Learning #9: it's good to be a banksta

I haven't been a big fan of the bank bailouts or the auto bailouts or the mortgage bailouts. I wasn't a fan when Bush started them (a fact seemingly subject to collective Republican onset amnesia - that, and the fact that the Bush tax cuts cost $2.48 trillion [over twice that of the public option healthcare plan], of which over 50% has gone to the wealthiest 5% of the citizenry), and I'm not a fan of Obama's bailout bonanza either.

And today, I'm even less of a fan after an... enlightening?... call with my bank.

People wondered how the banks were going to pay back the taxpayers, and after talking with a few friends and my own bank it would seem that the answer is: ever-increasing finance charges.

And this is where I have to shake my head (and fist) at the government. If the banks are going to pay back the taxpayers by extorting exorbitant APR's and fees, then what in the holy hell did they need the bailout money for in the first place? The government could be doing far more productive (and less costly) things than playing middleman, and the taxpayers can do better than having to pay for a bailout that, in turn, gets... maybe... paid for again from the very people who helped cause the freaking personal credit crisis in the first place. (Read: less-than-responsible consumers who couldn't pay their mortgages/debt.)

I really don't understand how it helps stimulate the economy to take a bunch of money from the taxpayers, hand it to the banks (to bonus employees and go on lavish vacations), and then have the banks turn around and put the thumbscrews to the already-harangued American consumer. If you want money to go back into the economy, you need to make it easier for the everyman to spend money - not harder.

You know who really gets screwed here? The loan sharks. Pretty hard to be a respectable loan shark when the banks are legally going up to 30% APR rates on credit cards. I mean, really: Joey Fingers must be beside himself with worry about declining customers. Bank of America has online banking, paperless billing, and its late fees don't come with a broken leg.

Then again, Joey Fingers does deliver on the paperless bill eco-score, and perhaps a knuckle sandwich for late payments is better than the auto-applied "finance charge" which, of course, will now be added to your debt and subject to the same bastardly APR that was making it impossible to pay off this card in the first place. Which is to say that compound fractures might be less painful to some than compound interest.

Actually, perhaps there's an open opportunity in the loan shark market these days: undercut the bank fees (and ditch the broken legs), and you might garner a client list that could eventually turn you into - gasp! - a neighborhood credit union.

Dare to dream, Joey Fingers. Ditch the tire irons and I'm there. Imagine how proud Mom would be...

I for one think that American consumers need to be accountable for their purchases. This is true. But I can't get over the fact that banks are bragging about paying back bailout money and posting profits (which are supposed to be a sign of an improving economy) when the main reason for the upswing is that they're extorting the American consumer.

I actually called my bank today (Chase) to get an explanation. After being really defensive about bailout money and telling me that they "didn't need it" but were legally forced to take it (and paid it back with interest), I asked about the banks (including them) increasing APR fees as a way to pay back the money.

After being reminded that they "didn't need the money," I was told that this decision was made so that Chase could continue serving its customers in the future.

Which means absolutely nothing. Actually, what it means is "We really don't want to answer this question, and we are not going to give your our actual business rationale, so we are going to come up with a script for our phone operators that sounds vaguely consumer-positive while conveying absolutely nothing about the fact that we're making extra money directly off our consumer base because we can, and you consumers can't do a thing about it because everyone's doing it. Oh dear, we've gone off script."

Here's the deal: banks shouldn't give credit out to people who can't afford that level of credit. Yes, the inherent nature of credit means that you're spending money you don't necessarily have - but it's a bank's job to look at a guy who makes $35,000 a year and realize that This Freakin' Guy can't afford a $25,000 credit line. And it's not right for the bank, at that point, to start sending a bunch of "introductory APR!" offers to This Freakin' Guy so that they can sucker him into a trail that inevitably ends up with them being able to, at their whimsy, raises the finance charges just as he actually has a balance. And so the cycle begins. Sure, it's legal. Sure, it's a consumer's job to make sound decisions. But it's still not right.

It's also This Freakin' Guy's job to figure out that credit cards are the opposite of free money that won't ever have to be paid back. The lack of accountability on both sides of this clusterfudgecicle is just outrageous, and it embarrasses me as an American. But in the end the banks always make out, and the poor bastard ends up poorer. (And in the meantime, our schools and parks and other public services are suffering.)

And that's why it's good to be a banksta. And less good to be a loan shark. (Get crackin', Joey Fingers. No, the other kind.)