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Monthly Archives: July 2009

Look, by now you should know that I am no fan of Obama.  However, I am a BIG fan of me.  And when it comes to me, I like to apply the concept of “value” in my life.  In fact, I was describing just such a concept to my 1st grader this afternoon.  We were discussing haircuts and price.  See, I don’t like to spend money on haircuts AND I don’t like crappy haircuts.  So, this means that I often times don’t get haircuts even when I need ’em.  Further, because I will only purchase cheap haircuts, Ii have to drive to where they further reducing how often I get them.  Anyway, we priced a trim right next door to the grocery today and we began discussing value.

Back to the point–energy.  Look, I am a market believer AND I am a environment believer.  I enjoy both.  And so it is that I don’t like to pollute and destroy the nature that we live in [at the same time that I have a decent sized piece of property in rural Wake county that maybe isn’t very environmentally sound] AND I enjoy low energy bills.  What this means is that I like to spend less on gas and electricity than I do spending more.  And, according to almost everyone, you can’t have both.

See, we are stuck in the new “Don’t Pollute” meme.  In the past, you had the Indian riding the horse with a tear in his eye as he surveyed the land around him being destroyed.  Now, now you have the polar bear floating away on melting ice as he becomes extinct.  And I wonder how it works that these things are bought into every time.  I don’t know–maybe it’s because the young watch more tv and are more vocal than the elders?  Not sure.

But here ya have it.  Because of global warming, we have to reduce our dependence on fossil fuels.  And, and if that doesn’t work, then we have to reduce our dependence on fossil fuels because we import oil from countries that hate us.  And, again, if that doesn’t work, then we have to reduce our dependence on fossil fuels because we’ll run out.  Wow.  It’s tiring.

I guess the point of all of this is this story by WRAL:

Imagine your power bill going up by $200 a month.

Progress Energy spokesman Mike Hughes said Thursday that it’s a possibility under President Barack Obama’s energy plan that narrowly passed the U.S. House of Representatives last week.

The bill, which Obama has said will reduce the nation’s dependence on foreign oil and clean the air, calls for a reduction of carbon emissions by 17 percent by 2020, and for 20 percent of the nation’s energy to be renewable – such as wind and solar – by 2020.

In the end, Liberals are not so much about doing much of anything on their own, they are more interested in dictating to others who they should spend THEIR money.  As such, I don’t suspect that this will actually come to fruition, but if it does, can you imagine what the impact would be on our economy?

Incent them.

See, for a long time the whole housing crisis and economy things has been blamed on greed.  You know, greed of the bankers and the banks.  Greed of the mortgage lenders and the lending houses.  Greed on the folks thta bought and sold mortgage backed securities.  All of ’em.  all Street is just infested with greed.  [Note the absence of the greed of the home owner.  Cause’ you know, guys who earn 17k as a fry cook at the DQ aren’t being greedy when they try and buy a 400,000 dollar house.]

Never understood that.  I have always felt it’s supposed to be that way.  You know, like when I’m offered two similar jobs, I take the one that pays the most.  When trying to buy a car, I try to find the best price and then again, when given a chose between gas at $2.55 or gas at $2.85, I always pick the $2.55 price.  Always.  Never occurs to me who is more deserving.  IN fact, the only person I think of is me.  And how I benefit.  We’re all greedy.  And the whole thing depends on that.  It’s why we invent all the things that we invent.  Because we want to make money.  And because of that, we have innovations and quality of life increases and all kinds of progressive stuff.

Anyway, so, I have tried to explain it this way.  Suppose I have a hundred bucks that I wanna lend in order to make some money.  And two guys come to me wanting to borrow that money and then repay me $103.  Who am I going to lend it to?  Well, I am going to try to identify which one is better able and most likely to repay me.  Then I’m gonna lend the money to him.  Every time.  Every single time.  Always.  Not ever the other guy.  Ever.

Except.

Except if I can change the rules a little and shade gain along with risk.  That it, if I am able to enter into agreement on different terms, I may be willing to lend to the other guy.  What, you ask, would cause me to lend to the less qualified borrower?  Why, by increasing the return.  I may be willing to lend to the guy if he agrees to pay me back $115 dollars.  And so we negotiate and come to terms.  Note, however, that neither of us are going to agree to terms unless we think that it is in our best interest to do so.

Now, in this small example, can you think of a thing that would cause me to ignore the ability of the borrower to pay me back?  In other words, what would cause me to just loan that hundo out to EVERYBODY that knocked on my door?  Nothing.  I would never do that.  Ever.

