Committee for the Abolition of Illegitimate Debt

CHAPTER 1

D.R.E.A.M. (“Debt Rules Everything around Me”) [2]

Abstract

The introduction starts by elaborating the relevance of debt for our contemporary world as well as for recent protests. Reviewing the (little) literature that exists on debt-based protest, I argue that the book fills empirical as well as theoretical gaps. In order to remedy the lack of theorization of previous work in the field, I suggest turning to both social movement studies and interdisciplinary work on financialization and debt. I then provide an overview over the definition and borders of the field of “contentious debt politics,” the research design and the methods used to generate data. The chapter closes with an outlook on the rest of the book.

Keywords: debt, financialization, social movements, contentious politics

Loosening the shackles of debt servitude begins with a quest of the moral imagination, after all. It means rethinking the question of to whom – or Whom – we owe what. What, as human beings, are our highest responsibilities, and what does justice demand in transactions between unequal partners? (Strike Debt 2012b, 8)

 

Marx’s call for working-class-based socialism remains valid for advanced societies; nothing in the last hundred years of world history has undercut the compelling potential, indeed necessity, of that call. (Skocpol 1979, 292)

The North Atlantic Financial Crisis and European Debt Crisis have catapulted debt politics into the limelight of public debates in the Global North. These crises entailed new discourses centered on social, political, and economic justice: While states used enormous public funds to bail out failed banks, countless individuals faced and face evictions, poverty, or decades of indebtedness due to stagnant wages, mortgages, unemployment, lack of healthcare, or student debt, among others. After using public funds to save financial sectors, states were eventually confronted by debt crises themselves, which have been perpetuated by years of recession due to austerity programs.

The general problematique at large is not new to many regions of the Global South. Governments and social movements in Latin America, Sub- Saharan Africa, and large parts of Asia have struggled with access to cheap credit and increasing debt burdens for decades. High interest rates Interest rates When A lends money to B, B repays the amount lent by A (the capital) as well as a supplementary sum known as interest, so that A has an interest in agreeing to this financial operation. The interest is determined by the interest rate, which may be high or low. To take a very simple example: if A borrows 100 million dollars for 10 years at a fixed interest rate of 5%, the first year he will repay a tenth of the capital initially borrowed (10 million dollars) plus 5% of the capital owed, i.e. 5 million dollars, that is a total of 15 million dollars. In the second year, he will again repay 10% of the capital borrowed, but the 5% now only applies to the remaining 90 million dollars still due, i.e. 4.5 million dollars, or a total of 14.5 million dollars. And so on, until the tenth year when he will repay the last 10 million dollars, plus 5% of that remaining 10 million dollars, i.e. 0.5 million dollars, giving a total of 10.5 million dollars. Over 10 years, the total amount repaid will come to 127.5 million dollars. The repayment of the capital is not usually made in equal instalments. In the initial years, the repayment concerns mainly the interest, and the proportion of capital repaid increases over the years. In this case, if repayments are stopped, the capital still due is higher…

The nominal interest rate is the rate at which the loan is contracted. The real interest rate is the nominal rate reduced by the rate of inflation. strain public budgets for social spending, and the International Monetary Fund IMF
International Monetary Fund Along with the World Bank, the IMF was founded on the day the Bretton Woods Agreements were signed. Its first mission was to support the new system of standard exchange rates.

When the Bretton Wood fixed rates system came to an end in 1971, the main function of the IMF became that of being both policeman and fireman for global capital: it acts as policeman when it enforces its Structural Adjustment Policies and as fireman when it steps in to help out governments in risk of defaulting on debt repayments.

As for the World Bank, a weighted voting system operates: depending on the amount paid as contribution by each member state. 85% of the votes is required to modify the IMF Charter (which means that the USA with 17,68% % of the votes has a de facto veto on any change).

The institution is dominated by five countries: the United States (16,74%), Japan (6,23%), Germany (5,81%), France (4,29%) and the UK (4,29%).
The other 183 member countries are divided into groups led by one country. The most important one (6,57% of the votes) is led by Belgium. The least important group of countries (1,55% of the votes) is led by Gabon and brings together African countries.

http://imf.org (IMF), World Bank World Bank
WB The World Bank was founded as part of the new international monetary system set up at Bretton Woods in 1944. Its capital is provided by member states’ contributions and loans on the international money markets. It financed public and private projects in Third World and East European countries.

It consists of several closely associated institutions, among which :

1. The International Bank for Reconstruction and Development (IBRD, 189 members in 2017), which provides loans in productive sectors such as farming or energy ;

2. The International Development Association (IDA, 159 members in 1997), which provides less advanced countries with long-term loans (35-40 years) at very low interest (1%) ;

3. The International Finance Corporation (IFC), which provides both loan and equity finance for business ventures in developing countries.

As Third World Debt gets worse, the World Bank (along with the IMF) tends to adopt a macro-economic perspective. For instance, it enforces adjustment policies that are intended to balance heavily indebted countries’ payments. The World Bank advises those countries that have to undergo the IMF’s therapy on such matters as how to reduce budget deficits, round up savings, enduce foreign investors to settle within their borders, or free prices and exchange rates.

, and powerful creditor governments tied financial relief to neoliberal reforms. These included financial and economic liberalization, which rendered Southern economies even more vulnerable to economic and financial crises, thus precipitating a downward spiral of debt, crisis, and austerity. At the same time, increasing amounts of financial capital seeking less and less profitable investment possibilities and income streams targeted especially the poor and women in various Southern contexts via micro-credits, thus integrating them into global financial markets in highly exploitative ways. The lesson that debt constitutes a social relation embedded in economic, political, and cultural power relations has now traveled North, with financial markets and creditors disciplining noncompliant governments such as in Greece, or commodifying and financializing the poor via payday loans, for instance.

