I Worked at Capital One for 5 Years. How We Justified Piling Debt on the Poor
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Re: I Worked at Capital One for 5 Years. How We Justified Piling Debt on the Poor
#2Re: I Worked at Capital One for 5 Years. How We Justified Piling Debt on the Poor
#3previous discussion: https://news.ycombinator.com/item?id=21138418
Re: I Worked at Capital One for 5 Years. How We Justified Piling Debt on the Poor
#4[deleted]
Re: I Worked at Capital One for 5 Years. How We Justified Piling Debt on the Poor
#5At least you can buy actual non-discretionary purchases with a credit card.
I've recently become much more alarmed by the rise of these "buy now, pay later" companies like Affirm and Afterpay, which partner with merchants that most would categorically put in the discretionary bucket (shoes, makeup, jewelry, designer clothes) charging similar interest or fees.
Re: I Worked at Capital One for 5 Years. How We Justified Piling Debt on the Poor
#6It would be interesting to run the numbers on a jubilee for certain kinds of debt.
I realize monetary policy of inflation is in-effect a debt jubilee, as it was applied to the boomer generation in the 70s and 80s. Since diminishingly few people keep their savings in cash (instead of putting into homes, durable goods, index funds, etc), inflating away debt seems like an inevitable policy outcome. In the US, if the democrats don't do it next term with MMT, the republicans will do it with negative interest rates. It's not just a partisan issue, and it seems like there is no alternative. The main problem is that without supporting the bottom end with a minimum wage increase to match inflation, it will just be a middle class debt bailout, and the precariat will remain as screwed as they always were. Approaching this by funding a minimum income with a new VAT doesn't improve the their situation since it just subsidizes exploitation by subsidizing disadvantaged wage levels. The horror is that it's going to come down to less of what's right, and more of finding people to screw who are less likely to vote. It's a grisly business.
These Capital One people were just following orders, as the saying goes, but unsecured debt is a form of slavery. Not sure how long people will accept incremental quality-of-life improvements in slavery, but at least now we have entertainment, software, and high speed pizza delivery.
Suddenly, those land parcels in New Zealand are looking more appealing.
Re: I Worked at Capital One for 5 Years. How We Justified Piling Debt on the Poor
#7I have a story similar to this.
There was a profound moment in my career when I was working as a consultant for a company I wont name, but they were in Canary Wharf, which is the financial center of London, UK.
I was in a glass high-rise building, and had been working there for about 4 weeks. The project I was working on was at heart, selling loans and credit to people who couldnt afford it - all hidden by opaque language and euphemisms like the article mentioned. After a few weeks it became clear to me that this is nothing other than programmers being told to use machines to steal from the poor, while the managers walked around like they were geniuses when really they were total frauds and liars.
We were very high up, and I remember going on lunch break and overlooking the poorer areas of London. With knowledge that the algorithms I was writing were causing them misery.
At that point I just quit, I told my boss I didn't want to be part of it. He just looked at me like I was crazy, then when I grilled him to the point of belittling his intellect, he admitted he knew what they were doing, but had an insane burn rate (wife, kids, expensive house and shit) so he couldn't just quit.
If these institutions would die, I would be glad.
Re: I Worked at Capital One for 5 Years. How We Justified Piling Debt on the Poor
#8It's easy to call this kind of lending predatory, but when you leave the problem of poverty to private businesses to solve you end up with high-interest loans and payday loans.
If the government banned this kind of lending and didn't provide an alternative, poor people would have no lending options. Regulating this kind of lending (e.g. by tightening the already regulated limits on interest rates) can only go so far before the products become unprofitable and will be discontinued.
There is not a market solution for this.
Re: I Worked at Capital One for 5 Years. How We Justified Piling Debt on the Poor
#9It would be interesting to run the numbers on a jubilee for certain kinds of debt. I realize monetary policy of inflation is in-effect a debt jubilee, as it was applied to the boomer generation in the 70s and 80s. Since diminishingly few people keep their savings in cash (instead of putting into homes, durable goods, index funds, etc), inflating away debt seems like an inevitable policy outcome. In the US, if the dem…
Have you wax economist Michael Hudson? One of his central theses is that we need debt forgiveness, as debt is piling up beyond the capacity for people to pay it. Debt grows exponentially, and it acts as a hindrance to the economy, while enriching the banking, finance and real estate sectors.
Re: I Worked at Capital One for 5 Years. How We Justified Piling Debt on the Poor
#10Debt is just another business. So long as the poor keep paying on the debt, it makes business sense to keep pushing debt to them. It seems the idea is to squeeze the rock just to the point it bleeds, but not kill it.