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Talking about the Bankruptcy Diaries

A couple of weeks ago I was interviewed about my book by the lovely people at Hackney Hive. It was great to talk about the work and some of the issues around it. Thanks to all those at HH for showing their support for local artists. 

Below is an excerpt:

Hackney’s rich history has many aspects, but it is particularly feted for two things: being London’s revolutionary corner and its importance as an artistic hub. Often, these two collide and have provided many high points in Hackney’s cultural palette, especially its literary output. The best known of today’s Hackney literati is Ian Sinclair, a beacon for London literature. Lee Rourke is also proud to call Hackney ‘home’. It is time to welcome a new addition to Hackney’s artistic – and artistically revolutionary – spirit: Paul Broderick, author of the recently released The Bankruptcy Diaries. I was fortunate enough to be afforded a short audience with the author to talk about his book, why he wrote it and what he will be working on next.

“The Bankruptcy Diaries is truly a banquet for the soul of our modern moralists,” said Paul. “It’s one man’s journey – mine – from the youthful naivety of university and entering working life and my role in the broader fiscal complexities of the state to an enlightened awareness of the actual depth of today’s corporate exploitation of the individual. I present the work as a choice that many people are now – and many more soon will be – confronted with: levels of debt that can never be repaid. I took my choice on this – it’s all in the book.”

To read the rest of this article click here. 

 Please do not be alarmed, I am not about to start a ‘Politician of the Week’ feature – once you’ve been ‘Clegged’ faith can never be fully restored – but I was nonetheless heartened to learn of MP Andrew Percy’s remarkably candid revelations about his own problems with debt during a Commons debate (on the Finance Bill) earlier this week. Percy revealed to the House how he had repeatedly maxed out credit cards and is still saddled with enormous repayments. The MP said:

“I certainly understand having debts to the tune of tens of thousands of pounds.

In my case, it was credit card debt, and I am not alone in that. It started at university and I went down the line of paying off one credit card by transferring it to another on 0% for a year or a number of months before conveniently forgetting that and maxing out the one that I had just cleared. I now pay about £600 a month to clear all my credit cards, which I have had to roll into a loan since my election. I understand what debt is like and I know how once someone is on the conveyer belt, it is difficult to get off, and that is just with credit card debt.”

Aside from being evidence of the extent to which debt culture has permeated all levels of society, Percy’s statement shows that we at least have some Parliamentarians with first-hand experience of the harmful effects of the debt industry; if credit, or debt (as they are one and the same), is to be more tightly controlled in order to prevent people’s lives from being ruined, then this can only be a good thing.

Leading the charge

The specific subject of the debate was a proposed amendment to Clause 11 of the Finance Bill, relating to high-cost lending: that most damaging sector of the credit industry which consists of companies who lend at extortionate rates to those who cannot get credit elsewhere, including payday and doorstep loan companies that also target the most vulnerable groups. Only this afternoon I saw a TV commercial from one of these companies, Wonga, advertising a 4,500% interest rate.


Could a doorstep loan be the answer to your problems?

 

 

Also deserving of special mention was the leading voice on the subject, Stella Creasy MP, who has been ardently campaigning for greater regulation of the high-cost credit industry for some time. Creasy told the House:

“the companies have specifically said that the lack of regulation in the UK compared with other countries makes it a target market for them.”

And,

“…in its ‘Keeping the Plates Spinning’ report, Consumer Focus estimates that payday lenders are expected to quadruple the scale of their operations in the UK in the next few years alone.”

Business as usual

Typically – in accordance with le libéralisme sauvage, which despite the crash and its fallout, shows no signs of being supplanted as the ruling ideology in Britain – those suffering most in these hard times are being pummeled for profit by the money-men and shareholders who operate these parasitic companies. Despite the best efforts of Andrew Percy, Stella Creasy and many others, the light-touch regulation mob prevailed and the motion was defeated by 273 votes to 228.

You can read the full text of the debate here.


I'm Rich Beyond My Wildest Dreams...

Tonight’s episode of Dispatches on Channel 4 focused on the lower echelons of the credit industry – doorstep loans, payday lenders and what they termed ‘rent-to-buy’ companies, all of which are effectively forms of sub-prime lending targeting the poor, and a very profitable business to the companies pedalling it.

In the days following my bankruptcy I began receiving mail-shots from some of the doorstep loan companies mentioned in the programme. It was immediately obvious that they must have some form of monitoring system that alerted them to new and potentially vulnerable targets. Just been made bankrupt? Here’s a dummy cheque for £500 – turn this into CASH – NOW!

Such is the size and power of the credit industry in Britain, that the loan companies are permitted to target people who have just been declared insolvent with more credit, allowing them to immediately begin racking up new debts, which they have even less chance of repaying. Whilst the exorbitant interest rates on these loans are admittedly made clear in the adverts, they are unmistakably designed to ensnare people into another particularly nasty debt trap.

Say 'Yes' to a Lifetime of Poverty

The programme also highlighted American payday loan companies who have begun moving into the British high street. Having had restrictions imposed on the interest rates they are able to charge in the US, these companies have found somewhere with less  regulatory inconvenience to do business. So whilst the British government dithers on whether to introduce a cap on the rates these companies can charge, the money lenders can continue to enjoy rich pickings to the detriment of the most vulnerable groups in our society. Never mind the credit crunch – Britain is still a great place to do business.  

 

We used to have a long history of credit controls in Britain, but these were done away with under the Thatcher government and her policies of deregulation. If America, the home of free market fundamentalism and lax regulation can clamp down on these despicable companies and their insidious practices, then surely the British can follow suit?

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