On credit

October 16, 2010

When i was a clothes horse for Harvey Ballsack in Leeds i was paid just shy of 10k (back in 2001) a year. Not very much. However, I and many of the other shop assistants on the same money somehow managed to afford – or more accurately, ‘purchase’ – items seemingly way beyond their wage power. How? Enter the store card. Ching ching.

As a staff member everything you wanted to buy from the shop was given a seemingly generous 30% discount. The catch was you had to sign up for a store card and pay for the item with it. APR on that bad boy – about 30%. I knew people earning 10k who had credit limits of about half that and some people were maxed out, no doubt paying interest only payments of significant sums a month out of a pay packet that wasn’t even a thousand pounds.

One way of supplementing your wage was to sign customers up to the store card. I think you got a couple of quid per card which added up when you were on such shite wages. Now you may think the store was the preserve of the rich and well financed. Not a bit. Students could get them. One day I think a saw a tramp walking out with a Gucci suit bought on tick. So you had this situation where very few people could actually afford to buy the volume of clothes out of their wages and so had to resort to credit cards that locked them in to buying from that store at extortionate rates of interest. All arranged by the low paid who needed to sell them to supplement their meagre income. Genius.

Nobody forced these cards on anyone. But what is striking it the way the economic system allowed vast sums of credit to be arranged for the low paid but considered the prospect of actually, you know, raising their wages anathema. You don’t have to be a Marxist to consider this a pretty fucked up state of affairs.

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2 Responses to “On credit”

  1. TBM7 said

    McCrack,

    Store cards? You’re not wrong to decry them. Not wrong at all. But right now, in this day and age… well, it’s as if you’ve just seen a massive pile of steaming elephant shit in the corner of your living room and thought: “there must be a mouse in here somewhere…”

    We’re smack bang in the middle of what may turn out to be a very deep recession. And why? One reason: credit regulations so relaxed they make Dimitar Berbatov look like Terry Butcher.

    “Sub-prime mortgages”? Another way of saying: “Obscene amounts of money leant to people who, given the most minor changes in the wider economy, would never be able to meet the repayments.”

    There’s a separate (but related) post needed here re: our earning/spending balance. Watch this space…

    TBM

    • McCrack said

      That was my point – obviously not made explicit enough – that a small example of the madness was someone on 10k being able to access a store card with a 5k limit. The point i was trying to make is that – and please don’t get the impression i think everyone needs a store card to survive – is that people could get masses of credit back then (i’m sure it’s different now) at the drop of a hat. Whatever that may be – store card, credit card, mortgage. But, for example, the idea of a minimum or living wage is heralded with the kind of warnings only reserved for suggestions like replacing the Union Jack with a flag depicting the world’s worst nonces. We need to give less credence next time to those who warn of impending doom for ‘economic reasons’ when someone suggest entirely reasonable things like paying the low paid a little bit more but who don’t see your aforementioned elephant defecating over the whole set up they thought was sound as a pound.

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