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With that said, one of my concerns with society (sadly, corporations must be included) is that many entities seem to believe that if an action is justifiable then it is okay. Let’s take Enron as an easy example. Mr. Lay, et. al., spent copious amounts of time, energy, and money analyzing in the law in detail to make sure that they careful avoided violating it. The failure was that those involved did not pay attention to the intent of the law. I believe it is wrong to take the mindset of "if the government didn't want me to do X, then it would have passed a law." The other justification I see over and over is, "If I/we don't do X, then someone else will." I say, then let them. Let the other guy be (ethically, morally, societally) wrong even if he makes more money. But that is not my impression of how most of society thinks. We are always quick to point to someone else and say, "If they are allowed to do it, then I should be able to too. It's only fair." What a sad concept of fair....
The above are perhaps symptoms of what is wrong with society. One solution that I believe will attack the cause(s) is to teach critical thinking skills early (and often) in our educational system. I encounter few people that know how to properly analyze a situation. Most people look at a situation only from their viewpoint, occasionally from a polarized version of an opposite viewpoint, but fail to consider the myriad of others that lie between the extremes. That's the immature, self-centered member of society coming through: what is best for me? I submit that there is a way to succeed while considering others; yes, one might not be as successful as one possible could, but the overall society may advance instead of just one individual.
That's sounds socialist, I know. But in our hearts I think most of are socialist. It strikes me as the underpinnings of a Judao-Christian society. It's not a bad thing, and we can still have our capitalism and republic. It comes down to individual responsibility and decision.
So to the original question, I would blame those that take advantage of unprepared individuals, and I would blame those individuals that have not prepared themselves. But each group is being blamed for different reasons because their contributions to the defined problem of debt are different.
I see this even a little bit from my parents, who are generally reasonable about money. To avoid being house poor, we live in a much more working-class neighborhood than we could afford, but it's not the sort of neighborhood that inspires envy when discussing your children with your bridge club. So we've received comments that are sort of backhanded encouragement to buy a more expensive that we don't need.
From my perspective, there is a lot of information out there about using credit wisely. No one taught our parents how to use the first credit cards and many of them did not get into trouble. So why is it now that teens need to be taught about credit, or it is parents or school fault? The issue goes beyond credit cards.
Money is energy. We give energy and are able to buy things that we need and want to live on. Yet, with the prosperity that we have seen over the last few decades, the idea of withholding energy has gotten more pervasive. We are looking to retire earlier and earlier by making money work for us so we do not have to. This is great in theory, yet what is it teaching our younger generation? Many people think they have more of an entitlement attitude, yet where have they gotten this from? Us?
So, this is not a straight forward blame issue. We each have a hand in how we live as a nation. We can have more financial education in high school. We can continue to blame credit card companies. We can blame parents and teens. We can blame government who doesn't show us how to live on a budget either. Yet, when we each see how our actions effect the whole situation, this is where we can start to change how we live.
Had a question: I was wondering for Chase credit cards (cause I have one), if the denominator for the utilization was not the actual credit limit, but the credit SPENT. There were previous posts for Capital One where this was the case. I was wondering if this was the same for Chase and which banks or credit card companies we have to watch for that do that.
In our society "responsible" spending means spending to look like you have the money you've got, or will get, or will someday make, or your parents make - no one champions the idea that responsible spending means that you live on less what you make. I think if you polled average people they would agree that responsible spending means not spending more in a month than you make, without thinking of what you spent it on or what better uses you could have put that money towards.
Cap's example is pretty apt - what would those kids have done if the credit card companies would not have given them a card because they didn't know how to responsibly use it? They would have complained about the evil credit card companies who wouldn't give them a card.
CIVILIZATION ON THE PLANET SURVIVED TO 100,000+ years but it is all coming to an end because of high interest rates on credit cards. It is so laughable and pathetic at the same time.
There is ONLY ONE THING TO BLAME (if you must call it that) and it is GREED!
Radix malorum est cupiditas
It is man's greed that created "interest" and it is the same greed that will undo him. It is YOUR current greed to earn "great returns" on your "investment" portolio that drives the problem: GREED.
http://en.wikipedia.org/wiki/Usury
Usury (in the original sense of any interest) is scripturally and doctrinally forbidden in many religions. Usury was denounced by countless spiritual leaders and philosophers of ancient times, including Plato, Aristotle, Cato, Cicero, Seneca, Plutarch, Aquinas, Muhammad, Moses, and Gautama Buddha.
The only person to blame is the person you look at in the mirror on any given day.
Parents need to tech their children about money and credit. Don't let your children wander through life buying lottery tickets and living paycheck to paycheck. And if you think the govt. should teach children about money, take a look at the $8.5 trillion mess they have gotten us into. You may not want the government to mention finances to your kids.
CC companies don't necessarily tell people what to do with the credit, they just make it easy for them. Likewise, do bars cause drinking problems? Is McDonalds to blame for obesity? Do gun manufacturers kill people? Does violence on TV cause murders? Your answers probably depend on the extent to which you believe in individual responsibility.
While our society should promote values that are beneficial, whose duty is that? I don't think you can blame for-profit businesses for pushing their own interests. Heaven help us if we think we should leave responsibility for our cultural values in the hands of industry. I think it's the responsibility of parents and our educational system to do a better job of teaching people how to manage their finances. Certainly, that is where you have to start. By the time people are adults, the self-destructuve habits of credit overuse are firmly ingrained.
What we CAN do is address the issue of not educating our population about the matter of personal finance. I attended a top notch private college preparatory school and am very thankful for what they taught me, but in retrospect it is inexcusable that they never touched on the issue of personal finance. I think it should be mandatory. It's just that important. But in college as well, there was nothing in the curriculum on this subject. It's just as important as your state's history or english composition, and those are required (at least in Texas.)
Even the very highly educated often have no exposure to personal finance education. My wife has a PhD in Chemistry and is at the top of her field. Her colleagues often say she'll likely earn a nobel prize for her work. She's extremely gifted in her narrow field of expertise, but is ill equipped to handle her finances. She doesn't understand the subject and until she met me she didn't see why she should spend her valuable time on it.
Now we have two children and I hope I can communicate the importance of understanding their own finances and being responsible with them because I don't believe anyone else (including their schools) will bother to educate them on this.
Yes, but normative claims don't really get us anywhere. This reminds me of claims by people who dislike welfare like: "Poor people shouldn't have kids they can't afford." Yes, everyone can agree that it's not a smart thing for them to do, but just stating it doesn't do anything; the poor are still going to have children, and we're certainly not going to let those children starve.
Yes, people shouldn't buy put things they can't afford on credit. Yes, it is their "fault". But that line of thinking is actually counter-productive, because unless we do something to change the sort of thinking that says new clothes are more important than a $0 balance, the debtors are going to outweigh the rest of us. And once they're in the majority, once the moral compass of the nation starts to want to excuse and legitimize the debt, what do you think is going to happen?
I certaintly don't think that we should shame people in debt, but I do think that we should call out anyone who reinforces the hegemony of consumption. Have you ever had a friend make fun of the outfit on someone across the bar? Ever make a snide comment about someone's '84 Ford? These are, IMO, the real problems.