her.
>
> On Fri, Nov 18, 2011 at 12:19 AM, Matthew Skomarovsky
>
>
>
>
>
> <matt...@verypolite.com> wrote:
> > There's a student debt strike about to launch, I hadn't heard about it until
> > today:
> >http://chronicle.com/article/Protesters-Plan-a-National/129810/
>
> > wrote:
>
> >> I guess my ideal preference would be to meet with economists first and
> >> clarify our ideas before we build too much. But is that realistic? Do you
> >> think we can organize something in time? Maybe Dec 1st, or maybe it should
> >> be folded into the colab-a-thon?
>
> >> -Thomas
>
> >> On Tue, Nov 15, 2011 at 12:07 PM, Greg Belvedere <gmb1...@gmail.com>
>
> >> I guess my ideal preference would be to meet with economists first and
> >> clarify our ideas before we build too much. But is that realistic? Do you
> >> think we can organize something in time? Maybe Dec 1st, or maybe it should
> >> be folded into the colab-a-thon?
>
> >> -Thomas
>
>
> >>> > "The universe is not required to be in perfect harmony with human
> >>> > ambition." - Carl Sagan
>
> >> --
> >> ____________________________________________________
> >> Thomas Gokey
> >> The Art School in the Art School | Department of Wonder and Joy
> >> Syracuse "University" | VPA Foundations
> >> Time Arts | Two-Dimensional Creative Processes
> >> w: thomasgokey.com
> >> e: thomasgo...@gmail.com
> >>> > "The universe is not required to be in perfect harmony with human
> >>> > ambition." - Carl Sagan
>
> >> --
> >> ____________________________________________________
> >> Thomas Gokey
> >> The Art School in the Art School | Department of Wonder and Joy
> >> Syracuse "University" | VPA Foundations
> >> Time Arts | Two-Dimensional Creative Processes
> >> w: thomasgokey.com
> >> ____________________________________________________
> >> This e-mail is a handmade object, all errors of spelling and grammar give
> >> it a sense of character and authenticity.
>
> >> Gmail's algorithms search the contents of our e-mail for keywords which it
> >> uses to customize the advertizements it shows us. Google tries to be
> >> sensitive, however, and disables the ads if you are writing about tragic
> >> subjects. If the algorithm finds keywords like "massacre," "slaughter,"
> >> "bloodbath," or "murder" it will not show you ads. Since I just used them
> >> here, in my signature, I'm ad free.
>
> --
> Sarah Jaffe
> ohyouprettythings.net
> @seasonothebitch- Hide quoted text -
> >> This e-mail is a handmade object, all errors of spelling and grammar give
> >> it a sense of character and authenticity.
>
> >> Gmail's algorithms search the contents of our e-mail for keywords which it
> >> uses to customize the advertizements it shows us. Google tries to be
> >> sensitive, however, and disables the ads if you are writing about tragic
> >> subjects. If the algorithm finds keywords like "massacre," "slaughter,"
> >> "bloodbath," or "murder" it will not show you ads. Since I just used them
> >> here, in my signature, I'm ad free.
>
> --
> Sarah Jaffe
> ohyouprettythings.net
>
> - Show quoted text -
Mike
Nov 19, 2011, 11:20:45 AM11/19/11
to debt-strike-...@googlegroups.com
You can be granted forbearance with no documentation required. Just sign the form and send it back.
If this were to happen en masse, it would server the purpose of sending a large message without there being a disproportionate risk to the borrowers.
As a borrower, interest accrues while in forbearance, and your monthly payment amount is recalculated, but the increase amount is trivial across a long term loan.
This strategy may help some people join in sending a message, who would otherwise be reluctant to incur the wrath of the banks.
Thomas Gokey
Nov 19, 2011, 1:13:29 PM11/19/11
to debt-strike-...@googlegroups.com
I'm stuck in NYC until monday (I got arrested on thursday and can't pick up my cell phone until monday). I might try to make it to the student debt-strike kick-off that Andrew Ross is holding in Zuccotti on Mon afternoon. This is a great sign. It means that there are lots of peole working these ideas out. The problem with a debt-strike has always been that we're in a debt-prisoner's dilemma. We need millions of people to independantly make the same decision and commit to it. I think that the focus of our group can be on building a platform that can accomodate commuication and coordination among these prisoners. We can let peopel like Andrew Ross work out the best economic/political tactics. But it would be great to touch base with him and organize a teach-in on the subject to get us all on the same page.
-Thomas
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