Except.

Except if Ii could turn around and sell that loan to another company.  Now to compress the story…what would cause THAT company to buy these loans from lenders without knowledge of risk?  The same thing.  The ability to sell ’em.  And you know who was buyin?  Fannie and Freddie.  And you know why THEY were buyin’?  Cause they had NO downside.  If they as a company fail, the government would bail ’em out.  And they did and Uncle Sam did too.

So, I have always said that if you lined up 10,000 people on one side of I-540 and I was on the other, I could increase the number of people who tried to cross by increasing the financial incentive to do so.  And, in the end, whose fault would it be if someone was hit and killed?  Tricky huh?

But today, today I am vindicated.

Stunning.  Truly stunning.

As the State is considering adding new taxes to the mix, they are at the same time telling local municipalities that they, in fact, can not tax those same businesses.

CHAPEL HILL — Local governments are watching anxiously as state lawmakers consider eliminating one of their revenue streams.

It’s called the privilege license tax, a fee that businesses pay for the privilege of operating within a local government’s jurisdiction.

Some lawmakers say the state needs to replace an unfair hodge-podge of fees that differ by locale and businesses without clear reason.

I wonder why?

Actually, I don’t.  See.  It’s much MUCH easier to be smart with someone else’s money than it is to be with your own.  Which is why governments, ALL of them, are not to be trusted with MY money.  This has nothing to do with conservative vs. liberal [although I do posit that conservatives are more for small government than libs are].  It has to do with the fact that the best people able to make decisions about their money are those people that EARNED it.  But hey, we all know that politicians are better able to spend our money than we are!

I have posted a in the last week about getting less of a thing here and here.  I posit that when something becomes more expensive you get less of it.  As that same thing becomes less expensive, you get more of it.  For example, when you tax jobs, you get less jobs.  When you reduce the price of beer, you sell more beer.

Real life example is here.

MAIDE — Dirt could start moving as soon as August on a new $1 billion facility Apple is planning to build in Maiden, officials said Monday.

Catawba County commissioners and the Maiden Town Council approved incentives at a Monday evening meeting for the project, which is expected to create roughly 50 jobs 60 miles northwest of Charlotte.

The local incentives approved Monday are on top of changes to North Carolina law intended to attract the technology company. In June, Gov. Bev Perdue announced the expansion just hours after signing legislation that will cut the California-based computer company’s tax bill in this state by about $46 million over a decade. Apple must agree to invest $1 billion over nine years in land, property and equipment to qualify for the benefit.

See how easy this is?  When you reduce thhe cost of doing business, you do more business.  Funny that.  Truth and Facts!

This past Thursday, workers at a Smithfield Foods went to work covered by a Union contract.  And from all accounts, they are very very happy to finally be so covered.   For example, the article mentions as benefits:

  • Guaranteed sick leave
  • Time-and-a-half holiday pay
  • $1.50 an hour raise over the next four years

“We really did accomplish something with this union,” said Mattie Fulcher.  “We might not have gotten the raise that we wanted, but that will come in time. This is our first contract, and it is a start.”

Now, it’s hard to gauge “success” of this contract for the members.  Among the most glaring omissions of the article are the pre-contract benefits.  For example, what have the pay increases for the average worker been for the past 4 years?  Or, what was the pay multiplier for holidays and overtime before the Union came in to “save the day”?  We do get an idea of what pre-contract life might have been in respect to sick leave:

Fulcher said that on Thursday she got a 40-cent-per-hour raise…and she began earning sick time for the first time since going to work for Smithfield. The sick time is unpaid, but in the past workers earned disciplinary points that could lead to firing if they stayed home sick.

Okay, so lemme get this straight.  The new Union contract says that Ms Fulcher is able to begin to accumulate sick time.  Sick time that is unpaid.  And this is different than in the past when the worker was afforded unpaid sick time but could, if abused, be fired for taking too much sick time?  Now, the article doesn’t mention this specifically, it does point out that employees were given “discipline points”; whatever that means.  Look, I work in corporate America and my sick leave policy is pretty straight forward and generous.  If you are sick, stay home.  As often as you are sick.  And guess what?  few of us ever really call in sick.  But when we do, our bosses mark it down and track us.  Cause, ya know, far be it from an employee to take every other Friday off and claim to be sick.  Sheesh.

