Credit-history Books

Robert D. Manning is a rare combination of influential scholar and public policy "statesmen" whose work has not only inspired hundreds of scholars projects and thousands of media stories but also directly influence public understanding and regulation of financial institutions, the deregulated banking system, subprime lending, and the global dimensions of asset-backed securities.

Author of the widely acclaimed book, CREDIT CARD NATION, and editorial advisor of the powerful documentary, IN DEBT WE TRUST, which is based on his book, Dr. Manning's scholarly and public policy work constitutes a pathbreaking intellectual enterprise: a dispassionate and ongoing investigation of the nature of America's changing attitudes and behaviors toward consumer credit, the power of financial institutions, and role of the banking system in changing American society. Manning's analysis of America's growing dependence on consumer credit, the powerful financial institutions that have emerged under the deregulation era and shaped the fragile underpinnings of the "American Dream," are presented in the context of broad social, economic, and cultural perspectives as US society grapples with its declining position in the global economy.

Dr. Manning has produced a truly creative approach to analyzing the post-industrial society where there is more profit to be made financing consumption than producing the items themselves. This is an unusual book in its effective weaving of macro-social and economic trends with carefully selected case-studies of companies and housholds. There is no attempt to present glossy oversimplifications, black-and-white statements, or sweeping generalizations. Rather, the book seeks to demonstrate how globalization and US industrial restructuring have dramatically changed the opportunities for the American middle-class based on their earned income (remember the primacy of the one-income earning family in the 1960s!) AND the pressures of the federal government to aid the suffering banking industry through favorable deregulatory policies which indirectly contributed to the soaring federal deficit. Manning emphasizes that there is no single institution or social trend that is responsible for this phenomenon as he artfully explains how all sectors of American society have become integrally dependent on borrowing--the "Triangle of Debt."

This book is an impressive intellectual achievement: in a dispassionate manner it marshals overwhelming evidence and complex conceptual models that reveal the predatory policy banking institutions and marketing tools that have addicted most people to easy credit in America--both young and old. Furthermore, this book was the precursor to foresightful academic predictions of the subprime mortgage crisis and I understand that his next book systematically examines the consequences of the Credit Card Nation as the country's Baby Boomers enter into an underfunded quagmire of retirement. Aside from the momentous intellectual contributions of the book, Dr Manning is one of the rare breed of scholars that practices what he preaches in the classroom through Congressional testimony, trenchant policy analyses, frequent media commentary, and his own carefully designed alternative to consumer bankruptcy.

We're in the middle of an ongoing social and economic crisis according to Robert D. Manning, author of "Credit Card Nation". And with supporting evidence like his figures of every credit cardholder having 10 cards in their name and every family revolving over $4,000 in debt (the number now is over $7,000), it's easy to see why he feels like it is a crisis. In this fascinating book, Manning describes the situation thoroughly, shows who's at fault, and what we should expect as a result of the situation.

Manning separates the country into two categories of credit card users, the convenience sector, who pay their debt off monthly, and the revolver sector, who have accumulated all the personal debt this country maintains. He focuses on the revolvers and the dire straits they're in due to the interest they pay on their debt. The author does mention some bright spots in the history of debt (e.g. 'The Blair Witch Project', which was financed on credit cards and ended up making millions), but the overall picture portrayed is bleak and Manning doesn't describe how everyday people can take advantage of the credit card economy.

One major liability in this book (no pun intended) is that Manning repeatedly blames the credit card industry for putting so much effort into their marketing. It's true that the industry uses some sneaky techniques to get people to become lifelong subscription holders to their finance charges, but some of the industry's marketing can be used for consumer benefit.

Manning has a great angle on the social aspects of our spending society (from a Puritan savings mentality to a commercial spending mentality) and how it affects the separate classes (the system negatively affects the people who need it most while helping the people who need it least). His philosophy on the drawbacks of a culture that punishes production but rewards consumption should also be transferred to taxes as well as credit.

All in all, this is a thoroughly insightful book, which everyone should read.

I think I'm getting sick of reading books from Humanities folks, they are also far too verbose. This book is not an exception. This book could have been much shorter if the author stopped repeating himself and wrote in a less verbose style.

There are a few interesting tidbits of information in the book, but overall its not worth reading.

A great overview of the precarious state of credit we've reached and how we got here. Good lessons for all: policy-makers, borrowers, lenders, college students.

I have no arguments with Prof. Manning's points, although I suppose I too was less than moved by the stories of college students who had to declare bankruptcy to pay for their bar tabs and expensive trips. I just didn't care about those predicaments all that much. But what I found less than valuable about this book was the writing style - as the professional reviewer said, it was not only filled with jargon, but in my opinion seems to have been written a few sentences at a time, with long gaps in between the writing sessions. The author continually repeats facts after several paragraphs, and treats the information as if we're hearing it for the first time. He even did this, oddly enough, in the same *paragraph* once - I did read the entire book because I liked the fifty or so pages of original material among the 250 other pages that repeated it. I also think he enjoyed using "big words" and convoluted sentences even when they hid the clarity of what he was trying to say - or, as he would put it, even when the obfuscation became peremptorily more insistent.

This is a good buy, it helps to explain a lot. There are also helpful numbers. I highly recommend this book.

This book has a lot of very useful information from people who really know what they're talking about.

