Is Tightening Credit Qualifications Really Such a Bad Thing?

by Dr. David Gruder

As of the second quarter of 2008, total US debt was rapidly approaching $50 trillion. Whatever bail-out solution is agreed upon will not touch the underlying problems of: 1) Debtism; 2) The massive greed that causes Debtism; or 3) Our profoundly damaging delusions about how to attain life fulfillment that have caused greed to proliferate so extensively in our society.

Instead of panicking over tighter credit, I invite you to take a moment right not to sit back and look more deeply with me at whether this is such a bad thing.

Here are the two most important details to know about what has happened in the credit market:

  1. Financial institutions that were greedy enough to approve or acquire mortgages acquired by people who truly didn’t qualify for mortgages that large have finally gotten slammed for their lack of financial responsibility, and so have those who were greedy enough to purchase mortgages that were beyond their means.
  2. Because of this, the amount of money currently available for loans is now significantly less than it has been for many years — this is what has caused the credit crisis that the US government is scrambling to do something about lest this cause our entire financial system to crash.

Now, add this little gem to the mix: In his "Address to the Nation" on September 24, 2008, President George W. Bush stated a government bailout is imperative to "help American consumers and businesses get credit to meet their daily needs…" (I placed this quote in bold.)

Think about President Bush’s statement for a moment: Why should American consumers and businesses so desperately need to get credit in order to meet their daily needs in the first place?

What’s wrong with this picture?! Do I really need to explain the insanity embedded in his seemingly innocous statement? Is anyone really listening to how many leaders and pundits are saying something like this right now? Is anyone really talking about how fundamentally dangerous is it that so many citizens and businesses have become so dependent on living on credit? Doesn’t this at all strike you as just a wee bit insane?

This is what I mean when I have written in prior posts that healthy Capitalism has been replaced with a dysfunctional an unsustainable economic system called Debtism.

It’s time to face facts: we have become a nation of debtors. As of the second quarter of 2008, and keep in mind that this was BEFORE the US government started pouring tens — and soon hundreds — of billions of dollars into bailing out the credit banking industry:

  • Financial Sector Debt                       = $16.51 TRILLION
  • Non-Finance-Sector Business Debt  = $10.91 TRILLION
  • Household Debt (all types)               = $14.01 TRILLION
  • Government Debt (Fed/State/Local) = $  7.52 TRILLION
  • TOTAL US DEBT                         = $48.95 TRILLION
    [Source: Moody’s economy.com]

That’s not "billion," folks, that’s "trillion." And now US citizens are being told they must immediately bless the US government to add up to a trillion MORE dollars to our government’s debt in order to fund this bail-out.

In this light, can you begin to see how tightening credit qualifications might not be such a really bad thing after all?

Now, stay with me here. This post is NOT about whether or not the government should fund a bail-out program. The point of this post is that we have an absolutely monumental underlying problem that is like the proverbial elephant in the living room. Even as government leaders scramble to sculpt some sort of rescue package, these leaders are STILL talking about continuing to feed our out-of-control addiction to living on credit!!!!

Virtually no one in positions of power or influence is talking, at least publicly, about the elephant: the Debtism economic system in which we have become enslaved and how to wean our country off this utterly unsustainable system so we can restore true Capitalism. Said another way, the government and the financial sector so far appear to have NO intention of shifting our economy from Debtism back to true capitalism.

Democratic Capitalism, as Mr. Bush called it, may indeed be the best economic system devised so far in our history, but Debtism is not!

In other words, whatever bail-out program is finally approved, the powers that be seem hell-bent on leaving untouched the underlying problem the lives at the core of our financial crisis: unparalleled runaway greed that guarantees the perpetuation of lack of Financial Integrity!

As I have said many times before, it is absolutely imperative that we come to grips with the fact that the reason we have such massive integrity problems today is because we have equally massive delusions about what creates life fulfillment. These delusions are what lead to greed and the lack of Financial Integrity that greed spawns!

To outgrow this insanity, all of us must fist embrace the principles of Integrity-Centered Life Fulfillment and then develop the life skills necessary for attaining it. I wrote my two-award-winning book, "The New IQ: How Integrity Intelligence Serves You, Your Relationships and Our World" to fill this desperate need. It provides a road tested blueprint that anyone, from everyday citizens to world leaders, can use to build Integrity-Centered Life Fulfillment in themselves and to help restore this orientation in society-at-large.

But, whether you utilize my book and its accompanying workbook to accomplish this or not, I urge you to commit today to start doing SOMETHING that can empower you to fill your part in helping to end this insanity!

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