Academia successively started to theorize transforming debt relations particular to the age of late neoliberalism, building on older heterodox traditions of social studies of the economy and finance (Carruthers & Kim 2011; van der Zwan 2014; Dünhaupt 2016). For instance, scholars have elaborated the intricacies of decades of debt-financed consumption (Crouch 2009; Soederberg 2015; Kus 2015). For the last decades, low- and middle-class consumers have increasingly used credit as a way to maintain their standard of living amid stagnating wages, unemployment and eroding social welfare structures. Frequently along similar and related lines, other research from heterodox economics and political economy has pointed out the origins and logic of recent sovereign debt Sovereign debt Government debts or debts guaranteed by the government. crises and the intertwined roles of different forms of debt within it (Lapavitsas 2012; Blyth 2012; Streeck 2013a). As a final example, some scholars have worked on cultures and moralities of debt, ascribing a constitutive force to the moral practices of rating and classifying individuals, groups and states (Ho 2009; Fourcade 2013; Streeck 2013b).

David Graeber’s “Debt – The First 5000 Years” may have constituted the highlight of these fruitful exchanges, which linked movement discourses to academic literature in very productive ways. Among (many) other things, Graeber (2011) points out that historically debt has been one of the most effective ways to frame relations of force and hierarchy as just and moral. As a consequence, he argues, revolts against debt have an extremely long history:

For thousands of years, the struggle between rich and poor has largely taken the form of conflicts between creditors and debtors-of arguments about the rights and wrongs of interest Interest An amount paid in remuneration of an investment or received by a lender. Interest is calculated on the amount of the capital invested or borrowed, the duration of the operation and the rate that has been set. payments, debt peonage, amnesty, repossession, restitution, the sequestering of sheep, the seizing of vineyards, and the selling of debtors’ children into slavery. By the same token, for the last five thousand years, with remarkable regularity, popular insurrections have begun the same way: with the ritual destruction of the debt records-tablets, papyri, ledgers, whatever form they might have taken in any particular time and place. ... As the great classicist Moses Finley often liked to say, in the ancient world, all revolutionary movements had a single program: “Cancel the debts and redistribute the land. (Graeber 2011, 8)

Moses Finley (1973, 80) calls this “the perennial revolutionary program of antiquity, cancel debts and redistribute the land, the slogan of a peasantry, not of a working class.” But the emergence of capitalist modernities did not end the pivotal role of debt for protest and mobilization. Indeed, debt was used to control indentured servants in the colonization of North America and served as an excuse for imperialist wars such as the British conquest of Egypt in 1882. However, debt related not only to accumulation by dispossession, but the general everyday valorization and reproduction of capital. The triplet processes of enclosures, witch hunts and colonialism provided capital with cheap labor power, which was increasingly dispossessed from other means of reproduction in market societies. The expansion of monetary relations meant that debt could now be accurately calculated, but this quantification nonetheless happened under unequal power relations. For workers debt could mean losing the formal freedom of wage labor – in Marx’s double sense as legal freedom and freedom to starve – and thus descending into forced labor or debtors’ prisons. Even today, debates around “modern slavery,” racial justice, carceral debt and the prison industrial complex render visible that the connection between debt and forced labor do not belong to a pre-modern past.

Elites, corporations and powerful states experience debt in a different way. Banks that were “too big too fail” in 2008 had their private losses socialized, while indebted households lost their homes. Early post-fascist Germany experienced debt relief for geopolitical reasons in 1953, while the Greek state was denied the same treatment in recent years. And while the US state is the biggest debtor in the history of the world, this debt has served to fund US hegemony and does not prevent liquidity Liquidity The facility with which a financial instrument can be bought or sold without a significant change in price. from seeking refuge in the US bonds as a safe heaven. Debt is thus not a straightforward number, but a social relation embedded in unequal power relations, discourses and moralities. This means that colloquial notion that “you have to pay your debt” does not apply to everyone equally, renders invisible the social contexts in which debts emerge, and can more easily be utilized from a position of institutionalized power.

Graeber (2011, 120ff) argues that debtor and creditor are formal equals who fall into a temporary relation of hierarchy until that debt is paid back. Since the debtor is expected to formally be an equal, there must be something wrong with them if they cannot restore themselves to equality. Graeber (2011, 121) states that this is what makes “unpayable debt so difficult and painful.” The explosive power of debt may thus derive from the following precarious constellation: The notion of formal legal equality in capitalist modernity is paralleled by an “instiutionalized social order” (Fraser 2013b) that continuously produces inequalities and fuels the social production of difference. This means that reciprocal relations imply an equality between trading Market activities
trading Buying and selling of financial instruments such as shares, futures, derivatives, options, and warrants conducted in the hope of making a short-term profit. partners that the power relations of actually existing capitalism continuously betray.

In light of this friction, it seems even more puzzling that research on debt has been growing, while resistance against debt remains tremendously understudied. Attempts at theorizing anti-debt mobilization in times of capitalist modernity in general (and of financialization or late neoliberalism in particular) thus have little literature to depart from. This text would like to contribute to closing this gap and provide an analysis of what I call contentious debt politics (see below) in North Africa and the North Atlantic since the North Atlantic Financial Crisis.

In the rest of this introduction, I will develop what I perceive to be the concrete empirical and theoretical gaps in the literature. In order to do so, I will touch some of the literature on debt campaigning in the context of the Southern debt crisis since the 1970s, which provides some conceptual, empirical, and theoretical groundwork to build upon; and suggest the need to engage social movement studies and critical political economy for this study in particular, and for the sake of the both fields in general. I will then elaborate what I perceive to be the field of contentious debt politics and discuss the methodological approach I chose to gather empirical data in said field. The introduction closes with a brief outline of the content of this book.

