The financialization of social policy and the politicization of student debt in Chile

The financialization literature focuses on how people become docile neoliberal subjects and pays less attention to debt resistance. This article focuses on this less explored dimension. The article draws on the case of Chile to explore the way in which thefinancialization of higher educationleads to thepoliticization of debt. It makes the case that social mobilization around student debt is a late stage in a succession of policy and political conflicts. These, moreover, arise from the fact that the financialization of social policy implies the reconciliation of three seemingly contradictory goals: the reach of fiscal responsibility and economic efficiency, the fulfillment of policy goals, and the management of the political consequences of imposing a debt-burden to citizens that are constituents. The case shows that, as legislators and policymakers insist on tackling these dilemmas favoring market mechanisms, e.g. the privatization of student debt, massive and deregulated extension of credit, they create the conditions for a 'student debt crisis' to arise. However, the extent to which such crisis may trigger the rise of social movements of debtors, depends on factors such as existing conceptions about debt and social rights, institutional incentives, and the existence of political organizations.

Automated summary

This article explores the impact of financialization on higher education leading to the politicization of debt, highlighting that social mobilization around student debt is a late stage of policy conflict. It discusses the three contradictory goals of financialization of social policy and the conditions for creating a "student debt crisis," as well as factors determining the rise of social movements of debtors.