CR on the NYT:

Streitfeld is writing about the growing wave of ruthless credit card defaults, but this also raises question about the credit card industry in general. Why aren’t consumers being educated on the dangers of not paying off their credit card balance each month? Maybe that will be a good role for the new consumer financial protection agency. And why are transaction costs for retailers still so high with all the innovation and advances in technology?

Two questions are posed. There is only one answer: money. Because the people in control can make even more of it the more the status quo is kept.

The main point of the article was on the rising tide of credit-card defaulters, people who’ve realized how they’ve fucked themselves, and just cutting off the cord to their creditors. A good thing? Well, not for the system in general, that’s for sure. But for the general well-being of the American public? A diminished lending sector would be good. Debt is a prison. There used to be debtors prison. Debt is the thing that turns our pretty possessions into chains of self-made repression.

Debt scares me, but at least now the worst can happen is they just call you a lot. I could survive without a phone. I could shred collections mail. Court’s the only thing that would compel me. No misguided sense of conscious would compel me – corporations fuck people over quite regularly, I don’t think much compassion should be shown to entities that have no conscious. These banks, they turn your debit card into a lottery ticket – no shit, I took a picture of the advertisement just knowing I’d have some great future use for it:

And because ‘the next purchase could be on’ Chase – they’re subtly encouraging you to not only make more purchases, but larger ones, hoping that will be the one Chase picks up for you – this was right after they bought WaMu, well after they bought Bear Stearns. They had to have lost some money on those deals, right? They bought failing institutions, why are they giving out free money to customers? I remember when the bank account was for keeping your money safe, not gambling that you might not have to pay one of those swipes.

I also like the whole Chase card eclipsing the WaMu card – very symbolic – and they’re lording their power over you by tempting you to spend more to get possible, but rare, free things.

People are not taught to pay off their balances so they will pay more money to the banks for their goods. Basically leasing them. The transaction costs to dealers are high because the rich cats in control of the banking industry have a monopoly on money trading. If you want to get paid you play their game. If you don’t accept cards, you get less business, because it’s inconvenient, unless you have a dedicated clientèle. People either don’t carry cash or don’t have cash so they’re trapped into using their cards to satisfy their consumer whims.

So, all this extra money, these fees and interest payments (and when you’re not careful, over limit penalties), where does this go? Most of it lines banker’s pockets – and the rest, I assume, helps out programs like “Swipe that thing, next one might be on us” and those silly rewards programs. In fact, one of the arguments against the tightening of credit card rules that Obama, the Funk-Soul Emperor signed into law was the fact that limiting fees and penalizing interest rate hikes would hurt the banks’ ability to offer reward incentive cards.

They’re effectively punishing the poor people that can’t keep up so people that can will be able to siphon off some of the effects of ignorant folks’ decision making. Rich people may spend more, dollar amount, than the poor, but in percentage of income spent, I imagine the pyramid would be well upside down.

And that’s my rant on credit for this evening.