The Southern Origins of Recent Contentious Debt Politics

Most of the limited research on debt struggles has refrained from going far beyond empirical description of single or multiple anti-debt campaigns. Studies have mostly focused on the popular Jubilee 2000 campaign, which demanded relief for indebted countries in the Global South. Jubilee 2000 was relatively successful in triggering large-scale collective action across borders and sympathetic press and academic coverage.

Soren Ambrose (2005) for instance delivered a useful historization of the Southern debt movement, its demands and the debt problematique from a participant perspective. The same goes for Yovana Reyes Tagle and Katarina Sehm Patomäki (2007), who provide an extensive data collection, describing the actions and discourses of the debt movement, but also hardly theorizing it. Elizabeth Friesen (2012) frames Southern challenges to debt politics as a Polanyian counter-movement to the Washington Consensus, which attacked dominant discourses and agenda-setting. Elizabeth Donnelly (2002) traces debt campaigning mostly in the Global North from the 1970s to 2000s and puts particular emphasis on the contribution of religious networks (Donnelly 2007).

Ruth Reitan (2007) has published one of the most comprehensive analyses of the Southern debt movement within her book “Global Activism.” In contrast to most of the other pieces mentioned, she went far beyond the descriptive level. Reitan sees the origin of the contemporary anti-debt movement in the Global South “IMF riots” since the mid-1970s, reacting to the social grievances of debt-related austerity measures (Reitan 2007, 69). She further points out the pivotal role of transnational Christian networks and organizations as well as humanitarian and environmental NGOs in the scale-shift from localized anti-austerity reactions, to cross-border brokerage and diffusion and finally to joint initiatives (Reitan 2007, 70 ff). The Jubilee 2000 campaign succeeded to mobilize vast numbers of participants and received sympathetic press coverage as well as a commitment from creditors for significant debt reduction. The contentious repertoire ranged from popular education and petitions to civil disobedience and “human chains.” Jubilee 2000 managed to mobilize large numbers of participants and won verbal commitments from powerful actors, but failed to initiate significant debt relief and was demobilized to a certain extent after said verbal commitments (Reitan 2007, 84-86).

Whereas Reitan provides a deep analysis of mobilizing structures and framing strategies, and translates the useful distinction between different forms of transnational social movement networks into the context of debt campaigning, Jean Somers (2014) focuses more on power and political processes. She traces debt campaigning in a transforming world order from the emergence of transnational networks since the Southern “IMF riots” in the last quarter of the 20^th century, to the more technical and professionalized debt campaigning in a unipolar world after the demise of state socialism, and finally the Jubilee 2000 campaign within the Global Justice Movement seeing the first cracks in neoliberal hegemony. From such a perspective, we see the important role of transforming political systems, critical junctures, and emerging international arenas.

A variety of other authors contributed single-case studies of national debt relief campaigns (e.g. Rustomjee 2004; Ariate & Molmisa 2009) or comparative analyses of different campaigns (e.g. Holmes 2006; Josselin 2007). In Chapter 4, I will reconstruct the trajectory of contentious debt politics in the Southern debt crisis until the North Atlantic Financial Crisis and thereby draw heavily from the studies mentioned above. While empirical research on contentious debt politics in recent years is scarce, these older studies foreshadow many of the contemporary movement practices and conflicts as well as conceptual questions.

As elaborated above, Ruth Reitan (2007, 2013) and Jean Somers (2014) have produced notable exceptions to the often somewhat descriptive literature and connected their extensive empirical research to some of the theoretical insights of social movements studies. However, their accounts do not cover the tremendous transformations of debt politics since the North Atlantic Financial Crisis, nor do they aim to theorize specificities of debt struggles vis-à-vis other fields of contentious politics, at least from this author’s perspective. Reitan is mostly interested in transnational connections and uses Jubilee as one case study among others illustrating her conceptualization in action, whereas Somers focuses on the capacity of transnational civil society to exercise power in engagements with institutional actors.

Any attempt to carve out the specificities of contentious debt politics would need to extend the insights of social movement studies towards debates in heterodox economics, political economy, economic sociology, and economic anthropology, as these elucidate the field of debt politics and performatively shape contentious discourses themselves. As a consequence, I will review the respective literature in Chapter 3 and try to outline useful concepts and mechanisms from these disciplines in order to include them in the empirical analysis.

Social Movement Studies versus Critical Political Economy

From such a departure point, one has to first note the curious fact that quite recently both social movement studies (SMS) and critical political economy (CPE) have autonomously initiated debates longing for reducing the large gap separating these two academic communities, important exceptions of interdisciplinary research notwithstanding. While social movement scholars have rightly criticized the “strange disappearance of capitalism” (Goodwin & Hetland 2009) from their field, critical political economists have lamented a tendency to focus on domination and stable structures in the European crisis and beyond, thereby excluding disruption, resistance, contradiction from the academic gaze (Huke & Clua-Losada & Bailey 2015).

SMS has since the 1960s formed as an autonomous academic community in o pposition to both structural-functionalism and economist-determinist Marxism (della Porta & Diani 1999, 6). Psychologizing narratives perceived contentious action as deriving from psychological anomalies related to feelings of deprivation and aggression (della Porta & Diani 1999, 7). Orthodox Marxist accounts, on the other hand, could not grasp the multiplicity of social stratification beyond the working class and often suffered from (economic) determinism: Grievances do not necessarily translate into collective action, as the former are often present without the latter (della Porta & Diani 1999, 6). Over decades, social movement scholars have developed various concepts in order to solve these puzzles, from political opportunity structures to resource mobilization and framing.

