A Modern Emancipation Proclamation

[Vast LWC]

You're missing the point. Who we call a "loan shark" is a matter of opinion. How high is too high when it comes to interest rates? As others here have pointed out, being willing to pay higher interest rates is sometimes the only way a person with poor credit can get a loan. Setting legal limits on that is, essentially, setting legal limits on who has access to credit.

I'm not missing the point.

These corporations are using these people's desperation to commit extortion.

Once they drag them into the cycle of debt, they keep raising their interest rates, and string them along for as long as possible until they suck them dry.

They are predatory, and are parasites on society.

That is why Christ called the money changers "a den of thieves", and why there have been usury laws in most civilized societies for millennia.

This practice is the primary reason for the massive transfer of wealth from the poor and the middle class, to the very wealthy, for the past 30 years.

Don't you people wonder why, while the average person lost 40% of their wealth in the past 5 years, the top 10% of the wealth-holders either held even or gained?

 

[Vast LWC]

 

[dblack]

You're missing the point. Who we call a "loan shark" is a matter of opinion. How high is too high when it comes to interest rates? As others here have pointed out, being willing to pay higher interest rates is sometimes the only way a person with poor credit can get a loan. Setting legal limits on that is, essentially, setting legal limits on who has access to credit.

I'm not missing the point.

Well, yeah, you are. You're simply repeating yourself in saying that loan sharking is bad. I get that, and as long as we agree on who the loan sharks are, I agree. But where we draw the line between a loan shark and a legitimate high-risk, high-interest loan is a largely judgement call. And my point is that different people will make that call differently.

As with so much of the regulatory state, you want to impose your judgement on others. Why not make laws requiring honesty and transparency and let borrowers decide what's best for them?

 

[Vast LWC]

Well, yeah, you are. You're simply repeating yourself in saying that loan sharking is bad. I get that, and as long as we agree on who the loan sharks are, I agree. But where we draw the line between a loan shark and a legitimate high-risk, high-interest loan is a largely judgement call. And my point is that different people will make that call differently.

As with so much of the regulatory state, you want to impose your judgement on others. Why not make laws requiring honesty and transparency and let borrowers decide what's best for them?

Because the huddled masses do not generally have the foresight to realize when they're being swindled, especially when the credit card companies catch them young.

Which is why they have salesmen go to college campuses across the nation, recruiting new debt holders.

By the time the average american is 30 years old, they are already tens thousands of dollars in debt. A debt that they'll very likely be paying interest on for the rest of their lives.

It is indeed a Den of Thieves. Sometimes that Jesus guy hit the nail on the head.

 

[Vast LWC]

And no, I'm not assuming that people are stupid, I'm simply saying that the average person simply cannot wrap their head around the fact that if they take out a large amount of debt, and only pay the minimum payment, they will, in all probability, never pay off that debt.

 

[dblack]

And no, I'm not assuming that people are stupid, I'm simply saying that the average person simply cannot wrap their head around the fact that if they take out a large amount of debt, and only pay the minimum payment, they will, in all probability, never pay off that debt.

Well, then perhaps we can come to some agreement on the transparency and full-disclosure that Foxfyre and I were discussing. I'm sure as hell not in favor of banks taking advantage of people by preying on their ignorance. They need to be abundantly clear with potential customers just what sort of commitment is involved. If that means adding requirements for showing loan applicants just how long they'll be paying if they only pay minimum payments, and just how much they'll be paying in total interest - that's the kind of regulation I can get behind. I certainly don't think there are enough of those kinds of rules currently.

 

[Foxfyre]

And no, I'm not assuming that people are stupid, I'm simply saying that the average person simply cannot wrap their head around the fact that if they take out a large amount of debt, and only pay the minimum payment, they will, in all probability, never pay off that debt.

They will understand it if the lender is required to explain it to them. Full disclosure and honesty in lending requires full disclosure and honesty. Then if the person has it explained to him and chooses to take the loan anyway, it should be his choice.

