The Debt Canon

It’s a stormy night here in New York the day after the holiday. What better than to sit down with a DVD set and forget all about debt. Only we chose one of those BBC classics, in this case Bleak House. And the literary canon is about nothing other than debt.

It can be said that the realist or bourgeois novel is the story of debt. Consider: Balzac, nothing but debt. Dostoevsky, all debt. In George Eliot, much turns around the screw of debt, especially in Daniel Deronda and its gambling debts and bankruptcies, and so on and so forth across the Great Tradition, all the way to Joyce’s Leopold Bloom, wandering his Bloomsday about Dublin, worried about his debts and how much he can spend.

Here there are both kinds of debt, or better three kinds. There is monetary debt of course. These debts are owed to shady money lenders, like Fagin. There is money raised on speculative lending like the nouveaux riches in Jane Austen’s Mansfield Park, wealthy on slavery. There is an immense amount of obligation, whether due to class, family or religion that often constrains the characters and drives the plot. It is the function of the police in the novels to determine the secret that characterizes the obligation. Sometimes the text argues against such obligations and it does so in the name of love, the required rebellion of the imperial bourgeoisie, but also a genuine form of relation.


Phil Davis as Smallweed (BBC)

So in Bleak House in the BBC/PBS version from 2005, much centers around monetary debt, as if prefiguring the 2007 crisis to come. Smallweed, a minor character in the novel, comes to personify predatory debt. Dickens made his character disabled and full of violent rage. The BBC added the obligatory hints of Jewishness. Dickens tells us of Smallweed:

The name of this old pagan’s god was Compound Interest. He lived for it, married it, died of it.

He lives by buying up secondary debt and making what he can of it. So Mr. George and Captain Hanwood and many other characters in Bleak House come to their downfall by means of this debt. No Jubilees intervened against the Law that Dickens represented as a suffocating smog, reaching across England.

Does it end happily nonetheless? You wouldn’t want me to spoil it, now, would you?

A Last Blast on Sandy

Out here in Long Island, you can really see the damage caused by Hurricane Sandy. Trees are down everywhere, there’s construction on all sides. Yet New York City is trying to shut down its hurricane relief centers. FEMA requires loan applications to be in by December 31. Today the New York Times ran quotes from people calling Sandy the storm of a lifetime, who are planning to rebuild in places where the flooding was most devastating.

So let’s review the climate change situation one last time in 2012. To have experienced a month that was not warmer than the historic average, you must now be at least 27 years old. That means close to 50% of the world’s population has lived only in the time of warming. By all measures scientific and experiential, the climate is changing and the only debate is how fast.

This year, two major exit routes to climate disaster closed. With the desultory agreement at the Doha round of the UN climate change convention, even the most optimistic person has realized that national governments are not going to drive this agenda. For instance, the world’s developed nations are committed to donating about $60 billion to the poorest threatened nations to help them adapt. None has been forthcoming so far. Imagine if these countries were banks–they’d have ten times the cash.

Second, and more worrying, the global hydrocarbon industry has done an end run around the idea of “peak energy.” This much-touted idea from the 1990s suggested that the world’s reserves of fossil fuel were about to be used up and so alternatives would have to be found. The exploitation of natural gas by fracking, and the expectation that reserves under the Arctic and Greenland will become available once the ice melts, have changed all that. Scientists have created means to turn natural gas into diesel, of which there is currently a shortage, and the building blocks for plastics. In other words, the path is technically open not only to continue the fossil fuel economy but to expand it.

These points are not exactly unrelated. Politicians are easily influenced by immense wealth and there’s no money like oil money. The “recoverable reserves” of oil and gas now amount to $160 trillion, which is real money even these days–more in fact than all global equities markets. To take just one example, 85% of Nigeria’s oil revenues go to one per cent of the population. Of that money, some $300 billion is entirely unaccounted for. Living standards for the mass population have not improved during the oil exploitation period of Nigeria’s history. This is where the politics kicks in.


Occupy Nigeria

Remember Occupy Nigeria? There was a reason why millions participated.

Because none of the oil, gas and tar is actually necessary as other research has shown:

A well-designed combination of wind power, solar power and storage in batteries and fuel cells would nearly always exceed electricity demands while keeping costs low.

