Debtor's Prison -- The Poor Person's Best Friend

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[The Loan Arranger]

Years ago, this country did away with debtors prisons. The nation in general, and poor people in particular, would be well served to bring them back. The harm to business from unpaid debt, and the reduced productivity and even business failure unpaid debt can bring, is obvious. Businesses or individuals who are not repaid the money they loaned or who are not paid for the goods or services they produced and sold on credit are prevented from accumulating needed and even expected capital for expansion, and they are frequently thrown into serious financial constraints making it hard to pay their own creditors and employees. This not only can theoretically choke the gross national product, many recessions and even the Great Depression have been in fact brought on at least partly by unpaid debt.

But debt relief measures, either in the form of actual debt forgiveness or in the form of relaxed procedures to collect debt (including the abolition of debtors prisons), are generally thought to help the poor. The idea that once again forcing poor people into involuntary servitude to pay for meager food and shelter is certainly a tough sell. But here goes.

A return to debtors prisons would help poor people in at least five ways: 1) increasing workforce participation; 2) increasing personal responsibility; 3) making it easier for the poor to climb the economic ladder through entrepreneurship; 4) reintroduction of the virtues which have proven the only reliable way of the poor to leave poverty; 5) making credit more readily available.

[Porterville]

It won't happen on the coast. They are coming in from all over the country and world to live on the coast.

[sevry]

In the 1920s, the average yearly salary was $1,236.00.

Average? What was the spread, and the median? What did it cost to rent a room - $5 and night? Less? What about today, for a similar room and board? $60, $100? More?

milk was 21 cents a quart

A genuine 100 octane gas was probably under .25/gallon. And gasoline rated at barely 2/3rds of that, today, and called premuim sells for what - $2.50? More? Soon to be more?

The car to put the gas in cost what - $3000 in the late 60s? Say a camaro, even a high performance 'Z' or 'SS', right? Today - what - $30,000? They call that an order of magnitude increase. That's a little over 30 years. Salaries have done the same?

A paperback book cost maybe, what - .10, .15? Less? The same book today, which looks the same, exactly the same, runs what - $4.25? $6? More?

A hardback schoolbook, say one of Knuth's little trilogy, cost what even in the late 60s? $15? Less? And what about today? $50? More?

Did small hardback monographs, say 50 pgs, cost a lot in the 50s, 60s? But today - what - $125? More? Been to a college bookstore lately? Take the oxygen tank with you - you'll need it.

It's been said, before, that if all other businesses had gone the way of microfab, you could build a freeway for $10, and they'd have to give cars away for free. But other businesses haven't followed suit.

Eggs cost 44 cents the dozen

If that were true, and you can get 18 on sale, regularly, at the chain supermarkets, for $1.50, today, then think of the livelihood. Eggs are produced. They are sold for profit. All the rest has skyrocketed, all the prices faced by egg producers. But people are paying only 3x for their product compared to the 1930s? according to your number. That says something, doesn't it?

You take land that cost $10K in 1970, let's say, and see what it runs today. Housing has skyrocketed. But the egg producers aren't seeing a similar increase in income, as you would have it. You're sort of making the point.

[Harmless Teddy Bear]

Gee, I was not even a gleam in my daddy's eye.

Nice numbers! Thanks. I didn't go further back then the 50's as he presented it as the golden age that everyone would like to return to.

Here is another good number. In the 1950's a average of 2% of the family income went for leisure. In 2004 it was 15%.

[Harmless Teddy Bear]

No you are missing the point.

Your post #102.

Look at the prices of items similar to today - then. The difference is what - a factor of 6, 10, more, in just 30 years? That's all I'm saying to you. If the rest of business had gone the way of microfab, as they keep saying, a car that cost $3000 in '68 would cost pennies, today. And soap, eggs, butter, etc., they'd have to give away. Instead, other businesses seem to have taken almost an inversely proportionally direction.

When this is pointed out to you as so much BS you claim that that proves your point.

Do you have an idea what you are saying other then Housing prices in some areas have gone up?

And have gone way down in other areas I might add. There are certain towns where they are actually giving land away if you will come and live there.

[sevry]

you claim that that proves your point.

