Can somebody please explain the Occupy Wall Street movement?

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Must be nice not to have a job.

Back in 2011 I almost immediately dismissed the OSW group as a bunch of whiners.  But I waited to see if they did accomplish anything of note in their platform areas of “undue influence of corporations on government” and “income inequality,” because I agree with these concerns.  They did not, because who is going to peacefully compel the corporations stop funding the government, and the government to stop accepting it?  I also remain skeptical because OSW and I have less in common than not.  While I am likewise anti-consumerist to some extent, I am neither Canadian nor anarchist.  For the record!

But a remarkable number of smart people that I like keep bringing up OSW.  So I keep it in mind.  Recently, someone shared on Facebook an article called “Occupy Wall Street activists buy $15m of Americans’ personal debt” so I checked it out.  The activists bought the debts at a deep discount ($400K) through the secondary debt market, and then forgave the loans.  A+ for humanitarianism, but I did not understand the message.  The Rolling Jubilee’s “primary purpose was to spread information about the workings of this secondary debt market,” and the interviewed author noted that you can “have a different conversation with the debt collector.”

This sounds like a bunch of nonsense to me.  The idea that you should feel empowered knowing that defaulted debts are bought at a fraction overlooks a couple of major problems.

First, obviously, defaulting on a loan harms your credit.  That alone should convince people that doing so is a bad idea, unless you are one of these long-game debt nuts and figure collections clear after 7 years.  They do, and you might also be a drug dealer by then if that rule is part of your personal financial planning.

Second, secondary debts are collected by collections agencies.  Anyone who has dealt with one knows they are bad news.  Sure, your defaulted debt which was originally $20K might be, say, $7K now.  But is it worth it to have collections after you for it?  Collectors are notorious for practices including demanding wrong amounts, collecting past the statute of limitations (noted above), and calling your workplace, all of which are against the law.  But you probably wouldn’t know that (as many modern people are not aware of all of our many rights).  And even if you did, pursuing justice could involve lawyers or at least your time and energy.  It is not really the “empowerment through loan default” situation described in the article.

The bottom line in the article is that if you have defaulted on a loan and a collector comes after you for the full original amount, you can know to confront the collector about the new secondary balance and be legally relieved of the responsibility for some of your original balance (with ruined credit, though the article does not mention this).  For people already in this situation, who fell on hard times, ok.  But a more direct way to educate loan bearers about legal rights in secondary collection would be to provide comprehensive information on the Fair Debt Collection Practices Act.  That a collector may try to collect on the full amount is just one example of illegal practices that collectors will try on the vulnerable.

The topic of the article is about strategy, not education.  It troubles me that it basically suggests that it is advantageous for those with loans to default and make the bank absorb some of the loss.  I do not think it is advantageous to the consumer with any common sense.

I am also rubbed the wrong way by the Rolling Jubilee’s stated position of “debt refusal.”  According to the article, this is refusing your current debt and telling the bank to go screw.  For me, debt refusal is refusing current debt by clearing it asap, and refusing future debt by making careful choices to avoid it.

And I agree with sticking it to the banks, but I want to do so by depriving the bank of the future interest it was counting on making off me (a $30K student loan at 6% paid over 25 years nearly doubles to $57K paid in total; the same loan paid over 2 years includes only $2K interest).  I want to stick it to the banks by utilizing my subsequent wealth in the peer-to-peer lending market.

Paying off loans is no doubt the more difficult approach for many.  But I do not understand why OSW preaches revenge rather than independence and optimism.  Can someone tell me anything else about this group?

 

Image: http://www.occupycooperative.com

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2 thoughts on “Can somebody please explain the Occupy Wall Street movement?

  1. I must confess I never cared much for OWS. Because I didn’t care, I didn’t bother to stay informed, and because of that, I’m not terribly qualified to comment on what OWS actually did. That’s ok, because in retrospect it was a short lived movement that barely accomplished anything, even the meager goal of raising awareness. I think it’s most helpful to look back on the movement and assess why they failed.

