Rolling Jubilee: Buying Up Distressed Debt, Occupy Offshoot Bails Out the People, Not the Banks

Well, explain, Pam. How was this conceived? And who exactly is getting bailed out?

PAMELA BROWN: Right. Well, first of all, thank you so much for having me on your show, Amy.

Right, the Rolling Jubilee was an idea that was floating around for a while. And one of the people in the video we just saw, Thomas Gokey, brought that idea to a coalition that we formed earlier this summer called "Strike Debt." And Strike Debt arose out of the Occupy Student Debt Campaign, Free University and Occupy Theory. And we came together, and we started to talk, and we realized that debt was really the tie that binds the 99 percent. It’s the intersection of Wall Street and our lives.

AMY GOODMAN: So, say more how Rolling Jubilee happens.

PAMELA BROWN: Right. So, it’s really actually a very simple idea, and yet no one has ever tried it before. But debt collectors do this all the time. What happens is that someone defaults on their debt—in other words, they cannot pay it—and the original creditor gives up on trying to collect it. And then a secondary round of people involved in the debt market, which is actually a $60 billion marketplace, decide that they’re going to try to collect on that debt. Obviously it’s not worth the original value, so the original creditors sell it for as low as five cents on the dollar, in many cases, and they sell it to a second round of collectors, collection debt buyers and collection agencies. And they then attempt to collect that debt. And, in fact, they do a pretty good job of it, because they make about $12.2 billion a year on collecting what was, in essence, defaulted debt.

AMY GOODMAN: Journalist Lindsay Beyerstein wrote an article called "Rolling Jubilee: How Does That Work?" for In These Times. She says the campaign may have unintended consequences comparable to those experienced by do-gooders who bought children out of slavery years ago. Beyerstein writes, quote, "The fatal flaw in this model was that the influx of American cash for child slaves drove up the price of children and encouraged slavers to capture more children. If Rolling Jubilee ever got off the ground in a big way, something similar would happen with credit card debt. The credit companies would make more predatory loans, and debt sellers would charge Rolling Jubilee more and more for the privilege of buying up the debt," unquote. Pam Brown, what’s your thoughts on this?

PAMELA BROWN: Right. Well, so far we’ve raised about $185,000, and that’s by no means an amount that could really impact the system. There’s over $13 trillion of consumer debt. So, it’s an interesting idea. I’m not really sure how it would play out. But I don’t think that we’re anywhere close to that point where we’re really influencing the system that way.

And the idea behind the campaign is really to expose the predatory debt system. And also, if you think about it, by buying this debt for five cents on the dollar, approximately, what we are doing is we’re preventing profits, at least at this level, and we’re also helping people, because people are really suffering. I mean, we’ve gotten emails from people saying, you know, "I can only afford to contribute a dollar. I’m a single mother. I am broke. I’m being hounded by debt collectors." And we know that the system is incredibly predatory and that it’s a racialized system, as well. Debt collectors target low-income communities of color regularly with predatory tactics, like entering judgments against them in court, things that they cannot

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