Rant of the Week

Household Debt


The average Canadian household debt, excluding mortgages, is about $40,000.  Yes, read it twice.  Don't believe me?

As everyone points fingers at those irresponsible Greeks-- rumour has it they don't work at all-- consider the Canadian consumer, also living high on future earnings. 

Now, if one in ten Canadians were in debt to the tune of $40K, you might begin to think that one in 10 Canadians is irresponsible, selfish, and/or inept.  You might look at yourself: I'm pretty smart and wise and self-controlled.  I have no debt.

But you can't.  You also have $40K in outstanding debt.  So you are irresponsible, lazy, and inept.

Good news for you-- you're probably actually pretty average.  In fact, you are average.  In fact, you are everyone.

So if the average person owes $40K to credit card companies and banks, what does that say about our society?  It says that the creditors in our world have found a way to transfer the hard-earned wealth you have earned from honest labour into their own pockets by simple virtue of the fact that they have capital to lend out.  If this state of things were the result of a character flaw, there's no way everyone would be doing it.

The banks act as if everyone has a choice of running up personal debt or not.  But the results of their policies and practices reveal the truth: the system is rigged to their favor.  The system is rigged to entice you into spending more than you have in order to "enslave" you: fixed monthly payments for most of your adult life is not "credit".  It's indentured servitude.   Twenty-eight percent interest on credit card debt is not there to provide a fair incentive to banks to lend-- it's there to keep you in servitude by making it increasingly difficult to pay off the principle.  And the financial crisis in the U.S. was largely triggered by the attempts of the banks in the U.S. to apply the lessons they learned about credit cards to mortgages, with balloon payments, floating rates, back-loaded payment schedules, and so on.  All of this requires a very large crew of lobbyists' and lots of political donations, because for it to work, the government must be complicit.   The government provides the legal system that is rigged to enforce the banks' rules and the banks' views of what is "fair" and "honest".  If the banks tried to enforce their own rules themselves, that would be called organized crime.  Extortion.  Loan-sharking.   When the government does it, it's called "free enterprise".

It may occasionally be necessary for some of you debtors to go over to a hot, dusty, godforsaken foreign country and kill people to maintain our glorious liberties and freedoms.  Thank you very much.  We'll get you to stand up at our baseball and football games and accept a salute.  No no no-- not you homeless or paralyzed veterans!  The ones who can stand.


All Contents Copyright Bill Van Dyk 2011 All Rights Reserved