As Peter Rugh has recently shown in his excellent article on the Far Rockaways, this contradiction is now at the center of post-Sandy politics. He quotes Occupy Sandy activist Jessica Roth

“If the Rockaways were based on clean energy going into this we would have been in a completely different situation. We would have had battery packs off of solar that were storing energy. We would have had wind turbines off the coast, which can pull up to 30 miles an hour off winds coming into the shore.”

Meanwhile, State Senator Addabbo has his mind on gas. While he says he is opposed to fracking, a carbon intensive method of methane extraction widely opposed by environmentalists, he supports the construction of a 30-inch pipeline that Williams Transco plans to build that will pump highly-pressurized, inflammable, fracked gas through the Rockaways.

This is a crossroads in national and international politics that Sandy has thrown into high relief here in New York. Renewable, local energy and a related localized politics interactive with its community–a sustainable democracy. Or a pipelined energy, controlled from afar by a small global elite.

A protest in the Far Rockaways

A protest in the Far Rockaways

This is why we occupied 2012 and how we must take the argument forward. It’s not a “climate” debate. The climate is a model for average temperatures and conditions. There isn’t a politics in a model. The question is how we respond to the change the model predicts, who benefits from that change, and whether those impacted by it will have a voice. It’s about freedom.

The Debt-Race Nexus

It’s worth revisiting this: debt is a system of social disciplinary control at national and international level. This system operates a means of deflecting opposition to itself, namely the amplification of resentment against “others,” which in the developed world manifests as increased racism. This interface is in high gear at present.

Greece is perhaps the most direct example of this interaction. This week, the all-powerful ratings agency Moodys raised Greece’s outlook to B-. This “promotion” is in fact an indication that austerity measures have been sufficiently implemented and that opposition to them has been contained. It is an index for the international bond market and a huge win for the vulture capital funds that bought Greek debt at intense discount. Expect a Michael Lewis book about vulture funds next year.

In the meantime, as the social protest against austerity has been blocked by the Troika, the rise of Greek fascism continues. Golden Dawn direct people’s anger at the impoverished but visibly different African migrants, who arrive in Greece at least in part because the rest of Europe makes such strenuous efforts to keep them out. No matter that the late Martin Bernal showed in his three volume work Black Athena that ancient Greek civilization learned extensively from Egypt (and Semitic Middle Eastern cultures), so that what we call “Greece” was always already a hybrid.

It’s a finely tuned gamble by the E.U. that Golden Dawn provide a sufficient safety valve for social unrest but do not succeed to the extent of gaining access to state power, in the manner of the French National Front. Or perhaps the bankers are sufficiently cynical that bond repayments is all that matters.

Indeed, there has been a similar rise in public racism cross Europe from Britain to Italy and Russia, especially at football (soccer) matches. It might seem that this represents a return to working-class racism as seen in the 1970s but sport is now so expensive that, almost by definition, people attending games live would have to be considered middle-class. Perhaps the very visibility of money in sport serves as a means to focus social resentment into racist forms?

British footballers Anton Ferdinand and John Terry confront each other over hate speech from Terry

British footballers Anton Ferdinand and John Terry confront each other over hate speech from Terry

More bizarrely still, despite all the protocol trainings by soccer authorities, the players themselves are now acting out this racism on the pitch. John Terry’s racist remarks to Anton Ferdinand (above) were discovered via a fan’s cellphone video posted to YouTube. When I was young, racism was endemic at football but I thought that the very substantial numbers of both black British and African players, not to mention the increased diversity of the UK, would have changed that. And in the boom era of “Cool Britannia,” it seemed that it had. With recession comes racism.

In Russia, fans of a team called Zenit have issued a statement saying they want no black or gay players. Italian team Lazio, based in Rome, have long been associated with fascism (literally, Mussolini). But every weekend there’s something hateful said on or off the pitch, or some physical violence from fans to players or each other.

Let’s not get superior. Last week, when President Obama gave a speech at Newtown CT in honor of the victims of white male rage (whether technically sane or unbalanced), a rash of obscene tweets broke out because his speech replaced some American football game on TV. The N-word was very extensively used.

As austerity continues as a form of social control, in defiance of the recommendations of central bankers in the UK and common sense everywhere, so too has a calibrated targeting of others. Dog whistles, subtle and not so subtle, have been blowing for months, if not years.

