A Prelude to Massive Outpouring of Public Funds
(Un prélude à l'effusion massif de fonds publics)
In May 2007 when the sub-prime loan problem was not so catastrophically shaking big players in the global money market, the BusinessWeek posed the following question to readers:
http://www.businessweek.com/debateroom/archives/2007/05/stop_fleecing_p.html
“The U.S. government should place greater restrictions on car sellers, pay-day lenders, and tax preparers who offer the working poor cash or credit with high fees and interest rates. Pro or con?”
Various answers and comments were presented as you see:
Nick
May 11, 2007 01:09 PM
Congress should definitely stop this fleecing of the poor. Mandate a halt to all these high interest rates and hidden fees that jack up the cost of the loans. This way, lenders will have no high yields to offset the high default rates of the poor, and be forced to stop giving credit to the poor. With no legitimate sources of credit, these people who consistently make bad decisions every day of their lives will make the decision to go to loan sharks. As they fail to pay off the loan sharks, the loan sharks will do society a favor and remove these idiots from the gene pool, preferably before they had spawned.
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Apollia
May 11, 2007 10:49 PM
Fleecing isn't the word for all this predatory lending.
It's more like flaying--given how the chronic shortage of money resulting from diligently and honestly repaying one's debts can profoundly reduce the quality of one's life and future opportunities, due to the inability to buy needed items.
The lack of money can even jeopardize one's health and the health of loved ones, if one cannot afford medical care or enough nutritious food.
You also might suffer bad health effects from being totally overworked from trying to do multiple jobs merely to keep treading water--just so you can pay your mortgage every month so you don't lose your house, car payment so you don't lose your car, car insurance so you can legally driver, inevitable car repairs (so you can still get to work).
Not everyone is fortunate enough to be able to even get a better than minimum wage job, and all these expenses combine to make life very hard for such people.
You don't even have to be stupidly and exorbitantly waste money on foolish frivolities in order to be struggling--other, basic expenses are enough to drown many people.
And when you have to work so much merely to survive, you have hardly any time, let alone energy, left over to learn new skills that might get you better employment. And if you want to go to school, you'll likely have to take on tons of debt for that, which will just dig the hole you're in even deeper.
The working poor don't deserve all this. They are not lazy, immoral bums. They're working poor and trying not to steal for a living (unlike various predatory lenders) but instead resorting to whatever legitimate, legal means they have available to them to try to improve their situation…
I strongly support a credit card boycott (you can search the web--I recommend using Yahoo--and easily find my web page about it; I also recommend reading my blog, where I wrote a bit about this BusinessWeek feature). That's my only focus, because that is what has personally affected me the most. But it's obvious that credit cards are just the tip of the iceberg of predatory lenders.
However, I think a nice mixture of the following, and probably other ideas as well, may improve matters tremendously for the poor in general, regardless of the exact type of predatory lender:
* Regulation--usury laws put back in place, excessive fees forbidden, etc., so this legalized loan sharking once again becomes illegal, as it deserves to be.
* Consumer awareness, so people know to watch out for these predatory scum and do whatever you have to do to avoid dealing with them.
* Financial education. I like the idea of a class being given in high schools.
* Generous grants (not loans) to individuals from caring wealthy people. These will prevent people from resorting to borrowing from predatory lenders to begin with--and rescue already drowning people from a gigantic, all-consuming black hole they could never possibly get themselves out of. It's almost like a boycott. What this comes down to is putting the poor in a position to be realistically able to boycott the predatory lenders.
There are probably other good, useful ideas out there as well.
Anyhow, thank you to BusinessWeek for featuring all these very insightful articles on this extremely important topic.
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Alec
May 13, 2007 09:27 AM
There's been a running theme throughout these comments, with perhaps the sole exception of Appollia, that poverty is a result of a failure of character. The reality is that America is the least socially mobile of all industrialized nations. If you're born into poverty, you're extremely likely to die there.
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And after May 2007, to date, the whole scale of repercussions caused by the subprime loan on the global money market has come to be exposed day after day with new facts and new countermeasures, such as a total outstanding amount of subprime loans estimated to be $1500 billion, $100 billion infusion of money to the market by the Federal Home Loan Bank System, $64 billion by FRB, $330 billion by European Central Bank, further recently 200 billion-worth Treasury bonds promised to be lent to the market by FRB, etc.
However, these huge amounts of money were all made public and transferred after the discussion hosted by BusinessWeek in May 2007
So, we had better review those comments as a last warning or a proof on which the God might decide the final course of the event.
And, you will understand that you cannot expect any solutions from super-rich people, since it is not a problem for them.
Or, ancestors of today’s super-rich people became very rich by conducting business similar to selling subprime loans to the poor on purpose.
As super-rich people do nothing and governments are spending public money to stop the collapse of the financial framework of economy, things will not be settled in favor of the poor if ever settled in future.
That is why I am telling you that you cannot expect any decisive solutions but the Religious Revolution to be pursued here and there.
There are no limits in desire of people in the money market and thus no limits of allowable profits in economics they love, which means winners in the market or super-rich people and those who want to be super-rich will not mind if millions of poor people die simply due to the lack of money.
Jesus Christ is completely against those winners in the market or super-rich people and those who want to be super-rich.
Jesus Christ orders people to give money to the poor unconditionally.
This is the only solution and it can be only accomplished after the success of the Religious Revolution.
It is because the Revolution is aimed at forcing people to obey orders delivered by Jesus Christ unconditionally.
Even laws, far unholy compared with words of Jesus Christ and the God, are allowed to force citizens to do something reasonable on the street and in office; so, it is natural for citizens to be forced by words of Jesus Christ and the God.
(One big difference between mankind and animals is of the propensity to money.
If you feel sympathy or friendship to, say, vanishing polar bears, orangutans, or elephants, it may be because they do not have money at all.
So then, the God must love the poor more than those with much money.
Indeed, as the money contaminates the nature, we have to use something else to save the nature, such as sympathy or friendship to animals being endangered or vanishing.)
“The Ruler of This World has already been Judged.”
(Der Herrscher dieser Welt schon verurteilt ist)