What happens when no one has money to pay their debt?

[sarcasmo]

I am not trying to be a chicken little. This thought crossed my mind today. Say the economy collapses as it did during the Depression. All American families owe on the average ten two twenty grand on a car, credit cards, student loans, etc.. I realize people will post they have no debt, many of us aren't in that situation. Individual debt wasn't the level it is now, what happens to this country when no one can pay anything because no one earns anything?

[frogcycle]

1. that's when people start clubbing each other to death to steal stuff.

and eating dogs and cats.

I saw an opossum in my yard when I got home tonight. I am glad to know he's out there.

[sarcasmo]

6. My mother told me how they used to eat Muskrat, so it's possible.

[JDPriestly]

17. I have complained to my mom about squirrels eating our avocados.

Last Saturday she suggested we get someone to trap or shoot them and skin a couple of them for us to eat. She said that is what her family did back when during the Depression. They had someone shoot their squirrels and clean them for eating. He got some, and they got some. I don't think I could eat squirrel meat under any circumstances.

[MrMickeysMom]

20. No kidding... I talked to someone who ate squirrels during the depression...

I wanted to know what they tasted like, and she said, "squirrels!"

:-)

[jwirr]

21. I have been told by the Native Americans out here that the rabbits &

squirrels are full of diseases now. I don't know if that is true or not but they think it is.

[boozepusher]

22. Not true.

I eat squirrel a couple times a year. Nothing wrong with it at all. In fact I would guess it's better than any store bough meat. I haven't had rabbit in many years but I know plenty of people that still eat wild rabbit.

[jwirr]

23. Glad to hear that. One more emergency meat we can add to our

plans if needed. Not as a regular diet.

[RebelOne]

48. Glad I don't have to worry about emergency meat. I'm a vegetarian. n/t

[wartrace]

55. Guess you are going to have to eat wild tofu.......n/t

[JDPriestly]

33. I used to eat rabbit while a student in France. The sauce made it

edible. What does squirrel taste like? I'm not thinking of eating it. Just curious.

[snappyturtle]

43. I haven't eaten it since I was a child, but I liked it....dark chicken meat. nt

[reggie the dog]

68. I like rabbit even just on the grill

The wine sauce is great for holiday meals...MMMM rabbit.....

[reggie the dog]

66. does it depend on the state you live in?

I can't imagine eating the squirrel from the close suburbs of Chicago where I grew up can be too good for you.

[boozepusher]

71. I would think it would be ok.

I wouldn't make a habit of it though. I travel about an hour out of the city and about twenty miles from the nearest town to hunt. Stupid squirrels probably cost me ten dollars a pound after adding up the gas I burn just to get there.

[Shardik]

45. Squirrel Stew. It's good.

Ingredients

* 1 squirrel, cut up
* flour
* salt and pepper
* 2 1/2 tablespoons butter
* 7 cups boiling water
* 1 teaspoon thyme
* 1 cup corn
* 3 potatoes, cubed
* 1/4 teaspoon cayenne
* 3 medium onions, sliced
* 2 cups canned tomatoes with juice

Directions

1. roll the squirrel pieces in flour, salt, and pepper.
2. Brown in butter.
3. Add squirrel and all other ingredients, (with the exception of the tomatoes), to the boiling water, cover, and simmer for 1/2 to 2 hours.
4. Add the tomatoes and continue to simmer another hour.

[ProdigalJunkMail]

54. i prefer squirrel and dumplings!

gotta watch out for the little lead pellets :-)

sP

[arcadian]

60. You better not let Swamp Rat see this post.

:D

[NightWatcher]

2. or as I called it "last thursday"

[Trajan]

3. The nation needs a 'fresh start' ...

America needs the Bankruptcy Bill to be repealed, and again allow families to discharge their unsecured debts .....

Government loans are another issue, which may need to be restructured in bankruptcy ....

[Donnachaidh]

12. the also need to ROLL BACK interest rates to SINGLE DIGITS

I'm completely STUNNED that people today think nothing of using charge cards with 20 to 30% INTEREST charges!

