[lbo-talk] self-exploitation or self-interest?

[Wojtek Sokolowski]

Today, the NPR had a program on tax refund loans
http://www.npr.org/templates/story/story.php?storyId=4473360
and how exploitative of the working poor these practices are.

However, these loans are not the only predatory practices targeting those
who can least afford it.  Other examples include check cashing places that
extort exorbitant fees for cashing institution-issued checks (and thus
involving minimal risk), or pawn shops that lend money on usury interest.
Still other type of institutions is slum-lording i.e. renting substandard
dwelling for the government-guaranteed market rent (under Section 8) to poor
tenants (again, hefty profit at a minimal risk).  Baltimore - and I presume
most other cities - are infested with these kinds of predatory businesses.

Although this kind of unscrupulous predatory behavior targeting the poor is
ethically repugnant - it is at least "rational" i.e. it can be rationally
explained by self-interest of individuals engaged in these practices.  What
I find puzzling is the virtual absence of defense against these forms of
predation in this country.

Informal credit associations - in which communities pool resources to
provide short term loans to individuals - are widely spread in poor
developing countries, especially in Africa.  Ditto for housing cooperatives.
What is more, this country already has the material and legal infrastructure
to establish and operate similar institutions i.e. credit unions and coops.


Yet the only community-based credit union I have ever seen in this country
was in Santa Cruz, CA - while other poor communities that I experienced in
this country use check cashing or tax refund places, and pawn shops for
their banking needs.  Housing coops are also scarce.  

This makes one wonder why?   Why is that people who are mercilessly
exploited by two-bit capitalists do not use legally available to them means
to protect their interest?  Who or what stops them?  

Similar questions occurred to me when I read the _Nickel-and-dimed_ by
Barbara Ehrenreich.  Why do people work for scurvy little spiders who sell
their work to rich home owners, instead of establishing their own house
cleaning cooperatives?

This is not a radical, high-cost venture. Most people can do by pooling even
meager resources.  All that is needed is a telephone line, cleaning
supplies, and ads - which can be purchased with savings resulting from, say,
dropping cable TV subscriptions and switching from brand-name to generic
clothing.  A know-how help can be obtained, I am sure, on a pro-bono basis
by unions and progressive lawyers (cf. NLG) and business professionals (cf.
the Dollars & Sense Collective).

This is an important question to answer, especially by the self-styled
revolutionaries waiting for people to rise and shatter their fetters.  If
they cannot or will not do anything to protect their interest in a
relatively low cost and legal manner, what makes one think that they will be
willing or able to engage in a much riskier and costly fetter shattering
adventure?  

I have a few ideas about possible answers to this question, but I would like
to hear from the list first.

Wojtek