These explanatory paradigms will be touched upon in Chapter 3; suffice it to say at this point that SMS has emerged as a separate discipline with a clear identity and relatively autonomous concepts and theories. While SMS thus developed with explicit boundaries from neighboring approaches it perceived as inadequate, early scholars were still highly influenced by critical analyses of “capitalism” and a variety of other Marxist concepts such as class relations or means of production featured prominently (e.g. Tilly 1978; Skocpol 1979; McAdam 1982).

Jeff Goodwin and Gabriel Hetland (2009, 5 ff) review the content of titles and abstracts of SMS’s two largest English-language journals and conclude that “a concern with capitalism had virtually disappeared from the field.” Reflecting on the reasons for this change, they find:

What happened? What might account for this strange disappearance of capitalism from social movement studies? Here, we can only speculate, but we would argue that this transformation is the result of several linked factors, including the waning after the 1970s of Marxism in the social sciences, the so-called “cultural turn” in academia, and a growing

emphasis on micro- and meso-level analysis – including framing and network analysis – in social movement studies proper. Our aim here is not of course to criticize cultural, framing, or network analysis, but simply to point out that these have effectively – and unnecessarily – “crowded out” a concern with political economy in the field. As a result, a number of promising causal mechanisms linked to the dynamics of capitalism are no longer even considered worthy of attention by movement scholars. (Goodwin & Hetland 2009, 10-11)

SMS is not the sole field of research that underwent such a transformation, and indeed a range of larger trends in the social sciences contributed to it. Departing from Goodwin and Hetland’s empirical observation of and meditations on the “strange disappearance,” a group of Florence-based social movement scholars identified one exogenous and three endogenous reasons (Cini & Chironi & Drapalova & Tomasello 2017). Exogenously, they perceive the overspecialization of sociology as problematic for analyses of larger societal transformations, which relates to two endogenous tendencies, namely the focus on micro- and meso-perspectives as well as the relatively short timeframes of social movement analyses.

Both papers in different ways imply that SMS critiques of Marxism reproduce the economism of a particular reading of Marx they sought to criticize. They identify capitalism with “labor,” “the market,” or “the economy” and thereby render illegible the cultural and political implications of capitalism as a social system. This is even more troubling since critical political economy (CPE) has endogenously debated the shortcomings of some of the dominant varieties of 20^th-century Marxism and produced numerous innovative approaches from post-operaism (Hardt & Negri 2000) and autonomist Marxism (Holloway 2002) to value theory (Postone 1980) and cultural political economy (Jessop & Sum 2013). In this way, SMS frequently exclude decades of advancement in CPE. Ritualized contemporary SMS critiques of historical materialism thus occasionally sound more antiquated than the Marxist strawmen they debate.

Meanwhile, parts of the CPE community have engaged in various debates about the role of the state, culture and the intersection of different categories of social stratification, among others. Nikolai Huke, Mònica Clua-Losada, and David Bailey (2015) for instance have recently pointed out that much of related literature has tended to center on relations of domination, without contextualizing these with contentious disruptive action. Narratives of powerful elites securing domination in the political, economic and cultural realm have rendered legible the production and reproduction of unequal social power relations, they argue, but perspectives should also include subaltern agency and the “incompleteness of sovereignty and control” (Huke & Clua-Losada & Bailey 2015, 3):

“Macro” (or capital-focused) Marxist accounts, we argue, have successfully highlighted the class character of the European project, but have proved largely unable to address or inform those seeking political strategies that are able to oppose and challenge the devastating effects of neoliberal European integration. (Bailey & Clua-Losada & Huke & Ribera-Almandoz 2017, 3)

As a consequence, CPE frequently neglects or obscures the existence of resistance and the creative agency of subaltern subjects. These tendencies relate to the above-elaborated discrepancy between the emergence of research on the role of debt in the crisis, and the simultaneous lack of perspectives on the disruption of debt politics.

Parallelizing social movements studies’ need to study the coevolution of protest and policing (della Porta & Tarrow 2012), I will thus try to build bridges between CPE and SMS in order to zero in on the contradictory and innovative interaction of social control and resistance. Such an attempt would need to strike a balance Balance End of year statement of a company’s assets (what the company possesses) and liabilities (what it owes). In other words, the assets provide information about how the funds collected by the company have been used; and the liabilities, about the origins of those funds. between an overly elitist focus on domination elaborated above, and romanticizing social movements as somehow existing outside of power relations or as acting independent of hegemonic power and control. In practice, this project will draw from CPE and its neighboring fields in order to delineate the structural context within which contentious agencies act in the ways described by SMS.

To sum up, these two academic debates within SMS and CPE reinforce the points I concluded from the gaps in existing literature on debt campaigning. Research on contentious debt politics should neither focus exclusively on the structure-making capacity of elites, nor should it divorce a study of social movements in the field of debt politics from an analysis of political economy. One theoretical aim of this text will thus be to contribute to a fruitful theoretical engagement of these two epistemic communities, and to appropriate their insights for the field of contentious debt politics. Insights from the contentious politics approach, mentioned above and further elaborated in Chapter 3, can contribute to such an endeavor.

