On the house that greed built:

Several months ago, I began thinking about writing a post on the dangers of credit and how it has allowed the values of homes and tuition to get so out of whack. Well, I’ve been busy and haven’t gotten around to it, but now it must be said. Yesterday the Dow fell more than 700 points and I just know we are living several dismal paragraphs in my grandson’s history text book.

Aces and Kings are dropping off the teetering house of cards that is our economy, and the politicians and the financial analysts and the Wall Street moguls want us to shore it up.

Yes, I am outraged that they are telling me—a law abiding, hard working, barely middle class single mom-- to mortgage my child’s future to bail out people who’ve been proudly and happily stealing from us and undermining our economy in ways they understood much better than I can-- even now. But I’m against the bailout for an even more important reason. I’m not an economist, but it has occurred to me that our economy’s basis in credit may be a major reason for the development of the chasm of inequality that divides the haves and the have-nots in this world. By shoring up this untenable system, we may be unwittingly perpetuating the oppression of the majority of the world’s people and missing the only opportunity in generations to undo it.

Think about it: could the price of a “starter” condo in a city neighborhood reach $300,000 without credit? Could college tuition rise to a similar level? Before borrowing for school was widely done, my parents worked their way through, and on the other side, their wages were their own. I will probably be paying down my education debt (at the rate of over $300 a month) for the rest of my life. And in comparison to recent graduates of private institutions and to those who attended medical or law school, my debt is downright tiny. Having this debt at the very beginning of one’s adult life often means incurring even more debt to own a car and a home. It can mean building up large credit card balances to fulfill daily needs.

Credit may allow us to do lots of wonderful things. It also allows us to live beyond our means, and to pay interest on the debt which increases the cost even further. It allows the prices of things to go up disproportionately in regard to our salaries and for us to continue to believe we can “afford” those prices. Meanwhile, the masters of the universe who run the companies which supply the credit, make greater and greater profits. Relative to them and to the cost of living, we become poorer and poorer.

We may as well be indentured servants--even slaves-- to this credit economy.

Now our masters have driven the plantation into the ground and they want us to rebuild this tool of our own oppression by borrowing against our future and our national security. I say, “Enough!” A house of cards reinforced by still more cards will fall just as easily and with a greater flurry.

I have no doubt it will be hard to quit the credit habit. The next few years may necessitate changing The Great Depression’s moniker to “Great Depression I.” But if there is any promise of freedom from debt and equal opportunity on the other side, I think it will be worth it.

Since I doubt the vast majority of the people will agree to go cold turkey with me, I have a back up proposal. Any money the government puts into the crisis should be used to bail out the individuals who were sold bad loans, rather than the rudderless companies who sold them. If we’re going to intervene, let’s make sure we intervene on the side of the innocent.