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From: faustus@ucbcad.UUCP
Newsgroups: net.politics
Subject: Re: Re: Collecting debts & Libertarianism
Message-ID: <34@ucbcad.UUCP>
Date: Sun, 23-Dec-84 14:26:34 EST
Article-I.D.: ucbcad.34
Posted: Sun Dec 23 14:26:34 1984
Date-Received: Tue, 25-Dec-84 02:42:28 EST
References: <3160@alice.UUCP> <29200175@uiucdcs.UUCP> <168@mhuxr.UUCP> <293@ssc-vax.UUCP>
Organization: UC Berkeley CAD Group, Berkeley, CA
Lines: 39

> >  Suppose I owe you $1,000 and refuse to pay.  You decide to use
> >  force to collect your debt, so you send your police to my house to
> >  force me to pay up.  They are met by a squad of MY police who
> >  say that they do not recognize the legitimacy of your claim.
> >  
> >  Result: gang warfare.
> 
>      It might be instructive to see what happens today:  I owe you
> (you being a local business, like a furniture store) some money and
> refuse to pay.  After deciding it is a bad debt, you can turn it over
> to a collection agency.  They will send letters and telephone and
> generally pester me until I either pay up or they too decide it is
> a bad debt.  You now report me to a credit reporting firm, who lists
> me as a bad credit risk.  I now find it very difficult to borrow money
> from anyone.  If they are willing to lend to me, it will be at much
> higher rates, or they will demand something of value as security
> (like pawn shops do).  In any case the cost of credit for me goes way
> up.  
>      There is no need for force, and no need for government intervention.
> In fact, as has happened to many people, you can be turned down for
> a loan by having an insufficient credit record.  You could be a 
> perfect angel, but until you prove youself reliable to the lender,
> you won't get that loan in the first place.
>      Now, if you lent me the money without checking my credit 
> references, and without requireing security for the loan, you took
> an awfully big risk.  If I turn out to be a bad borrower, hiring
> thugs is not an appropriate response.  Learning to be more cautious
> in lending is.

I haven't been involved in any bad debts (on either end), so I may be
wrong, but if I had a bad debt I would fully expect to be taken to
small claims court and be told that I had to pay off the debt, assuming
I hadn't declared bankruptcy. Maybe some people who have experience
with the way that collection agencies work can say how well these
agencies would work without government help... I suspect that it would
be a lot easier to pull off identity changes and create fake backgrounds
without government enforcement of fraud laws.

	Wayne