Revisiting the Physical Risks of Debt
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December 1919. “Christmas tree at the District Jail, Washington, D.C., and some of the prisoners.” National Photo Co. Collection glass negative. One f
[See the full post at: Revisiting the Physical Risks of Debt]Ash,
Would you mind filling me in on TAE take on FOFOA? I have to admit that guy scares the hell out of me sometimes. His recent post on Peak Exorbitant Privilege made a lot of sense; namely, that our perpetual trade deficits are no longer funded with recycled dollars, but w/ Fed printing, which means that for the last few years we’ve been pumping dollars out of the country – dollars that have not come back to us in Treasury bond purchases, but are being used instead to bid up oil, metals, real estate, and other actual stuff. More dollars chasing the same amount of goods and services…
FOFOA’s conclusion – “I’m talking about a near-term dollar super-hyperinflation that will make your hair curl and make Weimar and Zimbabwe seem like child’s play in the rearview mirror.”
OK, that our trade deficits are more inflationary now then when our trading partners used the surplus to buy our debt is clear enough. How you get from there to a super-hyperinflation I don’t quite understand. Apparently he thinks this glut of dollars we’re creating abroad is akin to an inflationary pressure cooker, poised to explode without warning.
https://fofoa.blogspot.com/2012/04/peak-exorbitant-privilege.html
I have heard that, in the far east, India and other countries, that the suicide rates have been rising due to the pressures being put on by the money lenders.
🙁
Its not a bright future for those owning assets.
Debt Collector Is Faulted for Tough Tactics in Hospitals
Hospital patients waiting in an emergency room or convalescing after surgery are being confronted by an unexpected visitor: a debt collector at bedside.
This and other aggressive tactics by one of the nation’s largest collectors of medical debts, Accretive Health, were revealed on Tuesday by the Minnesota attorney general, raising concerns that such practices have become common at hospitals across the country.
It’s Deja Vu all over again!
Haven’t we beaten this topic to death already?
I will grant you it’s generally better not to be in debt than to be in debt, however probably at least 50% of the population is in debt in some form and likely has negative equity as well. You like to examine probabilities, and the likelihood that 50% of the population can be dropped into debtor’s prisons is exceedingly small here.
The key is to understand how to work the system and not let your opponent get the drop on you. If you are deep in debt, be proactive and file bankruptcy first of all. On top of that, file a lawsuit against your creditor for harrassment, contract fraud, and whatever else you can think of that applies. Check the court docket for all your pending cases so you don’t miss any court dates and wait for the opponent to be so busy with other cases he misses a court date. Stretch it out with postponements and extensions.
If its a student loan which can’t be discharged in BK, if you have no income they have nothing to garnisheer anyhow. You can make it your job to tie the thing up in court as long as possible, and since you are not working anyhow it gives you something worthwhile to be doing.
On the probabilities end, its true that it is currently unlikely we will get a complete collapse of the Dollar overnight here, but its increasingly likely said collapse will occur long before your 30 year mortgage or even 15 year student loan could be paid off.
If you are currently destitute and Da Goobermint will guarantee you loans to pay for you to go bang some coeds for the next 4 years, you can weigh the odds you’ll ever have to pay it all off against the clear near term benefits of a Dorm Room, the Meal Plan in the Cafeteria and regular Nookie.
When the Iranians go Pearl Harbor, you’re likely to be Conscripted anyhow, and in return for signing up to be Cannon Fodder, Da Goobermint will probably wipe your loan off the books if you manage to make it back alive. If you do not make it back alive, you got no worries and you can go to the Great Beyond in Peace, knowing you left them holding the Bag on your loan.
When 7 billion humans start to go feral after the bursting of the greatest credit fueled ponzi scheme in history, no amount money will save you.
The first to slavery will be the 99%. The first to the guilotine will be the 1%.https://www.oftwominds.com/blogapril12/peak-housing4-12.html
Its not a bright future for those owning assets.
Note that property taxes declined significantly in the previous recession (2000-2002), but they rose steeply in the 2008-9 recession, and continued climbing. The recent modest slippage may have several factors: lower valuations in states that set property taxes on assessed values, tax revenues declining as homes in foreclosure languish with unpaid property taxes, and so on.
Anyone claiming that property taxes have peaked will have to support that claim with evidence that local governments have found other sources of tax revenues to replace property taxes. Until that dynamic changes, then local government will have every incentive to jack up property taxes by any and all means available.Reverse Engineer post=2412 wrote: You like to examine probabilities, and the likelihood that 50% of the population can be dropped into debtor’s prisons is exceedingly small here.
