Some Thoughts, Not all my Own, on Debt, Lending and Indebtedness
By John Taylor; 2009 May 29, Azamat 13, 166 BE
Last week a striking headline in the Toronto Star declared that the average Canadian is sunk some sixty thousand dollars in debt, not including mortgages. Being so badly in hock prevents consumers from spending and stimulating a tottering economy. A mountain of personal debt, rather than corporate behavior or monetary policy, is thought by experts now to be the main obstacle to recovery.
How could we have avoided this dilemma? As always, the best preventive medicine is education. I remember my father repeatedly warning me throughout my childhood never to get into debt, with the one exception of a mortgage on your house. I do not remember ever being warned against debt in school, though, and I took accounting courses throughout High School.
Evidently, the present generation has not been prepared by either parents or teachers, or if they were the advice was completely ignored. Ad Nausium my father would repeat the saying, "Never borrow, never lend, and you will never lose a friend." Of course, the first friend you lose when you borrow is yourself, because in effect you are stealing from your own future. Not only is it theft, but often it turns into murder. Debt is a strong factor in a surprising number of suicides.
I watched a documentary about debt in America last week produced just before the big crash last year. I learned from it a little about the role of religion in this. Many Christians pastors, it seems, also do debt counselling. They meet with couples up to their ears in debt, open up thier books and go right to the religious contributions column. Why did you stop contributing to the church?, they ask. The believers answer that they are in too much distress to give for now. That is why you are in distress, they respond. If you start paying you will recover. According to them, this advice always helps. The couples inevitably come back a couple of weeks later saying how astonished they are at what happened to get them out of their bind.
Fair enough. The Baha'i Writings offer similar promises, though they stop well short of suggesting that one borrow in order to contribute, as some high-profile televangelists are doing. After we die our estate has to pay off all debts before we can contribute to the Huqquq. Therefore, when a Baha'i gets into debt, he or she has to bear in mind that this not only imperils their own financial security, it also takes from the Right of God. On the other hand, since debt is the lifeblood of finance, there are no doubt cases where getting into debt will increase our net worth in the long run. But this happens only when the debt will directly contribute to a large future increase in income.
One (non-religious) debt counsellor in this film said something that still has me thinking. Asked what society should do about predatory lenders who go to new university students offering free gifts to sign up for credit cards (this temptation leads many to their ruin and suicide), he answers that "all lending is predatory." There is truth to this, but I think it should be qualified by saying, "All lending for profit is predatory." Or perhaps further qualified, bearing in mind what the Aqdas says about usury and moderate profits from lending being acceptable, "all lending for profit is, at the very least, uncharitable."
Here is an idea. We now have the technology to make debt visible. We alread have on media of expression, color. This is based on the century old use of colored ink on the bottom line in accounting practice; so we say that a person in debt is "in the red," and one free of debt is "in the black." You could easily hook up a shirt to change color from black to red according to what your bank says your overall financial condition is. If you wore such a shirt around there would be no need to meet with a debt counsellor to know what must be done to improve things. Would this lead to more debt-induced suicides, or fewer? I suppose it would depend on how often we had to wear our shirt, and how early in our lives.
Here, more or less in chronological order, is a small compilation of thoughts on debt gathered from others that I have gathered over the years.
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"May wealth not desert you, men of Ephesus, that you be convicted of your wrongdoing." (Heraclitus, fr. 125a)
"Owe no man any thing, but to love one another: for he that loveth another hath fulfilled the law." (Rom 13:8)
"Give to him that asketh thee and from him that would borrow of thee turn not away." (Matt 5:42)
"A small debt produces a debtor; a large one, an enemy." - Publilius Syrus
"That which ye give in usury in order that it may increase on (other) people's property hath no increase with Allah; but that which ye give in charity, seeking Allah's Countenance, hath increase manifold." (Q30:39, Pickthall)
"I place economy among the first and most important of republican virtues, and public debt as the greatest of the dangers to be feared." (Thomas Jefferson, Letter to Governor Plumer, 1816, from Thomas Jefferson on Democracy, 160, S. Padover Ed. 1953)
"He hath now made interest on money lawful, even as He had made it unlawful in the past. Within His grasp He holdeth the kingdom of authority. He doeth and ordaineth. He is in truth the Ordainer, the All-Knowing. ... Render thou thanks unto thy Lord, O Zaynu'l-Muqarrabin, for this manifest bounty." (Baha'u'llah, Tablets, 133)
"Commerce is as a heaven, whose sun is trustworthiness and whose moon is truthfulness. The most precious of all things in the estimation of Him Who is the Sovereign Truth is trustworthiness: thus hath it been recorded in the sacred Scroll of God. Entreat ye the one true God to enable all mankind to attain to this most noble and lofty station. (Baha'u'llah, in Trustworthiness Compilation, 335-336)
"The rich will do anything for the poor but get off their backs." (Karl Marx)
"Borrow money from a pessimist - they don't expect it back."
A young Scottish boy approaches his father and says "Dad, can I borrow fifty bucks?" The father quickly replies "Forty bucks! What the heck do you need thirty bucks for?"
"Everybody likes a kidder, but nobody lends him money." (Arthur Miller)
"When we were looking at a game show to develop, we figured that by the way Americans were spending money, most of them had already bought their prizes ." (Andrew Golder, producer of the Lifetime TV game show 'Debt', which pays off the winning contestant's credit card bills at the end of each show. The Oregonian; 22 August, 1996; p. B6)
"I remember feeling incredibly anxious about my debt in law school. But after you rack up the first $15,000.00 in loans, it all just begins to seem unreal." Nicole Deering, recent graduate of Lewis & Clark University's Northwestern School of Law, and now nearly $60,000.00 in debt. (Oregon State Bar Bulletin, "Law Degrees on Credit"; November, 1995; p. 9)
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