Did you know that we take out more loans today than we ever did? Did you know that in some parts of the western world, private debt has increased by some hundred percent since the 90’s? Did you know that a gamut of loan shark industries have cropped up, turning over millions by simply buying up private loans and then proceeding to brow-beat the ever-living shit out of fiscally irresponsible people to such an extent that the death rate of such indebted people is 30 times higher than average?
These numbers might not seem so absurd if you’re living in the US, where not just mortgages on homes could rank up your debt, but where a simple medical emergency can indebt you for life. The debt crisis of the United States is no secret, but these numbers aren’t sourced from that capitalist dystopia. These numbers are sourced from friendly neighbourhood socialist-lite Sweden. A place where healthcare is by-and-large subsidized to about 35 USD per emergency or visit. Turns out that a western nation doesn’t need draconian healthcare models to crush its citizenry.
No, these Swedish figures, which correlate to other Euro-countries such as Denmark and the Netherlands as well, aren’t associated to medical bills. Some of it comes off of the rise in real estate prices. And since no one (except for the 1%) can own their own homes any more, that also raises debt rates. But not even that easy explanation gets us to the heart of the matter. No, the greatest increase of delinquent debt comes from consumer loans. Quick loans. Easy cash. Some 100 bucks extra in the pocket, no questions asked, money to do with as you like, with hidden interest rates of up to a 1000 %.
To put it plainly; people borrow money at unprecedented rates just to consume. To buy the latest iPhone or a new television set. Or to go on a holiday, or to see that band they really really like in a once-in-a-lifetime show. People dig themselves into fiscal graves just to fill the role of a happy little consumer.
And I’m sorry, but to me that seems absolutely fucking insane.
Let’s set aside the American disaster as far as debt is concerned. John Oliver covered that garbage fire better than I ever could. Let us instead focus on the very visceral notion that people have been lulled into the imaginary compulsion to spend money they don’t have. Not on medical bills, not on a roof over their heads, but on shit like brand clothes. Electronics. Travel.
Two years ago, a Swedish NGO published a report on consumer loans and over-indebtedness, how widespread it is, the potential causes (such as, ‘lo and behold, a lack of mathematical education), and the withering consequences. Just this week, a major Swedish news publication warned that corporate transactions and private loan shark operations have flourished under the current circumstances. All of it taken together paints the picture that even in a mildly socialist state, a large minority of the private consumer base is sinking under the pressure of a burgeoning and sort-of legal loan shark industry. And I cannot stress this enough; not because of medical bills or mortgage rates, but because of reckless spending on bullshit stuff.
And I find that fucking fascinating.
It’s terrible, sure. Horrendous in fact. That so many people, disproportionately uneducated, low-income families, terminally indebt themselves just to try to fit into the consumerist box that we’ve locked ourselves up in. That fashion, travel, luxury has become so important to belong in society that you’re willing to commit fiscal suicide for it. It speaks to a sense of privilege, and a sense of what factors people on the fringe of society think they have to appear to be to fit in. Namely, if you want to fit the mold, you have to look like a Big Spender[tm]. Spending outside the limits of your income is depicted as trendy. And nestled in that trend, predatory business practises and targetted adverts prey on those too stupid and/or too desperate to understand what a several hundred percent interest rate will do to sustainability of your financial situation.
At the ass end of 2018, over 400’000 people (roughly 4% out of Sweden’s total population of 10 million) were so badly indebted that the government debt collection agency (Kronofogden) had their eyes on them. Over the course of a five year period, statistically 22% of those 400’000 people will remain stuck in this debt trap. What we have here is an accumulation of people stuck in indentured servitude.
And why not take a quick look at a comparison site for quick and dirty consumer loans, that frivolously lists loan shark companies (not banks, mind you) that will happily help you out with that dress that’ll look just right on you at Becky’s party. One of the most egregious companies, KlaraLån, can offer you loans from 120 USD to 24’000 USD, for an interest rate ranging from 29% to a whooping 1400%. No security deposit required. Won’t care if you have proven unable to pay back previous loans. You can have the money within two days time. Seems stupid? I’d agree, but according to the site, that particular service has been used by nearly 600 people in the past 7 days. And there are many more like it.
The cost of living, and the cost of community, even in a marginally socialist country like Sweden, has escalated so quickly that a wide minority of people simply can’t survive in it. Not on their own. And as soon as those loans begin to compound, those people lose their freedom. They can no longer chose where they work or where they live. They have without hyperbole, in the actual fine print, become wage slaves. A serf to not just the banks, but the loan sharks that buy the loans off of the banks and ride their new serfs to the grave.
Turns out that post-feudal society didn’t need an aristocracy to keep people enslaved to toil the land. They just needed the marketed dream of a white picket fence, income disparity, and deals just too good to be true. After that, turns out that the plebs will do the rest themselves.
/Sebastian Lindberg 8/12-2020
WastedWords 