Calling Cards... Long gloves vs Afternoon Tea gloves... How to prepare a proper wives luncheon complete with quiche???? WHO DOES THIS!!! As an Enlisted wife (And I find that most of the wives looking for help ARE Enlisted) you are going to wind up chucking this book right into the trash. The place on base that people keep mentioning as being useful is the Family Support Center. They have FREE reading material that is 400 times more useful than knowing what kind of gloves to wear to lunch. WHO WEARS GLOVES TO LUNCH?!! Half of the wives I know who "do lunch" end up showing up in jeans so where do the gloves come in??? I gave this to my best friend who is an Officers Wife, thinking that the Upper Crust might do these 50's style luncheons more than us enlisted people... as it turns out, they don't "do lunch" with gloves either.

Seriously, if you're COMPLETELY new to the military, this might help you learn some of the traditions. But it gives you the WRONG idea about what the military is like and, in all honesty, I've been married for several years now, was a brat before that, and the only pair of gloves I own are for winter weather. And the only reason I even HAVE calling cards is because, as a Jew, I'm forbidden to write on the Sabbath and sometimes I want to give my number to a new friend. I have never once needed more than the back of a reciept and a pen to give my number to other military wives, I have never served quiche at a get together and don't know anybody who actually EATS the stuff outside of their parent's house, And

If it's history and tradition you are looking for.. there are WAY more books out there to give you an insightful look at the military. If you're in your 50's, married to an officer, and you're the type to "do lunch" in a formal setting, you will get off on this book. But if you're anything like me (an Enlisted wife under 30) you're better off just going to the FSC, a library, or a Spouses Club meeting for all of the information that's in this book. Also, it helps to MEET the wives because then you will see that they are not a group of hat wearing, quiche eating old biddies who do tea.

This is a good read for new military wives (like me!) who are having some trouble figuring some things out. It's cleared up a few things for me so far and I'm not even that far into reading it, maybe 60 pages. It talks about a lot of things... some history of the military, benefits, services, moving, deployments, etc... for all of the branches of the military. It may not be the best, but like I said, it's cleared up a few things for me so far.

This book was okay... I too would say borrow it or check it out from the library. It had some useful information, but what it did have was not indepth enough to really be of help, and most of it was irrelevant.

John Steele Gordon has taken what could be an amazingly dull topic, limited in appeal, and translated it into a spectacular read for anyone with at least a basic education. This great little book is a welcome addition for folks interested in finance, the U.S. economy, and the national deficit. Nonetheless, despite its breezy style and short length (traits typically necessary for widespread appeal), I don't expect it will reach a wide audience. Consider yourself lucky that you've discovered this plain-language, excellent primer on how our national debt came to be!

The author's premise, like that of Alexander Hamilton, is that a national debt can be used constructively to monetize an economy. Both men were quite correct, and the debt served its purpose beautifully in supporting the fledging United States of America. It's subsequently been bastardized by numerous administrations, as a means of funding open-ended congressional and executive expenditures of middling value. Throughout the narrative of changes in the U.S. debt, the author details the creation and destruction of the National Bank of the United States. This institution flourished under Federalist rule, and languished or disappeared entirely when populist presidents (Thomas Jefferson, Andrew Jackson) sat in office.

Overall, a remarkable book that will be discovered by too few, and certainly treasured by those lucky enough to discover it.

I tip my hat to Mr. Gordon for providing a compelling short history of national debt, and how it has been shaped by tariffs, taxation and ever-increasing spending that has run amok in recent decades. It is a fascinating study into the competing visions of fiscal responsibility, notably the balanced budget extolled by Jeffersonians, which has actually been achieved on numerous occasions, versus deficit spending espoused by Hamiltonians, and of which John Maynard Keynes became the leading exponent in the inter-wars years between WWI and WWII.

While debts traditionally run high during wars, Gordon notes that since WWII, the yearly budget has rarely been balanced. It is during this time that Keynesian theory took hold and in Gordon's view led to a budget deficit that quickly spun out of control as entitlement programs took up fully three-quarters of the yearly budget. These programs have been virtually untouchable, but in 1995 (the point to which Gordon takes his history) a new reckoning emerged with the Republican landslide in Congress. Bill Clinton duly responded by proposing a balanced budget.

Gordon is a fiscal conservative, but recognizes the need to run in the red during hard economic times. He notes that this was Hoover's mistake at the onset of the Great Depression, as he continued to push for a balanced budget despite warnings that it would make the recession worse. However, the federal deficit, which has mushroomed to over $5 trillion, threatens to bankrupt many of the entitlement programs including social security.

The book is okay ... but in general the book attempts to have the reader buy into Hamilton and his develpment of the National Debt as a good thing in todays economic system.

It was set up originally to help our economy expand and to be used in a way such that in difficult times money would be borrowed so that in prosperous times it could be paid back. Although it is a factual account of a major portion of our Nations'Economic history it fails to take into account one thing in its summary, the Human Equation.

All things work great on paper but in this instance this is not the case. The current system, seeing that it has no intent of ever paying back the current debt, now has adopted the belief that as long as the debt to GNP ratio stays within + or - 5%, everything will be OK. This is where the book falls short, it doesn't analyse Hamiltons' theories as they apply today, accounting for Human Intervention. It instead tries to explain away our current economic problems as part of economic evolution. Not the case. Socialism works great on paper but fails in real life. Why.... Humanity. Simply put, if you borrow more than you could ever make or pay back, sooner or later you reach a point of critical mass (or you just keep printing more money, hence inflation).

