Why Debt Can Be So Hard to Pay Off: The Dark Side of Usury and the Vicious Circle of Loan Culture

Debt is often portrayed as a manageable burden, but in reality, certain financial structures and practices designed to exploit weaknesses can make paying off loans incredibly daunting. This article explores the concept of usury, the hidden costs of student loans, and the broader societal issues that contribute to the debt cycle. Understanding these factors can help individuals and societies navigate financial challenges more effectively.

The Dark Side of Usury: How Financial Exploitation Is Hidden in Plain Sight

Debt can become a perpetual trap, especially when structured to exploit the debtor's financial vulnerabilities. A common trick is the triple whammy of high interest rates, constant late fees, and never-ending compounding interest. When a creditor demands $100 as a payment, a surprisingly large portion of it—perhaps 60%—goes to cover interest, leaving only a small fraction to pay down the actual debt. This leaves the debtor in a cycle of paying interest indefinitely, creating a steady income stream for the creditor.

To illustrate, consider the example provided: if you owe $10,000 and make payments of $100, each month 60% of that $100 ($60) goes to interest, while only $40 is applied to the principal. This means that without any substantial change in your payment habits, you're essentially just keeping the debt alive forever, with the creditor collecting much of the principal in high-interest payments. This is a form of usury, where the creditor uses the debtor's weaknesses to create a situation where the debt can never be fully repaid.

Debt and Political Influence: The Case of Big and Powerful Nations

When considering the broader implications of debt, it is essential to recognize how it can be wielded as a tool of political and economic control. Major western countries, such as the US, France, and Italy, often accrue enormous debts, with a significant portion of the interest paid to large private banks. The banks have immense power, and they can influence political decisions to keep the money flowing, ensuring that these debts remain a source of continuous income for them.

Take the example of Nicolae Ceau?escu, the former president of Romania. He made a bold attempt to eliminate the national debt but faced fierce opposition, including covert operations by the CIA. When he couldn't pay the interest on the debt, it became a tool to destabilize his regime, leading to his dramatic downfall. Similar situations have played out in other countries, where leaders who refuse to embrace the global monetary system are sidelined or eliminated, while those who comply are kept in power.

Education Loans: A Vicious Cycle of Burden from the Start of Life

One of the most insidious forms of debt is the student loan. The idea that debt should precede adult life is inherently problematic. When young people are saddled with student loans, car loans, rent, and multiple other financial obligations early on, it can feel like an inescapable burden. This puts a significant strain on young adults as they try to establish their lives, often living paycheck to paycheck.

The vicious cycle of education loans can further be exacerbated by the lack of comprehensive financial education. Young adults may not understand the long-term consequences of taking out these loans or the availability of other financial options. Instead, they are often left with the impression that loans are the only viable way to fund their education. This perpetuates a cycle where even those who manage to clear their educational debt are burdened with substantial monthly payments for years to come.

Alternative Solutions: A Path to Financial Freedom

To combat the pervasiveness of this cycle, it is crucial to explore alternative solutions. For example, consider a system where parents are mandated to contribute a portion of their income towards a savings account for their child, starting from birth. These contributions would be held in government-controlled accounts, and when the child reaches adulthood, the funds could be used to finance higher education, reducing the child's financial burden and the interest paid to banks.

By shifting the focus away from debt and towards financial responsibility, we can create a society where financial health is prioritized. Countries in the Caribbean, for instance, have a tradition of financial prudence, which has led to a younger generation that is less stressed and more financially savvy. When societies provide adequate financial education and alternatives, the burden of debt becomes more manageable, and people can live within their means without the constant threat of debt collection.

Conclusion

The complexity and pervasiveness of debt are multi-faceted issues that require a holistic approach to address. From recognizing the dark side of usury to understanding the political and economic implications of debt, and exploring alternative solutions, there are steps that can be taken to break the vicious cycle of debt and foster a more financially responsible society.

Keywords: usury, debt cycle, education loans, loan culture, credit burden