Because it's a simple and pretty unarguable 'point'. Prices have skyrocketed. Everyone has their example. I presented a host of examples. And people are trying to make some 'point' of their own, without bothering about the facts.

[Harmless Teddy Bear]

Now as to housing. In 1950 29% of the budget went for housing.

In 2004 that has risen to 33% however the size of the average home doubled.

Making housing more affordable then ever.

1950's Americans spent 31% of their budget on food.

2004 Americans spend 13% of their budget on food.

Are you starting to get the picture?

[Harmless Teddy Bear]

Because it's a simple and pretty unarguable 'point'.

No it is so much BS.

Prices have skyrocketed.

Have you even bothered to do the math from the numbers I gave you? When the increase in wages out paces the increase in inflation then prices do not skyrocket.

And people are trying to make some 'point' of their own, without bothering about the facts.

That would be you talking to yourself while looking in the mirror I guess because the rest of us have given facts. You have given twaddle.

[sevry]

In 2004 that has risen to 33%

You can cherry pick or invent numbers all you like. But if you have a couple earning, saying 90K, which should qualify for a 500-600K mortgage, at either fixed or floating/variable rate, what percentage of their income goes to closing/housing, assorted insurance, property tax, maintainance and repair, etc?

And the same couple, where only the husband worked, in say 1955, what were the comparables? And don't make it up.

[sevry]

Have you even bothered to do

If you disagree with the numbers I posted, fine. Say so. Otherwise, you've got no basis for saying what you do.

[Harmless Teddy Bear]

I neither cherry picked or invented. All my numbers come from the DOL and other government websites.

That is how much they spend for housing. That includes all those things mentioned both in 1950 and in 2004.

The costs are per household not per family. Single parent, single person and families all count.

So your whine about only one parent working is as ignorant as the rest of what you have posted here.

[Harmless Teddy Bear]

What numbers? Have you posted anything but ONE housing number for ONE house?

You have engaged in the rankest hyperbole and have yet to produce numbers to back it up.

[nopardons]

Try doing your own research,instead of asking questions;some of which were pathetically ignorant.,as were your guessing at prices!

Yes,AVERAGE>/B>,as in median, as opposed to mean.

You're all over the place. There were NO paperbacks,as there are today,in the '20s.There were small pulp books in the '30s (where do you think they got the name for the movie "PULP FICTION" from?),but it wasn't until WW II that good literature/popular books were reprinted in small paperbacks (which looked absolutely NOTHING at all like today's paperbacks and yes, I know this for a fact,because I have some that were my father's!)for the military in WW II.

Paperbacks NEVER cost a nickle or a dime! "PENNY DREADFULS" (books about Wild Bill Hickok and Billy The Kid, etc. cost a penny or two in the 19th century) were NEVER reissued copies of popular books;not ever!

I give the average price for milk and you,YOU,go into a song and dance about gasoline? What the bloody hell is that ?

The price of a room,for one night? WHERE? In the Plaza in Manhattan,a flophouse in Chicago,or some roadside cabin and for WHAT year?

Oh,so you're a little boy still in college? that figures. No wonder you don't know anything at all!

Look,kid,it isn't the cost,it's the cost vis-a-vis what people earn.

You're making less than NO sense at all! Part of your problem is that you don't know any facts at all;the other problem,is that you have some grand idea of yourself. Mix those two things together and what you have is an ill/uneducated brat of a kid,expounding grandiosely about things he neither knows anything at all about nor understands.

Instead of attempting to debate this with me and failing abysmally,go reread what I've posted and then do the math. And you also need to understand that there were NO big chain stores,as you know them,with lost leaders and special sales for food,until very recently.Thedre were still vegetable carts,for crying out loud,in Manhattan,in the early 1950s.

You want a salary comparison ? Okay,I leave you with this wee eyeopener....

In 1890, Marshall Field ( he owned Marshall Field's, a grand department store in Chicago,which still operates today,but is no longer owned nor rum by any Fields and no Field sits on the board) earned $600.00 an hour. His shops girls earned $3.00 - $5.00 a week ,after three years of employment at lower wages. And yes,this WAS the "norm".