The fact that African-Americans and Latin@s in the US have been hardest hit by the 2008 crash has had no effect on this discourse. In fact, it seems to reinforce the narrative in which “sub-prime” borrowers (meaning people of color) were to blame. As if the people lending them the money were just good Samaritans and not making as much money from interest rates and derivatives as they could.

All that said, I don’t think that the connections between the debt crisis and the revival of racism are fully understood yet and it’s going to be an important topic of research and activism going forward.

We Are Rolling

The Rolling Jubilee has rolled out its first debt abolition. Letters to over forty (former) debtors have been mailed out in specially designed care packages. The point here is that if you are in debt, you’re used to getting letters of all kinds, carefully designed to get you to open them, that are about repayment. So these shiny gifts want to send the message that they contain something very different.

The Debt-Mas Tree with a Care Package

The Debt-Mas Tree with a Care Package

Here’s what people will read:

We write with good news: the above referenced account has been purchased by the Rolling Jubilee Fund, a 501(c)(4) non-profit organization. The Rolling Jubilee Fund is a project of Strike Debt. The mission of this project is to buy and abolish personal debt. We believe that no one should have to go into debt for the basic things in our lives, like healthcare, housing, and education.

You no longer owe the balance of this debt. It is gone, a gift with no strings attached. You are no longer any obligation to settle this account with the original creditor, the bill collector, or anyone else.

A letter to a former debtor

A letter to a former debtor

The Rolling Jubilee debt-buying team has taken incredible care with all the mechanics of this process. The team itself includes accountants and lawyers. They’ve been meeting with legal advisors since the summer to get this right.

Today the legal team also went public, via an interview with Nick Pinto of the Village Voice. Sadly, this was necessary because certain economics commentators on the institutional left took it upon themselves to claim that Strike Debt was going to get the debtors into tax trouble. The assertion was the IRS would see the debt forgiveness as income. Strike Debt is clear that it’s a gift and not subject to tax.

The tax lawyer dismisses the concern that the Rolling Jubilee is engaged in commercial activity: “It doesn’t make a great deal of sense to me,” she said. “When Habitat for Humanity is helping people build houses, someone still has to buy the lumber. It doesn’t change their tax status. The critical thing is that this is a not-for-profit organization, and it’s not engaged in trying to make money.”

The fact is that as of now, there’s $100,000 less medical debt out there. That has to be a good thing. We know it’s a drop in the ocean but that’s not the point. The Jubilee is a hack, or very precisely, a détournement. This latter was the way the Situationist International used the system against itself, which is exactly what the Rolling Jubilee has done.

It’s inspired activists in the UK to set up their own organization, Strike Debt UK. Writing in the new issue of the Occupied Times, the activists ask:

Can we, for example, buy discounted debt on the secondary debt market? Do we want to do this? What is the procedure? What are the relevant laws in England and Wales? Do we need a Debt Resistors’ Operations Manual here? Many of the questions raised in the group highlighted the need for people to come together, do the research, and share their findings in an accessible way. It also became very apparent that debt is becoming a popular tool in the resistance of capitalism, and as defaulting becomes more commonplace, we need to establish processes which will protect people, rather than financial institutions.

These are the right questions to ask. It would be nice if our friends on the established left felt like helping out. But we’ve been doing fine by ourselves so far. The next step is coming. Watch Barcelona in January, New York in February, maybe London in March. We are rolling.

A Return to Violence

Even before I heard about the massacre in Connecticut, before I was even technically in the country, I was reminded of the intense peculiarities of the U.S. In the Customs area of American Airlines, every kind of traveler was greeted with an immense slow-moving queue. A tall, white US citizen began remonstrating with American Airlines staff about the lack of energy in helping people. They called in Customs officers as back up and for a moment it looked as if he would be arrested. In fact, after an explanation, nothing happened.

When I finally got to the front, the Customs person I spoke to pointed out that people will have gone home blaming “big government” for that. In fact, it’s American Airlines to blame for pushing 500 people into retirement and not replacing them as part of their “restructuring.” And then he added that he could get fired for saying that. So to keep airline debt-holders happy, thousands of tired travelers are inconvenienced, miss connections, lose luggage–and added bonus, the government gets the blame.

Then, of course, we heard about the shooting. It’s important to repeat, yet again, that these don’t happen in Europe because they don’t allow people access to guns. When we see it reported that support for “gun control” has gone down, let’s remember what this really means in the condensed meme that it represents. “Gun control” means “the African-American socialist president is going to take away your guns as part of his plan to institute a United Nations-run totalitarian society.” Gun sales shot up after Obama’s elections in both 2004 and 2008.