Contentious Debt Politics and How to Study Them

In this book I suggest the concept of contentious debt politics as a mixture of contentious politics and debt politics. I define the former as “collective political struggle” (McAdam, Tarrow and Tilly 2001). With the latter I would like to render legible the pivotal role of political rules in different forms of debt governance. Debt-centered movements – i.e. social movements that explicitly organize around debt – tend to not mainly disagree with a specific amount of debt of certain social groups or collectives, but challenge the broader rules that govern debt and that made said debt possible in the first place. Contentious debt politics thus refers to collective political struggle over the rules that govern debt. I developed this concept while studying anti-austerity politics at large.

Austerity means a set of policies that aim to reduce sovereign debt by cutting public spending, associated with larger ideas of economic liberalism trying to push back welfare state institutions (Blyth 2012; Plehwe 2016). Debt politics are an important and indeed constitutive aspect of such policies, as debt levels justify wide-ranging reforms and shape the space for navigation of indebted individuals and collectives. However, austerity as well as neoliberalism transcend the field of debt politics. Debt politics movements therefore fill but one field of protest in the broad social process that is anti-austerity. Conflicts surrounding cutbacks in health, education, or housing, privatizations, free-trade arrangements, urban exclusion, and others converge in anti-austerity politics and thereby produce cross-sector and cross-national linkages and organizational platforms. While anti-austerity platforms at large have certain conceptions of debt and engage in contentious debt politics, they do not primarily define themselves via debt politics, unlike the networks which are the focus of my research. In order to aim for a relational perspective, I have situated debt-centered groups within the broader context of anti-austerity, but maintained a focus on the former.

The main actors within the field of contentious debt politics comprise movement organizations, NGOs, movement parties, as well as individuals. These groups and individuals form a network of networks and engage in collective action to transform debt politics. In the language of the contentious politics approach, these actors represent challengers in the sense of “constituted political actors” lacking “routine access to government agents and resources” (McAdam, Tarrow and Tilly 2001, 12). The scope of research also included allies of these challengers from within polities of a certain jurisdiction, such as movement parties or dissident insiders.

Some of the actors in this text prefer contained contention; others opt for more transgressive repertoires (McAdam, Tarrow and Tilly 2001, 77 ff). They sometimes choose to channel contention into institutional or collective extra-institutional pathways, or into a mix thereof. Resistance to debt can also take the form of extra-organizational everyday resistance by non-constituted actors or groups, that which Asef Bayat (2010) has termed a social non-movement. While such practices are certainly important, they fell victim to the choice of field and actors and efforts to narrow the scope of research, since this project is mainly interested in collective organizational responses to debt-related grievances. An inclusion of regressive movements would have certainly been interesting, even more so since finance occupies a pivotal role in more coherent bodies of right-wing theory, which conceive of finance as an elitist and parasitic (often implicitly or explicitly ethnicized as Jewish) force to subjugate (Postone 1980; Berlet and Lyons 2000). However, I eventually had to decide to maintain the focus on their progressive counterparts due to the already extremely broad scope of this project.

When presenting parts of this project, I have often encountered the question whether I focus on private, public, or multiple forms of debt. Similar to my geographical choices, the actors I followed and the logic of the field made that decision for me. While I will differentiate between debts that belong to states, families, or corporations, i.e. sovereign or public debt, household debt, and private (corporate) debt, these different forms of debt are inherently related. When challenging financialization as a general expansion of financial transactions, the concern is primarily with the general increase of debt, not only who holds it at a particular movement. Debt circulates between states, financial and non-financial corporations Non-financial corporations All economic agents that produce non-financial goods and services. They represent the greatest share of productive activity. , and households. States tax or subsidize corporations and households and may bail out bankrupt entities; corporations pay their workers; and households spend their money, thereby channeling it back into public or corporate pockets. The networks I chose to follow primarily focus on sovereign debt, which they identify as a pivotal lever for the dispossession of the commons, but also problematize grievances deriving from household debt and challenge the debt of private financial corporations as the main reason for the recent financial crisis.

Because of the lack of existing literature, I profited from extensive exploratory research. Along the same lines, the empirical field and its research questions were not deductively developed from hypotheses derived from existing literature on the topic. Instead, they constituted the first inductive step to explore a new field and to narrow the scope of a longer abductive research process. As a consequence of this focus on exploratory research and case-based comparison instead of pre-determined variables (della Porta an Keating 2008; Schwartz-Shea and Yanow 2012), research did not focus on a randomly assigned variety of cases, but on a low number of paradigmatic sites constitutive of the field of contentious debt politics as I perceived it.

These sites included different countries in North Africa and Europe, and eventually the US. Following the logic of the field as experienced during exploratory field work in Tunisia, Egypt, Belgium and Germany, I quickly identified three transnational networks and their constituent groups as the main protagonists of contentious debt politics, linking actors south and north of the Mediterranean. The more moderate European Forum on Debt and Development (Eurodad) formed as an institutional advocacy network, while the Committee for the Abolition of Illegitimate Debt (CADTM) identifies with more radical Global Justice direct action networks proposing unilateral and adversial action. While these groups launched in the early 1990s – effectively preserving the lessons of contentious debt politics for younger generations –, the International Citizen Debt Audit Network (ICAN) emerged out of recent anti-austerity protests and square occupations an reflects their horizontal and participatory practices. These new formations spanned across the Mediterranean and linked Tunisian, Moroccan, and Egyptian groups with their European counterparts, which manifested in the constituency of ICAN. Additionally, US groups established connections with these networks, albeit especially to the European groups.

I effectively focused on a decade of contentious debt politics since the North Atlantic Financial crisis until 2017, which I perceive as an episode of contention. Field impressions quickly suggested three overlapping periods: the diffusion of the crisis as a critical juncture in the field (2006-2009); the diffusion of new anti-austerity protest in the square occupations (2010-2012); and the transformation of the acampadas into durable local movement organizations, transnational networks, and new movement parties (2011/12-2016). Mobilization eventually slowed down with the return of reactionary forces in North Africa and the capitulation of Syriza in Greece. When I entered the field in 2014 against the background of several years of experience with the Arab Spring and transnational anti-austerity protests, a lot of the formative events in the field of contentious debt politics had already occurred and I needed to reconstruct them via documents and interviews.

