loans

From The “Rules Are Rules” Files: China’s “No Arms, No Loans” Policy

/ Jack Marshall / 18 Comments
Don't be afraid of Wu, you banks! He's completely armless!.

Don’t be afraid of Wu, you banks! He’s completely armless!.

Just when you are tempted to think the United States leads humanity in outrageous bureaucratic rigidity and the refusal to make sensible exceptions when common sense and decency demand it, a story like this one comes across the wires to restore one’s faith that cruelty and stupidity are universal.* That’s something to be thankful for…isn’t it?

Maybe not.

Wu Jianping, a 25-year-old teacher from Zhengzhou in the Henan province of China, told the news media there that banks have denied his application for a mortgage loan because he had inadequate identification.  Banks in China require fingerprints for loans, and Wu has no fingers. In fact, he has no arms, having lost both of them when he was electrocuted in an accident at the age of five.

Jianping says he typically writes his signature by holding a pen in his mouth, but banks rejected his loan applications on the grounds that his written signature can be easily imitated, presumably by anyone holding a pen in his mouth, and they don’t accept toeprints.

“Fingerprinting is a common practice because signatures can be imitated, but there is no way to copy a fingerprint,” one bank employee was quoted as saying. Ah. And just how does someone impersonate a loan applicant with no arms? How many 25 year-old teachers without arms are there in China, anyway? Are people always coming up to Wu Jianping in the streets of Beijing, where he works, and telling him, “I’m sorry! I mistook you for someone else” ?

The banks are receiving widespread criticism online and in social media, with many writing that demanding fingerprints from an armless man is unreasonable. Gee, ya think? Let’s have a panel discussion about it. Now some of the banks are apparently relenting. That’s generous of them.

I bet George Bailey would have given Wu a loan…

[Ethics Alarms will now open up the thread to all the terrible jokes anyone wants to submit, as my Thanksgiving gift to the readership. I might as well, since I know you will make them anyway. I reserve the one in the caption, one of my all-time favorites, and also “Well, they can’t accuse him of asking for a hand-out!”, because I wanted to write it first, and it’s my blog, so there. But there are a lot more. A lot.]

*One of the very first posts on Ethics Alarms highlighted a similar episode in an American bank. [Thanks to Tex for reminding me!]

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Pointer: Fark

 

Be Careful What You Wish For Dept.: “Occupy” May Finally Have a Plan, and Sure Enough, It’s Ethically Bats

/ Jack Marshall / 13 Comments

Oh, yes,THIS is bound to work out well…

The core of my objection to Occupy Wall Street and its progeny was and is that it never had the discipline, cohesion or communications skills to make it clear what the “movement” really wanted to accomplish, other than generally blaming all the world’s ills on the wealthy and successful. This was the reason for its failure, though Occupy fans like to say that it “succeeded” by starting a national dialogue about corporate executive salaries and the growing disparity in income levels between the richest and the poorest Americans—as if that dialogue hadn’t been ongoing long  before the first sign went up in Zuccotti Park.

Now there are signs that the Occupy bitter-enders are hard at work launching a real, substantive effort with a specific goal, albeit and insane one: to bring down the financial system with a “debt strike.” ( In These Times headlined its story about this “You Are Not A Loan.” Pretty clever!) The idea is to refuse to pay back the interest or principal on outstanding debt, and to insist that all loans and interest  be forgiven, since the debt system is inherently corrupt and rigged to transfer wealth from the poor to the rich.

We shouldn’t have to expend a lot of argument on why this is unethical. People, companies and nations in serious debt reach that point because they spend more money than they have. They borrow money promising to repay, agreeing to pay an additional fee, interest, for the privilege of using money that doesn’t belong to them. The vast majority of debt is not amassed by desperate debtors who have to deal with the equivalent of Loan Shark Larry and risk broken legs or death unless they pay unconscionable fees. Most debt comes from wanting something before you can pay for it. While laws are in place to minimize predatory lending and to provide a safety net (in the form of bankruptcy) so people and companies don’t end up destitute and in debtor’s prison, essentially the system, like society itself, exists on trust, the cornerstone of all ethics.  Lenders give their money to trustworthy loan-seekers, and charge higher interest rates to those who they deem less trustworthy. That is fair. Continue reading →

Charging Your Parents Interest: Ethical?

/ Jack Marshall / 4 Comments

An inquirer to the Christian Science Monitor’s financial blog “The Simple Dollar” poses this real life scenario:

“I’m 22 and have very robust finances…My dad recently suggested to me that instead of paying his credit card company interest (~20%, he thinks) on his balance (~$4000), I could lend them the money to pay it off in exchange for something like 10%….This is money I can afford to lose, and would otherwise be sitting in a money market or bond index fund. So my question: is it unethical to charge my parents interest, at least more than I’d earn otherwise? While 10% is much lower than their current payment, it’s much higher than I’d earn otherwise. If I’m willing to lend them the money at a lower rate, am I ethically obliged to?” Continue reading →