None the less, if some basic, simplistic history is what you want want, here it is.

John Steele Gordon is an excellent writer, one whom I have enjoyed very much in the pages of American Heritage and who wrote a nifty history of Wall Street called "The Great Game."

This book, "Hamilton's Blessing: The Extraordinary Life and Times of Our National Debt" is a good, if brief, overview of the fiscal history of the American government. It is somewhat misnamed, since the National Debt serves as a background and tie in to each period of fiscal history studied.

The author does a superb job of explaining Alexander Hamilton's establishment of our financial, banking, debt and money system. Here is a woefully under appreciated founder explained succinctly and whose brilliance and indispensability are brought forth by Gordon.

Descriptions of attitudes towards and major changes in financial policy and tools follow. Gordon covers the major aspects: the struggle over the Second National Bank, Jackson's paying off the debt (the only time the US Gov't has been debt free), Lincoln and Chase's tax, greenback and bond finance of the Civil War, the long fight to establish the income tax, the fight over high marginal rates and an efficient system of taxation, and the change in view in the last century from one that deficits and debt were something to be controlled to our current sorry state of view whereby no one worries about much about deficits anymore.

Debt, when properly used, has allowed us to primarily wage wars. It was retired in times of peace. We face an interesting time now, when debt as a percentage of GDP is much higher than it has been in most peacetimes. This raises the question that if we have to fight a truly massive and long war in the future, will we have the capacity to borrow what we need (based on historic statistics, it is a question well worth pondering).

Gordon finishes the book with a polemic against the political culture that has lost its way in terms of providing an efficient and fair and economically sound system of taxation and the willingness to moderate the nation's debt.

This is a good and interesting book. Anyone looking for a succinct telling of the development of our government's fiscal structure will appreciate this gem.

Just two years ago, John Steele Gordon's book on the history of the U.S. federal debt would have seemed dated, even though it was published in 1997. After more than twenty consecutive years of operating in the red, the U.S. federal government had not only erased its annual deficits and began paying down the debt, but surpluses were projected over the next ten years.

This is no longer the case. A tax cut, the war on terrorism, and a slowdown in the economy have combined to push the U.S. government's outlays above its revenues. They have also made this book -- "Hamilton's Blessing" -- relevant again.

Gordon's book is two things: 1) a basic history describing the twists and turns of U.S. fiscal policy over the last two hundred-plus years and 2) a political tract condemning the latest turn U.S. fiscal policy has taken since the Great Society.

By combining the two, Gordon seeks to show that the most recent practice of U.S. fiscal policy -- that of habitually running deficits in peacetime -- is not only unprecedented in U.S. history, but also, more importantly, unsupported by any sound theory of economics.

"Hamilton's Blessing" is well-written and interesting. The book is only slightly marred by a lack of detail in some areas. How exactly does a large public debt hurt your average citizen and by how much? We never find out.

Gordon also should have kept his own political bent out of the book. Among other things, he spends three pages in a less than 200-page book detailing Jack Kemp's personal and political history, including his football career. All very interesting, but not really relevant to the history of the U.S. debt.

Karger reveals what he accurately terms the "fringe economy". Something possibly unknown to those safely enscounced in the American middle class. This fringe is inhabited by working class people, which might have experienced a bout of bad luck. This can come in the form of losing a job, or having a very low paying one. Or perhaps a chronic illness, that severely restricts what types of jobs one can get.

Within the fringe economy, the book shows a range of companies that might be accurately described as predatory. Offering short term payroll loans that amount to over 100% interest on an annualised basis. Or for those unable to buy furniture, these are made available on a rental basis. Again, typically at an annual rate of over 100%. Such techniques might perhaps be aimed at those who exhibit poor personal money management. The deservedly imprudent, if you will. But the techniques also take aim at those who carefully count every dollar, and who do not squander what little they have.

The fringe economy is a poorly-understood shadow structure operating below the surface of maintstream life, according to Karger, a professor of Social Work in Texas. His outlook is more broad than deep, but I applaud both the scope of his work and his policy recommendations. While I would disagree with a few of them (as an economist I have a slightly different perspective of the function of financial institutions), the suggested policy actions offer a launching point for further discussion that is missing in some other purely emotive works. I also applaud Karger's effort to tackle this fairly ethereal subject (much like the idea of the 'economy' itself) and put it into human terms.

I knock one star for the presentation of statistics - there's a little too much of it without enough order to support their presentation. However, these do not detract from the logic of the book, only from the continuity in a few sections. Otherwise, an eye-opening read.

I bought this book because I love books about economics and finance. I enjoy reading about the pitfalls of credit and the dangers of an over-leveraged society. And I wish everyone could pull themselves out of this dangerous cycle and live debt-free.

What I don't love, however, is reading an author who puts the blame for society's ills on everyone but the individual. For example, it's not Joe Sixpack's problem that he makes $8 an hour, but HAS to have a $4,000 big-screen LCD television. It's Sony's fault for having compelling marketing, and the predatory bank's fault for loaning him the money, and Wal-Mart's fault for selling him the TV, and the cable company's fault for broadcasting NFL games, and the NFL's fault for allowing games to be televised. Poor Joe Sixpack -- he can't possibly live with a 20" CRT TV -- he needs an LCD TV. So he's a victim.

