Sunday, December 5, 2010


For the last few years, I've worked with credit cards from different banks in either customer service or collections. I've heard all the stories. I've seen all the procedures. If you ask me, credit cards are the ultimate evil. This is because they have taken the greatest evil, usury, and made it even worse. Take into consideration this excerpt from Wikipedia:

Usury ([…] from the Medieval Latin usuria, "interest" or from the Latin usura "interest") originally meant the charging of interest on loans. This included charging a fee for the use of money, such as at a bureau de change. After interest became acceptable, usury came to mean the interest above the rate allowed by law. In common usage today, the word means the charging of unreasonable or relatively high rates of interest. The term is largely derived from Christian religious principles; Riba is the corresponding Arabic term and ribbit the Hebrew one.

Back in the day, charging interest (at any rate) was considered evil, but somehow the meaning of the word changed. Ah, the power of money! On first sight, charging interest seems like a great thing. People can buy things they can't afford by borrowing money, and then pay a little for the favor. Poor people get their instant gratification and the wealthy get more wealth. It's a win/win, right? No wonder it eventually became acceptable. Imagine if the meaning of "murder" eventually changed to something like "to kill more than 10 people within a week".

While I no longer consider myself a religious type, I still observe Christian values. Whether you believe Jesus is the son of God or just a really neat guy with great ideas, fabulous abs and a riding velociraptor, you can't deny most of his teachings are plain common sense (emphasis on "most", as in "not all"). You see, I believe in ancient wisdom. Our ancestors learned from their mistakes and put their findings in writing, and although most of the time they don't explain themselves clearly, upon deeper analysis you can find there are good reasons for these laws; even if you find said reasons are obsolete today.

Take pork, for example (mmmmm pork). Many religions forbid eating pork. I'm sure most people think this is pure superstition if not downright stupid. Then, there's also bacon (a very valid point), but let me share a little anecdote with you. I live in a country that still employs the tradition of cooking whole pigs over an open fire. While it's certainly good eats, even with modern-day sanitation standards I have gotten sick from eating pork cooked like that. Once it was so bad, I couldn't eat pork like that for years, and still won't do if I don't trust the source. If it hadn't been for modern-day medicine, I could have possibly died. It was definitely a bad idea to eat pork 2000 years ago, but it was very hard to explain why.

It was a bad idea to charge interest 2000 years ago. It still is today. It's still somewhat hard to explain today. I'll still try.

Many of those against usury believe charging interest is wrong because you'd make profit without working. Here I am, all rich and fat, charging interest from the poor, getting richer without moving a muscle. To me that's not really it. Sure, it sickens me, but you can't blame them for trying! Besides, lending (and collecting) money is hard work! Remember, I'm in the business (although it's not my money). In addition, the renting of land, buildings and the ownership of intellectual properties are honest ways of making money out of having something, without doing much work.

Others believe the real problem is that of abuse. The most obvious example would be lenders rising rates in times of need or applying excessive penalties. In some countries, even today, people who can't pay their debt have to work for the lender; they become slaves. On the other hand, delinquency can drive a lender bankrupt. Abuse only happens in extreme cases, and the authorities can regulate it. Besides, one can see similar abuse in regular commerce (high prices, shoplifting), so one should always be careful about giving more power to those who already have more than enough. Close, but no cigar.

What is it then? Put in the simplest of words, usury makes it profitable to be rich and expensive to be poor. Therefore, the rich are bound to get richer just for being rich while the poor get poorer just for being poor, this effect reflects collectively regardless of the individual's efforts. This comes with other serious side effects. For the rich it encourages hoarding; amassing large amounts of wealth solely for lending with the goal of eventually living entirely off interest. Many wealthy people live frugal lives and never really enjoy their fortunes and even those with more flamboyant lifestyles do not spend in proportion to their income. This, in turn increases the ratio of people being born rich. In the case of the working class and the poor this encourages the opposite: excessive spending, probably because of a false perception that one can always borrow more, as a way to compensate for certain things one is perceived to be deprived of or as a way to attempt to live the lifestyle the born-rich portray as normal though advertising. The flow of goods, services and wealth becomes entirely unidirectional and as a result, the value of money for the hoarders, the born rich and the indebted is different and the line between necessity and luxury is increasingly blurred. This blur is relative to the degree of separation between the higher and lower class.