    1) They lacked a clear unified goal. When in doubt, it’s nice to come back to a single, actionable item as the basic platform for your cause. This item has to be something that can be accomplished through a single action. So “ending the war in Vietnam” is a clear, concerted goal, whereas “ending the gross wealth inequality in America” is not. You can immediately see how one would achieve the first. You cannot immediately see how one would change the second. If, perhaps, they had outlined a simple campaign finance reform policy, a sensible tax legislation, a program for debt forgiveness (forget for a second how silly that last one is), perhaps they would’ve had more success, and their message might have achieved more traction.

    2) They lacked a charismatic and influential leader. They tried to make this weakness into a strength, emphasizing the egalitarianism of a horizontal structure where every voice was heard. There’s just one problem. Humans don’t actually work that way. Every major movement in the last 2000 years, from Caesar’s march on Rome all the way to the Million Man March has been done largely because of the efforts of great leaders, and especially great orators. If OWS had its Martin Luther King, its Adolf Hitler, its Mahatma Ghandi, its Charles Manson, if it had even had someone as recognizable as Carrot-Top at the helm, it would’ve gotten more attention, gained more traction. There would’ve been a single speaker to make the talk show rounds, to get the message out. Instead of a gifted talking head, OWS was represented by a shifting cast of randoms that did much to weaken the brand.

    3) They attacked the wrong targets. How can you tell? Occupying Wall Street never actually impeded the function of Wall Street. A good sit-in stops the business from running. It drives away consumers. A good boycott has the same effect, choking the revenue and forcing the business to question whether it can afford to maintain its policies. The beauty of non-violent protest is that it precludes retaliation and turns every act of retaliation into a justification for the movement. However there was no need to retaliate. Wall Street just kept on keeping on. And the longer they did it, the sillier the movement looked. They picked their targets poorly, and attacked them ineffectually. Had there been an adequate leadership nucleus in place, they might have recognized their failures and adapted their methods. They were not able to do this.

    These, to me, are the chief reasons for the failure of OWS and they serve as a good reminder that the modern practice of non-violent protest is not some sure means to success. Had they been students of history they might have looked to the peace protests of the 60’s, which also largely failed. America exited the Vietnam War only when they lost it. They might have compared that movement’s methods and practices with the successful Civil Rights movements of the 50’s and found a better way to go about achieving their goals.

    The problem is that the OWS had a point. There is gross inequality in our society. The current system of lobbying Congress and campaign finance allows for massive corruption and corporate interest to plague our government. Congressional incumbency rates due to voter negligence allow corrupt politicians to remain in office for decades. Our society is becoming increasingly divided into the super rich and the truly poor. It is harder to be middle class than it was even 30 years ago, and we have far less social mobility. These are dangerous circumstances. Political revolutions rarely come from the oppressed poor. They lack the power to plan and organize and supply a major movement. Revolutions most often come from a blocked and disenfranchised middle class, which is what we’re creating in America right now.

    • Rob, you wrote that in the time it took me to close my laptop, feed the chickens, and drive to work. Just though you should know 🙂 My day feels insignificant so far.

      You have a good point that I am asking about OWS in general but picking on a specific article that doesn’t seem to have much to do with the basic principles. I take it that after not being able to “bring down the Man” they have eventually resorted to drive-by humanitarianism antics such as what was noted in the article.

      You are right that they were tackling serious topics and therefore should have have a serious plan and influential leader. But they did not, and as far as I am concerned they have only established a negative message: that the world is irreversibly unfair and you should just get your revenge where you can.

      Seriously, I have coworkers who complain about the government problem du jour and occasionally a “Occupy Wall Street, man” comment comes up. I don’t understand the reference. In context, it is supposed to mean “we need to fights the Powers that Be” but it sounds like “hey there’s nothing we can do.” I assume that was not the goal.

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