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Credit ratings in the United States are not controlled by the government, and you have recourse if your rating is hit for no reason. Comparing the two systems t

Credit ratings in the United States are not controlled by the government, and you have recourse if your rating is hit for no reason. Comparing the two systems together makes some sense as there are material impacts in both cases, but to say credit ratings are even close to this is to miss a pretty critical distinction. As for no-fly: agreed that is a stain on our democracy.

coldtea 8y ago
>Credit ratings in the United States are not controlled by the government So there's also no democratic control on them?
- sailfast 8y ago
  There is always the ability to control private enterprise when enough of a consensus is established. In this case, credit reporting is regulated by the Fair Credit Reporting Act which provides a number of guidelines as well as a dispute process, access to your report for free, etc. I would argue that is democratic control to an extent that the people’s representatives have chosen to regulate the industry to that extent, yes.
- dd36 8y ago
  Fair Credit Reporting Act.
lentil_soup 8y ago
Since they're not controlled by the government then they are controlled by the market, as in, private companies. Not sure that's better, you could argue with a government controlled one you still have "some" rights and due process, with a private one there's not much you can do if they decide to give you a bad rating. I rather have none, to be honest.
- sailfast 8y ago
  First, you do have rights under existing regulation and in a court of law. Second, I’m really not sure what the lending landscape looks like if you don’t have these ratings. (Not saying better or worse, just not sure) I guess if you want to go tell every lender your life story and get your own individual interest rate and negotiate it all yourself then feel free? Numbers tend to free up liquidity because it creates a relatively well understood framework that banks can hedge and lend on. This enables speed as well as more lending. I’m not a huge fan of the consolidation of ratings agencies but I do like the speed and available credit these scores enable.
  - ryanmercer 8y ago
    >First, you do have rights under existing regulation and in a court of law. Sure you can take a credit reporting agency to court, if you can afford a lawyer. You can take creditors to court, if you can afford a lawyer. You can file bankruptcy, on some debts, if you can afford a lawyer. But that bankruptcy follows you, it will flat out prevent you from employment in certain industries, it will prevent you 99% of the time from any job that requires a security clearance for the rest of your life, it will severely hinder your ability to have credit in the future. Sure, you can dispute incorrect things on your credit report... if you know how. Then of course, all a creditor has to do is, within a few months, say 'yes that information is correct' and the dispute rules in their favor. Sure, if someone steals your identity and takes out some lines of credit you can attempt to undo that damage but it could take years (if ever) to fix your credit report while employers and would-be-creditors see you as someone that defaulted on debt, even though you had nothing to do with it, and treat you as someone irresponsible and unreliable. All of this while the credit agencies are SELLING this report to anyone that wants it, effectively telling the buyers how allegedly trustworthy and responsible you are.
    - sailfast 8y ago
      I’ve heard small claims court is quite effective for redress as well for some of these things. I agree that disputes are not easy, but you are not being denied rights by the state if your credit is bad which is the key difference here vs China. If you think we need more reform of credit reporting (I would not disagree) then please contact your representative - that’s going to be the way to better regulate the dispute process and provide more recourse for citizens.
ryanmercer 8y ago
>Credit ratings in the United States are not controlled by the government, Yet they can prevent you from getting, or keeping, government jobs, prevent you from getting government contracts, prevent you from being able to purchase a home, prevent you from getting student loans... They aren't as bad but they're still tools of control.
- dd36 8y ago
  Based on public court records.
  - ryanmercer 8y ago
    >Based on public court records. Which to this day aren't in some central database. Many states have counties where court records aren't even available online, that's a hell of a lot different than a centralized service that compiles, ranks and sells this information. It's in a credit reporting agency's best interest to find every last scrap of financial information about you so they can sell it. They don't care so much about accuracy, they just care about growing that file so they have more to sell. There's countless instances of people having their credit reports merged with others, containing erroneous information that pertains to a parent or child if they are Bob Smith I, Bob Smith II, Bob Smith III etc, then of course you are asked for your SSN for jobs/taxes/rental applications/in many cases it is on your driver's license which is handed over to numerous people for numerous reasons making it incredibly easy for someone to steal your identity and racking up debt, that they do not pay, on YOUR credit files which can take you years to get removed, all the while being on a centralized purchasable document that is intended to say how trustworthy you are as a person...
    - sailfast 8y ago
      Handling ID Theft is certainly an area that could use improvement. It’s a total pain in the ass and the fact that we’re basically paying K&R insurance each month to hedge this risk is crazy.
- sailfast 8y ago

coldtea 8y ago

>Credit ratings in the United States are not controlled by the government So there's also no democratic control on them?