Just a couple of decades back the government used to call that RACKETEERING! Businesses and people charging that sort of interest were called LOANSHARKS.

Just say NO to plastic until the government starts looking into these SERIOUSLY criminal behaviours of the banks and credit card companies.

[JDPriestly]

18. The 20-30% interest rates are especially appalling since

you will earn at most 4% on money in a bank or CD.

[regnaD kciN]

24. Good idea on "just saying no"...

The problem, of course, is that finance companies, like good pushers everywhere, start people out with low rates ("the first one is free, kid"), and only raise their rates to that 20-30% once they've accumulated enough of a balance so that they'll have an impossible time paying it off, especially with the higher interest rates. In-debt consumers can swear off using their cards (always a good idea) but, often, will find that their income will only cover paying basic living expenses plus the minimum monthly payment on their card(s) -- and those debts will take years to pay off.

Refusing to use credit cards is a smart move, but, if someone is already deep in debt, it won't stop the banks and finance companies from jacking up the rates on already-existing debts to levels that, in any civilized society, would get their C.E.O. thrown in the slammer for violations of usury laws.

[earth mom]

40. Good point. There are a LOT of laws that have been changed to hurt citizens ever since Reagan.

And don't forget the god damn bankruptcy bill Congress passed a few years back that favors the banks! :grr:

[roguevalley]

67. I wish I believed in hell because Reagan would certainly be in it.

Biden voted for that bankruptcy bill. I expect him to spend the next eight years fixing his errors.
:7

[truedelphi]

56. Yes that seems to be very underdiscussed.

The Chicago Mafia only had interest rates of 150%.

Military families using paycheck advance loan centers are paying 900% a year.

[Lucian]

4. Maybe we all should be bailed out.

How come Wall Street gets a bail out and we don't?

[sarcasmo]

5. It would have been easier.

[aquart]

7. And cheaper. We're not in as deep as the banks.

[sarcasmo]

10. I think fifty grand would have done us all quite well, subtract those under 18 what does that total

[snappyturtle]

44. I think your idea is on the right track for kicking the economy too. Should

we start lobbying?

[reggie the dog]

70. hell for fity grand I would move back to the USA

and bring my wife and kid with me.

[emilyg]

8. A heck of a lot cheaper

in the long run.

[Lucian]

9. Exactly!

[regnaD kciN]

29. When the financial crisis began...

...and the banks were asking for $900 billion (at the time) in bailouts, I advanced a Swiftian "modest proposal" -- since the amount of unsecured credit-card debt in the U.S. was also around $900 billion, why not simply provide the bailout money to debtors, with the requirement that a) they would use the money to pay off their credit-card debts and b) that they would make a legally-binding promise to cut up all their cards and not apply for new ones for a set number of years?

Of course, the banks wouldn't have gone for it at all, because they want the government to hand them money for bad investments, plus have the guaranteed income stream of 10%-30% interest on every penny of that $900 billion debt.

That's why "big money" will never allow the government to provide a similar bailout to consumers...for, if they did, the banks would get their principal back -- but would forever lose the huge, continuing profit stream that comes from charging interest on pre-existing debt. Loss of that profit stream might well be enough to drive the banks into failure all by itself. So, bailouts for Wall Street, but no bailouts for you...because Wall Street needs to keep vacuuming out the average American's pocket to survive.

:grr:

[arcadian]

61. Here's a better idea.

Stop buying worthless crap that we all don't need.

[FirstLight]

11. Why can't we "wipe the slate"...?

I owe 20K in student loans, and maybe 5K in old debt from my exhubby...

geez 25K isn't much to most people, but when I can't even make rent or put food on the table, it may as well be 250K

As much as I hate to see our whole economy collapse, I sincerely wish we could somehow just clean the slates and everyone start with wht they have, and go from there. The sea doos and the mega TV's can go byebye, but the debt for education and medical bills should be the first to be "pardoned"

[SlicerDicer-]

14. What about people like me who knew higher education became a money grab?

I mean seriously.. Not to poo poo your plight.. I know its awful and it should be stricken from the record. However what about people who did right? What about people like me who have no debt. I wont get free schooling EVER... nor will I ever get a free house if other debts are stricken... So it seems rather unfair.

