One of the things I’ve been interested in lately is the position of power structures in society. Debt is one such power structure that looks different when you examine it. Rather than something that enables the many to buy things they couldn’t otherwise afford, it can be used as a tool from which the rich profit. It limits the abilities and options of those who are in debt, as they have less freedom in their choices. Those who go to medical school have very little choice but to become a doctor once they graduate, even if they hate the job. The massive amounts of debt they take on ensure that they will be working as a doctor until they are at least 40 before they once again have choices in what to do with their careers. The same situation plays out in corporations everywhere. Individuals cannot leave their jobs, as they have house payments to make, and credit card debt to pay down.
It is even worse for those who fall on hard times and are hit with enormous repayment rates and few hopes for recovery or financial solvency. People have become reliant on the current financial system of banks, credit, loans and debt, which keeps the current financial power structure (with Wall Street at the top) in place. However, we are currently seeing a few ways in which that structure is being subverted. Using the increasingly connected internet, some individuals are able to bypass large current financial structures and create an entirely new system of financial transactions (Bitcoin, Lending Club, etc.).
Christianity is one of the greatest examples of subverting current power structures. In the early days of the Roman Empire, brutality and power were revered as societally admirable qualities. Power was the measuring stick for the empire. Christianity gained early influence as a slave religion – it provided hope to the masses, and a way for them to increase their self-esteem. Rather than conform to society’s notions of power and money being the ultimate goal, they flipped those ideals around. Now, the meek, the poor and humble could think of themselves in an entirely new light. Rather than lower-class Romans, they became exemplary Christians. They may be slaves, but Christianity allowed them to consider themselves morally superior to the many they couldn’t hope to reach in status. Christianity was the way out of their lower-class status – a new power structure that allowed them to redefine who they were. Perhaps this has something to do with Christianity being the strongest in poorest countries – they are the ones who need a new measuring stick the most.
There is currently a movement going on that works to subvert America’s consumer culture where wealth acts as a signaler. The minimalist movement is extremely popular among bloggers (especially lifestyle bloggers) who tout it as a way to achieve clarity, simplicity and happiness. Instead of being measured in terms of displayable wealth – a game which much of the population loses – the minimalist movement has gained steam as a way to step out side of the game entirely. Rather than measure wealth in terms of the size of one’s house, 401k or flashiest car, these minimalists compare Twitter followers, travel experiences, or who owns the least number of possessions to compare wealth and status. Rather than play a consumerist game they would surely lose, why not compete on who owns the least amount of things, or who drove around the country in an RV?
This subversion of accepted societal standards and power structures is evident in today’s society at large. You can see it in class divides. Artists, startup founders, and students all live a sparse existence. They spend very little on nice things, and instead choose to devote time and money honing a craft or gaining knowledge. They live a frugal existence. The poor in this country, on the other hand, rather than live frugally they live cheaply. They spend money trying to imitate the rich in society, rather than stepping outside the game all together. The rich drive nice cars – the poor drive crappy cars that they raise the wheels on or install mufflers on. They carry fake leather purses or counterfeit purses – the rich carry the real thing, while the student carries a backpack. The frugal step outside of the game and create their own power structures where they are not directly competing against those who they can’t hope to approach in status.
This will happen in our financial systems. As more and more people start losing houses they shouldn’t have been able to buy, and fall further into student loan and credit card debt, there will be change. With the new peer-to-peer technology that the internet makes possible, I think there will be more and more people who step outside of the financial networks all together and start creating their own power structures and financial networks that don’t profit off of their ignorance and benefit only the few. Bitcoin is an example of this, and Square is another step in the right direction. As the markets crash, more and more people will be looking for other ways to invest their money, in a game they can win. This may look a lot like Lending Club, or investing in startups or other local ecosystems. People could become the banks, and have financial power structures on a more local level. But rest assured, change is coming. More and more people will start to subvert the current power structures. You can see it already, as more people pull their money from the markets and fewer are choosing to put their trust in large investment banks. New concepts of trust will be defined. Rather than having a bank backing a loan, it is quite possible you could see many individuals collectively backing a loan for someone they can see has a strong online presence and can be held accountable.
This low point in our economy will lead to large-scale restructuring, and I believe that there will be many forced changes to the financial structure. These changes will be driven by people, not politicians, and many will end up playing an entirely new game.