Who said that 50% of the population would be kept in prison? That’s just one tactic that is currently being used to harass/threaten people and squeeze them for whatever they have to offer, including their cheap labor after they are released. I do believe that it will continue to occur and will get worse in upcoming years, but it’s not the only way people will be slaves to debt.
The key is to understand how to work the system and not let your opponent get the drop on you. If you are deep in debt, be proactive and file bankruptcy first of all. On top of that, file a lawsuit against your creditor for harrassment, contract fraud, and whatever else you can think of that applies. Check the court docket for all your pending cases so you don’t miss any court dates and wait for the opponent to be so busy with other cases he misses a court date. Stretch it out with postponements and extensions.
Agreed.
If its a student loan which can’t be discharged in BK, if you have no income they have nothing to garnisheer anyhow. You can make it your job to tie the thing up in court as long as possible, and since you are not working anyhow it gives you something worthwhile to be doing.
Yes, IF you are the ones smart/lucky enough to have no discernible income and still make ends meet (big IF). And then you must still hope the corporate government complex has reached max prison/jail capacity.
On the probabilities end, its true that it is currently unlikely we will get a complete collapse of the Dollar overnight here, but its increasingly likely said collapse will occur long before your 30 year mortgage or even 15 year student loan could be paid off.
If HI of the dollar represents a complete end to centralized control through forms of debt, then this may be true. If not, and another system of debt-based money (in whatever form that money takes – perhaps energy credits?) and taxes is established, then the risk of enslavement is still present.
If you are currently destitute and Da Goobermint will guarantee you loans to pay for you to go bang some coeds for the next 4 years, you can weigh the odds you’ll ever have to pay it all off against the clear near term benefits of a Dorm Room, the Meal Plan in the Cafeteria and regular Nookie.
Remember to factor in the odds of some kid going postal and executing dozens of people in nearby classrooms. That’s what happened my last month of college.
If you are “destitute”, make it through high school, are able to get a loan and have absolutely no better way to spend the next 4 years of your life, then, yeah, maybe you’re right.
When the Iranians go Pearl Harbor, you’re likely to be Conscripted anyhow, and in return for signing up to be Cannon Fodder, Da Goobermint will probably wipe your loan off the books if you manage to make it back alive.
That counts as enslavement in my book.
Also, keep in mind that we are not only talking about people who borrowed money in the conventional sense. We are also talking about anyone who has been processed through the judicial system for any criminal/civil violation and owes fines/taxes of any sort, as well as people who never owed anything in the first place, like Lisa Lindsay.
ks post=2407 wrote: Ash,
Would you mind filling me in on TAE take on FOFOA?
I can fill you in on my general take.
FOFOA makes a lot of valid points in his posts, and clearly understands the structural problems with our current monetary order, i.e. the $IMFS. Where we disagree is why those structural problems have really arisen, and what the near-term implications will be in terms of deflation/HI.
The idea that China or other trade creditors of the US have already or will soon stop recycling our dollars into treasuries (or other dollar-based assets) is an assumption, not a fact. It is an assumption characteristic of the Austrian school, which believes markets are inherently self-regulating and any major imbalances (such as the trade imbalances between surplus/deficit nations) can be fixed in a moment’s notice.
I do not agree with that assumption. Instead, I believe that countries such as China cannot afford to voluntarily defect from the debt-dollar system, i.e. one of their largest export markets, until they can generate sustainable growth from internal consumption, which is a LONG way off (and perhaps will never happen). Therefore, they will only jump ship in a haphazard manner when they are forced to by circumstance, i.e. when the dollar is already hyperinflating and will not buy them energy or other commodities at remotely affordable prices.
If that is true, then the time line for the dollar’s viability as reserve currency may be stretched out significantly longer than FOFOA expects (it’s already much longer than A/FOA expected), even though we are well past the point of “peak exorbitant privilege”. In a nut shell, I believe that FOFOA is greatly under-estimating the momentum of this structurally imbalanced system, failing to see the fundamental inter-dependencies that have been created.
I also have major issues with the theory of Freegold, but that’s a different (yet related) story.
Of course Conscription is Enslavement. Thing is, you will be Conscripted whether you are in Debt or not so you might as well go in for the whole 9 yards while you can here.