It’s no accident that nearly every shooter in these events is a white male. That’s not to say that the shooting itself was a racialized event but that the fact that white men demand to make it absurdly easy for people like them to get guns has a racialized motive. And then the shooting of Congresswoman Giffords and the “Batman” shooting in Colorado did involve political motives.

I’ve had many occasions over the past year to write about people with unmet needs in this society. Many found their way to the occupations, when they were active, both here and in the U.K. Like most of them, whatever this young man’s issues were, he clearly did not get the help he needed. And he far more clearly received the message that this violent society sends most loudly of all, that violence is a good way to make a point, to resolve issues and to claim attention. And that it’s ok to use that violence on people weaker than yourself, whether women, children, the endebted, the homeless.

In order to make any kind of move away from the culture of violence, it’s obvious that there needs to be limits set on the possibilities that one person can attack another. But that is just a small start. The health care system needs to be able to help all those with needs. That requires more public revenue.

Women against Starbucks in the UK

Women against Starbucks in the UK

In Europe, they have ideas about that too. UK Uncut has shamed Starbucks into making some restitution for their tax avoidance by making these kinds of connections:

Sarah Greene, a UK Uncut activist said: “It is an outrage that the government continues to choose to let multinationals like Starbucks dodge millions in tax while cutting vital services like refuges, creches and rape crisis centres. It does not have to be this way.”

The politics of austerity is also a politics of violence. As the Greek Debt Audit Campaign has put it:

The link between debt, austerity and privatisation is clear. We consider it urgent to end the growing impoverishment of the people and ensure that all can cover their basic needs, as reflected in the Universal Declaration of Human Rights: housing, food, healthcare, education, employment and social services.

One way to summarize these rights is the formula “the right to existence” that comes down to us from anti-slavery organizing. A right to existence includes the right not to be subjected to physical or economic violence.

Staten Island today

Staten Island today

When I turned on my phone for the first time, one of the messages I received was from the Small Business Administration because I registered with FEMA after Sandy. It reminded me that the SBA loans were the “primary” form of government “assistance” for the disaster and that the deadline for applications was December 31, 2012. More debt, with deadlines, while people are still clearing up and finding out what their situation really is.

That’s the last official day of this project. Obviously, it won’t be over on that date.

What’s Radical Now

Fifteen months ago, OWS launched the meme of the 99% against the one per cent. We identified the agents of the crash as “Wall Street” and its primary consequence for the 99% as debt. In 2013 the agenda has to move forward. The new agents of exploitation are the mining and energy companies. The consequences are all too visible in the climate disasters.

As 2012 closes, the first billion dollar fine has been levied against HSBC bank. It’s a good symbolic moment but it amounts to 5% of HSBC’s annual profits. Directors are “deferring” their bonuses, meaning they get them in five years time. Today, it was UBS’s turn to step up for a billion dollar hit in the LIBOR case. The banks are happy because they did not get prosecuted. The financial markets let it be known that if big banks were prosecuted and declared ineligible to trade, it would engender another financial crisis. Governments don’t want that and caved. Still, the banksters have been sufficiently cowed to stop pretending they can’t afford a small increase in their US taxes.

None of this has helped the endebted very much. Admittances to British universities are down 14% this year, thanks to new tuition fees, for example. If debt suicides got as much coverage as royal-related prank call suicides, there would be nothing else in the media at all. Personal debt can’t be fixed, it can only be abolished.

And the reason for that is all around us. Abnormally cold temperatures in Northern Europe suggest that the slowing of the Gulf stream may have begun as predicted. No IPCC prediction, it should be noted, is behind predicted pace: they are all ahead. Arctic ice melt is so far ahead of presumed pace that it’s freaking out even those inside the climate change field. Floods, typhoons, hurricanes. You know the drill. We can’t grow our way out of the debt because it just adds to the planetary emergency.

So today Britain decided to approve its “dash for gas” and endorse the expansion of fracking in the UK. Never mind that the last time they tried, it set off earthquakes–yes, really. Now all they are doing is shattering carbon emission targets and polluting the British water table. Even the British government’s own climate change commission says that the planned 40 new gas-fueled power stations are not compatible with its own goals on carbon.