I object to charging the same interest rate to the irresponsible high risk person as is charged to the responsible person who has done what is necessary to merit a low interest rate. Interest should be based on risk and not some arbitrary amount fixed by government.

But the only way I can see to tie this line of discussion to the OP is to require honesty and full disclosure from our elected leaders and those hired to be administrators of government agencies. That in turn would also apply to the Fed and require us being informed on how and what basis interest rates are set for the banks at the federal level. (Unless we can get rid of the Fed but that is for a separate debate.)

 

[Vidi]

I reject the resolution entirely as such equal distribution of "benevolence" can only be attained through a socialistic redistribution of wealth, which I fundamentally oppose.

 

[Vidi]

And no, I'm not assuming that people are stupid, I'm simply saying that the average person simply cannot wrap their head around the fact that if they take out a large amount of debt, and only pay the minimum payment, they will, in all probability, never pay off that debt.

They will understand it if the lender is required to explain it to them. Full disclosure and honesty in lending requires full disclosure and honesty. Then if the person has it explained to him and chooses to take the loan anyway, it should be his choice.

I object to charging the same interest rate to the irresponsible high risk person as is charged to the responsible person who has done what is necessary to merit a low interest rate. Interest should be based on risk and not some arbitrary amount fixed by government.

Interest rates are not dictated by the government. They are dictated by the Federal Reserve which is privately owned.

 

[Vidi]

One man's loan shark is another's savior. I hardly see how we justify telling loan applicants how much interest they can pay on a loan. It should be up to them.

A loan shark is no one's savior.

You're missing the point. Who we call a "loan shark" is a matter of opinion. How high is too high when it comes to interest rates? As others here have pointed out, being willing to pay higher interest rates is sometimes the only way a person with poor credit can get a loan. Setting legal limits on that is, essentially, setting legal limits on who has access to credit.

Let me put this to you:

I would argue that risk is shared.

If someone buys the house next door to mine, but goes bankrupt and the house falls into disarray and stays vacant, MY property values suffer.

Should there not then be some mechanism to protect me from the foolish risks taken by others? Should the irresponsible behavior of others cost me?

 

[dblack]

And no, I'm not assuming that people are stupid, I'm simply saying that the average person simply cannot wrap their head around the fact that if they take out a large amount of debt, and only pay the minimum payment, they will, in all probability, never pay off that debt.

They will understand it if the lender is required to explain it to them. Full disclosure and honesty in lending requires full disclosure and honesty. Then if the person has it explained to him and chooses to take the loan anyway, it should be his choice.

I object to charging the same interest rate to the irresponsible high risk person as is charged to the responsible person who has done what is necessary to merit a low interest rate. Interest should be based on risk and not some arbitrary amount fixed by government.

Interest rates are not dictated by the government. They are dictated by the Federal Reserve which is privately owned.

We were discussing usury laws that cap interest rates lenders are allowed to charge for loans.

 

[gallantwarrior]

A MODERN EMANCIPATION PROCLAMATION​

WHEREAS, Federal spending is out of control to the point that not only is there a lack of will to balance the budget, but it is fast becoming an impossibility, and

WHEREAS, the ability to use other people's money to increase one's personal power, prestige, influence, and wealth makes it irrisistible to avoid doing that, and

WHEREAS, it is human nature to become comfortable and dependent on government benefits we receive, and

WHEREAS, we Americans as a people have long abandoned a concept of restricting government to what the Constitution says it can do and we now allow government to do anything not specifically prohibited by the Constitution, and

WHEREAS, the resulting entitlement mentality at all levels from big corporations to agricultural subsidies to the typical welfare recipient is a pervasive corrupting force infecting both those in government and the beneficiaries of government benevolence,

THEREFORE BE IT RESOLVED that a constitutional amendment must be passed to prohibit the federal government at any level from bestowing any form of benevolence or benefit upon any person, group, demographic, or entity that does not equally benefit all regardless of political leanings and/or socioeconomic status.