Next on the hit list, guaranteed hours:

The contract will also guarantee workers at least 30 hours of work each week…

Awesome.  Really awesome for peope who wanna work more than 29 hours a week.  Really REALLY bad for folks who don’t.  Cause guess what?  Those people get fired.  No company in their right mind is going to pay someone 30 hours of pay for 15 hours of work.  Nice.

And the last piece of good news:

Union members will begin paying dues of about $7 a week…

So, Ms Fulcher gets a $0.40 per hour raise AND gets to pay $7 bucks a week.  Let’s say, just for fun, that she works 40 hours a week.  40 hours at $0.40 is $16.  Assume a 15% tax burden and that 16 bucks goes to $13.60.  Of which $7 goes to the Union.  In the end, she gets $6.60 a week, or about $26.40 a month.  The Union’s take?  7 bucks.  7 bucks or $28 a month.  Guess who makes out better here?  The worker or the Union?  In this specific case, even considering that Ms. Fulcher kept her job, the Union made more money than she did.  But let’s not forget the folks that lost their job as a result of this.  In the end, they have lost the most.

Last week I posted about how to get less of something; raise the price.  You see, as price goes up, demand goes down, that’s how it works.  If you sold 3 cases of beer at a buck a bottle, you could expect to sell less than 72 bottles at 2 bucks a bottle.  Now, this isn’t all bad news.  Sometimes, the supply is limited.  Take, for example, a concert.  You can only fit so many people into the RBC Center.  So, what sense would it make to price the tickets where the demand exceeds the supply?  Rather, a shrewd business manager would continue to raise the prices until the demand met the supply exactly.  Anyway, I digress.

In our story, the Great State of North By God Carolina has only begun, Be-GUN, to talk about assessing state sales tax for on-line purchases made as a result of pass though retailers.  Wow.  That’s a lot to think through.  But it works like this.

Say, as readers are flocking to this site by the ones and twos, I decide to cash in on the traffic.  I make a deal with randomsite.com and put their advertisement on the side of my web page.  Then, as my gentle readers clock though to randomsite.com and make purchases, I get a percentage.  The beauty of Capitalism.

Now, however, North Carolina is wanting to apply sales tax to those purchases made as a result of click through programs.

Much like our local pub above, these retailers are seeing sales go down as a result of prices going up.  After considering their situation, costs, benefits and other tricky business school kinda stuff, they decide to end their commission relationships with their on line partners.

Net/net – North Carolina sees the same amount of sales tax dollars as they would have without the law.  Namely $000,000.00.  And, this is the best part, North Carolina residents who run websites see a reduction in their incomes.  Further, we have to assume that these North Carolina residents are reporting the income that they make as a result of these relationships.  That is, they have to submit as income and then pay State and Federal income taxes on any money that they make.  Now the state, AND Obama, is losing the State Income tax revenues too.

Awesome.  Simply by talking, just talking, about such a tax, we have seen two on-line retailers leave the market.  The latest?  The NewsandObersever is reporting that Overstock.com is ending their arrangements with North Carolina partners.

The real slap in the face for Carolina?  This concept is SO insane that even the Govna’ of California, The Terminator, vetoed a similar bill in California.

The Unanimous Declaration
of the Thirteen United States of America

When, in the course of human events, it becomes necessary for one people to dissolve the political bonds which have connected them with another, and to assume among the powers of the earth, the separate and equal station to which the laws of nature and of nature’s God entitle them, a decent respect to the opinions of mankind requires that they should declare the causes which impel them to the separation.

We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable rights, that among these are life, liberty and the pursuit of happiness. That to secure these rights, governments are instituted among men, deriving their just powers from the consent of the governed. That whenever any form of government becomes destructive to these ends, it is the right of the people to alter or to abolish it, and to institute new government, laying its foundation on such principles and organizing its powers in such form, as to them shall seem most likely to effect their safety and happiness. Prudence, indeed, will dictate that governments long established should not be changed for light and transient causes; and accordingly all experience hath shown that mankind are more disposed to suffer, while evils are sufferable, than to right themselves by abolishing the forms to which they are accustomed. But when a long train of abuses and usurpations, pursuing invariably the same object evinces a design to reduce them under absolute despotism, it is their right, it is their duty, to throw off such government, and to provide new guards for their future security. –Such has been the patient sufferance of these colonies; and such is now the necessity which constrains them to alter their former systems of government. The history of the present King of Great Britain is a history of repeated injuries and usurpations, all having in direct object the establishment of an absolute tyranny over these states. To prove this, let facts be submitted to a candid world.

He has refused his assent to laws, the most wholesome and necessary for the public good.

