What Is Debt Peonage?

Slavery takes a variety of forms, including debt peonage, or forced labor as a consequence of money owed. Some forms of debt peonage, such as the sharecropping that became an institution in the American South after the Civil War, are relatively easy to identify. Other forms of debt peonage are more subtle and difficult to define. For example, debilitating credit card debt can force people into demeaning work situations that offer little hope of repaying the sums owed. Historical perspective on debt peonage sheds light on how contemporary situations are similar to this outlawed practice, and how they differ.

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Although debt peonage has been outlawed in the United States and is commonly thought of as an archaic and barbaric practice, it still exists in some forms today. The legal system slaps fees onto defendants facing criminal charges. Penalties for failure to pay can include community service, a form of unpaid labor, and prison sentences which often include work requirements where prisoners are contracted out to private for-profit companies.

Although nobody knows precisely how and where debt peonage began, it has clearly been around since at least classical times. The Greek lawmaker Solon instituted anti-slavery reforms, some of which targeted practices related to forced labor and debt. It was practiced in Rome, as well. Debtors, or 'Nexus', retained citizenship rights but still had to work for no pay. When New Mexico was still part of Spain , debt peonage became a social and economic institution and the practice continued after the area became part of the United States, causing some observers to compare it to the slavery of the American South. After the Civil War, many freed slaves became sharecroppers due to lack of economic opportunity. The sharecropping system relied on a system of debts to landowners that were nearly impossible to repay, requiring ongoing labor to maintain.

Congress passed the Peonage Abolition Act of 1867, aimed specifically at ending the long entrenched practice of debt peonage in New Mexico. The legislation followed on the heels of the Civil War, and was sparked by obvious comparisons between the work conditions in the Southwest and the practices that had just been abolished through the Thirteenth Amendment, which outlawed slavery or peonage.

Although debt peonage has been outlawed in the United States and is commonly thought of as an archaic and barbaric practice, it still exists in some forms today. The legal system slaps fees onto defendants facing criminal charges. Penalties for failure to pay can include community service, a form of unpaid labor, and prison sentences which often include work requirements where prisoners are contracted out to private for-profit companies. Some industries, such as poultry processing, rely disproportionately on undocumented immigrant labor and practice a modern form of debt peonage. Undocumented immigrants face the threat of deportation, making them vulnerable to unfair labor conditions and below market wages. Like the recently freed slaves after the Civil War, their precarious status forces them to work at unfair rates.