It's also not Joe's fault for the 32% interest, over-limit and late fees he's paying. It's the bank's fault for not letting Joe slide when he needed beer money and a cool stereo for his new car and couldn't pay his bills for a few months. Poor misunderstood Joe.

The author also rails against payday lenders. Never mind that payday lenders employ ten of thousands of people in blighted urban areas, and provide much needed access to money to buy food or heating oil. They're evil because they expect that money back! And who are they to add an interest rate to cover operational expenses and provide salaries for those inner-city employees? The nerve!

I should have read about the author before purchasing this book. If I had realized that he was a purveyor of pseudo-science (sociologist) living in an ivory tower, and not an employed, real-world financial analyst I would have passed. I did manage to sell it used for two-thirds of what it cost me though. I guess I'll just consider that interest paid.

While Nickel and Dimed is an excellent read, in key ways it lacks authenticity. Barbara Ehrenreich, while attempting to live the marginal life, could always fall back on the resources of her "real" life, which she admittedly does on occasion. Her actions in these instances underscore the importance of Karger's book. Where do the actual poor, who can't step out of a temporary context, go when they need something to fall back on? As Karger so clearly illuminates, they must look to those who "have" and are anxious to give - at interest rates that guarantee the customer will be back, again and again. Karger's keen observation of the relationship between morality and economy may hit too close to home for those benefiting from the system. For those committed to reform of a predatory economy, he offers critical strategies for change. This book is an eye opener and a wake-up call to those of us who have not lost our moral center.

On a personal note, my friends and family who will see themselves in this book - lured by the "easy" money of the fringe economy - have gotten this book as a PRE-Christmas present. I hope they read it before they borrow money they'll never to really be able to pay back to buy Christmas gifts they can't really afford.

"Pawn shops, check cashers, rent-to-own stores, payday and tax-refund lenders, auto-title-loans, buy-here-pay-here used car lots - what seems to be small independent storefront operations turn out to be part of an economy dominated by well-financed corporations with little-no oversight and increasingly strong ties to mainstream financial institutions" - so claims "Shortchanged" summary material. The book then goes on to provide stories of real people trapped in perpetual debt, usually starting with overpriced goods, and acerbated by high interest rates and required extra charges.

Karger admits that serving the poor can cost more, and thus would justify higher prices. However, he cites examples of pawning a vehicle for 1/3 its value and paying interest of up to and over 300%/year to get it back, depositing $100s-$1,000+ in low-interest savings accounts to acquired a secured credit card that charges 30%/year rates (and more) to use, check cashers paying 3% to cash relatively risk-free government checks - and concludes that clearly the line separating "reasonable" from "unreasonable" was crossed.

Karger's material is well-documented, providing sources for his claims - eg. "almost 10% of unbanked households' net income is spent on alternative financial services,." "consumer debt, excluding mortgages, averaged about $19,000/family in '04," "68% of EITC and CTC eligible families use tax preparers (average cost $305 in '01; total of $1.3 billion vs. $EITC payouts of $30 billion." However, sometimes these claims, despite documentation, do not seem to hold water - eg. Karger states that the "bulwark of public assistance programs cost $125 billion/year or less (low-income housing, AFDC and its successor program, food stamps, WIC, school lunch), compared to check cashers, payday lenders, pawn shops, rent-to-own growing $78 billion in '01 - the problem is that the $78 billion did not appear substantiated by the detail.

Information on how these purveyors of credit to the poor avoid usury laws is provided - eg. require a loan applicant to sell up to three household items to the lender, and then lease them back.

The material on home mortgages for the poor was particularly eye-opening - balloon payments, shared appreciation mortgages (due at maturity), extra insurance fees, foreclosure "help" that often takes the customer's equity, and high interest rates (location, credit rating). Car sales (over-priced to begin with) that allow the seller to break-even in about three months, accompanied by a 30% repossession rate for "buy-here-pay-here" and frequent profitable trade-ins upon breakdown. (They even have companies that rent tires - at high fees and rates!)

Debt counselors get about 15% from money paid to credit card companies - some counseling firms are reputable and provide good service. Others steer money towards the credit card companies, neglecting home mortgage and car payments. Only 26% complete the process.

So, one wonders, if these firms are making so much money, why don't others come in and compete down the charges. In some cases this is happening - Wal-Mart is now providing check-cashing services at far lower charges than check-cashing stores. On the other hand, there is also a problem with low-income consumers being their own worst enemies - eg. not knowing that they could cash a payroll check free at the issuing bank, or even the advantages of having a bank account. (I'm left wondering how President Bush's privatization of Social Security would possibly avoid these people being taken advantage of.)

An excellent book, even for someone like myself who thought he knew it all already!