Because I was smart I am punished. Doomed to renting till home prices crater further if they ever do.. I cannot afford a house still in the market if I wanted too and credit was not locked up.. Its asinine.

[SlicerDicer-]

15. Scratch that...

Just give everybody 50k$ and tell them to clean their debts.. If they dont have debt they can do what they want "IE: Downpayment on house or whatever"

If people are boneheaded and do something stupid with it WAAAAAAAAAAA! screw em. They had their chance. Then the people like me and you would both be helped :)

Note: This is better than a boneheaded bailout.

[FirstLight]

19. the latter isn't a bad idea - if we are just giving out money... BUT

to address the former...
I had no choices or "financial aid counseling" available to me, was a single welfare mom at 22 who got "sold" loans by my community college to pay for overhead (like utilities and furniture and daycare costs and diapers, etc) while I finished school, my AA took 5 years, and moving 50 miles or more to find a universiy to complete my eduction was not an option...they told me "by the time you get your degree, you'll be making so much that the payments will be EASY"

Hence, all I am qualified for is glorified secretatrial positions, and have yet to finish my BA or get into a real "career" position. I have LOTS of experience and am really smart, but street smarts doesn't count for much when it comes to money or lack thereof.

I don't want to get into a flame-fest here...but by saying it isn't fair to help me, you are taking what I see is a RW and very shallow approach by saying it is my fault I got into the mess I am in.
When greed (like the bankers on Wall street) had nothing to do with it, but getting by is somehow a punishable offense.
I would LOVE to make enough money to afford payments, on ANYTHING - but at this rate my actual annual income has NEVER broken past 15K - and I have 3 kids now and 2 ex husbands who were good for nothing.
Am I to be punished because the males in my life and my generation are glorified adolecsents who have no sense of responsibility except to their own self-indulgence? Is it my fault that my second husband abused me and made me a prisoner in my own home and controlled ALL finances for his own pleasure so my Loans wen into default when I had kept them in the green for 5 years by myself by either deferring or paying minimal interest...?
Is is my foult that I am still having symptoms of PTSD that keep me from holding down a decent job while trying to raise 3 kids as "normal" as possible after the hell we went through?

yea, I am a little sensitive about this.
I have called the DOJ (who make the laws concerning domestic violence) and the Dept of Education on several occasions to try and see if there are 'extenuating circumstance' forms that can get me OUT of default and get me back into a place of good graces - there are NO protections for this kind of situation - even with a conviction on his record and documentation from Mental Health professionals on my end of the trauma.

So yes, I see the banks that are worth millions and their CEO's who have SO much and I am livid...where is MY bailout? I wasn't greedy, i was a victim, and I am still being victimized.

Many Americans are VICTIMS of this economy, of the wars, of the banks themselves and of countless trickle down situations that came from the MIS-management of this Administration. So how is it unfair to help THE PEOPLE?

[gaspee]

46. Good for you

For changing your life as much as you have so far.

Want to know another right wing talking point I'm sick of? The whole "Single Mother" meme where the problems of the world are all due to single mothers and taxpayers having to foot the bill. The meme started in the 80's and it's the favorite right wing talking point of all time. I don't know about you, but I don't know one single mother who would not want help from a caring, nurturing, economically healthy partner (male or female.) Too bad so many men find it so easy to walk away from their offspring.

And before the MRA's attack me, yes, women do walk away from their offspring as well, but not nearly in the numbers men do. And because our society is the way it is, men who walk away from their responsibilities can live economically stable lives while the women and children are left in poverty. It's almost impossible to get some men to pay their fair share for their offspring's upkeep and when the government has to help to prevent the kids from starving, or to see that they get medical care, the mother is blamed, not the absentee father.

Again - good for you for changing your life. I can't even imagine the hell you've gone through.

[SlicerDicer-]

52. I never said your slate should not have been wiped clean

I said it should :) I guess you missed that.

