What would happen if everyone decided to rack up their credit cards and never pay it back?

Question

Sometimes I feel like we need to show the government that they take way too much out of our paychecks for taxes and what not so we need to show them that we have to live on damn credit cards just to get by. What do you think?

Answer 1

everyone would lose their points and couldn't buy all that cool stuff

Answer 2

The interest rates charged on unpaid balances would be charged each month and the debt would keep piling up. Eventually, these debts would be turned over to collection agencies and those folks would make your life quite miserable for awhile. Eventually, I could see a lot of personal bankruptcies being declared, complete with legal fees. The credit cards would be canceled so you'd have to start living paycheck to paycheck.

I think that it isn't that the government is taxing you too much that's getting you down. It's either that you're living too extravagantly for your income or that your pay is too low for how you want to live. Either way you look at it, your best bets would be to cut back on your consumption (in which case, you'd be cutting back on the taxes you pay, too) and at the same time, work to find more income. Maybe you need a degree or a certificate to qualify for the next raise or promotion you'll get? Go after it. Or, perhaps the answer is to polish up your resume and start working the "employment wanted" section of your local newspaper.

Answer 3

This would penalize the financial institutions, not the government. Although the banks borrow money from the federal bank, they are separate from it.
If less people paid off their credit cards, the interest rate charged by the credit card companies to cover their costs would increase according to their risk - consider the high rates that payday loan companies are able to charge, because some people are willing to pay those interest rates.
Besides, one can only file bankruptcy about every 8 to 10 years, and laws have changed to make it more difficult to file for bankruptcy. So, eventually one ends up paying back one's loan one way or the other, and the longer it takes, the more interest is paid on top of the original loan.

Writing a congressman or 2 with suggestions for tax breaks that would actually apply to the middle class - not just to the upper class - would probably be a more constructive course of action.

Answer 4

For the tax portion of the question:
You are entitled to vote, to petition the government for redress of grievances, and to contact your elected representatives to make your opinions known.
For the non-tax (credit card) part:
If everyone maxed out credit cards and then defaulted, the credit card companies would suffer massive credit losses, which would very likely ripple through the rest of the economy. The result would be increased prices, interest rates, and umemployment. The cure you suggest is worse than the disease.

Answer 5

And just how would running up credit card debt take money away from the government? Last I looked, banks were private and not owned by the government.

If you're talking about everyone quitting their jobs, then yes, tax revenue would decline. Fortunately most people are honest, and wouldn't just run up debts they knew they were going to default on.

Answer 6

And only the place will our government get each and all of the money to pay off those credit enjoying cards? We as a rustic are TRILLIONS of greenbacks in debt...and you desire the government to handle much extra debt by paying off human beings's credit enjoying cards? With money our government would not even have? Makes surely no experience.

Answer 7

Banks and governments are two totally different things.

What would happen if everybody borrowed money (as in maxed out their cards)? It will cause interest rates to rise, as the supply of lent money will swamped by borrowers. Governments could print more money, but then you would have inflation and/or the plumetting value of your own currency.

You've got a vote. Use it wisely.

Answer 8

If you want taxes decreased start trying to get medicare, Social security, Welfare, Fedral Grant money, all reduced.

Also expect crappier roads, more expensive but less quality health care.

Or move to switzerland.

Maybe if your living off credit cards you need to see what you spending money on.

Answer 9

Then everyone would owe alot of money.