11 Dec 2011

Britain is now a cesspit where decent human beings are trampled in the dirt

I'm not joking. I felt physically sick when my wife Michèle just pointed out to me that in France and other countries in continental Europe there are laws that prevent the practise of usuary, and I realized just how dire the situation in the UK has become. We had been talking about my comments earlier this week on the abomination of Payday loans - the practise of lending desperate people money at interest rates of thousands of percent. There have been reports on the BBC, the Guardian and the Yorkshire Post following a study by the R3 organisation that showed that millions of people in the UK were being forced into taking on such loans because they have nowhere else to go. Social services are being cut back together with child support etc etc.  Christmas is just around the corner. How many desperate mums and dads in the UK will be contacting one of the 25 different websites where you can get a loan that will arrive on your account within half an hour or so - you just have to say that you are in employment? How many will look at their kids and say "I can't imagine a Christmas with no presents for my kids - I'll just take on that payday loan where I can get £50, but where I have to pay back £70 in january".

I was already extremely upset by this. But then (and thanks to Michèle), I discovered that in France we have had laws against usuary for ages (since its introduction in a law passed on 28th December 1966 to be precise). These laws have been respected by both left and right wing governments, and make it illegal for anyone to charge interest rates at more than a certain fixed rate. Have a look at this site, which gives details of the maximum rates that can be charged in France - sorry it's in French. But hopefully you can understand the following numbers that give the maximum rates that can be charged. The numbers were updated for the 4th quarter 2011.

Loans for property purchases
  • Fixed rate mortgages 6.23%
  • Variable rate mortages 5.61%
  • Bridging loans 6.28%
Consumer loans
  • Loans up to 1524 euros 21.03%
  • Overdrafts, revolving credit, temporary loans from 1524-3000 euros 19.27%
  • Personal loans from 1524 to 3000 euros 12.76%
  • Overdrafts, revolving credit, temporary loans from 3000-6000 euros 18.16%
  • Personal loans from 3000-6000 euros 11.65%
  • Overdrafts, revolving credit, temporary loans above 6000 euros 16.62%
  • Personal loans above 6000 euros 10.10%
Business loans
  • Variable rate loans for over 2 years 9.61%
  • Fixed rate loans for over 2 years 5.52%
  • Overdrafts 13.84%
  • Other loans over less than 2 years 6.36%
Incredible. Please note that these rates were just increased significantly - they were even lower for the 3rd quarter. Indeed, there are plenty of people complaining that French laws on usuary have become too laxist (see here, for example).

But at least there are controls.  In France you can get fixed rate mortgages and loans,  and the rates that can be applied are controlled by law. Anyone charging more can be taken to court. And in the UK? Absolutely no restrictions whatsover. If a lender can get away with charging 4000% interest, that's fine. If it is actually impossible to take out a fixed rate mortgage over 15 or even 25 years, that's fine too. The important thing is to leave the financial markets free to do precisely what they like, and sod those who end up committing suicide.

It is this freedom to do what they like that David Cameron was defending so vigorously, and which led him to veto any possibility that the sort of "restrictions" that we have in France might make it across the Channel.

People of Britain, wake up!!

Despite 29 years of living in France, I still feel pretty British. I know that most Britons will tend to shrug their shoulders and say "things could be worse" or "I'd rather not make a fuss". But now, it is clear that the British people should make a fuss. You have a government that is working entirely for the interests of 1% of the population. They have to be stopped.

My friend Philippe committed suicide a few weeks ago. He couldn't face the world in which we live. But he was living in France - a country that still has some semblance of humanity. God help the millions facing misery in the UK. I'd like to wish them all a Merry Christmas, but I think that with the government they have, there is almost no hope.

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