[lbo-talk] Unbanked (was dd on microcredit)

joanna 123hop at comcast.net
Tue Oct 17 16:30:08 PDT 2006


Yes, it's very, very expensive to be poor. No humor intended.

What rally burns my ass about the microcredit movement is that it supports the very ideology that creates poverty. Theoretically, it turns every individual into a mini capitalist, even if the only worker to be exploited is the self. It also makes a mash of the idea of capital, since it implies that what the microcredit recipients get is "capital."

Nothing I have left to say on this subject is printable.

Joanna

Yoshie Furuhashi wrote:


> On 10/17/06, boddi satva <lbo.boddi at gmail.com> wrote:
>
>> connect poor people to the financial system
>
>
> In the heartland of capitalism called the USA, there are "56 million
> individuals" who have no access to a regular financial system.
>
> <blockquote>In 2002, there were almost 56 million individuals in the
> U.S. who did not have either a savings or checking account at a bank
> or other traditional financial institution.1 Additionally, over 83
> percent of families without a bank account earn under $25,000.2 These
> families often use alternative financial services, including check
> cashing, payday loans, refund anticipation loans, and others, that
> provide convenience at high cost. A 2004 report estimated that these
> alternative financial services handled 280 million transactions,
> generating $78 billion in fee revenue.3 As a result, "unbanked"
> low-income workers who can least afford to pay more for basic services
> often do. They pay to cash checks, are subject to higher interest
> rates on credit, and pay higher fees and interest rates for consumer
> loans, auto loans, and home mortgages. (David Marzahl, O.S. Owen,
> Steve Neumann, and Joshua Harriman, "First Accounts: A U.S. Treasury
> Department Program to Expand Access to Financial Institutions,"
> Profitwise News and Views, February 2006,
> <http://www.chicagofed.org/community_development/files/02_2006_first_accounts.pdf>)
>
>
> Given recent (still continuing?) discussion of American Populism in
> the 19th century, I should add that populists called for establishment
> of postal savings banks in the Omaha Platform: "We demand that postal
> savings banks be established by the government for the safe deposit of
> the earnings of the people and to facilitate exchange" (at
> <http://www.historymatters.gmu.edu/d/5361/>). That was an excellent
> demand, but it still remains unrealized.



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