In the next few weeks, thousands of people will get surprise letters informing them that their medical or student loan debt has been eradicated thanks to the Rolling Jubilee Project. The plan is simple, use the laws for debt collection to instead help out the millions of being now suffering from debt.
As covered earlier, the aim is to help as many people as possible. They purchase blocks of debt from the current holders and then proceed to forgive it. The original test used $500, which resulted in the forgiveness of $14,000 in debt.
By Friday, the group had raised $269,913, enabling them to forgive an estimated $5 million in medical and student debt. And they are continuing their efforts.
For those unaware, debt is sold for pennies on the dollar. Debt collecting companies risk very little in up front costs and typically reap major windfalls. This system, however, is now being used to instead help people, instead of faceless corporations seeking to profit financially from the misfortune of others.
With over 90% of credit reports containing errors and over half of posted debt now found to be in error, the entire credit industry seems poised on the brink of worthlessness. The very nature of credit has been twisted over the years to the point that it no longer reflects the purpose for which it existed in the first place.
The concept of credit is to allow for short-term bridges or for large-scale purchases to be paid on over time. The buying of a house is a prime example of a good use of credit. If having good credit becomes too easy, however, it can create inflation, as it adds incredible amounts of cash, as it were, in to the market. Properly used, it hasn’t, but the narrow-market inflation it can trigger is very real indeed. Access to credit in the housing market was made too easy and it helped cause the housing bubble. Now the skyrocketing cost of both the level of higher education demanded by a white-collar job culture (requiring insane levels of documentation) and a medical insurance system which has operated without proper oversight and regulation for decades has resulted in a credit system on the verge of collapse.
What Occupy is doing, properly, is saving the financial institutions from their own hubris. They could not regulate themselves, so we the people are doing it for them. While the $5 million worth of debt which was eliminated is but a fraction of the $1.8 trillion estimated in the student and medical debt fields, it is a start.