To learn enough about anything to make an informed decision. At best, with great effort, they can do so in one domain, say, picking the best schools they can afford for their kids. But asking people who have a full time job to research in depth financial, medical, legal, educational, political etc information to be able to make informed decisions in these areas is ridiculous. Personal responsibility in such a complex and busy world full of deceptive information coming from the top simply cannot exist.

We are bombarded every day, numerous times throughout the day, with advertising. And, numerous times a day, we make choices as to whether or not we are influenced by various advertisements.

The lower one's income and education, the more likely one will get 'suckered.'

They also get suckered by 'Low Prices' in Big Box stores.

It's a vicious cycle: Children and parents in lower income/education brackets tend to watch more TV and quickly develop an "I want it now!" drive. That is reinforced by parents who don't want their kids (or themselves) to 'look' poor. They drive to the Big Box stores and see all the 'good deals,' and rationalize their purchases as 'smart buys.'

They fail to factor in whether or not they even have the money to make these purchases. But, they are 'rescued' by credit card companies who offer them more money than they could ever pay back. And, since they receive more than one offer from credit card companies, they continue to sign up for additional credit cards and attempt to 'float' their debt.

During this time, they are NOT thinking of ways to pay down their credit cards. Sadly, they keep thinking they have 'free money' to use to buy even more crap they can't afford.

By the time it all catches up to them, they risk everything from repossession of vehicles to home foreclosures/eviction. At this point, they can't drive to work and risk losing their jobs.

All because they got a good deal on a Plasma TV.

So, who is to blame?

You can blame public schools for not having mandatory courses in money management.

You can blame advertisers for being so pervasive.

You can blame society for the stigmas associated with being poor.

You can blame credit card companies for predatory lending.

You can blame yourself for not having the courage to say, "NO! I can't afford this."

Perhaps, I'm in the minority, but I don't view credit card companies as evil. I enjoy a great relationship with credit card companies. I'm able to borrow large sums of money for little or no interest because I've always been very careful about money management. And, if you're good to credit card companies, they are good to you. If you're bad, you quickly learn about the zero tolerance rules of the credit card industry. It's true that credit card companies don't go out of their way to make one aware of their zero tolerance policies, BUT one generally figures it out rather quickly after just one late payment. From that point on, the burden is on the borrower to get his/her finances in order QUICKLY.

I grew up during a time when I SAVED to buy a tennis racket or a bicycle. I didn't just get the idea that I wanted a bicycle and have it INSTANTLY after a quick trip to Walmart (cuz it was a good deal).

I think our debt problems are due mostly to a societal acceptance (even encouragement) of instant gratification.

Therefore, I think delayed gratification must be taught. We can't expect parents who never learned it to teach it to their children. It must be taught in school, along with money management.

However, I also think a resurgence of the "Just Say No" campaign could be effectively used today. Instead of that copy hovering over various drugs, it could hover over an enlarged checkbook ledger with the balance in brackets (indicating debt).

I think that the explosion of kids diagnosed with various forms of hyperactive disorders and other forms of behavioral problems is in large part due to parents not training kids on the basic skill of delayed gratification. By not doing so, the developing brains of these kids never learn how to internalize basic forms of self-control. Of course, when society sees any disciplining of kids as abuse, what can one expect? On top of that, you have big pharma which is very happy to advertise and sell drugs to "fix" these problems.

Credit card companies are all three.

They decide if you are 'pre-approved;' they decide if you should 'get away' with a late payment; and they decide whether or not to 'kill' you with excessive interest rates, penalties and fees.

I would argue that most people know this about credit card companies BEFORE they sign that first application. But, even assuming they've been living in vacuum and have no idea, they get the electrical shock the first time they are delinquent with a payment.

Few things in life are that black and white. The CHOICE to enter the credit card game is not one to take lightly. You have to train for it.

Unlike speeding or blowing off work for a day or giving into a child's demands, where you are playing the odds of whether or not you'll get caught or if your actions will catch up to you, credit companies let you know IMMEDIATELY that you screwed up.

They aren't like the IRS who will not catch up to you for several YEARS (after you've really screwed up). You know right away that you've spent more than you can pay back. And, if you don't choose to immediately adjust your spending habits, then you're NOT a victim.

Having said that, I do think credit card companies should NOT offer more than a $1,000 limit on first cards. You should EARN a higher credit limit over time. And, I believe laws should be passed to that effect.

Link to SF Chronicle Article

Going for broke, American-style

Debra J. Saunders
Thursday, June 12, 2008

When the GOP Congress passed and President Bush signed the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005, supporters hailed the measure as a victory for "personal responsibility."

Three years later, the bill has managed to dent the number of bankruptcies filed in America - from 1.6 million in 2004 to 850,912 in 2007, according to the nonpartisan American Bankruptcy Institute. That number is great for the banks, but in the wake of America's subprime mortgage and home foreclosure wake-up call, you can't argue that either American lenders or consumers are exhibiting more personal responsibility.

Forget high gas prices. If you're among the 1 in 5 households with credit-card debt service payments exceeding 10 percent of your income, you probably have bigger problems. Congress refused to cap interest rates at 30 percent when it passed the bankruptcy bill. Predatory lenders remain free to charge usorious interest rates, as well as to assess whopping late-payment penalties.

A report, "For a New Thrift: Confronting the Debt Culture," released last month by the Institute for American Values, Public Agenda and other do-gooder groups, catalogs the many ways that private and public institutions are making it fast and easy for working people to do the wrong thing with their hard-earned dollars.