And it turns out that even in the neoliberal market-driven terms it makes no sense: gas will add £600 ($1000) to energy bills per year. But the same energy from renewables would only cost £100 ($160).

So welcome to your new one per cent: the energy moguls, who are driving us to extinction in the name of sustainability.


Here’s Francis Egan, head of Cuadrilla, the UK fracking mob. He was brought in from a company called BHP Billiton. You’ve never heard of them: here’s what they do:

We are a leading global resources company. Our purpose is to create long-term shareholder value through the discovery, acquisition, development and marketing of natural resources.

We are among the world’s largest producers of major commodities, including aluminium, copper, energy coal, iron ore, manganese, metallurgical coal, nickel, silver and uranium along with substantial interests in oil and gas.

What does this mean? it means they mess things up massively all over the world. Below is their own publicity photograph, demonstrating just that.

BHP Billiton

They have revenues of $72 billion annually and make pre-tax profits of $27 billion–nice returns there of 30% profit. Where do we get this information? On the debt investors page. In other words, we have to fry the planet so BHP Billiton can pay its debts. We don’t know as much about Cuadrilla because it’s a private equity company like Monsanto. But let’s have a wild guess that it’s profile is very similar. Debt, energy and climate disaster are mutually reinforcing and catalyzing. We have to get off the roundabout.

What’s radical now: demanding an end to growth, no new fossil fuel exploitation, debt abolition and a living wage. Can’t happen? Ask HSBC and UBS.


On Continuing Not To Be Dead

Instead of doing that consumerist frenzy holiday shopping thing, why not have an Occupy weekend in NYC? There are important and fun events all weekend on student activism, recovering from Sandy and what’s next for Strike Debt. Still not dead, folks.

Book Block!

Book Block!

On Friday, support the excellent occupation by Cooper Union students by participating in the book block: a parade of books as shields. Make your own from 12-1pm on Friday December 14 at Cooper Square (7 East 7th St) and then join in the discussions on the future of student activism from 1-3pm and who knows what might happen next.

Saturday Dec. 15

This is important. Here’s a call from the Occupy Sandy people taking on mutual aid in Staten Island with people from the local community:


On Saturday we, the residents of affected areas of Staten Island, will come together and make our voices heard as part of a citywide day of action.  We invite you to come hear our stories and go on a tour of our neighborhood, a tour of destruction. We will open our community and our homes to show the world what is really happening in Staten Island. Hurricane Sandy was a disaster, but the lack of government response is shaping up to be another kind of catastrophe. We deserve better and we demand answers and action.

Go! and take your friend the journalist/blogger/film maker to publicize this to the max. Houses in NYC are getting devastated by black mold, just like people were in New Orleans after Katrina. You have to demolish all the walls to get rid of it. FEMA and co are offering nothing but loans. The obvious hope is to create more upscale housing and offices on these sites, although they will equally obviously flood next time as well.

Sunday Dec 16

Winter Jubilee

Not tired yet are you? Good. So go to the Strike Debt Winter Jubilee. This is not another debt abolition event, it’s an introduction to what Strike Debt does, and hopes to do in the future, as well as a seasonal secular celebration of a year of being undead. See you there!

Debt, Haiti and Jubilee

Whoever called Paris the city of light definitely wasn’t here on a wet Friday in December like today. You felt you were barely able to wake up. In the subterranean depths of the National Library, I time travelled to 1826 when France imposed an indemnity on Haiti for having declared itself independent. And from those old papers you could begin to sense how the free republic tweaked the nose of the old slavers and monarchists. You could also perceive how the modern debt system was from its beginnings a racialized tool of domination.

Haiti became free in 1804. There’s a few documents available that record the moment, like this text of the declaration of independence:

France did not recognize the new Republic and continued to hope that it might regain its old colony. By 1826, it was clear that this would never happen. Haitians had been free for a generation and what one French colonist called “the magic of slavery” no longer worked.

In return for accepting Haiti’s independence, France demanded an indemnity of 150 million livres, the old monarchist money. However, the true believers in colonial slavery were incensed. They valued their property in the former Saint-Domingue, including human property, at no less than four billion livres so this sum seemed derisory. A pamphlet and newspaper war began, sounding for all the world like Fox News, declaring that a war could easily be won in Haiti, slavery restored and the plantations reopened.

