Although physical debtors’ prisons were outlawed in the United States in the 1830’s, figurative debtors’ prisons in which people are trapped under piles of student loan, medical or other debt are very much alive in this country today.
This is so much the case that a growing number of companies, nonprofits and individuals are paying off debt as a way of helping people out of hardship – and a way of bringing attention to this problem.
An early, high-profile example of this was the 2016 initiative in which TV-host John Oliver wiped out nearly $15 million in medical debt for 9,000 people by purchasing the highly-discounted delinquent debt for $60,000. At that time it was estimated that 43 million Americans had medical debt that was hurting their credit.
That episode of Oliver’s show about the medical debt crisis is still very much worth watching. The website of RIP Medical Debt, the group that Last Week Tonight worked with on the relief effort, estimates that it has helped retired over $1.3 billion since it was started in 2014.
It would be an overstatement to say that there has been a tsunami of such company-backed efforts but such efforts are becoming more and more common. Get Insured, an online health insurance marketplace, recently announced that it had retired $1.8 million in medical debt in Pennsylvania. Magnolia Pictures retired $1.5 million in medical debt in a February promotion tied to the premiere of the movie Buffaloed.
Student loan burdens have become such a huge problem that they are a major topic of every Democratic presidential debate and student loan debt relief is an increasingly popular employee benefit.
This year’s Super Bowl-linked campaign by the SoCal Honda dealers is another indication of how debt relief has become a part of the zeitgeist.
“For the last few years, the SoCal Honda Dealers have celebrated the Big Game with their trademark Random Acts of Helpfulness,” a press release from the group explains. In the past they have dones such things as pay for Uber Rides to get people home safely or made donations to charities linked to how often Super Bowl commercials incorporated clichés.
This year the group decided to help SoCal residents “Tackle Student Debt” by enabling people to apply online to have the group pay off “daunting student loan bills they’ve had to endure for years.” In their own tongue-in-cheek video explaining the program, the group told several people they would pay off thousands of dollars of their debt — if they tackled a Helpful Honda guy mascot.
One may question the light-hearted tone of the commercial (is it in good taste to have people racked by debt take on a silly stunt to earn relief?), no doubt the people whose student loan debt was retired appreciated what the SoCal Honda Dealers call a BIG Random Act of Helpfulness.
An example of using a debt relief “stunt” as a part of a much larger effort to create structural change is evident in the work that Chobani did last year to retire public school cafeteria debt as part of its larger, ongoing work to fight hunger in America.
After hearing about students being “lunch shamed” at school by cafeteria workers in Warwick, Rhode Island because they had unpaid school lunch debt, the company arranged to pay off all outstanding lunch debt there as well as in a school systems near their Idaho and upstate New York plants.
Recognizing that “this was a national problem that needed a national solution,” the company upped its efforts to lobby for reform alongside Feeding America and the Food Research & Action Center, said Chobani President Peter McGuinness.
Structural change that gets at the roots of the problems that afflict people with unmanageable debt is clearly needed. In the meantime, expect to see more small symbolic efforts to ease the suffering of people trapped in the modern-day versions of debtors’ prisons.
