Wednesday, January 16, 2008

I Had My Heart Broken Last Night

By a movie: Maxed Out.

The film, released in 2006, has proven to be more timely as the years have passed:
Maxed Out takes viewers on a journey deep inside the American style of debt, where things seem fine as long as the minimum monthly payment arrives on time. With coverage that spans from small American towns all the way to the White House, the film shows how the modern financial industry really works, explains the true definition of "preferred customer" and tells us why the poor are getting poorer while the rich keep getting richer. Hilarious, shocking and incisive, Maxed Out paints a picture of a national nightmare which is all too real for most of us."
You'd have to have a heart of stone not to be affected by some of the stories in this expose, juxtaposed against some of the cruel, callous and officious bullshit spewed by the people who are roasting, toasting, and burning to a crisp those who are least capable of handling the credit so cynically ladled on them by predatory lenders.

If you want an idea of why the subprime market worked so well despite nearly every single rational thought, this movie gets under the mechanics and tinkers with the very soul of why credit cards exist, how they work, and what the banks and their cronies in Congress and the Bush administration wish would happen to you.

Yes. You. There's not a one of us in this country, with the possible exception of the uberrich and propertied, who couldn't but for the grace of God be one of these stories: white, black, urban, suburban, rural...everyone could fall prey to these sharks with silk tongues wearing silk suits:
The most profitable niche of the industry is called "alternative" or "sub-prime"—euphemisms for a business formerly known as loan-sharking. They target those with less than perfect credit-people like Mark Mumma, whose frustration with the sub-prime credit card issuer Providian caused him to start the website From 2000-2002, Providian paid over $400 million to settle charges that it defrauded its customers. Soon after, a Providian director and the chairman of its compliance committee was appointed corporate crime czar by George W. Bush.
Right now, in this country people are going broke at a faster rate than they did during the Great Depression.

Sink your teeth into that statement for a moment. The event that triggered your parents and grandparents to squeeze each and every dollar for all it was worth was nothing compared to the firestorm headed our way: it could create a permanent underclass along the lines of sharecroppers of the post-Civil War South.

The stories in "Maxed Out" will leave you breathlessly angry and crying from rage and sympathy. As director James Scurlock puts it:
We're all led to believe that people get into financial trouble because they are irresponsible, but I've learned that most people are getting in trouble because the banks and credit card companies are setting their customers up to fail. Why? The more credit they give us, the more credit we need. When we inevitably fall behind, they can charge the huge late fees and the over-limit fees and the stratospheric interest rates that drive their profits.

I highly, highly, recommend this film. It will scare you into taking care to clean up your debts now.