There are dozens of such documents in the National Library. They tell another story as well, one of the post-revolutionary debts of the old slavers, unable to get their hands on the indemnity because their creditors claimed it first or because bailiffs intervened.

Against that, there’s so little from Haiti but what remains is eloquent in its own way. Haiti passed a law in February 1826 accepting the indemnity as a national debt. There are two clauses to the law, which I was able to read today. Above was Haiti’s new coat of arms, which displayed powerful cannon suggesting that the country would defend its motto “Liberty or Death,” and replaced the fetishized cash crops, like sugar and coffee, with a splendid palm tree.

The law declared:

Article One

The indemnity of 150 million pounds consented to France in exchange for the full and entire recognition of the independence of Haiti, is recognized as national debt

Art II

The President of Haiti will take measures which his wisdom will suggest to him to liberate the nation from this debt.

So although the French portrayed the indemnity as compensation for the wrongful abolition of slavery, the Haitians presented it as a contractual exchange for the full and entire recognition of their independence.

And where the French law required an extensive 27 member commission to decide what to do with the indemnity, Haiti devoted one line to the not very important question of repayment. In the first year, they borrowed the money from France to repay to France. For the next two years nothing was repaid. French royalists worried out loud about the possibility that they might refuse to pay it.

Working on that fear, President Boyer (below) had the indemnity reduced to 90 million.

But it was not all détournement and bluff. To repay the debt, Boyer had to establish a national bank of Haiti in 1826 and he compelled the subalterns to do forced labor to raise money.

But the implied leisure of Haiti’s emblem, the palm tree, was not lost on the colonists. The racist diatribes in 1826 against the formerly enslaved, accusing them of living in “indolence,” doing nothing but dance the bamboula, sleep in the sun, and eat tropical fruit prefigures both Carlyle’s widely-cited discourse against the emancipated of 1846–and of course the much desired “holiday in paradise” now sold to Northerners. What an irony: the tropical island depends for its hard currency on the former slave owners’ fantasy of the life of liberated slaves.

At Bowdoin College that same year of 1826, the second African-American to graduate from college gave the commencement address about Haiti. John B. Russwurm did not mention the debt. He was jubilant:

Can we conceive of anything which can cheer the desponding spirit, can reanimate and stimulate it to put everything to the hazard? Liberty can do this. Such were its effects upon the Haitians—men who in slavery showed neither spirit nor genius: but when Liberty, when once Freedom struck their astonished ears, they became new creatures, stepped forth as men, and showed to the world, that though slavery may benumb, it cannot entirely destroy our faculties. Such men were Toussaint L’Ouverture, Desalines and Christophe!

Such jubilant theory was exactly what the former colonists feared. They thought it meant the end of slavery and the Caribbean colonies and it did. Boyer thought he could turn the debt to his advantage and not overly burden his new nation in so doing. If he did not succeed in doing so, it was largely because the new imperialist era of the nineteenth century saw exactly what a threat Haiti had become.

Riding the Rails

The Occupy 2012 Road Trip has come to France via high-speed rail. You can get from London to Paris in two and a half hours now. Well, you can get from Calais to Paris pretty fast, and the Brits don’t delay you that much. Why is this impossible in the US, I thought? Why did the Republicans manage to delete all the high-speed rail from the stimulus and why did the Democrats let them get away with it? The train was packed, as was the link to Strasbourg, also high speed, which gets you from Paris to 30 kilometres from the German border in two hours.

Like most people I know, I really like trains. I was sitting there looking out of the window, ready to give Europe a boost, when I saw something that I don’t think I’ve seen in Western Europe before: a full-blown shanty-town. If you live in, or have traveled to, a developing country you’ll know what I mean. Informal housing, not officially connected to services, constructed out of sheets of corrugated aluminum (aluminium UK readers). The settlement was on the steep slope of a railway siding, so most of the structures must get soaked whenever it rains or snows by the runoff. And it was snowing. After London, it didn’t feel that cold out, but not so that you would want to sleep in one of those places.

As I was taking this in, I looked down at the journal I was reading, a very interesting collection of essays on race, colonialism and debt in the current American Quarterly (mostly paywalled but with a useful online resources section here) {PS American Quarterly, check out Strike Debt!!} Many of the essays show how the foreclosure disaster was particularly visited on African-American and Latina/o households, who were targeted for sub-prime high interest rate mortgages.

