Paper short abstract:

Debt governance consists of regulations that are implemented by debt advisers. They act as brokers of legal rules but they also need to break those rules if they want to help clients in the moral economy of bankruptcy. Interviews with debt advisers show the predicament of control and empowerment.

Paper long abstract:

Debt governance consists of legal rules and regulation that reach deep into the neoliberal constitution of the indebted self (Lazzarato 2012). Especially the process of discharge of residual debts imposes a number of financial and social constraints on debtors. Those constraints are implemented by debts advisers who guide debtors through the legal process of discharge. The advisors’ roles are manifold: they give juridical and economic advice, console and reprimand and help with budgeting and saving money. They understand their function not as teachers of thrift (Färber/Podkalicka 2019), but as guides helping to understand that changes in both house-holding and self-perception is needed on the way out of debts. In this role, debt advisers are bound to the legal framework of debt discharge, they have to act as brokers of the rules. At the same time, they also have to break those rules in their duty of empowering their clients and helping them to understand their agency. Legal regulations also collide with social relations which are vital when in debt. Just one example shows the predicament: The proceeding of debt discharges prescribes that all creditors are treated equally. Social expectations, however, suggest that one would pay back close relatives and friends before repaying the revenue board and telecommunications companies.

This paper analyses interviews with debt advisers and their view on debt governance, thus providing a perspective that is often missing in the analysis of the power structures inherent to debt relations.