He has forbidden his governors to pass laws of immediate and pressing importance, unless suspended in their operation till his assent should be obtained; and when so suspended, he has utterly neglected to attend to them.

He has refused to pass other laws for the accommodation of large districts of people, unless those people would relinquish the right of representation in the legislature, a right inestimable to them and formidable to tyrants only.

He has called together legislative bodies at places unusual, uncomfortable, and distant from the depository of their public records, for the sole purpose of fatiguing them into compliance with his measures.

He has dissolved representative houses repeatedly, for opposing with manly firmness his invasions on the rights of the people.

He has refused for a long time, after such dissolutions, to cause others to be elected; whereby the legislative powers, incapable of annihilation, have returned to the people at large for their exercise; the state remaining in the meantime exposed to all the dangers of invasion from without, and convulsions within.

He has endeavored to prevent the population of these states; for that purpose obstructing the laws for naturalization of foreigners; refusing to pass others to encourage their migration hither, and raising the conditions of new appropriations of lands.

He has obstructed the administration of justice, by refusing his assent to laws for establishing judiciary powers.

He has made judges dependent on his will alone, for the tenure of their offices, and the amount and payment of their salaries.

He has erected a multitude of new offices, and sent hither swarms of officers to harass our people, and eat out their substance.

He has kept among us, in times of peace, standing armies without the consent of our legislature.

He has affected to render the military independent of and superior to civil power.

He has combined with others to subject us to a jurisdiction foreign to our constitution, and unacknowledged by our laws; giving his assent to their acts of pretended legislation:

For quartering large bodies of armed troops among us:

For protecting them, by mock trial, from punishment for any murders which they should commit on the inhabitants of these states:

For cutting off our trade with all parts of the world:

For imposing taxes on us without our consent:

For depriving us in many cases, of the benefits of trial by jury:

For transporting us beyond seas to be tried for pretended offenses:

For abolishing the free system of English laws in a neighboring province, establishing therein an arbitrary government, and enlarging its boundaries so as to render it at once an example and fit instrument for introducing the same absolute rule in these colonies:

For taking away our charters, abolishing our most valuable laws, and altering fundamentally the forms of our governments:

For suspending our own legislatures, and declaring themselves invested with power to legislate for us in all cases whatsoever.

He has abdicated government here, by declaring us out of his protection and waging war against us.

He has plundered our seas, ravaged our coasts, burned our towns, and destroyed the lives of our people.

He is at this time transporting large armies of foreign mercenaries to complete the works of death, desolation and tyranny, already begun with circumstances of cruelty and perfidy scarcely paralleled in the most barbarous ages, and totally unworthy the head of a civilized nation.

He has constrained our fellow citizens taken captive on the high seas to bear arms against their country, to become the executioners of their friends and brethren, or to fall themselves by their hands.

He has excited domestic insurrections amongst us, and has endeavored to bring on the inhabitants of our frontiers, the merciless Indian savages, whose known rule of warfare, is undistinguished destruction of all ages, sexes and conditions.

In every stage of these oppressions we have petitioned for redress in the most humble terms: our repeated petitions have been answered only by repeated injury. A prince, whose character is thus marked by every act which may define a tyrant, is unfit to be the ruler of a free people.

Nor have we been wanting in attention to our British brethren. We have warned them from time to time of attempts by their legislature to extend an unwarrantable jurisdiction over us. We have reminded them of the circumstances of our emigration and settlement here. We have appealed to their native justice and magnanimity, and we have conjured them by the ties of our common kindred to disavow these usurpations, which, would inevitably interrupt our connections and correspondence. They too have been deaf to the voice of justice and of consanguinity. We must, therefore, acquiesce in the necessity, which denounces our separation, and hold them, as we hold the rest of mankind, enemies in war, in peace friends.

We, therefore, the representatives of the United States of America, in General Congress, assembled, appealing to the Supreme Judge of the world for the rectitude of our intentions, do, in the name, and by the authority of the good people of these colonies, solemnly publish and declare, that these united colonies are, and of right ought to be free and independent states; that they are absolved from all allegiance to the British Crown, and that all political connection between them and the state of Great Britain, is and ought to be totally dissolved; and that as free and independent states, they have full power to levy war, conclude peace, contract alliances, establish commerce, and to do all other acts and things which independent states may of right do. And for the support of this declaration, with a firm reliance on the protection of Divine Providence, we mutually pledge to each other our lives, our fortunes and our sacred honor.