"Your account is now delinquent in the amount of $40.00. Until your account is current and below your established credit line, we must insist that you do not use your card. We must inform you that failure to make at least the minimum monthly payment will leave us no other alternative but to turn your account over to our Collection Attorneys. Please be advised your account is also being reported as delinquent to a local credit bureau. Key Federal Savings Bank." (107) All this heckling is the name of $40. Imagine you are in the shoes of Will Harrison suffering from diabetes with two amputated legs that opened his own small flower shop years ago and owed $1,000 a month in interest payments alone. Imagine you are Megan of whom half of her earnings go to pay the minimum of each of credit card bills who has a girlfriend screen her calls as she is terrified of the collection agencies and is depressed as a result of her debt. What a depressing, demoralizing, and humiliating toll the credit industry is taking on the poor of our country.
These are the stories of exploitation that Brett Williams recounts in her newest book Debt for Sale: A Social History of the Credit Trap. Williams is clear from the very onset that she is making no attempts at neutrality and objectivity; she is simply telling it like it is, or at least the way she thinks it is. She herself suffers from massive credit debt. And yes, the language of suffering and victimization saturate this expose. The institutions, the government, even the consumer culture are to blame in this book for the downfall of the American poor and lower middle class. She uses the tragic tales of the few to stand in for the exploitation and suppression of the masses at the benefit of these ambiguous, all encompassing, and greedy financial entities, who ironically are the major source for employment in the US's new service sector economy. Despite this irony, the book is well put together in its explanations about how creditors, whether credit card companies, cash checking facilities, pawn shops, or mortgage brokers, exploit notions of American entitlement to freedom, choice, flexibility, and materialism in order to pedal their products.
Our story begins in the 1970s when credit and debt became "the engine of the US economy." Through acquisitions, mergers, improvements in technology and communication, the financial services and credit industry has boomed and enabled the wealthy to become wealthier while feeding on the misfortune and inability of repayment of the poor debtors. Attempts have been made in constraining these financial giants such as Senator D'Amato's push for a 14% cap on usury, but have mostly been defeated through the rhetoric of credit as the new welfare, enabling the poor to get by when even their own government was not there to support them. Williams demonstrates the cyclical damage that the credit industry has laid upon the less fortunate through treating those who pay their bills and do not carry a balance as "deadbeats", and therefore encouraging people to pay the bare minimum and get caught up on exponentially high interest rates.
The industry paints a picture of comfort, freedom, and security for those in tight financial situations and not only could care less, but thrive on the automatic cycle of debt. She tackles the idea of convenience users verses revolvers; convenience users being those who basically use credit as short-term, low-interest loans, and revolvers being those who get stuck in an endless succession of barely paying the minimum and rolling over their balance and interest into future periods. The institutions seek out those who are desperate and/or ignorant and turn their bad year into a horrific one. If you thought that credit cards and banks were the only people profiting off of ridiculously high interest rates, Williams offers up some additional institutions for examination. Student loans have become a large portion of current financial aid packages, putting terror in the eyes of those who intend to use their education for the betterment of the world instead of their own purses. Rent-A-Centers charge outrageous monthly fees for usage of furniture, appliances and more that amount to interest rates of up to 150 percent. At pawn shops, customers often pay $0.25 for every dollar of an items value while it is being held. Payday Loan Corporation reckons that its customers pay a whooping 1288.5 percent interest on five day loans. (98)
The point of Williams book, however, is not entirely wrapped up in the banking and credit world of fancy terminology and high interest rates, but perhaps more importantly attempts to expose how credit is linked to American society. She states, "Credit and debt only make sense in the context of other social relations and obligations." (5) This theme of the book is expressed well in the chapter entitled Seducing Students in which credit almost becomes a rite of passage for teenagers, ushering them into the mature, responsible adult world. Materialism and the need to put up a front of lavishness and style are cited as additional reasons that people are seduced into the world of credit. The book is not at all intended, however, to focus on why people make certain purchases, or how they get into debt, but the institutions that take advantage of their bad luck and keep people there at their own profit.

Williams does, unfortunately, leave the reader wanting for more. The book is challenging for those with little economics background or credit training. It spends virtually no time discussing what a credit score is and how that influences ones ability to purchase and pay, and the extent to which it can sway interest rates. Williams offers a myriad of solutions in her short conclusion including usury caps, reenact New-Deal-type programs for employment, and the government liquidating debt burdens. The distressing part though, is that the suggestions for the most part are barely explained and not feasible solutions for the problem of debt inequalities in America. What is realistic in a capitalist country based on a consumer culture in which the ability to buy is the ultimate test of citizenship?