Perceiving the field as an ensemble of interrelated sites, the research design was heavily inspired by Philip McMichael’s (1990) “incorporating comparison,” and Michael Burawoy’s (2000, 2009) “extended case method” and “global ethnography.” An incorporating comparison perceives cases not as external to time and space, but as relational processes embedded in social reality, thereby transcending methodological nationalism. Contentious debt politics in Tunisia, Egypt, Greece, or the US cannot be compared as distinct cases, since structural processes of financialization, sovereign debt crises and austerity cut across borders, producing debt-related grievances. Even more so since debt politics networks form transnational organizational links and exchange knowledge and resources.

Along these lines, I did not do a comparative study of separate debt movements in different countries, but a deep case-study of transnational contentious debt politics in interrelated sites. I followed my research subjects around for several years, thereby observing social practices and leaving space for reconfiguring the research project and expectations. This is how I identified debt as a crucial issue and interesting topic to study in the first place, how Tunisian developments led me to Belgium as a site for many important debt-related NGOs, and how Greece as a pivotal site for debt struggle has become visible, for instance. While single case-studies producing thick knowledge about a local site can certainly be tremendously enlightening (Flyvbjerg 2004), a multi-sited (Falzon 2009; Marcus 1995) and global (Burawoy 2000, 2009) ethnography as presented here can potentially deconstruct the methodological nationalism inherent to most comparative research designs as well as the local-global-binaries. My research design thus links the empirically thick study of locally embedded processes with the tracing of circulations of people (contentious actors), things (debt) and discourses (Marcus 1995, 105 ff).

Data was gathered via participant observation, semi-structured interviews (33 to 44 minutes on average) and an analysis of hundreds of movement publications, homepages and protocols. Multi-sited participant observation (Figure 1) in early research helped to identify contentious debt politics as a field of mobilization as well as the main network structures and actors within it. It also illuminated connections between sites, popular organizational, framing and action repertoires as well as the broader field of anti-austerity politics. Observed events included internal organizing meetings and conference calls, (transgressive) protest events entering public space, and public debates. All of these frequently converged during large transnational protest summits, such as the Blockupy protests surrounding the opening of the new European Central Bank Central Bank The establishment which in a given State is in charge of issuing bank notes and controlling the volume of currency and credit. In France, it is the Banque de France which assumes this role under the auspices of the European Central Bank (see ECB) while in the UK it is the Bank of England.

ECB : http://www.bankofengland.co.uk/Pages/home.aspx building, the World Social Forum(s) in Tunis, or the European Action Days in Brussels – all of those in 2015 alone. These large transnational events serve as hubs for exchanging information, strategies, and ideological formations across networks and fields of mobilization. Initiatives and campaigns formed, contacts were established, people mobilized.

Figure 1 Participant observation overview

Interviews (Figure 2) form another crucial element of ethnographic studies, especially in social movement studies with its “relative scarcity of systematic collections of documents or reliable databases” (della Porta 2014, 228). In addition to ethnographic interviews, I conducted a total of 33 interviews, which ranged from about 20 to 120 minutes, with an average of 44 minutes.

Figure 2 Interviews

Although Skype was considered as a possibility, interviews were always done in person since frequent large movement events navigated me across multiple settings, where I had enough opportunities to conduct a satisfying number of interviews. Interview partners were snowballed according to geographical and social diversity, but also with the axiom that additional interviews can never hurt, as over-representation of certain social groups, organizations, geographical contexts can be critically reflected, especially in relatively inductive work done for theory-building in somewhat uncharted territories. English, French, and German (in addition to some small talk in Tunisian Arabic) fortunately proved sufficient.

Participant observation and interviews have contributed vast amounts of data, which I have complemented with the analysis of movement texts such as protocols, homepages, and movement publications. While these sources helped tremendously in the reconstruction of prior events, for the accumulation of factual information, and to arrange and prepare interviews, the texts also constituted the foundation for an analysis of the knowledge and framing practices of contentious debt politics networks (although data from other methods was taken into account for this as well).

I have gathered or secured access to hundreds of movement publications, homepages, and protocols, and analyzed them systemically. Indeed, reading through them was organically embedded in the ethnographic process, which benefited the later rounds of more rigorous and systematic document analysis via MAXQDA. The documents ranged from calls for action and open letters to brief articles, yearly progress reports, newsletters, theoretical monographs, edited volumes, videos, and formative texts about the respective group’s identity. Newsletters, progress reports, and protocols were tremendously helpful for tracing and reconstructing contentious activities and organizational repertoires, whereas books, pamphlets, videos etc. were particularly useful for the analysis of knowledge production and framing.

The data collected was triangulated using these methods (Balsiger and Lambelet 2014, 19) and interview transcriptions, notes, and network texts were uploaded into MAXQDA to provide for a systemic data evaluation process via categorization, coding, and analysis (Balsiger and Lambelet 2014, 18). In accordance with the interpretivist research design, the project focused on concept formation (e.g. formation of debtors’ clubs, deconstructing debt fetishism) and thick description. A first cycle of in-vivo coding served as a first step towards concept-building (Saldaña 2009). In a second round of focused, axial, and theoretical coding, I eliminated some codes in order to move towards a smaller number of major themes, which foreshadowed the eventual structure of Chapters 5 to 9.