[sevry]

DOL

I suspect that you mean the Dept. of Labor. And you can cherry pick or invent any figures you like. If you dispute the examples that I myself provided, then that's something different.

[sevry]

You have engaged in the rankest hyperbole

I'd simply say the same of you. If you dispute what I wrote, specifically, then that's something else. Well, do you?

[sevry]

are today,in the '20s

You're creating a straw man, instead of replying to what I actually and specifically wrote. I have old copies of old paperbacks from the 50s and 60s. I can read the price that's printed on them. And that's what I wrote, previously.

about gasoline?

About gasoline. It's on the increase even now. And it cost a small fraction of that, some decades ago. And the gas was of better quality, back then, as well. It's a simple thing to say. And you just seem to want to dispute, just for the sake of being contentious.

it's the cost vis-a-vis what people earn

If you weren't so on edge, so defensive, so contentious, you'd understand - THAT'S EXACTLY MY POINT. Thank you.

[Nowhere Man]

A society of independent family business owners would operate on a cash-and-carry basis to a much greater extent than our modern wage-labor system does. In such a society, default on credit would drop to low levels: since people would not be dependent upon uncertain work for wages, their ability to pay debts would be tied to their own efforts alone, not the vagaries of international commerce, labor markets, and securities trade. This would have the effect of drying up the market for easy retail credit, as people would be forced to live within their means. With retail credit widely unavailable, families would be far more likely to save for major purchases or go without. Such loans as would be available would be small and would be secured by pledges of real property (cattle, machinery, etc.)and not future wages. These loans would be provided by the dues-supported trade guilds, neighborhood community chests, or individuals, and would thus carry no interest charges. As a result, housing would become both more modest and more affordable -- if $100,000 in credit is unavailable the the average potential buyer, builders will not construct $100,000 homes. Loans for big-ticket items (farm machinery, printing presses, etc.) would be made on a cooperative basis within the guilds, with three or four family businesses sharng the lien risk and the use of the machines among themselves. (In any case, most farms would be small and would not need the kind of heavy machinery industrial farming techniques require.) Since loans for automobiles would be hard to get, most people would be forced by economics to live and work in the same building -- their homes -- and would build or buy homes within walking or bicycling distance of neighbors, shops, places of business, and recreational destinations. This would obviate the need of the average person to go into debt to buy a private car. Those who wished to buy their own vehicles would be required to pay cash, or pledge an equivalent amount of real property to the lender, in order to do so. (With big corporations taxed out of business, cars would tend to go back to being what they were in the beginning -- hand-crafted works of mobile art designed and buit by local "garages", and thus would be better-built, more beautiful, and far fewer in number than they are today.) Mass transit would be the average person's way to get around, with the federal government providing the funds to build rail, air, and ground transportation infrastructure and private operators providing the services themselves. Since all transport providers would be guild members, there would be no need for the nightmare of federal regulations we have today; any member of the Transport Guild, say, could operate his or her own private taxi service, motor coach fleet, or airline with no state or federal licensure or involvement required!)

I know there are some efforts in the Christian community of doing things like that, sort of making their own communities where they depend on each other for most things. Many are doing this to fight the social evils of society and/or see some sort of economic collapse or atomic war coming. Heck, there is an effort by Christians to move to South Carolina and evenutally secede from the Union along with a similar libertarian drive for New Hampshire.

I don't see corporations as evil although with the banking and credit industry, which I have a lot of distrust of, are using their power to buy Congress critters into getting "The Man" to play the heavy on debtors who fall into a bad situations. I think your car example is a little far fetched, you do need some sort of mass production for cars and usually behind that is a corporation or in some countries, the government itself like they did in the old USSR (I love their GAZ-13 "Chaika" which was 1955 Packard clone that was made from 1959 to 1983, I have a thing for Packards), but for us in the Western world, it is usually a corporation. Still I see a lot of validity in your example, if money is more scarce, you'll see more cars worked on and kept longer and you might end up with more modified hot-rods. The hot-rods first got their start in the 1930's during the Depression when people could only afford cheap cars and had to work on them although it didn't take off until after World War II, again cars were scarce until industry could gear up again, after that, it was cash strapped teens and so on. Look at Cuba, the average person who has a car usually drives a 1940's to 1950's era car, usually handed down in the family. The Soviets pirated a lot of our automotic technology to the point where even the pistons from a Soviet made car and an old American car were the same and could be used as replacement parts. Chrysler, Packard and GM cars were usually copied. In other cases, parts are jury rigged, to save gas, one Cuban used a Soviet carburettor in his old 1950's Chevy but when he wanted to race and show off, he put the old American one on for more speed and power.