It might be our biggest problem, but Americans still are not talking about it. Although high levels of debt have become widely prevalent in the United States, American social conventions prohibit most discussion of personal financial troubles. Instead, this downward spiral into debt silently worsens during economic hardships, through "people's desperate, sometimes misguided, often inescapable efforts to maintain the illusion of a middle-class standard of living." (43) With 1.2 million people filing for bankruptcy in 1996, (60) the lack of a productive conversation about issues of debt and credit is startling.
Debt for Sale: A Social History of the Credit Trap is Brett Williams' attempt to change that. Her anthropological work indicts the booming debt industry for its unscrupulous role in creating massive profits for lenders by hammering poor Americans deeply into debt. Rather than blaming the indebted, she attacks the lending institutions for their predatory tactics and deceitful business practices, which she insists brought about such unnecessary adversity for so many people.
Brett Williams is a professor of anthropology at American University in Washington D.C. She has lived in the nation's capital since 1976, where she has researched a variety of topics related to urban politics and poverty. She is also "an unwilling participant-observer in the social relations [she describes]." (7) Having used credit cards since arriving in D.C., she has experienced difficult times of debt and makes no attempts at neutrality in this work. This aspect is refreshing, as the author devotes her entire energy to exposing the damage wrought by the credit industry without pretending to be objective. With that said, the author backs up her statements with carefully researched detail, so despite its lack of a neutral stance, this book is still firmly based in experience and statistics.
Debt for Sale is a powerfully surprising presentation of the credit industry as an exploiter of poorer Americans. Williams explains that, unexpectedly, credit companies prefer consumers who can not pay off their entire balance every time it is due. Instead, they seek those who are unable to handle their usual balance and impose "a creative plague of penalty fees for every little malfeasance imaginable." (33) Because these punishments provide so much profit for the banks, people who pay too faithfully are avoided by companies like Capital One, where "your account may be cancelled if you don't charge enough or if you pay too fully and faithfully." (50) This seemingly illogical structure sets the tone for the book as a meticulous revelation of the many ways that banking methods defy reason.
This book compellingly describes an American economy based in a self-reinforcing set of inequalities, slanted heavily toward the rich. Not only do the banks market their products less aggressively toward people more able to pay, they also give those people better credit cards deals. Rather than hassle the wealthy with higher interest rates, lending institutions unload these burdens on already strapped debtors. As Williams tells us, "this flow of money from the poor to the rich is just one example of how middle- and upper-class economic privileges are sustained by the poor." (113) While banks could easily lessen the burden on the poor--who often need credit to get through medical emergencies or lay offs--they instead cater to the wealthy, leaving the lower classes in even worse shape. Illuminating these trends of inequality with true stories, Williams succeeds in bringing her readers to deeply question the methods and motives of these lending giants.
Her work is strengthened further by its comprehensive analysis of fringe banks, which exploit the poor while enjoying monstrous profits. Fixtures in impoverished areas, they engage in "the most outrageous, expensive and quasi-legal transactions." (98) Check cashers, payday lenders, pawn shops and rent-to-own businesses all benefit from taking advantage of poor Americans who need a little extra cash to get by. For example, Rent-A-Center, the largest rent-to-own store in the United States, made $100 million in profit in 2003. (104) Compounding these issues, these institutions also further impoverish and disenfranchise members of poor communities, "leaving them with no records of proof of payments, no ongoing relationship to build up a credit history, and in greater personal danger from carrying cash." (99) Sometimes charging annualized interest rates over 1000%, the contrast between these booming institutions and the suffering they profit on brilliantly highlight the inequalities caused by debt today.
Williams' chapter on the attempts of banks to establish a presence on college campuses, to gain access to largely uninformed potential customers, widens this book's scope by describing another aspect of manipulative lending businesses. Seeing students as a "current and future source of profits," (67) banks fight to develop a large client base among younger and younger students. In this section, Williams expertly incorporates the stories of three separate college students as she traces the notion of the credit card as a rite of passage gone wrong, through their parallel stories that begin with a credit card in college and end in "an adult life saddled with seemingly intractable debt." (68) The true accounts given here and throughout the book allow it to resonate on a personal level, something not often found in works on economic subjects.
Overall, Williams' work breaks down stereotypes of debtors as "the poor, the welfare state, greedy and impulsive women, or racially marked and foreign others." (4) She draws attention to the real causes of these issues, pinpointing the big banks that encourage states to abandon anti-usury laws and governmental agencies to keep regulation low, so that profits stay high. Her focus on the way that "credit cards work to obscure, reproduce, and exacerbate divisions of class, race and gender ... in a patronizing, asymmetrical economy of debt" (6) brings the reader to want change in this industry of exploitation. As Williams explains, "we are all participating in the same economy; we are all connected" (123) and subjected to the dangers of this unsustainable growth in credit. As a result, her revelation of the previously hidden aspects of the debt industry represents an important first step in starting a discussion about these collective issues.

Debt -- and the degree to which our society and economy have become dependent on it -- is an incredibly important topic. It was thus with high hopes that I picked up "Debt for Sale", Brett Williams' history of the "credit trap." The book made for a quick, emotionally-charged read, but its flaws ultimately left me hoping for a more balanced, more complete treatise in the future.

The emotional charge of the book comes from its many anecdotes of the victims of predatory lending, many of which make one's stomach turn and one's blood boil. One cannot help but be disgusted by the rapaciousness of credit card companies tempting college students with easy money, or the avariciousness of the banking marketing exec explicitly targeting the poor with usurious check cashing services. The many stories of those living in debt penury (stories that Williams calls "debt porn") and a solid (if brief) history of the credit card business are the strengths of this book.

Unfortunately, the book does a better job convincing of the seriousness of the problem than it does explaining its broad scope or inner workings, let alone exploring solutions. Among the book's several flaws is its nearly exclusive focus on the poor. Debt is an important topic because it is has become pervasive -- it is not limited to just the poor. And indeed, the elephant of debt -- mortgage debt -- is virtually undiscussed by the book. Given the rise of insane debt devices like interest-only ARMs and flexible payment ARMs -- and the dubious judgement of the GSEs pumping the liquidity in the first place -- the lack of discussion of mortgage debt is a serious failing.

Even when the book is on its home turf of credit card debt, there are dubious assignments of blame. For example, the author accuses those of us who don't keep a balance on our credit cards as getting a "free ride" on the backs of those who are paying crushing interest. Further, the author suggests that mandatory monthly payments should be required for such people. This is a naive suggestion: if my credit card company were to not extend a grace period, I would simply stop using my credit card. Remember, the point is that I (and millions of others like me) have the money in the bank to back every one of our purchases; the credit card is thus simply a convenience, not a source of true credit.