The Outline of This Book
In the following lines I will trace the diffusion and transformation of contentious debt politics in North Africa the North Atlantic since the North Atlantic Financial Crisis, from the impact and nature of the crisis, to debt-related grievances, the organization of debtors and their allies into debtors’ clubs and unions, the repertoires of knowledge production, and new forms of collectively dis-/engaging creditors and creditor institutions. As set out above, I will attempt to link insights from CPE and SMS to zero in on the co-evolutionary diffusion of debt-related grievances and contentious debt politics. Such an approach will hopefully provide empirical insights to the ways the recent crisis has worked as a critical juncture to open space for the transformation of contentious debt politics, which had so far been mainly restricted to the Global South. This analysis will illuminate different ways the evolution of capitalism and related broader waves of contention have affected grievances, political opportunities, constraints, and threats, as well as organizational, knowledge, and action repertoires. The text will also highlight the fact that debt constitutes an important feature of anti-austerity in and of itself, and try to delineate several more general mechanisms of contentious debt politics.

Chapter 2 reviews selected literature on debt and financialization on the one hand, and some of the state of the art in social movement studies on the other. Heterodox and interdisciplinary approaches to financialization help to trace the structural processes constitutive of debt-related grievances, while social movement studies provides useful concepts to analyze how these grievances turned into collective action. The financialization literature is itself relatively heterogeneous, and can be categorized into approaches that focus on accumulation patterns, the rise of shareholder value, or the financialization of everyday life (van der Zwan 2014). I will mostly turn towards approaches from heterodox economics and historical materialism, which analyze the embeddedness of debt relations in financialization as a mode of accumulation, but also include insights from economic sociology and economic anthropology, which highlight the cultural and moral aspects of debt and finance. From social movement studies, I will briefly mention some of the main concepts from grievances and political opportunities to mobilizing structures, framing, and action repertoires. Against this background, I will then develop my reading of the processual turn in social movement studies, and discuss the contentious politics framework as one among others to link different concepts in social movement studies, and discuss the contentious politics framework as one among others to link different concepts in social movement studies to broader processual, relational, and constructivist perspectives.

After the literature review, Chapter 3 draws from these heterodox social science analyses of “the economy” to outline the historical emergence and trajectory of the financialization of capitalism. I will argue that (and illustrate how) financialization transformed the practices of non-financial corporations, banks, households, and states. With non-financial corporations developing autonomous financial capacities and becoming financial markets actors themselves, banks lost a traditional field of profit Profit The positive gain yielded from a company’s activity. Net profit is profit after tax. Distributable profit is the part of the net profit which can be distributed to the shareholders. . In order to make up for this, banks capitalized on deregulated financial markets as well as on the assets of households, and subsequently securitized these assets to lend heavily to other banks and households, who in turn increasingly financed consumption via debt due to wage stagnation and the loss of public welfare. Government (de-)regulation and public debt crises facilitated this transformation and the drastic increase of the US federal funds rate by the FED FED
Federal Reserve Officially, Federal Reserve System, is the United States’ central bank created in 1913 by the ’Federal Reserve Act’, also called the ’Owen-Glass Act’, after a series of banking crises, particularly the ’Bank Panic’ of 1907.

FED – decentralized central bank : http://www.federalreserve.gov/ in 1979 (and the Southern debt crisis it precipitated) constituted the start signal for a new wave of contentious debt politics in the Global South.

Chapter 4 then uses this context to trace the history of transnational movements and campaigns against what they termed “odious” and “illegitimate” debt in the Global South from the 1970s to the 2000s, which constitute a direct reaction to the debt crises in Latin America, Sub-Saharan Africa, and parts of South and Southeast Asia. The networks challenged contemporary levels of sovereign debt and the rules that produce and reproduce them, and shared the assumption that debt politics are constitutive or reflective of debt-related grievances, and that other forms of debt politics are possible and desirable. The chapter will introduce some of the actors, structural constellations, repertoires, and discourses which have reappeared in the recent crisis.

Chapter 5 takes a historical leap forward towards the recent wave of contentious debt politics since the North Atlantic Financial Crisis; and thereby also a geographical leap from Latin America, Sub-Saharan Africa, and South/-east Asia towards North Africa and the North Atlantic, where debt struggles have increased dramatically since 2006. I will first return to the transformations entailed by financialization outlined in Chapter 4 and argue that these initiated processes to eventually entail the North Atlantic Financial Crisis. I will then map the diffusion of the crisis from the US housing sector towards North Atlantic banking networks, and from there to the rest of the world as the financial crisis turned into a global recession. The chapter will elaborate how the financial and economic crises turned into interrelated social and political crises, and how these multiple crises precipitated deep crises of legitimacy across countries. I will argue that this critical juncture was interpreted by established transnational movement networks and INGOs in the field of contentious debt politics as threats to debtor countries and affected citizens, but also as an opportunity to challenge neoliberalism and hegemonic debt politics in new geographical contexts.

Chapter 6 introduces the waves of anti-austerity protest that followed crises of legitimacy as a second opportunity for contentious debt politics. Building on a triangulation of my empirical data, I will delineate three processes following – but also somewhat overlapping with – the square occupations of 2011: the perpetuation of the acampada spirit in new movement organizations, transnationalization, and the emergence of new movement parties. New debt movement organizations as well as the transnational net work ICAN formed out of these dynamics, and with the help of experienced debt organizations mentioned in the previous chapter, who tried to put debt on the agenda of anti-austerity struggles. Finally, the chapter discerns the different organizational repertoires by the respective networks.

