Debt and labour coercion in historical perspective

Dr Judith Spicksley

Lecturer in Economic History

Wilberforce Institute, University of Hull

As an academic, it’s always good to be invited to give a talk. Thanks to Shebanee Devadasan, President of Durham Justice Society, I was asked to join the Modern Slavery panel as part of their annual Human Rights Conference for this year.  I was in excellent company as my fellow panellists were Gary Craig,  Parosha Chandran and Meena Varma. My contribution was to provide some historical perspective on the role of debt as a method of labour coercion, as this is often a key mechanism through which modern forms of slavery operate.

Over the last decade I have been thinking hard about the relationship between debt and slavery in historical and contemporary societies. Exploring the transatlantic slave trade, I found that in the colonial records of the Portuguese government in Angola, discussions about debt slavery were an important part of the contested framework of enslavement between those areas under Portuguese law and those under African rule. As I discussed in my talk, European societies by the early modern period did not generally allow citizens to recover their outstanding debts through the enslavement of debtors. This had been a common route to enslavement in antiquity, and documentary evidence of such activity survives in the ancient Near East, Middle East and Eastern Mediterranean from the end of the third millennium to the middle of the first millennium BCE. Under the influence of Roman and biblical law, medieval societies in western Christendom increasingly rejected such practices. By the sixteenth century, debts were recovered on goods, livestock or lands, or through imprisonment until the debt had been repaid. The practice of debt bondage, in which the debtor agreed to work for the creditor until the debt had been repaid (also of ancient origin), was retained, however, and was used by early modern migrants from western Europe to the Americas who signed up to an agreed term of labour as a way to repay the cost of their passage. A very similar system remains in operation today. Siddharth Kara’s work on contemporary migrants shows how a formal debt agreement, which covers costs associated with travel and arranging work, has to be paid off on arrival through labour. But what Kara’s work also shows is that additional debts are imposed on migrants after travel and costs manipulated to keep them in debt and under control.

Debt slavery has been prohibited by international convention since 1926, and in 1956 a supplementary convention added debt bondage to the list as an institution or practice similar to slavery. Debt bondage as defined in this latter treaty refers to agreements in which the value of the labour that is performed is either not applied towards reducing the debt or has no defined time limit. A classic example is hereditary collateral debt bondage in South Asia, in which the debt rolls over to the next generation. Yet examples of debt bondage, also referred to as bonded labour and debt servitude, continue to exist around the world. There are good reasons for this, and working off your debt is not in itself against the law. The idea of being able to repay a loan through your labour offers those in need of resources, who have no other way of repaying their debt, a valuable as well as pragmatic solution. However, because this is often the only way funds can be raised it can encourage creditors to exploit their debtors and extend the labour-debt relationship indefinitely.

In my studies of the connection between debt and slavery I argue that the idea of debt is one of the most powerful sources of social coercion we know, and one of the earliest. There is a longstanding myth, as Graeber’s book articulated, that all debts have to be repaid, even though we recognise that this is not always the case. The idea of debt provides the glue that creates the social relationships that allow us as individuals to work with others for the benefit of us all. This cooperative strategy is not fool-proof, however, because not everyone obeys the rules. Debt as a social construct can also be weaponised as a way to force some to accede to the demands of others, and when debt can be recovered by using the human body, the impact can be devastating. During the transatlantic slave trade debt was used as a pretext for ensnaring its victims: if you could create a debt, no matter how small, you could call it in and claim a slave.

Today it is through the binding of labour rather than sale into slavery that debtors become trapped. Kevin Bales’ work on brick kiln workers in Pakistan revealed how dishonest managers could exploit the illiteracy of their labourers to ensure that the number of bricks they made did not cover the debts they had accrued. As a result the family had to return to work in the kilns the following year. The idea of debt may have most traction where labourers are involved in illegitimate activities. The extortionate interest rates that workers are charged in illegal gold mines in southern Ghana means they are quickly trapped into long hours of work as they try to repay their debt. They work because they are desperate and because they believe they must honour their borrowing agreements – their debts have to be repaid.

Brick kiln labourer. This file is licensed under the Creative Commons Attribution-Share Alike 4.0 International license.