Kevin and Linda Moore of Boise, Idaho, declared bankruptcy recently. They were required to list each asset and its value. They put down $5 for the toaster and $10 for the cat. On the debit side was an unpaid $18,000 hospital bill. If the cat gets sick and they have to take him to the vet the Moores may have a problem.
The Moores are among hundreds of thousands hurrying to declare bankruptcy before the new federal bankruptcy law goes into effect. The new law makes it very hard to get debts wiped out. Instead of a wipe-out, you get reorganized and have to pay so much a month. How many months would the Moores have to pay under the new dispensation? At, let’s say, $30 a month that would be - - Oh, don’t forget to calculate the interest.
In addition to not getting the debts wiped out, a bankrupt must attend re-education classes in which the financial offender is taught how to manage his or her money correctly. Take a family like the Moores. If one of its members comes down with a ruptured appendix, the sickly one will be cautioned not to go running to a hospital which they cannot afford but to go to Rite-Aid, there to buy a box of tissues so as to clean up the mess at home. With a little planning and ingenuity people do not have to live beyond their means.
Something close to two million people will declare bankruptcy this year and millions more will teeter-totter close to it. They stay in debt forever paying off tuition, medical bills, the car, heating fuel, whatever.
But there are pluses. Such financial stringency encourages appreciation of things people with more money take for granted like a family supper at Denny’s, a day in bed, a splurge at the dentist’s to take care of that front tooth little Oscar snapped off.
The social benefits of tens of millions in perpetual debt are enormous. Debt ridden persons cannot afford to tell their bosses they can take this job and shove it. Debt ridden persons dare not go out on strike or honor a picket line. They are better than obedient. They are conveniently servile.
Mass indebtedness promotes the status quo and protects against change. All that and we make money off the interest, too.
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