OZY, September 7, 2018: Contending with debt – 244 midterm candidates are in the red
Stacey Abrams has captured the hearts of progressives who have long dreamed of turning the red clay of Georgia a liberal blue. But this spring, the Yale Law grad and entrepreneur had to confront what could be her Achilles’ heel: debt. Her financial disclosures showed more than $170,000 in credit card and student loan debt, and over $50,000 in deferred tax payments to the IRS, which she said she accrued while helping to support her parents and niece, when her father was undergoing cancer treatments.
“Debt is a millstone that weighs down more than three-quarters of Americans,” she wrote in an editorial for Fortune magazine, arguing that the debt she took on to help support her family humanized her and was, in part, emblematic of the disproportional debt African-American students carry. “It should not — and cannot — be a disqualification for ambition.”
OZY analyzed the personal financial disclosure reports of 396 candidates who ran or are still running in the 56 most competitive congressional districts across the nation this election cycle, as determined by the University of Virginia Center for Politics. Candidates are only required to report a range of what they owe — so exact figures are not available — but 62 percent of those congressional hopefuls, or 244 of the 396 candidates, had some liabilities, and at least 65 of them carried more than $50,000 in non-mortgage debt.
In her editorial, Abrams not only described her experience with debt, but argued it was a systemic issue for women, and particularly, women of color. She wrote that while the average U.S. household wealth was $81,000 in 2013, the real splits were by race: White families had $142,000, while Latinx families had $13,700 and Black families had only $11,000. She also highlighted the gender pay gap: Women make only 80 percent of what men do. “Systemic biases, legacy barriers, and current explosions of inequality conspire to undermine wealth generation among minorities,” Abrams wrote. That message resonates with Liliana Bakhtiari, a former Atlanta City Council candidate. “As a brown, queer woman, I’m never going to be able to make a mistake the way a White man can,” the Iranian-American woman says.
The “money mistakes” Abrams writes about — particularly of going to college and utilizing credit cards as if they were “magical slivers of plastic” — are common, Lizbeth Pratt, the CEO of Givling, a company that uses the money it makes off a trivia game to pay student loans off in a lottery, says; “The grand irony is that you have Donald Trump, who I believe declared bankruptcy three or four times as a business tool, and who for all intents and purposes is deeply in debt of hundreds of millions, but people don’t view that as a liability,” Pratt says (actually, Trump’s businesses have declared bankruptcy six times). Personal loans are often seen differently than business ones, even if legally they are hardly different, Pratt says: “When you bring it down to the individual, human nature is highly judgmental.”
Some Republicans see it as a losing battle to critique Abrams’ money woes. Georgia state Sen. Josh McKoon, in a Facebook post, warned fellow conservatives to lay off it — saying the party had excused Republican candidates who “got behind the eight ball” while helping family members. “People already see us as the party of rich people. Why play into that stereotype by appearing disconnected from the plight of everyday folks?” Others aren’t so gun-shy. Karl Rove, the famed Republican adviser to George W. Bush, argues voters will forgive some debt but that the IRS payments will hurt her at the ballot box. Abrams, Rove says, “said she can sympathize with the problems of families. Not paying for your taxes — most people can’t get away with that.”
Regardless, Abrams certainly hasn’t shied from her most visible weakness. In a live Atlanta taping of the popular liberal podcast Pod Save America in June, Abrams deadpans to the crowd, unprompted: “You may have heard I have some debt,” she says, adding that she has made good money, and spent it on others. When a woman in the audience starts to cheer loudly, Abrams breaks off her sentence, lifts a fist and smiles: “Yes – yay, debt!”
