
More Struggling Borrowers Face Pay Garnishment - pg
http://www.nytimes.com/2010/04/02/business/economy/02garnish.html?ref=business
======
pg
This is getting uncomfortably close to debt slavery.

In ancient times, or less ancient times in some countries, people who got into
sufficiently large debt to someone had to sell themselves to them. And since
credit card lenders' ideal situation is when someone can pay the interest on
their debt but not the balance, if they tuned the percentage of the
garnishment to do that, the debtors would end up paying them for the rest of
their lives.

~~~
startuprules
Debt slavery? Not even close. In America, there are numerous ways still to
discharge your sins of a previously extravagent lifestyle funded on credit
card. You can declare bankruptcy (the article mentions the high cost of
$2000+, but there are free social services that will help reduce that cost).
You can refuse payment for many years, eventually settling to pay off 10-20
cents on the dollar for debt. You can choose to work in jobs getting paid in
cash, thereby having no records of salary, and pay no taxes, and eventually
your debt is discharged. And so on.

Personally I would like to see people who declare bankruptcies multiple times
to serve some sort of jail terms.

~~~
tptacek
I would like to see the people who design business models that target the kind
of people who file bankruptcies multiple times serve some sort of jail term.

~~~
startuprules
Ok, let's take it to a bigger scale. Airline industries declare bankruptcies
and gets bailed out time and time again, to tunes of billions. Homebuilders
transfer assets to new entities, then declare bankruptcies, pocketing billions
and evades creditors. Banks leverage themselves with trillions of debt, and
gets bailed out by the government.

Meanwhile, regular people have to pay for the billions and trillions of
mistakes, with loss of social benefits, or taxes, or inflation. When does it
stop?

And you would prosecute the politican who enacts a law to incriminate, and
prevent future bankruptcies (by saying NO MORE!)?

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smallblacksun
When people don't pay their debts, the cost ends up going to people who do. I
have no sympathy for people who tried to live beyond their means, and are now
paying for it. They made their bed, now they have to lie in it.

~~~
tptacek
When you pay $10,000 to address $1,000 of a $5,000 loan, you have not made
things any worse for the rest of us, except to help promote a system that
allows unscrupulous creditors to exploit people.

~~~
smallblacksun
It's not the systems fault that those people took out those loans. At some
point, people have to take responsibility for their actions instead of always
blaming somebody else.

~~~
tptacek
What does that have to do with your original argument?

