Let me be the first to admit that I don’t know a whole lot about the economic principles driving the world’s current financial woes, and for that reason I have a hard time forming an opinion about the various stimulus packages being proposed and adapted. I’m glad there are people out there who know a thing or two about monetary sums that for me are objects of feeble speculation. From where I sit, 800 billion dollars might as well be Sasquatch. Reasonably sane and trustworthy people tell me that both exist, though I’ve never seen either one, and I’m not sure how either would interface with the world I inhabit.
This much money is a make-believe sum. I rather doubt that 800 billion dollars worth of money ever has been printed. After all, with 800 billion paper dollars you could make a stack of money more than 54,000 miles high. With 800 billion dollar bills you could wall-paper our entire planet and with the money left over you’d still be richer than Bill Gates.
Of the 800 billion dollars of what amounts to Monopoly money 200 billion is earmarked to help encourage consumer credit—credit card lending, auto loans, and the like. (You could count 200 billion dollars at a rate of one dollar per second by Christmas if you had started around the end of the Stone Age). This expansion of consumer debt makes me suspect that the wizards of finance are so comfortably compensated that they don’t comprehend how money works among regular people.
Among the people I know—in my community, in my church, in my family, and among my friends—consumer debt is the single greatest obstacle to financial health and wellbeing. Many Americans are up to their eyeballs in credit card debt. It may be good for the banks when Americans are shackled to their credit cards, but for individuals it is soul-suckingly awful to carry the weight of unsupportable debt obligations.
The 55 percent (or so) of Americans who are unable to pay off their credit cards each month, on average, hold thirteen active consumer credit lines (including car loans and other non-mortgage debt) and owe more than $16,000. This is a great deal for the lenders. The victim of revolving consumer debt must make payments on each account and cannot, therefore, afford to pay much more than the interest on any one debt. The principal is never retired and the borrower ends up paying the lender far more money than ever was borrowed. It is a trap. The lenders get rich on what essentially is free money, while the borrowers lose their freedom and watch their options for life dwindle and fade.
There is no question that the economy needs a good bit of fixing, and a big part of the repair work will have to be directed toward banks and other financial institutions so that investment dollars will flow toward the businesses and industries that keep Americans employed. It is unjust and therefore immoral, however, to rescue banks at the expense of American credit card users, most of whom are working class or poor, many of whom are young and unfamiliar with the workings of a household budget and unpracticed in the arts of saving and restraint.
Those who deal in dollar amounts as high as 800 billion should not have their already considerable wealth preserved by adding more weight to the debt load that rests like a millstone on the shoulders of America’s less fortunate citizens. It simply is not just. That much I know.