Another secondary reason I believe usury is wrong is because lending is a form of gambling. You give money to a person hoping they pay back with interest. You adjust the rates according to the possibility of the borrower actually paying. Now if a rich man makes an unwise loan and ends up losing the money, we can assume he knew the risk and he probably still has enough to feed his family. Besides, given the concern that his family's well-being is at stake he'd only lend to someone he trusts. Is it the same way with corporations? When a corporation with thousands of employees makes thousands of unwise loans that aren't paid, they just start kicking out employees and rising rates until they're back on the black. The ex-employees in turn have to default on their loans and before you know it, you have a mayor crisis across the country. I don't mind a little gambling here and there, but that shit ain't funny.

What can be done to correct this? Well, since we can't ask banks stop charging interest, perhaps we can just stop handing it to them. I learned how to do this the hard way. About 5 years ago, I decided to apply for a credit card; it was my very first so it had a very small credit line and ridiculously high rates, but I needed to get some stuff for my new job from which I was fired before I could do the first payment. Besides that card, I had also borrowed on a few other places. My credit was ruined before it was even established! All the accounts were charged off. I had to learn the hard way to pay up front or realize if something is too expensive then maybe it's not for me. When I look back, I'm glad it happened; otherwise, right now I'd be up to my eyeballs in debt.

The good news is that you can learn from my misfortune/mistakes. The first step is to re-establish a clear boundary between necessity and luxury. Once this has been defined, you know when it's OK to borrow and when you should just save and wait. In my opinion, a middle-class family should only take two loans in a lifetime: one for a house and one for a car. Everything else can be covered paycheck-to-paycheck and with savings. A big screen high-def TV is definitely not worth getting in debt. If you REALLY want it, you certainly can have it, just start saving for it! In the end, you'll value it more and it'll cost you a lot less.

If you still insist you need it NOW, then under no circumstance use a credit card. Credit cards are too volatile, at any time they can change your rates, credit limits, fees or services. In addition, even the most reputable institutions will occasionally send you an invitation for some obscure "service". By invitation I mean a letter that congratulates you for been selected and advising you to call as soon as possible if you wish to opt-out; by the time you find out it's too late to object. Instead, take a loan from a small bank or, better yet, a local credit union (at least that way you're not making the fattest man fatter) with a fixed rate, due date and balance. Make sure you read the small print and compare all the choices before you sign and keep a close eye on any piece of paperwork they send you.

That's all I have to say… o yeah, post a comment!

Broken Democracy

The first time I ever voted was in 2008. I attribute this to a lack of interest in whatever any of the running candidates had to offer. You see, politics in my country are pretty messed up.

Contrary to what you'd see in most democracies, where different parties pick a side (left or right) based on their ideals on how the country should run, we have 3 parties which differentiate themselves solely by the kind of relation they want to have with the United States. Right after breaking free of the Spanish monarchy these options made a lot of sense; this seemed like an issue that needed to be resolved immediately, so the population set all other differences aside and picked a party. The only problem is that things have been the same for generations. That's why I was not interested in either, but at the time, I wasn't quite able to put my finger on it, probably because I didn't really care. All I knew was that they would promise to lead us in the right direction only to have four more years of nothing happening and I got bored of it. I also remember arguing with other kids at school over politics, actually, over our parents' views on politics. We'd sing parodies of the other guy's campaign jingles and attend rallies for fun.

