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Posts tagged ‘Home-Buying’

Buying a House: Debt

I’m in the process of buying a house for the first time.  This is exciting and strange.  I first started looking for a house the same week that I was teaching John Locke’s Second Treatise on Government.  I realized even more forcefully this time around how much social contract theory’s claims to belonging are tied up in relations to private property.  Witness the ongoing opposition between owners and renters documented in San Francisco in the wake of the tech boom.  Then last week, as we were signing the purchase agreement, I was explaining Marx’s analysis of capitalism to students, that wealth is produced by labor.  Fine, work harder.  But in the capitalist mode of production based as it is on private property, the worker never sees the fruit of her labor.  Private property gives the owner license to recoup the surplus value of labor, while the worker only has the right to the compensation that is socially determined is sufficient to return her to work again.  I realized I was living smack dab in the center of the contradiction between ideology and economic mode of production that Marx maintains will be the end of capital.  So being a good member of the typing left (per Jodi Dean), I decided the best mode of resistance is surely to blog about it.   This will then be the first in a series of blogs about house buying, private property, home-owning, home repair and remodeling, and town vs. country.

So, debt.

I have tens of thousands of dollars in student loan debt, even though I had tuition remission and a stipend from my graduate program.  I definitely made decisions in college based on money rather than on what I wanted to do because I was paying for college by myself and I couldn’t afford not to work during summers and winter breaks (like I didn’t think I could afford study abroad, and was never told otherwise, and I just didn’t know that I could take my loans to off-campus housing which could have been cheaper and things like that).  I thought Occupy’s efforts to take on debt and organize for debt forgiveness were a good idea, but not at the top of list of efforts to join.  So yeah, I read David Graeber’s Debt: The First 5,000 Years and I know debt is a burden and a historical rather than an intrinsic social relation, but I don’t think I ever realized how much a racket the debt industry is until this morning when I had to read through the 70-something pages related to my mortgage agreement.  Even though intellectually I know better, I thought debt was just the price you have to pay to be in the middle class.  By the end of the life of my loan, 69% of what I will have paid back will be interest on the principle.  69%!  What I realized in reading my mortgage agreement is that this situation is not just an economic necessity, borrowing with an interest rate that has 69% of what you pay back going to interest (i.e., to the bank, and I have a great rate!) could not happen without the institutional support of the government which makes the penalty for failing to pay, not just financially costly, but dire for families who are foreclosed on.  Government officials–sheriffs!–do the bank’s work of putting people who cannot pay on the street.

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