Dealing with Debt

by Raven Glomus

Last week I talked about how the older communes didn’t seem to have thought about the fact that most people don’t stay forever in communities and that you wouldn’t want it to be hard to leave an income sharing community–and the problems that caused, and how the newer communes created Exit Agreements to deal with that.  This week I want to talk about another issue that the older communes didn’t want to deal with: Debt. 

In my made up story to illustrate the need for exit agreements, I said that the homeless man had no money but no debt.  That would be an unusual situation.  Actually, a lot of folks come to the communes with a little money and a lot of debt.  Twin Oaks’ solution to this is to say that folks either have to not pay the debt (ie, default on it or declare bankruptcy) or not move into the community.  At one of the newer communities, at least in one case, the solution was to actually pay off all of the debt for one of the members.

This is a more expensive solution and probably wouldn’t work in one of the larger communities.  It also probably wouldn’t work if the community had a lot of folks with lots of debts.  But it does illustrate a more radical solution to the debt problem.

The problem is that our current society runs on debt.  Student loans alone constitute an enormous amount of debt. It turns out that this past year, US students owed nearly $1.6 trillion in debt.  Furthermore, nearly 12 million student loan borrowers were in either loan deferment, loan forbearance, or loan default. 

And then there is credit card debt.  The outstanding total US personal debt, most of which was credit card debt, reached $998.4 billion in July 2021.  There was a $5,525 average balance on credit cards over this year.  Once you are in debt, it’s hard to get out of it.  Defaulting on loans when you enter a commune is one solution (and it makes sense as a way of just getting out of an horrible system), but when you figure a lot of communards are going to leave the commune at some point, starting over could be very difficult with bill collectors on your back.

Again, I realize that simply paying off debt for every member with it probably wouldn’t work in the long run.  But, just like the new communes needed to come up with new policies to deal with folks leaving, such as Exit Agreements, we need to figure out more possible solutions to folks in debt–because there’s a lot of them out there and, if communities are going to offer real alternatives, dealing with debt is something, especially for those who are trying to start new communities and find folks, that is going to have to be built into the new community’s policies.

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