Most of the other suggestions for improving the system are similarly untenable, even in the absence of the banking lobby. For example, in one paragraph, the author advocated debt forgiveness -- but in the next, feared that the government would have to bail out the greedy, overextended banks. It is clear that the author didn't understand that the first suggestion would bring her fears to reality. The problem with debt is that it becomes repackaged and resold so many times over, that forgiving debt at one end of the system is robbing savings at the other. The book doesn't touch on this interconnectedness at all; the author doesn't seem to realize the connection between an Asian central bank soaking up 10-year treasuries and a new credit card offer showing up in the mail. There very much is a connection, of course, but the task of exploring it awaits a more comprehensive book...

In "Debt for Sale" Brett Williams examines the history of debt in America and focuses on the many tenets of the Debt Industry. Debt is not only a financial phenomenon but also a social and cultural one heavily embedded into U.S. society. The Debt Industry is a very sophisticated, organized, methodical, and politically powerful industry in America. Close to 70% of the American economy is now propelled and highly dependent upon, consumer spending. As fixed expenses (expenses we have to pay) increase and take more and more out of the average American's income, Americans are increasingly, spending and borrowing --> borrowing to spend. A high percentage of Americans are now using debt for "cost of living" and not soley for crass, mass consumption. This has become increasingly common for the middle class.

There's also the ignorant and myopic:
In 2007 the ARM mortgage payments will increase we'll be hearing more and more of the people who used them. :)

Most of us have been in these debt situations. I certainly have. But the degree and size of this situation is what has been increasing dramatically, in particular over the last 2 decades. Debt can help us in many ways (Good debt). However, one question to ask is: how did the *size* (per capita debt ratios) get so big?

Williams discusses how debt is now arguably one of the most pervasive aspects in American society. Yet it seems real discourse regarding it is rarely if ever discussed. If there is discussion, it remains on the superficial level of TV talk shows, and newspapers and web articles that redundantly regurgitate "How to get out of debt" or "How to dig your way out of the hole." "Cut up your cards, pay off the higher interest rates first, establish a budget, itemize all expenses." And, "cut down on the Cappuccino from 5 days a week to two. You'll save X amount of dollars per year this way."

Perhaps the question should be not "how" (to dig out of it) but "why" it is there in the first place. Per capita has debt grown so much in the last 20 years that simply 'living beyond one's means' is not the main factor, for many. Further anchoring (revolving) debt into lifestyle normalcy is potential employers running credit checks on non-financially sensitive positions being applied for by job applicants.

In many instances, the FICO score has become an almighty determiner about "who a person is." Further confusing the already bemused, are the Self-anointed pop culture gurus and money management helpers who rarely if ever ask the "why" questions, as well. Of course there is good debt, and borrowing can help us in many ways. Obviously, most of us cannot pay cash for certain necessities, such as the car we need to commute to work. (In the U.S. a car is a necessity in most areas.)

Excluding the Mortgage and Car Loan, (and in many instances including these 2 debts) one could look at the concept of American debt this way: the systematic engineering to encourage, promote, and place Americans, in debt. Many organizations benefit from this. Corporations prefer to hire and employ people with revolving debt payments. This provides the control and leverage to the employer. The employee is the dependent party in the relationship. The employee works for income and then pays creditors, over a period of months and/or years, while the principle of the debt balance slowly whittles away. The employer holds a disproportionate amount of power in the relationship because the worker has given Self-Determination, or choice, up.

As for the non-interest payment treadmill, whatever happened to pay as you go? We sign contracts from everything from cell phones, to gym memberships, to Karate lessons, now.

The government likes and wants to keep its citizens in debt. Employees will work longer hours and be more efficient. And productivity improves statistically, when workers have certain minimum Per Capita Debt Ratios.

The author notes the normal concept of having debt begins during or right after high school, and usually extends until death. Debt has been internalized by a high percentage of Americans. It is a cultural norm.

As for the recent explosion in education costs since 1999, how does the U.S. government address it? By loaning more money; increase the debt ceiling.

Williams also asserts the poor get targeted more, proportionally. This is true, however everyone on the socio-economic spectrum gets targeted to acquire, increase, and maintain debts. The poor are the ones that are affected the most severely. The poor get hit more than than the socio-economic groups above them in many ways.

This book examines the social history of debt and the credit trap. And although credit card companies can seem predatory, how will "debt forgiveness" advocated in this book, help? Would these people change their behavior? And, would they be able to reduce their fixed expenses? Could debt forgiveness just exacerbate the problem for a sizeable percentage of the population? We also know forgiveness won't happen.

This book can motivate some to get off of the treadmill if they choose to, if it's not too late.

While most analyses of BCCI saw it as a banking scandal, Beaty and Gwynne correctly understood and colorfully present its true nature: as the deepest and most detailed glimpse anyone has so far had into the real workings of the underground economy. Their findings, which have never been challenged or refuted, have only grown more urgent with time. This book will not only tell you where Osama-types come from, it will tell you how and why they can thrive -- or not. That it was written before anyone knew who bin Laden was makes it all that more extraordinary.