Chapter 6 presents different framing practices and repertoires of knowledge production. I will first introduce the concept of “deconstructing debt fetishism,” i.e. challenging hegemonic discourses of supposedly irresponsible debtor behavior to be disciplined via frames of predatory creditor practices and unfair systemic-structural dynamics. While the different actors found significant common ground against the background of this structural necessity, analyses nonetheless differed substantially. In order to illustrate this, I will discuss the different diagnoses of the origins of debt-related grievances as well as the respective solutions suggested.

Chapter 7 then puts the previous chapters in motion and elaborates how new forms of innovative collective action formed out of these organizational and discursive practices. In accordance with their respective constitution and strategic perspective, the groups often operated in different settings, but frequently encountered each other, especially due to the Greek debt crisis. I will first discuss transnational advocacy for a “fair and transparent” insolvency regime within the United Nations. I will then turn towards initiatives for public debt audits after the Tunisian revolution and during the first Syriza-led administration in Greece and explain the trajectories and dynamics of these attempts as illustrations of debt audits in action. The chapter will close with a presentation of more prefigurative forms of debt politics, such as citizen debt audits on the municipal level or the people’s bailout organized by the US network Rolling Jubilee.

Chapter 8 will briefly summarize and discuss the empirical and theoretical findings. Based on these, I will suggest features of a middle-range theory of contentious debt politics and provide an outlook on future research as well as on distinct possible trajectories for future transformation.

The Argument of the Book
The contestations of debt (and the rules that govern it) analyzed in this book arose in a particular space and time of neoliberal capitalism. A Southern debt movement had emerged in response to the Southern debt crisis, which proved formative for more recent waves of contentious debt politics. After the North Atlantic Financial Crisis of 2007/08, movement networks in the field of contentious debt politics saw an opportunity and the necessity to start working on debt politics in the Global North as well (and to eventually intensify activities in revolutionary North African countries). In addition to this, escalating anti-austerity struggles created new threats to livelihoods and politicized a new generation of actors, who discovered debt as an issue worth mobilizing around.

Based on experiences from both the Southern debt movement and recent waves of contentious debt politics, this book will suggest a couple of concepts and a general framework towards a theory of contentious debt politics.

Social movement theory has long argued that movement actors respond to transformations they perceive in their field. Transformations in the field of contentious debt politics may stem from new legislation, financial crises, electoral disruptions or many other processes. Critical social theory helps us to analyze such disruptions as well as the broader transformations they are embedded in, such as shifting social formations and coalitions, profit models or regimes of knowledge, for instance. However, social movement theory teaches us that we also need to analyze how actors and networks interpret said disruptions in the field. When actors perceive opportunities or threats to necessitate action, they face several tasks discussed by theories of contentious politics: creating mobilizing structures, counter-hegemonic narratives and repertoires of action.

Debt is a social relation and along the same lines debtors and creditors constitute classes structurally related by a clash of interests. They respectively organize and lobby Lobby
Lobbies A lobby is an entity organized to represent and defend the interests of a specific group by exerting pressure or influence on persons or institutions that hold power. Lobbying consists in conducting actions aimed at influencing, directly or indirectly, the drafting, application or interpretation of legislative measures, standards, regulations and more generally any intervention or decision by the Public Authorities. governance institutions to universalize their interests. With creditors having more resources and better access to governance institutions, debtors need to construct collective action networks we could term “debtors’ clubs” (in case of indebted states) or “debtors’ unions” (in case of indebted individuals) in order to break the structural isolation associated with indebtedness. They do so by appropriating existing organizations and spaces or by creating new ones.

In addition, debtors’ clubs and debtors’ unions need to deconstruct the common sense and morality of hegemonic debt politics that “debts have to be paid,” arguing that and illustrating how that is indeed frequently not the case as determined by power relations. In doing so, they create narratives which blame grievances not on a supposed (moralized) failure of debtors, but on predatory creditor failures or on systemic rules privileging powerful actors. This is especially important for private individuals and households, who may feel ashamed of their debt. Empowering discourses may prevent them from internalizing guilt and instead encourage them to engage in collective action.

Finally, subaltern actors need to challenge and/or delink from creditors and governance institutions. Engagement may re-negotiate concrete levels of debt or the rules that govern them in more consensual or transgressive ways, whereas de-linking from hegemonic power structures means creating autonomous institutions such as a Bank of the South or a prefigurative local-communal banks. Waves of (dis-)engagements in turn transform the field of debt politics and thus combine with other forms of contentious politics to co-produce larger transformations as an outcome of conflict, concrete decisions, unintended consequences and circumstance. The task of critical social theory and social movement studies is to study how transformations, crises, actions and new outcomes constitute larger social processes (and the task of movement scholars is to additionally intervene in them).

Eurodad, CADTM, ICAN and their constituent groups each approached debt politics in their own particular ways. While significant disagreement over strategic and ideological questions may exist, for instance between CADTM and Eurodad, actors tended to oscillate between active collaboration and critical solidarity with other networks’ actions. In their distinct projects and visions for alternative futures Futures A futures contract is a standardized advance commitment, negotiated on an organized futures market, to deliver a specified quantity of a precisely defined underlying asset at a specified time – the ‘delivery date’ – and place. Futures contracts are the most widely traded financial instruments in the world. lie potential trajectories towards a more social and democratic debt politics. Such a debt politics could include among other things financial regulation, debt cancellation and redistribution in order to re-embed market economies, reduce grievances and increase life chances across social groups. But this could also feature a more substantial transformation towards a wholescale democratization of f inance (and
the economy at large). This would mean running banks as democratic producer-consumer associations in order to fund a transition towards an economy run not competitively for private profits and state authority, but collaboratively according to human needs and abilities.

FULL VERSION :