Friday, November 16, 2012

Left Side of the Aisle #82 - Part 4

Occupy Wall Street: Occupy Sandy and Rolling Jubilee

I'm going to wrap up with a sort of feel-good story, at least one as feel-good as anything can be about the victims of Hurricane Sandy.

Do you know what was among the first organizations to get relief to the victims of Sandy around New York City? An organization that was on the ground, distributing food and water and blankets and medicine and even some generators, often before the Red Cross or FEMA even showed up? A group that within just a couple of days established two distribution centers and was directing about 1,000 volunteers a day and by last week had dozens of relief centers across the city?

Occupy Wall Street. Yep, them. Working under the name Occupy Sandy, OWS has taken the commitment its participants showed, their social media skills, the prowess at on-the-fly organizing they developed, and the knowledge of neighborhoods they gained when doing community organizing in all those months the mass media thought they had just disappeared, and turned them into a praised and effective relief organization for victims of the superstorm.

ABC News claimed that OWS had become a punchline. I'm afraid that around New York I don't hear any laughing.

In fact, this is a double feel-good bit. Something to which OWS gave birth was the organization Strike Debt! which published the Debt Resistors' Operations Manual to tell people being crushed under debt about their rights and options. Now, Strike Debt! has a new project. It's called Rolling Jubilee.

Traditionally, Biblically, a jubilee year was a time for freeing of slaves and prisoners, returning land to its former owners, and forgiving debts. Rolling Jubilee wants to make the forgiving of debts an on-going event.

When banks or other creditors have what's called "distressed" debt, a debt that is in default which they are having trouble collecting, they often enough will sell that debt to someone else for a fraction of its face value, sometimes for just pennies on the dollar. This is a rather simple and fairly common business transaction. Usually, the new creditor sets about harrassing the debtor for the balance, which is all profit to the new creditor. What Rolling Jubilee intends to do is to use crowdfunding - that is, lots of people contributing small amounts each - to raise funds to buy destressed debt for pennies on the dollar, but then instead of trying to collect that debt, forgive it. Wipe it off the books.

The idea has been called simple, brilliant, and powerful and it's all quite legal. And in a country where in one-third of the states it is still legal for you to be sent to prison for not paying a debt and yes that is true, it's also very necessary.

But there is one potential hang-up: The banks may not go along with it. An outfit called American Homeowner Preservation was buying up pools of bad mortgages and then restructuring them to make it easier for the homeowners to pay them off. But the banks hated the idea of a homeowner being able to stay in their house after a short sale, and often asked for an affidavit from the buyer saying that the former owner yes, would be kicked out. Obviously, American Homeowner Preservation couldn't make such a promise since that was contrary to its whole purpose. So the banks just refused to sell them any mortgages.

There's no reason to think the banks will be any less stubborn, unreasonable, and selfish in this case. But even if that happens, there is one thing that can come out of it: A lot more people will know just how small-minded, stubborn, unreasonable, and selfish Wall Street is.


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