I've watched way too many of my clients and readers fall into problems with credit cards. I use Dante's Inferno (which a lot you of read in high school) to give an example of how people fall into a deeper and deeper "hell" with credit and credit cards.
Dante's Inferno described Hell as nine layers of suffering. Each layer was progressly worse than the last one.
Now many people are in a different kind of Hell. Credit Hell.
Dante's version of Hell is remarkable similar to Credit Hell.
Dante's first circle of Hell was limbo. Most Americans are in the credit version of limbo. They say they are going to pay off their debts, but never do. They don't necessarily suffer, but they are never going to make to financial heaven.
The second circle is Lust. People borrow money to get things to show off. They lease cars they can't afford and rack up credit cards balances to buy stuff they don't need. They fight a never-ending battle to keep up with the Joneses.
The third circle is Gluttony. In modern times, we call it Greed.
Dante used the words "avarice" and "miserly" to describe those in the fourth layer of Hell. Instead of "avarice and miserly," we use two different words: Wall Street.
After Wall Street ran through trillions of investors' money, they borrowed trillions from American taxpayers. They will keep us all in Credit Hell for generations to come.
The fifth circle is where the wrathful are condemned to fight each other for eternity. That sounds like Congress. Congress allowed big banks and credit card companies to create most of credit Hell.
The sixth circle is for the heretics, who went against Orthodox thinking. Credit Hell was caused by politicians who ignored history and orthodox economics. They came up with concepts like "too big to fail" and "sub-prime lending." They got America onto a rung of Hell that will be difficult to get off of.
The seventh circle is for the violent. In "The Godfather," the Don says something like, "A lawyer can steal more with his briefcase than can a hundred guys with machine guns." Change the word "lawyer" to "credit card company" and you can see why those credit businesses don't feel compelled to carry Uzis. They can make huge impact on society without guns.
The eight level of Hell is for the fraudulent. We have that going around these days, too. This level of Hell has ten different sections and the section for fraudulent advisers encases the sinner in individual flames. I see this in Bernie Madoff's future.
The ninth, and most severe, circle of Hell is for traitors against humanity, like Judas. They are encased in ice.
I would reserve the last level of Credit Hell for those in the payday lending and tax refund anticipation loan business. They exploit the most vulnerable members of society and, in a stroke of evil genius, got us to believe it was socially acceptable.
In another era, loan sharking was against the law. Payday lenders and tax refund anticipation loan companies get rates that the loan sharks could only dream of. The lenders use celebrities like Magic Johnson in their advertisements, and no one bats an eye.
There is, however, one major difference between the Hell that Dante envisioned and Credit Hell.
Dante's Hell came from his imagination. Credit Hell exists in the real world.
To get rid of Credit Hell, restraint is the word. We need to restrain our spending and impulse buying. We need to restrain our lawmakers when they get close to corporate lobbyists. We need to restrain Wall Street when they get obsessed with runaway greed and we need to restrain payday lenders and tax refund companies in the manner that we formerly used to restrain loan sharks.
If we do that, credit Hell will be someday be mythical -- like the Hell in Dante's Inferno.
Don McNay, CLU, ChFC, MSFS, CSSC is the founder of McNay Settlement Group, a structured settlement consulting firm, in Richmond, Kentucky.
He is the author of Son of a Son of a Gambler: Winners, Losers and What to Do When You When The Lottery. You can write to Don at email@example.com or read his award winning column at www.donmcnay.com. He is a frequent guest on television and radio talk shows.
McNay is a lifetime member of the Million Dollar Round Table.