Credit cards, as most people theoretically understand, can turn into the 21 st century equivalent of sharecropping. First, you borrow from The Man to get your cotton planted (or maybe to buy that new flat-screen HDTV ). Comes picking time (or the warranty runs out ) and you're likely to discover, in the words of an old country song, that you "owe your soul to the company store." Not to mention late fees and a big jump in the interest rate. Meanwhile, you're getting letters daily offering you a new card at temptingly low rates for the first six months. Why not double down ? Hey, your 15-year-old's being offered a platinum card with the logo of his high school's mascot. Shoot, I've got a Charolais calf named Layla who's probably eligible for EZ-Credit today. Basically, anybody who can walk and chew cud at the same time can end up owing a half-dozen company stores. But why worry ? Money ? They're practically giving it away. And if the payments get too steep, what with $ 4-a-gallon gasoline and $ 5 milk, all you've needed to do over the past dozen years or so, in the immortal words of George W. Bush, is borrow more to "make the pie higher." Refinance with an adjustable rate mortgage, pull some cash equity out of your house, pay off a couple of credit cards and then repay the home loan with tax-deductible cash. Sweet. See, you're going to trade the dump in on a fancier house to borrow against before the interest rate resets anyway, pushing your monthly payment into the stratosphere. Because as everybody used to know, real estate can't go anywhere but up.
Until recently, spending money you didn't have was your patriotic duty. Wasn't it the same George W. Bush who advised Americans to respond to the 9 / 11 terrorist massacres by heading to the mall ? When the going gets tough, everybody laughed, the tough go shopping.
Never mind that it was also Bush who inherited a $ 128 billion budget surplus and turned it into a $ 482 billion deficit—an estimate, incidentally, that leaves out the costs of the wars in Iraq and Afghanistan. They're off the books, a bit like Enron's money-losing "partnerships." In retrospect, the Enron collapse clearly predicted the fiscal consequences of Bushism.
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