Why doesn't the government go into the credit business?

[HiFructosePronSyrup]

Instead of buying up toxic banks in the hope that they'll be extending credit lines, why doesn't the government just sell credit itself?

It can offer low interest loans. Won't exploit seedy usury law loopholes, ideally. Or go around selling the loans in shady business deals.

It already sells student loans, right? Why not business loans? Mortgages? Car loans? Etc.?

[dysfunctional press]

1. i think that ALL consumer banking should be nationalized.

from home loans to credit cards...with low interest rates- 4% and under.

THAT would put money in people's pockets.

[DJ13]

2. Because the politicians are too dependent on campaign donations from bankers?

I do know the Fed bylaws gives them the legal authority to lend directly in "times of crisis", so there really isnt any reason outside of the buddy system in campaign financing that is preventing it.

[KansDem]

3. Works for me...

As long as we're willing to throw $100 billions at the Wall Street and the banks, why not just bypass the "middleman" and do it ourselves?

[TwixVoy]

4. For fucks sake

how about instead of that the average american learn to function with out trying to find someone to finanace every aspect of their life?

[Oregone]

6. Credit is immensely important, even in an incredibly moderate society

Loans have existed for millenniums, for good reason.

[TwixVoy]

7. Nope - it's out of control

we have fools in debt for school, in debt for consumer purchases, in debt for their cars, plus used their home as a damn ATM machine, plus have financed who knows what else. It has gotten out of control. As far as I am concerned the moment you start to swipe that VISA card for consumer purchases I have NO sympathy once you get screwed over because that is the ultimate end result.

If you think you NEED credit for anything other than your home then your ass will be owned by the banks until the day you die and you will die poor.

[Oregone]

9. It may be out of control...

But that can be partially the result of a privatized banking sector handing out easy credit for the sole purpose of consumerism. Certain pitfalls can be avoided with a nationalized, regulated approach. Out of control or not, it doesn't mean a nationalized credit system is a bad approach in a society that is more in control of their debt and spending habits.

And yes, Im mostly only support this in terms of home financing, in that it could more easily allow people to own homes and build true wealth, rather than sustaining a system of an ownerless class constantly renting from an owner class.

BTW, the only debt I have is 100K on a home, and I use a VISA/MASTERCARD for every damn purchase in my life. There is an advantage to buying a home when you build up an 800 credit rating.

[TwixVoy]

11. Sorry my friend

you are most of the rest of the country are going to have to learn to live with out financing your life. The money train is finished. Unfortunately the vast majority of the country doesn't realize that is where we are headed....

[Oregone]

15. There isn't any part of my life that is financed...other than a moderate mortgage...

But yes, many Americans went to far. They "cashed" in their equity for toys. Private banks allowed them to do that. Private banks took the interest money and sent it to their shareholders to never see the light of day. Private banks assumed control of the properties when the homeowner could no longer pay the new adjusted mortgage, or the same liar loan mortgage when their luck ran out. That was out of control.

But those are symptoms of a needy, selfish society (they all are about), coupled with an irresponsible banking system. Is it too much to suggest that we implement a responsible banking system to resist the desires of this selfish society?

[endarkenment]

12. You've bought the bullshit. Turn off hate radio.

Nobody is a fool for getting a college education, even if that means taking out loans. Many people cannot afford cash for a car, and yet they need a car in order to work, consequently they have to borrow money to get a car. Hardly anyone can pay cash for a house, so instead they have to borrow money in order to buy a house.

But we digress, the problem right now is not consumer credit as much as it is the entire international credit system, a system that failed last October and is right now currently on life support. This has not much at all to do with car loans and college loans and home mortgages, or the right wing talking point about those irresponsible people using credit other than of course the listeners buying their bullshit. It has to do with 30 years of deregulation of the financial system coming to its predictable demise in an orgy of outright fraudulent, corrupt, and/or merely misguided adventures in totally bullshit financial concoctions, all of which is now crashing down around us.

[endarkenment]

8. that is very ignorant

you seem to not understand the financial system

[TwixVoy]

10. No I understand it all too well

We have built up our economy on consumer debt spending that is out of control. People had crazy ideas like the OP's to obtain more credit. Can't pay your 30 year mortage? Get a 50 year! Can't do fixed rate? Get this attractive low rate ARM. Want to pay off your credit cards? Get a home equity line of credit. Fuck I remember you couldn't walk in to a WAMU branch with out the teller trying to get you to open a HELOC. That is why we are completely screwed right now.

[Oregone]

13. That isn't quite what the OP is suggesting...

No, not more easy credit...

A nationalized credit system, such that it is regulated and the interest profits go straight to public coffers (to fund other programs). Do you understand how much the government could make off such? Do you understand how empowered the people would be, not throwing thousands away yearly to private shareholders of their mortgage company (that bank the profits). Do you know how empowered our society would be, fueling programs with interest profits?

Its not a post about easy credit. Probably much the opposite (being the government could set high qualifications and enforce them). But it would probably be cheaper in terms of interest, and the government wouldn't be essentially subsidizing banks to loan out money anymore.

[leftstreet]

14. For fucks sake - how about every American gets paid a livable wage?

What a shocking idea.

[guitar man]

16. exactly

Nail meet hammer. That's the foundation of a sound economy, a working class that is valued and receives just compensation for their labor. When we attempted to replace decent wages with easy credit, that's when the wheels started coming off.

[Blackhatjack]

17. You have very little compassion for those of lesser means ...

Not everyone has the means to pay cash for necessary healthcare for themselves or their kids, or the utility bill to keep the heat on with the temperature outside below freezing, or the repair bills for their automobile they use to get to work, etc.

And just because you have to take out a loan by credit card or otherwise to pay for an essential does not mean you should have to pay outrageous interest rates and fees.

Being poor does mean you have to wear a sign that says 'kick me I am poor', and it sure does not justify others saying 'I have no sympathy for them' because they did not have another choice.

[Oregone]

5. Because th government would make too much money off of it,

leading to excess profits padding public coffers. There would be no more excuses to not implement UHC or put more money into education.