Beaty and Gwynne do an excellent job tackling the Leviathan that was BCCI. With so many labrynthine angles to pursue, this book does a terrific job of presenting them to the reader in clear and lucid terms. With a keen eye for crafting a good story, they keep your interest throughout by adding a bit of detective story flavor. Indeed, just investigating this story has always been dangerous for journalists and public servants--many deaths are associated with BCCI.
This book would be a timely read right now, as many of the players involved in BCCI still exercise huge influence on world affairs. Though published in 1993, the book details very accurately our current president's involvement with figures closely connected to the drug and arms dealing that was a huge part of the BCCI network, not to mention the funding of international terrorists, including the bin-Ladens.
Long before Michael Moore, and much more academic, these writers had no idea that they were doing the world a great service by helping to uncover the massive corruption of our own government and its decades of business dealings with terrorists and criminals throughout the Middle East and the world, despite their overt lying to the contrary. Read it before the election.

The events that inspired this book occurred over 15 years ago, but if you want to understand what is going on now in the world politically and economically, especially in terms of US-European-Middle Eastern-Third World relations, this is still very timely.

Outlaw Bank is an excellent and far-reaching piece of well-documented investigative reporting that carefully uncovers the BCCI scandal and the ensuing US cover-up attempts. The sheer scope of the corruption, the deception, the narcotics and clandestine weapons trade involving US government agencies, personnel, and very well-known politicians is stunning. Not only is it as bad as you imagined in your wildest dreams, but many of the same people are still exerting influence (James Baker, Jimmy Carter). BCCI may be gone, but after reading this book and then looking around, you will conclude that not a thing has really changed.

The book for the most part stays away from hyperbole, and while I found it a little difficult going in some of the explanations of financial transactions, I realized often that's because I just couldn't believe what I was reading!

Not a bad report of what took place although the topic could be a bit dry for the average reader. The dust jacket tries to make the book out to be a bit sexier then it really is. The authors do a good job or moving the story along but I did expect more from Beaty. I think what is interesting is some of the same move movement issues covered within the book are now coming to the forefront with the current crack down on terrorists. If you are interested in the topic of international banking then this book will be interesting.

The book is a well written well search analysis of the history of the Social Credit movement through the developmental years of Canada's current political climate.

The topic is quite interesting but Stingel's writing style is sporadic. It goes from embracing to monotonous. If you can get through the dry periods you will be quite well informed about Canada's dark past of anti-semitism.

In Social Discredit: Anti-semitism, Social Credit, And The Jewish Response, Canadian social researcher Janine Stingel aptly surveys the virulent, belligerent, anti-Jewish campaign undertaken in Canada by Social Credit before, during and after the years of World War II. While most Canadians acknowledged the perils of race hatred in the wake of the Holocaust, Social Credit continued to intensified its post-war anti-Semitic campaign. By examining Social Credit's anti-Semitic propaganda, and the reaction of the Canadian Jewish Congress, Stingel details their mutual antagonism and explores why the CJC was unable to put a stop Social Credit's blatant defamation. When Social Credit eventually and gradually abandoned its anti-Semitic trappings, the CJC began to adopt the assertive, activist public relations philosophy that was to make it an effective champion of human rights in Canada. Social Discredit is highly recommended reading for students of 20th Century Canadian political and social history, and Judaic studies.

With thrifts like Washington Mutual now among the nation's biggest financial institutions, and the excesses of the 1980s still fresh, it's hard to believe that savings and loans once were nonprofit cooperatives. Yet, so-called buildings and loans were, in fact, altruistic associations that sought to give working-class people access to credit. Business historian David L. Mason lays out the little-known roots of the S&L industry in this intriguing study. He outlines the cultural, political and economic forces that shaped thrifts. While Mason doesn't shy away from the S&L debacle of the 1980s, he makes it clear that he sides with the institutions. Readers looking for dirt on the crisis should look elsewhere. Still, we recommend this thorough report to anyone who's curious about the history of the thrift industry.

I enjoyed reading this book far more than I imagined I would. Though the detail of the third chapter outstripped my stamina for the consideration of sunspots, the rest of the book proved gripping. Biagioli writes the science clearly and the history beautifully. At issue here is the economy of credit or trust within which various scientific tools (telescopes, books) were proofed and various discoveries (Medicean Stars, asymmetries of lunar surface, sunspots) shared. Biagioli capably crafts a sense of the European drama of scientific disclosure at this pivotal moment in history, for Galileo had to determine what he would share with whom and when--with his livelihood and reputation riding on each decision. A credible and savvy Galileo is evident in his capture of Medici patronage, as is his failure with the Inquisition in whose theological strands his persuasion progressively became mired. Also receiving discussion are the relationships between text and image, art and science, nature and book, center and periphery, and states and scientific societies. On the whole this book communicates what feels like a mastery of a subject told from a neat perspective and an ideal of history writing.

Although old, this is a thorough review of James Robinson's rule at American Express. Robinson was a consensus builder who sought to grow American Express by acquisition. However his poor strategy brought him to get out of cable too early, and the brokerage age when it was too late.
His rule weakened American Express. What is prevalent throughout this book is the shark like atmosphere in American business, where one person is seeking to displace another. Some heavy hitters are in this book such as Sandy Weill, Lou Gerstner, and Cohen.

This is a nice book about how an American icon company is badly run. It shows how and why American companies have not fared well in the international market. The caption on the cover of the book equates it with Barbarians at the Gates, and I think this book is as good as that. A nice thorough review of what went wrong at American Express.