BTW, there are some neat tactics you can use for getting out from under Student Loans. One I actually used 🙂 When I decided I was going to declare BK, I took my remaining Student Loan debt and paid it off with Credit Cards 🙂 Of course, you have to have enough working credit to do this, and at the time I did. I was only recently Unemployed and had nice long lines of credit on Visa and Master Card still open. As I mentioned also, the banksters didn’t even bother to show up in my hearing. I was out of the courtroom in less than 15 minutes, Free & Clear Chapter 7. Of course, this was 20 years ago also, but I suspect many of the same tactics will still work.
As to the future inside the new Fascist State, we’re all slaves here anyhow until it fails. In many cases, it’s worse for people to be out of prison than in prison now. 3 Hots and a Cot. I don’t recommend the option, but at least for the moment if you are sick and can’t afford the price of the drugs to keep you alive, if you get imprisoned you’ll get some treatment.
RE
RE Actually, I am sorry to say, that is not exactly true here in PA where some prisoners are not given their meds, are made to sleep on bare concrete in solitary confinement and are tormented by guards with next to no education and minimal training. Some prisoners have recently committed suicide (or have been murdered by their guardians.) No appeals to wardens, psychiatrists or DOC have been really attended to. Doesnt this fit in nicely with taking out surplus population? Especially in light of privatization of prisons. Better be careful not to wind up in the justice system at all. Stay under the radar until you can actually take some of the one percent out because by then you have nothing to lose!
A very ill friend of mine, living of less than, $800. SSDI, had a 3 year running battle with a hospital and later a series of collections agencies regarding a bill for HIS pap smear and hysterectomy!!
First a fight with the hospital, which after much “investigation” claimed that yes, they would concede that HE didn’t have these procedures, but it much be a coding error for something that he did have done. They couldn’t place him in the hospital within 6 months of the date of billing…so they investigated some more before saying yes it was indeed a mistake and they would take care of it. They sent it to collections.
Even though it is illegal to freeze accounts into which disability checks are deposited, the agency and the banks did so…causing checks to bounce and huge fees to accumulate.
After a judge told the 1st agency that this was not a justifiable claim and dropped the case it was then sold to another agency and it started all over again. More bogus claims, more illegal actions, more illegal bank fees.
He couldn’t have paid the bill, even if he had wanted this to just go away, as he is that poor, although I’m sure that’s what the collections people were aiming for.
Several long years later this was somehow resolved with both the collections people and the banks, but my friend now has to get himself to a check cashing place to cash his SSDI check and pay large fees for money orders to pay his few bills as he no longer trusts banks. Even if he is sick he has to get there anyway because Gov’t checks expire after 30 days and it takes forever to get a replacement. Without friends to literally hold him up he would be sunk.His experience reinforced my belief in living debt free and keeping a large stash of cash available.
A few thoughts here.
In 1912, Hilaire Belloc suggested (in “The Servile State”) that class warfare was inherent in industrial capitalism and would eventually lead to the capitalists enslaving the laborers. He defines slavery as a legal obligation, on pain of penalty enforced by the state, to labor to the benefit of another person. Prison labor is slavery by that definition, and it fits his view of the dynamics, namely that the corporations want productivity and that the poor want subsistance. Prison slavery is thus fast becoming our social safety net, just as formal slavery was the social safety net of ancient Rome. That ought to scare the living daylights out of any American.
I think it is against this background that the physical risks of debt have to be understood. Legalizing prison slavery for mere nonpayment of debts is problematic because of the 13th Amendment which restricts slavery to that for punishment of a crime. I greater likelihood would be to create laws to allow prisoners to work off debts while in prison. Then you can get busted for smoking a joint and whether you get prosecuted can depend on how much you owe people. Add some vague laws and extra surveillance, and you get to the point where people might be able to be prosecuted on a “show me the man and I’ll find you the crime” basis. So I dont think the 13th Amendment is a magic bullet here.
The second major risk is that if there is a rapid collapse, it may result in local areas breaking away. This may change dynamics, but I can’t imagine that creditors would be able to utilize the power of the state in such an environment. However for local debts, it may be the case that it is a lot easier to go after someone with fewer laws in the way. So I am not sure that would be necessarily pro-creditor or pro-debtor. It may depend a lot on physical distance, administrative issues, and relationship between creditor and debtor.
Modern prisons are new institutions born of social complexity. The old institutions for dealing with debt were formal slavery. The story of Virginius and Virginia should be instructive there as a warning.
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