Heck, we need to make things that last and last, we are too much of a throwaway society and this is reflected in consumerism. I still watch a 1982 Zenith color TV we got in 1983, the same set I watch today is the same one I watched as a high school sophomore. I still have our first color TV, a 1970 Zenith, I'd like to fix and if I do, being the old electronics/radiohead I am, I'll use it as my main set. I'd love to have a 1950's or 1960's era "roundie" (old color TV's with the round screen) color TV like my aunt had, but I digress. B-)

The details are arguable; the important thing is to build a system where the majority of people are free -- i.e., they own their own homes and businesses and do not depend upon employers for their living or retail credit lenders for the basics of life. In such a world the standard of living would be much lower than it is today in terms of material wealth, but the average person would be much richer overall than they are today, since they would be safe in their homes and personal property, would be eatng locally-grown food and drinking locally-brewed drink, and would no longer be subject to the whims of wage labor nor the tyranny of usurers.

In some ways, it would be better that way. As I said above, it would also mean that the products we need, make and buy would have to be repairable and last longer. Back in the 1950's, if the TV was on the fritz, you soldered in a new capacitor but for the most part, you changed a tube and you were on the road again. If a toaster, radio, washing machine, or if you're lucky, air conditioner died, you fixed it. My grade school buddy lives in a townhouse and most people got new A/C units but he still gets the original central A/C fixed which was built in the early 1960's. I saw a picture of my grandfather working on the family car, a 1948 De Soto when my mother was young. You'd see a lot of that again.

I'm willing to bet the average person would rather live a a 1950s standard of living and be free than have all the toys and be a wage-slave or debt-slave. I know I would -- and I do.

Being a bit of a "Neo-Victorian/Edwardian" myself, I'll drink to that! B-) Seriously, I think a lot of tradeoffs we have to make would be worth it if we can get rid of the debt bubble and make things in America again that most consumers would buy.

[nopardons]

Some "golden age"...NOT!

There were 4,843 strikes in that decade.

The population was 149,188,000, of which,there were 3,288,000 unemployed adults seeking employment.

The labor force was a 5/2 male/female ratio.

In 1950,inflation was up 5.7%. '51,it was up .7%, '52 it was up 1.7%, '53 it was up .06%, '54,it was up .4%, '55,it was down .3%,'56,it was up 1.2%, '57,it was up 2.9%, '58,it was up 1.9%, '59,it was up.5%.

In 1958,just tuition,cost $1,250 a year at Harvard.But the average salary for that year was $4,230.00. A teacher made $4,085.00, a doctor made $22,000.00, and a factory worker averaged $4,786.00.

[nopardons]

Trust me,pet,your supposed "facts" don't add up.

[sevry]

your supposed "facts"

But which do you dispute? I can't guess. You have to tell me what you're thinking.

[Nowhere Man]

I've had to hire and fire employees many times for both reasons. If they can't or won't do the job then I don't need them. But I have never fired an employee just so I can improve my bottom line. About once a month I receive an offer from India or Eastern Europe to outsource our work. I could cut labor costs by almost 90% and pocket the difference but I won't do it.

I believe any company that does so should be responsible for paying the bills of any employees who lose their jobs because of outsourcing. I'll back any politician who supports such a Bill with campaign contributions and personal support.

Count me in, I'll second that, unless someone else has before me. Barry Goldwater wrote in his 1988 biography about the looming danger of people who would put the bottom line before the best interests of America and her security and we are seeing that with outsourcing and so on. Dang, I ought to post the late Harpseal's economic program at some point, he had a lot of good ideas. BTW, I noticed you are into Robert A. Heinlein, good writer, I "grokked" "Stranger in a Strange Land" and "Farnham's Freehold" although the latter was really chilling.