22 October 2008

A Solution to the Credit Crisis That Doesn't Involve Healing Crystals

Hippies Have Strange Ways of Fixing the Economy

Hilzoy has an article at The Washington Monthly that basically says we are fucked because of the outrageous credit card debt that Americans hold:

The first is the possibility that banks will have to write off even more bad debt. Americans owe about $950 billion worth of credit card debt, and, as with mortgages, credit card debt has been securitized. The second is that banks might hoard cash if they think they will have to write down bad debts, at a time when credit is already very tight.

The author of the superb "Handmaid's Tale" and 60s-era relic, Margaret Atwood, has a strange solution to cure America of its addiction to debt [NYT]:

But we’re deluding ourselves if we assume that we can recover from the crisis of 2008 so quickly and easily simply by watching the Dow creep upward. The wounds go deeper than that. To heal them, we must repair the broken moral balance that let this chaos loose.

Debt — who owes what to whom, or to what, and how that debt gets paid — is a subject much larger than money. It has to do with our basic sense of fairness, a sense that is embedded in all of our exchanges with our fellow human beings.

Maybe it's because I'm not down with drum circles humming the beat to The Age of Aquarius, but I'm not following Atwood's fru-fru explanation on debt throwing off the earth's Karmic alignment. Here's a better idea that's comprehensible to the rest of us: quit buying crap you don't need with money you don't have, ya jackasses.