Tag Archives: debt

Debtors’ Prison

This is kind of scary, especially when you consider how often folks get billed erroneously and then have to struggle to get it cleared up:

How did breast cancer survivor Lisa Lindsay end up behind bars? She didn't pay a medical bill — one the Herrin, Ill., teaching assistant was told she didn't owe. "She got a $280 medical bill in error and was told she didn't have to pay it," The Associated Press reports. "But the bill was turned over to a collection agency, and eventually state troopers showed up at her home and took her to jail in handcuffs."

Although the U.S. abolished debtors' prisons in the 1830s, more than a third of U.S. states allow the police to haul people in who don't pay all manner of debts, from bills for health care services to credit card and auto loans. In parts of Illinois, debt collectors commonly use publicly funded courts, sheriff's deputies, and country jails to pressure people who owe even small amounts to pay up, according to the AP.

Is Your Kid’s Student ID a Debit Card?

This morning I stumbled across this story about a community college student who was suspended for two semesters because he protested on the school's Facebook page the school's forcing students to use student ID offered by a debit card company. He was later reinstated after an advocacy group intervened on his behalf.  From the story:

Catawba Valley Community College student Marc Bechtol was suspended for two semesters earlier this week after complaining about the debit card on the school's Facebook page, according to the Foundation for Individual Rights in Education.  Bechtol's Facebook complaint included a suggestion urging readers to find "good viruses" to send to the school or register it for porn sites. On Oct. 4, Bechtol was pulled from class and told he was no longer allowed on campus.

After the Foundation for Individual Rights in Education (FIRE) intervened, Bechtol was reinstated. The school viewed Bechtol’s post as a threat, but FIRE argued that it was protected free speech and not a serious threat…

Bechtol complained last spring that school was forcing him to obtain a debit card issued by financial firm Higher One, and that his personal information would be shared with the company. When he did, he said he immediately began receiving credit card spam, which directly inspired his Facebook comment.

"Did anyone else get a bunch of credit card spam in their CVCC inbox today? So, did CVCC sell our names to banks, or did Higher One? I think we should register CVCC's address with every porn site known to man. Anyone know any good viruses to send them?" he wrote, according to the letter FIRE published.

I currently have one child attending a North Carolina university (UNCC), and will likely have two more attending NC schools in the next three years, and I can tell you I would be quite unhappy to discover that their only choice for student ID is a debit card.  I couldn't tell from reading the story if there was any way for students to get an ID that had a deactivated debit card feature, but even if there is I think the student raised a good point – why should they have to deal with their names being sold to marketers?

Something else that bothers me about this story is the school's reaction to the student's Facebook rant.  Granted he suggested students register the school with porn sites and/or infect the school's network with viruses, but you'd think the school's administrators would recognize hyperbole when they see it.  Or maybe not.  Any which way you slice it I'd say they overreacted just a touch.

US Debt is Falling

Here's an interesting blog post at Time.com that points out how overall US debt is falling:

The U.S.'s overall debt – which is government debt plus individual household debt plus corporate debt and bank debt – when compared to our GDP, which is how most economists look at these things, is actually much lower than many other developed nations. Overall, the U.S. and its citizens owe a little over $41 trillion. That, of course, is a lot of money. But when compared to the U.S. GDP, it's not a shockingly bad number. In fact, it's pretty good, when compared to other nations. The U.S.'s debt is equal to 275% of our GDP. That percentage for the United Kingdom is over 450%. Japan's overall debt-to-GDP is about the same as the U.K. Spain comes in at nearly 350%, and France's debt is above 300%. Our debt level is about the same as Germany, which everyone think is pulling off economic miracles these days. But more importantly than that, the U.S. appears to be the only developed country where the overall debt level is falling…

Of course, the reason our overall level of debt has been falling is because of individuals and not government. Government debt is continuing to rise. Private household debt has been falling, in large part because people have been losing those households, and the debt that goes with them. Consumers have also reigned in spending and are now saving at the highest level in years. And that is one of the reasons that the economic recovery has been slower than expected.

But Charles Roxburgh, who did the study for McKinsey, says his point, at a time when there has been a lot of focus on government debt, is that overall debt matters. Private debt – what individuals, banks and companies owe – can become public debt, as we have seen from the bailouts. So the fact that our private debt is falling is a positive in the government debt debate.

Read more: http://curiouscapitalist.blogs.time.com/2011/07/18/surprise-u-s-debt-is-falling/#ixzz1SZlZPQmN