On the last election year a fourth party was formed and, always being one to root for the underdog, I started "following" it. I'd pay closer attention to debates on TV, listen to the news and read the paper. It all made so much sense now. Their point was exactly what I had been thinking, we need to start worrying about the real issues and then we'll be able to make a better decision regarding colonial status. Suddenly you'd see candidates bring deeper topics forward, caring more about the economy, the environment, social and moral issues - subjects they'd never bring up when it was just the usual suspects. I was really pumped.

My party flopped so bad it wasn't even funny. I haven't heard about them ever since. I wasn't really surprised. What surprised me was that once the dust settled, everything was back to normal. I was really hoping for some change in the way politicians went about themselves.

Well, all that reading and listening wasn't a complete waste of time. I realized the same people have toyed with my entire country for the last century. The two major parties (pro-statehood and pro-status quo) have had a perpetual tug-of-war for power that only seems to fuel the loyalty of a fanatical legion of blind followers. It doesn't matter how corrupt their candidate is, or how much potential the adversary has, voters are taught that if they let the enemy win, in the blink of an eye, their "ideal" wins forever (even though that has never happened). They make such a great spectacle that nobody ever suspects that both parties share the exact same ideals and that in order to keep the fear of each other alive, nothing will ever be done in regards of our colonial status. Things will remain unchanged as long as they are allowed to continue taking turns stuffing their pockets at the people's expense.

Speaking of fear, I'm pretty sure half the people in this country have no idea what a republic is. I kid you not. Up until the nineties, the word "republic" was used by those against independence to scare the others into believing that "without the US we would become a republic". I guess they, being so fond of the states, didn't know that it is a republic. So you can imagine what the general understanding of any other forms of government is. It's not because people can't understand or don't care, it's because their eyes have been shrouded. In public school, history class is always very vague and always skips decades of important events. Kids are diverted with fairytale-like stories about the native Tainos and the Spanish conquistadors. From there to the present, it's all fuzzy. Moreover, we're never taught the history of the United States. What could it be that those in power don't want the people to know? Is it maybe that they're all a bunch of borderline far right-wingers?

Year after year the news covers countless stories of corruption, bribing and embezzlement. Year after year, they prove their allegiance to the wealthy. And every four years the people either "revolt" out of anger for a terrible administration or re-elect out of fear the "opposing" party may be even worse. Every debate is based solely on their plans to resolve the colonial status and a few pressing issues, every other subject is avoided or discussed as politically correctly as possible. Every four years they will belittle their real opposition by totally ignoring them and making the public believe a vote for them is a vote wasted, that there are only two real choices. Every four years they teach us to vote defensively by identifying the worst candidates and voting for their closest competitors. Every four years they will point their fingers at each other and call "thief". They are usually right.

I understand any other country ending up with just two parties, but we've been forced into a bipartisan system in which both alternatives are the same. By law, we are entitled to a referendum to choose between independence and statehood (or anything in between, I suppose). A referendum is a vote by the people, regardless of who is in charge; direct democracy at its finest. In the end, however, I believe we have no say in the colonial status issue, just like a slave has no say on his freedom, and a stranger can't decide he wants to live in your house. There have been a couple of these since I can recall; the result is always inconsequential. Both major parties sabotage the results by adding shady options or diluting the most popular alternative. The last time around the winning option was "none of the above" I shit you not. One of the parties even campaigned for this option.

If you want to know, I am mostly undecided (regarding colonial status); probably because I know I had been looking at a few details from the wrong perspective. I believe most of us have taken a side for the wrong reasons. Many statehood supporters see it as an opportunity to tap into an infinite source of wealth. Many independence supporters believe statehood will entirely rid us of our culture and identity. The rest are just afraid of change. In a way they all make sense, thus we have a very un-debatable subject. This is where democracy comes in. If we can't all be happy, well, then let's try to make the most people happy! I've been reading a lot lately, studying different forms of government, reading the untold story of our country. The best part so far is that now I understand political jokes on TV talk shows. I can't wait until the next election year, when I hope I have a few opportunities to make a few people realize they've been made fools of. People have to realize what they stand for, what they REALLY want for their country. The colonial status-based party system has to end.