Submitted by ari on Tue, 07/21/2009 - 22:19
The Metro Industrial Areas Foundation (Metro IAF) is a network of 17 broad-based citizens organizations throughout the East Coast, Midwest, and Europe. We are a regional affiliate of the national Industrial Areas Foundation (www.industrialareasfoundation.org), created by Saul Alinsky in 1940.
I don't get how this even number of 10% works out to be the moral choice? If 10-15% of credit card customers default on their accounts, 10% interest rates lose banks money. Banks are not exactly sure who will not pay their bills, so they if they can't raise the rate, they just cancel anyone who poses a risk - the economically vulnerable people who need the credit. Credit will still flow to the big earners in the big suburbs to get their bigger iPods and boats with their higher credit limits. Meanwhile, working families won't be able to get legal short term credit. Enter the loan sharks. This is happening already here and in places like England. Our goal should be to help people who need credit, not to penalize the big nasty rich banks.
Why do credit unions, who aren't trying to earn a profit, charging more than 10%? Because they're is a lot of risk out there right now.
If you think 10% is not enough, mortage your house and car, take your retirement and college savings, and lend them out to people at below 10%. Be twice as nice - lend at 5%. Don't want to do this? Are you afraid of the risk? Realize that at 5% inflation, you are taking a great risk with no real return on your money? Lend your own money first before you tell banks to do it, lose money, and then stop lending to certain people or go out of business. Lusting after the big guys' money doesn't help the little guy.
>>>Why 10%? Because 10% is enough
Self obvious statements deserve incredible scrutiny. Why a 10 gallon limit per month on gas for each family? Because 10 gallons is enough. Doesn't make sense. Repeating it doesn't make any more sense. Car payments should be $100/month. Why? Because $100 a month is enough. Doesn't make sense? Just say it more and protest in front of the right buildings? Please develop some moral and economic arguments on why this is the right thing to do and why it won't hurt the people whom it is designed to help. Aren't there concrete things like credit education that would help hurting families more than protesting?
Rusty
Its about time
Ivan DelValle
World & LocalSuperCenter.com