From there I went to thinking about China Miéville’s recent wonderful oddity Railsea [spoiler alert!!] The novel at first seems to be a reworking of Moby-Dick set on an alternative Earth where humans ride everywhere on railways–the rails, as they call them–and Captains of special trains pursue particular monstrous animals, known as their Philosophy. But we hit an alternative loop and go in search of the end of the Railsea. Without giving away too much, it turns out that the whole reason this railway world exists, with all its poisonous soil, abandoned materials from another world, mutant creatures and other foibles, was to pay off debt.

When I got off the rails, I was at once impressed by the apparent comfort and prosperity of Strasbourg, home to the European parliament, a body that is routinely steam-rollered by the Troika but apparently makes a nice living at it. I mentioned this to my anarcho-communist hosts. Oh no, they said. The city just puts all the “dangerous people” (their ironic quotes, meaning migrants, the dispossessed and so on) outside the centre of the city.

Climate Change Makes Growth Makes Debt

For some time, I have been asserting that climate change, debt and official growth figures are linked. New reports on the macro and micro levels show that the increase in climate-change-generating emissions is the same as that of global growth. Added together, they equal the figure for the increase in global debt.

Emissions are the correlative of “growth.” But now we can see that they combine to generate debt in excess of both, requiring yet more “growth” to pay back the debt. Which causes more emissions, but never enough growth to recuperate the debt. The practical results are those the new Strike Debt report on Hurricane Sandy clearly shows: climate disaster makes profit for certain sectors by debt financing. Nothing is solved, everything gets worse.

Start with climate. A new report on CO2 emissions this year shows continuing bad news:

Data show that global CO2 emissions in 2012 hit 35.6bn tonnes, a 2.6% increase from 2011 and 58% above 1990 levels.

While this is a slight decline from 2011, emissions levels are running far ahead of any possible chance to restrict climate change to 2 degrees above pre-industrial levels–if you think this year was bad, remember we’re not even half way to 2 degrees yet.

Interestingly, global growth levels are exactly the same according to current reports:

Global GDP growth is now expected to expand by an estimated 2.6% in 2012, very close to the global recession threshold of 2.5% and well below the long-term average growth rate of 3.5%. However, the forecast for worldwide GDP in 2013 is 3.2% growth.

So the “growth” we have is in fact experienced, as we all know, as recession in all but name. It now precisely mirrors carbon emissions, demonstrating statistically what I and many others have been saying: you cannot grow your way out of this financial crisis because it still further destroys the biosphere. Yet I did not realize that growth and emissions were in such lock-step.

Here’s the kicker: debt levels are rising at the aggregate of growth plus carbon emissions, as the end of year statements are showing:

Overall global debt capital markets activity totaled US$4.2 trillion during the first nine months of 2012, a 4% increase from the comparable period in 2011. Bolstered by a resurgent corporate debt market, third quarter global debt activity totaled US$1.3 trillion.

Climate change plus growth thus equals debt: minus a percentage point for losses caused by climate disasters. So here’s how it works: climate disaster generates more borrowing, which produces weak “growth,” because the disasters also cause huge personal losses.

I’m aware that “adding” emissions figures to fiscal growth is not real mathematics. Nonetheless, the comparison is striking and the realization that debt is outpacing growth two to one, even as emissions accelerate, is the definition of a no-win situation. As long as the economy is thus predicated on generating debt, we will have low growth and high carbon emissions.

The “micro” example comes from New York City, where residents are learning the hard way that FEMA is just another loan agency. All people wanting FEMA support are required to apply for loans. A new report from Strike Debt called “Who Pays for Sandy?” highlights the difficulties behind the apparent “assistance” being offered:

[the] application is reported to be at least thirty pages long. Applicants are reporting that the forms are difficult to complete, because flooding destroyed much of the required paperwork.

Nor are the loans so great when you get them. Interest rates are determined by credit scores and the ceiling on loan amounts is not very high. Nonetheless FEMA loaned about $6 billion after Katrina, with expectations post-Sandy being for much greater amounts.

As Strike Debt puts it:

By only offering loans to already struggling homeowners, FEMA and the SBA shift the burden of disaster to individuals and send profit to the loan servicers.

In short, climate change disaster generates debt creating growth. But it’s the debt that will be the highest number and the longest legacy.