So, the next phase for the minimum wage hike is set for July 2009.  Right around the corner.  And this might seem like good news, heck, even in my own household I’m told this is a good idea.  To which I reply “The real minimum wage is $0.00.”  See, if you don’t have a job, you don’t get paid.  Which brings me to the point of it all I guess.  Or, rather, what should be the point.  See, government is really really bad at setting expectations, conducting data driven analysis, implementing a solution and then tracking that solution for results.  Heck, even private industry is generally bad at this, but really, government is horrible.  The reason?  It’s easier to manufacture spin than it is to demonstrate results.  Spin is easy.  Results are hard.  One gets you elected, the other gets the other guy elected.

So, let’s take minimum wage.  Let’s see if we can’t try to:

  1. Identify what we are trying to accomplish.
    1. Or, perhaps, more specifically WHO were are trying to help or assist.
  2. Identify some metrics that we can use to study data and later, measure results.
  3. Get some data, run some analysis.
  4. Since we have already implemented this policy, we’ll skip the whole “should we implement it” phase.
  5. Go back and see if the policy has worked.

Alright, so, let’s see if we can work to identify what we are trying to accomplish with a minimum wage law.  In my search, I found this, a study entitled “The Who and Why of the Minimum Wage” from The Economic Policy Institute.  The EPI is a liberal economic think tank; imagine Cato or Heritage for the Democrats. Right away we are given a hint of a possible metric:

Raising the wage floor is an essential part of a strategy to support working families.

Now, I’m going to clarify here.  All families, ALL of them, are working families.  While I don’t make the minimum wage, nor does my wife, I would take umbrage with anyone who tried to claim that ours is not a working family.  Yet, somehow, I understand from this study that mine is not the family we are trying to “support”.  The author is trying to support the poor or near poor, working family.  So, alright, we have a start.   We want to increase the income of the families, or people, who make the minimum wage.

To be clear, the authors do devote a significant portion of the study to those making more than the minimum wage, they do claim that the minimum wage is only a start.

Moving on to bullet #2 we need to see if we can identify a metric that we can use.  That would be something that would be able to give us an idea as to where we are now and then compare it to after we have implemented our change.  For me, one metric that jumps right out is the Annual Income of the target population.  So, we have as a metric “Annual income of people who made minimum wage before the increases of that minimum wage went into affect”.  If the law works, that metric should go up.  If it didn’t work, that metric would go down.

The third bullet point is what they always skip, and since they did, we can’t recreate it here.

So now we move on to number 5.  Let’s see if the policy worked.  Here we go!

First task, who earns the minimum wage?  Let’s check.

  • 2.2 million workers with wages at or below the minimum made up 3.0 percent of all hourly-paid workers.
  • Workers under age 25 represented only about one-fifth of hourly-paid workers, they made up half of those paid the Federal minimum wage or less.
  • About 7 in 10 workers earning the minimum wage or less in 2008 were employed in service occupations, mostly in food preparation and serving related jobs.
  • The industry with the highest proportion of workers with hourly wages at or below the Federal minimum wage was leisure and hospitality (about 14 percent). About three-fifths of all workers paid at or below the Federal minimum wage were employed in this industry, primarily in the food services and drinking places component. For many of these workers, tips and commissions supplement the hourly wages received.

Do you know what this means?  This means that A). Very very few people make the minimum wage. B). Those that do are young.  And C). A large portion of minimum wage or less earners are bringing in tips.

As an aside, I used to tend bar, at one point I did it for a living.  When I did, I would calculate an annual “salary” based on wage and tips adjusting for taxes [that I didn’t pay on tips].  Every year I brought in more than 40K.  Often I was making better than 44k.  And this did not include the added benefit of eating most meals at the restaurant as well as a significant discount on my “liquid” needs.  While I didn’t have health insurance provided, I was young and in good health; though I did smoke and did work in a smoky environment.

Needless to say, in 2008, the vast vast majority of workers in America did not make the minimum wage.  While the numbers above reflect the 2008 year, as recently as 2005, 67% of teens and young adult making the minimum wage:

  • Worked part time jobs – Again, I worked a part time job in school, high school and college.  In each case, I was paid the minimum wage at the time.
  • Had average family incomes of 64k.

Folks, I get the fact that we wanna help people who are struggling, but the facts is the facts; almost everyone makes more than the minimum wage.

So, we have two nations involved in power conflicts; Honduras and Iran.  In Iran, we have a nation that is a center player on the world stage.  They are center in Mid East peace, they continue to provide oil and their regime continues to insist both on having nucs and destroying Israel.  In Honduras we have, well, not much.  Interesting take that our President has in handling each crisis.