This amendment will not affect or apply to any policies of state or local governments.

* * * * * *​

Your observations, comments, opinions, objections, and rebuttal follows. . . . .

I would add language that would force all elected and appointed government representatives to be held to exactly the same standards as everyone else and I would make any violation of that stricture to be punishable by law.

 

[Foxfyre]

I reject the resolution entirely as such equal distribution of "benevolence" can only be attained through a socialistic redistribution of wealth, which I fundamentally oppose.

Excuse me? The OP forbids the federal government from dispensing ANY form of benevolence on anybody. How can that be a socialisitc redistribution of wealth?

 

[dblack]

Let me put this to you:

I would argue that risk is shared.

If someone buys the house next door to mine, but goes bankrupt and the house falls into disarray and stays vacant, MY property values suffer.

Should there not then be some mechanism to protect me from the foolish risks taken by others? Should the irresponsible behavior of others cost me?

Yes, this is the core difference in philosophy between libertarians and, for lack of a better term 'statists' (no insult intended). You want a government whose primary purpose is to function as an insurance company and assumes all risk is a public concern. As this fundamentally violates self-determination, and actively interferes with our personal decisions regarding how much risk we are willing to accept, I reject it categorically.

There will always be secondary (tertiary, etc...) effects of someone in society suffering misfortune (or enjoying good fortune for that matter). But freedom requires us to accept this. Insisting that we be protected from every inadvertent side-effect of others' decisions effectively disallows those decisions and squelches personal freedom. It implies that every decision we make requires permission from the state.

 

[Foxfyre]

A MODERN EMANCIPATION PROCLAMATION​

WHEREAS, Federal spending is out of control to the point that not only is there a lack of will to balance the budget, but it is fast becoming an impossibility, and

WHEREAS, the ability to use other people's money to increase one's personal power, prestige, influence, and wealth makes it irrisistible to avoid doing that, and

WHEREAS, it is human nature to become comfortable and dependent on government benefits we receive, and

WHEREAS, we Americans as a people have long abandoned a concept of restricting government to what the Constitution says it can do and we now allow government to do anything not specifically prohibited by the Constitution, and

WHEREAS, the resulting entitlement mentality at all levels from big corporations to agricultural subsidies to the typical welfare recipient is a pervasive corrupting force infecting both those in government and the beneficiaries of government benevolence,

THEREFORE BE IT RESOLVED that a constitutional amendment must be passed to prohibit the federal government at any level from bestowing any form of benevolence or benefit upon any person, group, demographic, or entity that does not equally benefit all regardless of political leanings and/or socioeconomic status.

This amendment will not affect or apply to any policies of state or local governments.

* * * * * *​

Your observations, comments, opinions, objections, and rebuttal follows. . . . .

I would add language that would force all elected and appointed government representatives to be held to exactly the same standards as everyone else and I would make any violation of that stricture to be punishable by law.

It is there in the resolution. They can't vote anybody--and that would include themselves---any benefit that they don't vote for all of us. That takes care of the problem.

You may have a good idea to add language specifying that they can make no law affecting any of us that does not apply equally to themselves.

 

[gallantwarrior]

THEREFORE BE IT RESOLVED that a constitutional amendment must be passed to prohibit the federal government at any level from bestowing any form of benevolence or benefit upon any person, group, demographic, or entity that does not equally benefit all regardless of political leanings and/or socioeconomic status.

Then we can stop calling ourselves a Christian nation? When Muslims are feeding their poor and hungry from govt funds, we should be ashamed to pass this.

There is nothing in the resolution to prevent Christians at any level other than the federal level from being benevolent to anybody they wish. And with the exception of Kuwait where there really are more millions than there are people, but in which class status still strongly prevails, there are almost no Muslim countries that do not have many people living in crushing poverty.