[regnaD kciN]

30. As I pointed out above...

...it's a great idea, but the finance industry will never allow it. They depend for their profitability on consumers not being able to wipe the slate clean, since they need that steady income stream of credit-card interest to go on indefinitely. Even if they got every penny of their principal back (which they would under your plan, assuming people were smart enough to pay off their debts), and were thus no longer exposed to defaults on bad loans, they would also lose years of future interest payments on already-accumulated debt -- money which, I'm pretty sure, is already factored into their business plans.

The only way finance companies would go for this, I believe, is if a huge number of consumers (well over 70%, I'd guess) were about to declare bankruptcy, and they calculated that taking a payoff of the principal now would be worth more than the income they could expect from the remaining 30% or less continuing to pay interest until their debt was retired.

[glowing]

64. Because we're all in it together. People are locked into economic wealth or depression.

Your livelihood is tied to the person who can afford something related to the service you provide.. no funds, no job, and then you are in debt or in a bread line. Its a chain link.. kind of like a ecosystem.. you remove something, and things start to collapse.. one or two might not make a huge impact at first.. but as time goes on, you have a disaster.

[sarcasmo]

50. You are exactly the type of person that would benefit from a thirty grand bailout.

You would be debt free and the Government would have just received their money bank, a much easier solution than giving it to the banking industry.

[Donnachaidh]

13. With all the privitization of prisons I wouldn't be surprized

to see some repuke somewhere try to push the thought of debtor's prisons.

Hell, they are doing their best to drag us back to the 19th century. :sarcasm:

[cabluedem]

25. The Industrial-Prison Complex is a growth industry. Lots of sub-level IQ guards make over 100k/Year....

Lots of them have to get a GED because they didn't graduate High School.

You can imagine the type of person who would become a prison guard. Not much better then the prisoners in many case, needless to say.

[BamaGirl]

37. Kinda like those $70/hr union jobs

Both are myths. I have a GED. And a BA. IQ and education level don't necessarily match. Just sayin'. I was an Army MP and so was my husband. He's a civilian cop/in the Guard now. Curious thing about our backgrounds is we know a lot of people in a lot of different fields. Lots of soldiers. Lots of cops. Lots of CO's. And even ppl in way different kinds of jobs. Thing is, no one, NONE, of the cops or co's or firefighters, etc come near to making 100k a year. And the places they contract that stuff out? In the South at least they make a lot less money than they would working for the states they are in. 100k a year? A regular employee? (I mean, ya know, not a warden??) Not anywhere south of Richmond or east of Texas. Keep dreaming.

[cabluedem]

73. Keep dreaming? I am speaking from knowledge of a personal sort. With OT, yes 100k is the deal. nt

[regnaD kciN]

31. I think, had the Republicans been re-elected...

...that would have been a real possibility. After all, following the 1994 "Republican Revolution," Newt Gingrich proposed restoring the orphanage system to handle children on welfare -- could debtor's prison be far behind? (I could even imagine rhetoric on how trying to get out of your debts was "economic terrorism" that could destroy America. :eyes: )

I don't see it happening under the new administration, though.

[NV Whino]

16. Why, that's when you get "The Bail Out"

Do I really need this--:sarcasm:

[nadinbrzezinski]

26. Depends, but you can see things ranging from tax revolts,

to ahem, debt being wiped clean across the board.

Usually things are somewhere in-between

[1]

27. that! is a great depression. see the difference? n/t.

[shimmergal]

28. Jubilee Year, or

that other O.T. law which calls for all debts to be cancelled every seven years?

Why haven't those fundamentalists who're always ranting about Bible-derived "moral values" ever brought THESE up?

No kidding--I think these would be an excellent populist rallying call for our time.

[regnaD kciN]

32. Actually, lots of progressive Christians have been advocating it for years...

...in terms of forgiving debts of third-world nations. But I could see the movement here as well.

[asteroid2003QQ47]

39. progressive Christians!? There's a contradiction in terms! n/t

[reggie the dog]

72. alll interest rates should be abolished

as should all debt from accumulated interest. The Peoples Bank of the World should loan people money for NO INTEREST. We could even let people slide for a while when they could not pay. Hell if people can pay the rent month after month why should they be kept from buying? With no interest loans people could buy houses and pay a lot less per month. The fucking interst keeps certain people in the owning class and others in the renting class.