In Iran, I think that Obama is right to be very careful and avoid giving too much ammunition to the current ruling party.  Anything that we would be able to do or say* would be used by the sitting President as meddling by the US and would simply stir up anti-American sentiments in that nation.  The President is right to allow the people of Iran to work this out for themselves.

The other nation, Honduras, is another matter all together.  Here, Mr. Obama IS inserting himself and calling for the ousted leader to be reinstated.  While it’s true that a sitting President was “arrested” and taken out of country, the facts on the ground are not very clear that the sitting President was a lawful one.  IN any event, Mr. Obama is clearly NOT affording the people of Honduras the same opportunity as he is the people of Iran.

Which brings up the question of why.  My thoughts: the sitting President is an ally of Hugo Chavez, an ideological brother of President Obama.

* Let’s not forget that Obama’s Administration IS talking.  In fact, they are talking about taking credit for the protests.

…privately Obama advisers are crediting his Cairo speech for inspiring the protesters, especially the young ones, who are now posing the most direct challenge to the republic’s Islamic authority in its 30-year history.

In both cases, claiming to energize the protesters and then just letting them hang AND defending Socialist regimes–Obama is showing what we knew when all ya’ll not me elected him.  He is a rookie at this whole thing.

Six weeks ago Dave Ribar wrote about the affects of the new consumer protection measures.  Congress pass and Obama signed a new law that would restrict banks ability to raise rates and fees.  It seems that certain elected officials are shocked, just SHOCKED at the news that banks are responding by raising rates now:

Yesterday, Sen. Charles E. Schumer (D-N.Y.) once again requested that the Federal Reserve invoke its emergency powers to place a limit on interest rate hikes.

“This is what many of us feared about a law that didn’t take effect right away,” Schumer said. “It was never going to take this long for the credit card companies to get ready for the new reforms. Instead, issuers are using the delay in the effective date to wring more dollars out of their customers. It is against the spirit of the law, and it is just plain wrong.”

And:

Rep. Carolyn B. Maloney (D-N.Y.) said the recent rate and fee hikes were “unfair and deceptive and must be stopped.”

“Capricious actions like these are why Congress overwhelmingly passed, and President Obama signed, my credit card reform bill: to level the playing field on behalf of consumers,” she said.

However, I am not so sure why this should catch these folks, or any of us paying attention, flat footed.  It’s not as if the companies didn’t warn us:

Bank executives had warned that the new law would force them to increase rates and fees because it would keep them from properly managing borrowers’ risk.

The reason for this?

The argument is that if banks can’t raise rates on riskier customers, they will have to raise rates on all.

Silly I know.  When banks lend money they wanna be able to asses risk and base rates accordingly.  When this ability is taken away from them, how would you expect them to react?

Look, it seems reasonable that different portfolios of risk would return different rates of profitability.  Sure, there IS profit for the banks by extending credit to borrowers who payoff their balance every month.  Equally likely is the fact that these borrowers will likely never default and declare bankruptcy; low risk, low gain.  On the other hand, by extending credit to high risk borrowers increases the chance that the banks simply lose their money.  In fact, we have been seeing this:

Banks have been hit with a record number of charge-offs, or debts they give up on because the borrowers have no way of paying them back. In June, credit card losses hit a record 10.44 percent, according to Fitch Ratings.

Once again, it seems that Liberal policies meant to protect the people have only hurt the people.  But this isn’t new.  An interesting fact is that it’s currently possible for individual Liberals to lend THEIR OWN MONEY to risky borrowers.  I wonder how many do?  And if they do, would they still scream for regulations on rate and limits and such.

Finally, I love the personal story that ends the Washington Post article.  You know, the token story of one single person getting taken advantage of by these evil evil companies.

Charles Chichester Jr., a 65-year-old retired U.S. Postal Service employee who lives in Fairfax County, was trying to pay off his credit card soon but now fears he will be unable to do so at all. He received a letter from Chase, he said, notifying him that his $373 minimum monthly payment would increase to more than $900. When he called to say he could not afford that, a Chase representative told him to consult with a credit counselor, he said. That’s exactly what he plans to do.

“The 900-something-dollar minimum monthly payment is just something I cannot do,” he said.

Of course, NOT on the list of things that Charles cannot do?

  1. Rack up more than $18,000 worth of debt on a single credit card while pulling a retired U.S. Postal Service employee’s income.