5 ms·

I don't think that's quite fair. While the quote oversimplifies it, you too are oversimplifying it. If the boots situation existed your planned boots-loan would

by 542458 11y ago

I don't think that's quite fair. While the quote oversimplifies it, you too are oversimplifying it. If the boots situation existed your planned boots-loan would never work. Because poor people are high-risk loans, you'd need to put a significant risk factor on that boots loan if you ever hoped to break even (there's a reason credit cards charge 20+% interest). So now the $100 boots are $130 or more. Additionally, nobody not already in heaps of debt would ever take the loan, because people hawking predatory loans and money-for-nothing schemes are a dime a dozen in poor parts of cities (cash4gold! payday loans!) and those who don't lean quickly to ignore them all get screwed. Finally, you're ignoring the psychological aversion to taking on debt, even if it's for the best. Even among fairly well-to-do university students the concept of business leverage seems to come as a bit of a shock, and takes a fair bit of explaining - "But why would you deliberately go into debt?". Imagine trying to explain to somebody below the poverty line that the boots are worth going into debt for!

SilasX 11y ago
>Because poor people are high-risk loans, you'd need to put a significant risk factor on that boots loan if you ever hoped to break even (there's a reason credit cards charge 20+% interest). Well, yeah, but that's the point: it's not that they're $50 away from a perpetually self-reinforcing cycle of rising out of poverty. It's that even if you loaned them the money, and showed them the savings, they still won't take the rudimentary steps (pay back some of the easy savings). (Hence why my disproof involved the example of a charity program.) But at that you'd you'd be using a very different theory of poverty than the Vimes one; it's not that the person couldn't find an extra $50 one time, it's that they are unwilling to plan ahead even when the seed money is given to them. That has a very different moral than the one in the excerpt. >"But why would you deliberately go into debt?". Imagine trying to explain to somebody below the poverty line that the boots are worth going into debt for! So wait, now you're saying the problem is that the poor are too unwilling to borrow?

by 542458 11y ago

SilasX 11y ago

>Because poor people are high-risk loans, you'd need to put a significant risk factor on that boots loan if you ever hoped to break even (there's a reason credit cards charge 20+% interest). Well, yeah, but that's the point: it's not that they're $50 away from a perpetually self-reinforcing cycle of rising out of poverty. It's that even if you loaned them the money, and showed them the savings, they still won't take the rudimentary steps (pay back some of the easy savings). (Hence why my disproof involved the example of a charity program.) But at that you'd you'd be using a very different theory of poverty than the Vimes one; it's not that the person couldn't find an extra $50 one time, it's that they are unwilling to plan ahead even when the seed money is given to them. That has a very different moral than the one in the excerpt. >"But why would you deliberately go into debt?". Imagine trying to explain to somebody below the poverty line that the boots are worth going into debt for! So wait, now you're saying the problem is that the poor are too unwilling to borrow?