sailfast 8y ago
There is always the ability to control private enterprise when enough of a consensus is established. In this case, credit reporting is regulated by the Fair Credit Reporting Act which provides a number of guidelines as well as a dispute process, access to your report for free, etc. I would argue that is democratic control to an extent that the people’s representatives have chosen to regulate the industry to that extent, yes.
dd36 8y ago
Fair Credit Reporting Act.

lentil_soup 8y ago

Since they're not controlled by the government then they are controlled by the market, as in, private companies. Not sure that's better, you could argue with a government controlled one you still have "some" rights and due process, with a private one there's not much you can do if they decide to give you a bad rating. I rather have none, to be honest.

sailfast 8y ago
First, you do have rights under existing regulation and in a court of law. Second, I’m really not sure what the lending landscape looks like if you don’t have these ratings. (Not saying better or worse, just not sure) I guess if you want to go tell every lender your life story and get your own individual interest rate and negotiate it all yourself then feel free? Numbers tend to free up liquidity because it creates a relatively well understood framework that banks can hedge and lend on. This enables speed as well as more lending. I’m not a huge fan of the consolidation of ratings agencies but I do like the speed and available credit these scores enable.
- ryanmercer 8y ago
  >First, you do have rights under existing regulation and in a court of law. Sure you can take a credit reporting agency to court, if you can afford a lawyer. You can take creditors to court, if you can afford a lawyer. You can file bankruptcy, on some debts, if you can afford a lawyer. But that bankruptcy follows you, it will flat out prevent you from employment in certain industries, it will prevent you 99% of the time from any job that requires a security clearance for the rest of your life, it will severely hinder your ability to have credit in the future. Sure, you can dispute incorrect things on your credit report... if you know how. Then of course, all a creditor has to do is, within a few months, say 'yes that information is correct' and the dispute rules in their favor. Sure, if someone steals your identity and takes out some lines of credit you can attempt to undo that damage but it could take years (if ever) to fix your credit report while employers and would-be-creditors see you as someone that defaulted on debt, even though you had nothing to do with it, and treat you as someone irresponsible and unreliable. All of this while the credit agencies are SELLING this report to anyone that wants it, effectively telling the buyers how allegedly trustworthy and responsible you are.
  - sailfast 8y ago
    I’ve heard small claims court is quite effective for redress as well for some of these things. I agree that disputes are not easy, but you are not being denied rights by the state if your credit is bad which is the key difference here vs China. If you think we need more reform of credit reporting (I would not disagree) then please contact your representative - that’s going to be the way to better regulate the dispute process and provide more recourse for citizens.

ryanmercer 8y ago

>Credit ratings in the United States are not controlled by the government, Yet they can prevent you from getting, or keeping, government jobs, prevent you from getting government contracts, prevent you from being able to purchase a home, prevent you from getting student loans... They aren't as bad but they're still tools of control.

dd36 8y ago
Based on public court records.
- ryanmercer 8y ago
  >Based on public court records. Which to this day aren't in some central database. Many states have counties where court records aren't even available online, that's a hell of a lot different than a centralized service that compiles, ranks and sells this information. It's in a credit reporting agency's best interest to find every last scrap of financial information about you so they can sell it. They don't care so much about accuracy, they just care about growing that file so they have more to sell. There's countless instances of people having their credit reports merged with others, containing erroneous information that pertains to a parent or child if they are Bob Smith I, Bob Smith II, Bob Smith III etc, then of course you are asked for your SSN for jobs/taxes/rental applications/in many cases it is on your driver's license which is handed over to numerous people for numerous reasons making it incredibly easy for someone to steal your identity and racking up debt, that they do not pay, on YOUR credit files which can take you years to get removed, all the while being on a centralized purchasable document that is intended to say how trustworthy you are as a person...
  - sailfast 8y ago
    Handling ID Theft is certainly an area that could use improvement. It’s a total pain in the ass and the fact that we’re basically paying K&R insurance each month to hedge this risk is crazy.
sailfast 8y ago