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Joe G. Top Photographer. Lives In Ruislip. From Greater London.

Britain - Bring Back Usury Laws

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Posted 24th October 2012 at 4:45PM
Usury is the practice of making loans with excessive interest rates and most countries have laws in place to clamp down on this kind of practice. But not in the UK.

We apparently seem to actively encourage userers and we now have companies like Wonga that are legally allowed to plaster our TV screens and hoardings with money lending adverts offering rates of up to over 4000% APR (which is actually just over 1% per day compounded).

My problem is a moral one in that their business model is solely about making long term maximum profits from the poorest, least educated and most vulnerable in our society. They prey on the vulnerable and they aim to lock people in to long term dependency. We are giving the green light to the rich and greedy to feed off of the desperate and poor. The loans superficially appear to be a lifeline, given to a desperate person, but in fact are dead weight stones attached to their necks.

The counter argument is an easy one to make, that in a free and fair society any borrower should be able to contract with any money lender as they see fit. Further, that if you bring in usury laws, it will just push those people in to the arms of the street loan sharks.

Firstly, I don't agree that we should have capitalism at any cost, secondly I think as a society we have a responsibility to protect the most vulnerable, thirdly two wrongs don't make a right and there are laws to deal with loan sharkers and finally we should be making every effort to educate about the perils of a debt driven/ridden consumerist culture where debt adds a few £££ to GDP today but erodes investment tomorrow.

This is about putting morals above profits but there are some other long term economic benefits of usury laws which include directing more money towards investment rather than barefaced consumption or fraudulent adventures. And I see exorbitant interest rates as representative of market failure which will soon enough down the line lead to insolvency anyway. And perhaps usury laws can encourage a moderation of the want in now/entitlement culture we have at present in favour of greater investment and a longer term view.

Yes bluntly I am talking about protecting vulnerable people from themselves for theirs and societies long term good and this may sound like the nanny state but there is a history of successful examples which are now hard to argue against such as the compulsory usage of seat belts or the ban on smoking in enclosed work spaces.

And if we look at other countries for examples almost every other developed country has usury laws in place including Canada, Germany, France, Belgium, Netherlands, Japan, Spain and even some US states.

So isn't time we caught up?

Sources: Europa.eu

Watch: Panorama - Debt on the doorstep
 

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Pennington
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Pennington
There’s money in it Like 0 Disike 0 Report  
14th October 2013 at 4:45PM
I suspect that some M.P's have a vested interest in these "loan sharks"

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