Monday, December 15, 2008

I think I suggested this once before.

Some time ago I suggested everyone not send in a credit card payment in the month of September, I think it was, to protest some egregious profiteering that the Robber Barons were doing to their helpless captive customers. Now, an economic analyst is saying the same thing - except he means for more than just one month.

Citizens’ Economic Stimulus Plan:
Stop Paying Credit Card Debt
By Richard Cook for Global Research.ca

...So what are ordinary people to do who have families to feed, rent or mortgages to pay that are still inflated from the collapsed housing bubble, unmet medical or insurance expenses, or may be trying to get their kids through college? Should we go deeper into debt when U.S. households, businesses, and government already owe in the neighborhood of $60 trillion (excluding federal unfunded debt liabilities), almost five times the GDP? Banks have cut back on lending anyway.

...I have argued in recent articles that the government should implement what I have modestly called the “Cook Plan,” whereby a dividend similar to the Alaska Permanent Fund would be paid to every U.S. citizen at the rate of $1,000 per month in vouchers for food, housing, and other necessities of life.

This dividend would be paid out of the U.S. Treasury, where I used to work, from an emergency self-financed account without recourse to taxes or government debt. The dividend would constitute each citizen’s fair share of the producing potential of the economy, as advocated by Social Credit reformers in the British Commonwealth nations for decades. The vouchers could then be deposited in a new network of community savings banks that would revitalize local economies through lending at zero-percent interest, charging only administrative fees and a small amount of lending insurance for access to capital.

Such a system would provide recompense for the vast amounts of money stolen from citizens’ pockets due to a lifetime of borrowing from financial institutions which are now looting our children’s and grandchildren’s heritage to pay for generations of abuse. This abuse has taken place under a debt-based monetary system by which banks create money out of thin air, then charge the rest of us interest to utilize it for survival. This system has operated for almost a century under the auspices of a Federal Reserve System accountable to no one.

The “Cook Plan” would bring real reform to a system that has collapsed. The plan would begin to correct the primary cause of the recession, which is the steep decline of consumer purchasing power.

...Of course I am not so deluded as to believe Congress or the incoming Obama administration would implement it. Why would the politicians turn against a financial system which paid their way into office? As indicated by the announcement that Obama will appoint Timothy Geithner, president of the Federal Reserve Bank of New York , as his treasury secretary, it’s the banking system that will continue to oversee the government, not the other way around. Even so, I would be happy to explain the "Cook Plan" to Mr. Geithner - for free.

But the citizens must do something. How can we just sit and wait while the financial monopolists smother the economy to death in order to protect their wealth and privileges? The least they could do is declare a moratorium on debt payment until the economy is functioning again or cancel the most egregious types of debt-abuse, such as credit card or student debt.

But they are not likely to do this either. So citizens’ can be forgiven if they simply stop paying. Many home purchasers are already doing this—turning in the keys to their homes and driving away. Who can blame them?

But the worst of the debt may be credit card debt, where the controls on interest rates and penalty charges were lifted long ago and the government stopped providing a tax deduction for interest paid. In many cases, interest on credit cards is 28 percent or more, which means that even by making the minimum required payment, consumers see their balances grow each month. That the politicians could continue to allow such evil to exist is astounding but proves who their masters are.

So until real relief is forthcoming, citizens who are in distress should simply destroy their credit cards and stop paying the monthly bills. People are already doing this. Arrearages and defaults are climbing, and credit card debt is starting to be viewed as the next bubble to burst. But so what? If people have to use a credit card, that means they can’t really afford to buy whatever it is they think they want. If they can afford it, they should use a debit card instead.

Then tell the credit card company you cannot pay. Ask them to write off some or all of the debt, and if they want to take you to court, go on your own and defend yourself. You don’t need a lawyer, and you don’t need anyone’s permission. You also don’t need to go through the horrendous “reformed” bankruptcy system the credit card companies got Congress to pass in 2005. Failure to pay credit card debt is not, thank God, a crime in this country, and there are no debtors’ prisons—yet.

Besides, if people do not pay credit card debt, that money remains in circulation. So default is actually a form of patriotism in today’s trying circumstances. And the credit card companies really don’t lose anything, since the money didn’t exist before they lent it to people who are now broke...

...Richard C. Cook is a former federal government analyst who writes on economic issues. His new book, We Hold These Truths: The Hope of Monetary Reform, is now available and may be ordered at www.tendrilpress.com (303-696-9227). His contact email is EconomicSanity@gmail.com.


He's not wrong. They never had any money to loan you, yet they pretended they did and made the loans anyway. Now they want you to pay back money they never had in the first place from money you don't have right now.

Something has to give - and if they won't voluntarily declare a Jubliee, then we ought to declare one for them. But at the very least, simply cut up and do not, ever, use a credit card again for anything, period. Pay off the ones you have, even if you have to dip into retirement or savings to do so - and simply don't play their game anymore. Why let people exploit you? It's insane. When you're deep in a hole, stop digging - and stop letting them profit off of you. Even if you pay off your balance every month you feed the monster with your transaction fees - better to starve it to death, class.

Don't do business with Robber Barons. I can't put it any more plainly than that.

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