In a country consumed by Iraq and corruption, it was surprising and significant that San Francisco's Nancy Pelosi, our House speaker to be, put cuts in the cost of student loans on the top of her agenda for change.
The fact is that millions of Americans are caught in an economic crunch with rising student loans only part of a much deeper loan and credit crisis that most politicians and media outlets tend to ignore except when featuring some hapless victim of identity theft related to credit cards.
A credit divide in America fuels our economic divide but it is rarely focused upon. It is not a partisan issue either. Reagan Advisor Kevin Phillips argues it is structural and institutionalized. He labels the process "financialization" and argues that there is now a credit and debt complex every bit as insidious the military-industrial one.
Put another way, the globalization of our economy is about more than the outsourcing of jobs. There is a deeper shift underway from a society based around production, with the factory as the symbol of American economic prowess, to a culture driven by consumption, with the mall as its dominant icon.
This is particularly timely as the Christmas shopping season approaches in a nation where a credit score is the only score many people and institutions care about and where vast databases record our every purchase and consumer choice.
Ours has become a nation in which the carrot of instant affluence is quickly menaced by the harsh stick of bill collectors, lawsuits and foreclosures. And yet this bubble can burst: The slickest of our bankers and the savviest of our marketers have been able to undo the law of gravity, that what goes up must come down.
That old class struggle is assuming a new form in the conflict between creditors and lenders that reaches into many Americans' homes, where each month bills are juggled and re-juggled with today's credit card bills paid by tomorrow's new card. Meanwhile, with interest compounding at usurious rates, indebtedness grows, and working people sink even deeper into debts they cannot manage.
In this conflict, financial service companies function as well-organized machines while borrowers are forced to react as individuals. Many are brow-beaten with lectures about "personal responsibility" by corporations that only pay lip service to any form of social responsibility.
Centuries ago, we had debtor's prisons. Today, many homes become similar kinds of prisons, where debtors struggle with personal finance issues. The scale of indebtedness is staggering as consumers simply follow their government's lead.
As of Christmas a year ago the national debt stood at $8,179,165,267,626.42. Break that down, and each American's share comes to $27,439.48, and our nation's debt increases $2.83 billion each day. Add to that two trillion more for consumer debt, including mortgages. That's a lot of money.
Who is really responsible for it? Few of us seem to know. And fewer appear to know what can be done about it. "They're never going to be repaid," says economic historian Michael Hudson, who for many years worked at Chase Bank. "Adam Smith said that no government had ever repaid its debts, and the same can be said of the private sector. The U.S. government does not intend to repay its trillion-dollar debt to foreign central banks and, even if it did intend to, there's no way in which it could. Most of the corporations now are avoiding paying their pension fund debts and their health care debts."
The government and big companies might not have to pay, but ordinary people do, as our collective consumer debt has doubled in the past 10 years. With mortgage debt included, it's now reached almost ten trillion dollars, paralleling an out of control national debt.
Hudson compares the plight of millions of debtors in the United States to serfs of an age gone by: "For many people, debts now absorb 40 percent of their income. So many people are paying all of their take-home wages over and above basic expenses for debt service. And that's rising. In effect, 90 percent of the American population is indebted to the top 10 percent of the population."
I discovered all this in making the film In Debt We Trust (Indebtwetrust.com). I started out looking at the abuses of individuals that are often sensationalized on TV news magazines like 20/20, at which I once worked, and realized that a more in-depth film was needed to investigate and explain the hidden dynamics that are rarely touched on.
The threat of a deepening debt trap threatens all of us as the capitalist United States finds itself increasingly in hock to Communist China.
One question for the Democrats: when will these larger issues be put on the agenda? Who will bail out the American people?
"News Dissector" Danny Schechter is a filmmaker and author who also edits Mediachannel.org. Comments to dissector@mediachannel.org
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