The purpose of the resolution is to eliminate what I believe is the rampant abuse resulting from the ability of those in the federal government to use our money for their own benefit, the widespread corruption resulting from that, and in a manner from which we the people are so removed that we are powerless to stop it without a new law.

Unfortunately, all good ideas and intentions...but guess who passes the new laws? Revolution is sometimes a preferable option if true results are desired.

 

[gallantwarrior]

???? Why the emphasis on interest rates? That's a big tool used to fight inflation, why are you putting limits on it?

Because, by far, the largest current method of transferring money directly from the poor to the rich in this country is interest on debt.

Specifically, interest rates of about 30% that can be found on credit cards and other forms of credit generally used by poorer folks.

If one wants to make sure there is no need for federal funding to be extended to the poor, (and cutting off funding for poor folks is surely what this amendment is aimed to do) then stopping creditors from charging outrageous usury fees would be an excellent first step.

And don't tell me people need to be smarter about borrowing money. If the circumstances are dire enough, anyone will try to get credit, no matter what the interest rate, and that's when they get trapped.

Especially in the rather common circumstance where a payment is missed, and the interest rates on a credit card suddenly go up from 8% to 29.9%.

A top interest rate of 10% will leave plenty of room to fight inflation.

The federal government is not given the task of being a banker for "poor" people who cannot afford credit. What happened to saving for what you wanted? You want it badly enough, you give up some other things. Or, if not able to go beyond the basics, and unwilling to improve your lot, you just continue in the socio-economic strata that you inhabit. It is not up to the government to improve anyone's lot in life, especially if they are unwilling to do so on their own initiative.

 

[gallantwarrior]

LWC posted in his previous post:

If one is going to make a legislation that revokes relief to poor people, surely it is in everyone's best interests to help said poor people out of the hole they have dug themselves into, which is a good part of the reason they require the assistance in the first place.

In one sense I agree. It would be unconscionably and unjustifiably cruel to abruptly revoke Social Security and Mediare at the federal level after making millions of people dependent on these programs. . . but. . . .

We could begin now to slowly and carefuly back out of these programs at the federal level in small increments just as they have accrued and begin to privatize them.

Except for allocating tracts of unimproved land to homesteaders way back when, I can't think of any case in which government has relieved poverty to any significant degree by giving people stuff. I rather go with Ben Franklin's philosophy that we do people no kindness by making them easier in their poverty, but true compassion is leading or driving them out of it.

People allocated those government land grants were required to "prove up". That meant that they had to actually improve the land to some specified extent, thereby making that land productive and the landowners contributors to the general welfare of the community.

 

[gallantwarrior]

One man's loan shark is another's savior. I hardly see how we justify telling loan applicants how much interest they can pay on a loan. It should be up to them.

A loan shark is no one's savior.

You're missing the point. Who we call a "loan shark" is a matter of opinion. How high is too high when it comes to interest rates? As others here have pointed out, being willing to pay higher interest rates is sometimes the only way a person with poor credit can get a loan. Setting legal limits on that is, essentially, setting legal limits on who has access to credit.

It gets even worse when the federal government insures loans made at these usurious interest rates. There is no real impetus for those making such loans to ensure that the people they are loaning the money to are capable of paying the loans back. Those who take these loans have no real reason to pay them back when they know the loans will be paid for should they default.

 

[Vidi]

They will understand it if the lender is required to explain it to them. Full disclosure and honesty in lending requires full disclosure and honesty. Then if the person has it explained to him and chooses to take the loan anyway, it should be his choice.

I object to charging the same interest rate to the irresponsible high risk person as is charged to the responsible person who has done what is necessary to merit a low interest rate. Interest should be based on risk and not some arbitrary amount fixed by government.

Interest rates are not dictated by the government. They are dictated by the Federal Reserve which is privately owned.

We were discussing usury laws that cap interest rates lenders are allowed to charge for loans.

I stand corrected. Thank you.