[sarcasmo]

47. Where in the Bible does it speak of Debt, help an Atheist out.

[Morning Dew]

57. Leviticus 25 has some rules on debt

nm

[leftofthedial]

34. that's when the rich get richer

on the cheap

[Robbien]

35. Its called indentured servatude

All of our asses are theirs.

[Odin2005]

36. Deflation. Lots of it. Just like in the Great Depression.

Deflation is the killer of economies, it makes inflation look like a minor irritant by comparison.

[MazeRat7]

38. I would suspect there would be leins against your assesets. n/t

[earth mom]

41. What happens: the country goes to hell in a handbasket & we'll be living like they did in Argentina

when their economy collapsed 1999 - 2000.

It will be like living in the freaking Wild West new millennium style.

Read this first hand account from a thread here on DU:

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=114x47838

or direct link:

http://www.silverbearcafe.com/private/10.08/tshtf1.html

[Waiting For Everyman]

42. It's already been happening for several years now. Nobody noticed.

The middle to bottom rung of the ladder has been earning less than the interest they have to pay for quite a while. It's called DEFAULT. Unable to pay, any more, any longer. We can't print money in our basements as the banks seem to think. They raise interest and fees to any number they dream up, and think it will materialize. Well it won't. That has been going on for a number of years now, higher and higher. Why is this a surprise?

Interest has to come down, and wages have to go up - immediately. But even before that, right now, asap, the legal/financial machine has to be stopped for a time, just to stop the downward spiral it's causing... that means moratorium on foreclosures and bankruptcies. They are a runaway train.

By January, if the FDIC's mass mortgage modifications aren't enacted in the lame duck Congress, this will be twice as bad as it is now. Those legal actions already in process are more than 2 million. Add to that the huge number of people who just lost jobs in the last few months, who will be in the pipeline next, and it's over. The momentum won't be catchable if the doing-nothing doesn't end, and quickly. This whole year has been standing by and watching millions more people go under, doing nothing.

[EnviroBat]

49. I just refinanced my house, and with the check I'm getting back

from the escrow overpayment, I'm paying off two credit cards and destroying both of them. I would keep the accounts if the credit card companies weren't charging me 19%-22%. It's bullshit, and I'm not playing their fucking game anymore. There should be a 9% cap on all credit card interest rates, and a 7% cap on home loans. Let these fuckers compete with each other, and prevent them from robbing people into destitution.

[sarcasmo]

51. A cap is right and in no way should they jack you rate to 30percent like they do now.

[pitohui]

53. actually the average american credit card debt is only $2k

i read this awhile back on msnbc.com -- stories of how "most" americans owe $8 or 9 K in cc debt, are simply untrue -- apparently that average was arrived at by conveniently ignoring the 40% of americans who have no credit card debt at all

there will never be a day when "no one" earns anything

that said, if you are truly concerned about deflation, don't take out loans and pay out any loans you do have, there are plenty of cars that can be bought for cash, no need to have an auto loan

[sarcasmo]

58. That is the process I we are in right now, paying everything off and borrowing nothing.

[Cleita]

59. Can you say crash?

Many people will lose everything and become homeless. Financial institutions that haven't already crashed from mismanagement that is robbing them blind will then crash because of defaults increasing unemployment. It won't be pretty unless this new administration and Congress can take the bull by the horns and "fire" all involved who has brought this economy to its knees.

[kentuck]

62. You're looking at it.

That is what happened, basically. An economy cannot survive with just an upper class and a lower class.

[dysfunctional press]

63. most people still have no problems in that regard.

and i doubt that the unemployment rate will ever hit 100%.

[Dukkha]

65. we battle in the desert over "the juice"

so stock up now on cool bondage heavy metal gear and a hot rod car

[treestar]

69. Uncollectible debt becomes the creditor's problem

Strange, but it is a reality. if someone who has nothing owes you money, you won't get it. Even if you get a judgment against them, you have to have something to levy on - wages or property. If they own nothing and aren't working, all you have is the judgment.