Equifax and our credit-fueled lifestyles

The Equifax hack has caught the nation’s attention. And not in a good way. The private information of 143 million Americans is at risk. Criminals are apt to open credit card accounts or buy new cars in our names. And the immense task of cleaning up the mess rests on us. The anger is palpable and justified. Shall we simply shut down these damnable, incompetent credit reporting agencies?

Very tempting, but first let’s look back at where they came from and what they do.

In the 1800s, credit was very personal. A wealthy manufacturer was known, personally, to his banker and was able to borrow to build a new factory, for instance. Banks, in those days, catered mainly to the rich, and the rich bankers and rich capitalists ran in the same circles: they knew each other.

To us normal folks, credit was more likely to be extended by local merchants. A farmer would borrow from the town’s general store to buy seed, and would repay the loan when the crop was harvested. The store owner knew the farmer personally, and extended the loan based on that intimate knowledge.

In the 1946 classic “A Wonderful Life,” homes were bought on credit based on the worthiness of the borrowers as personally known to the community. (The heartwarming conclusion involved a community inured against making a run on the bank. They trusted George (Jimmy Stewart) because they knew him).

But as we moved into the twentieth century, several major trends grew and entwined. The population boomed. Many more people lived in the cities than on farms. Assembly lines began to create mass quantities of consumer goods. Automobiles. Sewing Machines. Washing Machines. Radios. And many of these items cost more than the typical worker could conceivably pay in one chunk. For instance, at the turn of the 20^th century, the average annual factory wage was $500 while a sewing machine cost $100. So Singer Sewing Machine Co. began offering credit to its customers to enable them to buy a machine on an installment payment plan.

Here was the problem, though. Singer didn’t personally know their customers. They had to find some other way to determine if they were creditworthy. And hence grew the demand for services from the Retail Credit Company (which became Equifax) and other credit reporting agencies. These firms employed investigators and maintained files on potential customers, allowing the sewing machine and washing machine and automobile companies to make a somewhat informed decision whether to extend credit or not.

And then came the credit explosion in the last half of the twentieth century up to today. Credit cards, secured only by personal integrity, grew rampantly. New cell phone accounts, insurance policies, automobile loans, were all expected to be approved on the spot. The credit reporting agencies were forced to use massive computers to collect, collate, and quickly report credit trustworthiness to lenders who were under the gun to approve a loan within minutes, or seconds in the case of credit card transactions.

And here we are today. For whatever sloppy reason, Equifax didn’t properly secure our data. And we suffer. What to do?

We have decided to freeze our credit rating accounts. This is because we don't plan to refinance the house or buy a new car, open a new credit card, or a new cell phone plan. All of those things require a credit check which would be blocked by the freeze. But we don't intend to do any of them. In any case, a freeze can be removed, temporarily or permanently, at any time if necessary.

It took us about 30 minutes to get all four (yes, four) credit rating accounts frozen. We decided to do it online rather than deal with phone calls or mail. Here are our experiences.

Transunion. https://freeze.transunion.com/sf/securityFreeze/landingPage.jsp

This company insists that you create an online account with them in order to freeze via online request. It took a few minutes. The freeze cost $5 (charged to credit card). Based on which state you live in, you may not be charged a fee. Transunion asked us to create a six-digit PIN which must be used in any future request to unfreeze the account. Write it down and don't lose it!

Experian. http://www.experian.com/news/security-freeze.html

Also $5. Also, could not use our normal browser, it refused to load the site. But we tried Internet Explorer and it worked fine. Also asked us to create a PIN. Write it down.

Equifax. https://www.freeze.equifax.com/Freeze/jsp/SFF_PersonalIDInfo.jsp

The company causing all of this angst didn't charge us anything to freeze our account. Good on them. They assigned a 10 digit PIN to us and we printed it out.

Innovis. https://www.innovis.com/securityFreeze/index

A new kid on the block in credit rating firms, also the easiest to freeze. No fee. They will snail-mail a confirmation (with, we expect, our PIN).

Freezing your credit rating accounts doesn't mean that your personal information hasn't (or couldn't in the future) be stolen. But it keeps the crooks from easily obtaining loans, opening lines of credit, or acquiring new credit cards in your name. This will save you untold grief.

At the end, the credit rating firms inspire our anger, but they enable our credit-fueled lifestyles. Unfortunately, we can’t have one without the other. They are the necessary replacement for personal, intimate knowledge.

But further legislation is possible. The Fair Credit Reporting Act of 1970 improved things a lot. There is certainly more to do, to protect us and shift burdens to the FCRA companies. Talk to your legislators about this.

And good luck.

We must be prepared to deal with evil, at home or abroad. Else it will deal with us.

An orphaned Rwandan child

“War leaves all children behind.”

A sentiment with which we may all share a great measure of  sympathy. War is a terrible thing and children are often casualties, emotionally if not physically. Photographs from war zones tear at our hearts, compel us to demand the cessation of hostilities. But too often, our demands are unmet.

The unfortunate truth is that we are not all kind, compassionate human beings. There are some number of us who are out and out criminal, possibly thirty percent according to a Wall Street Journal article. Citing a study first published by the American Academy of Pediatrics, the study (“Cumulative Prevalence of Arrest From Ages 8 to 23 in a National Sample”, December 2011) found that by age 23, the prevalence of non-traffic arrests “lies between 25.3% and 41.4%.”

The AAP’s finding: “At a minimum, being arrested for criminal activity signifies increased risk of unhealthy lifestyle, violence involvement, and violent victimization.”

Let’s ponder that last bit, violent victimization, and remember that this tendency may exist in approximately 30% of the population.

Now, pivoting quickly to Africa, and back in time to 1994, let’s consider the mass slaughter that “wiped out about three-quarters of the ethnic Tutsi population in the African nation of Rwanda…” (Science News, “Duty Bound Killings,” August 19, 2017). Although estimates of the carnage of this modern genocide range from 500,000 to 1.2 million deaths, “most scholars place the death toll at 800,000.” The dead were indiscriminately made up of men, women, and children. Perhaps these children would have wished for a military intervention (war) to relieve them of their affliction.

Let’s consider, though, how many of the Hutus made up the killing squads? “In reality, only 20 percent of Hutu men seriously injured or killed at least one person during the genocidal outbreak.”

Now we have two estimates, ranging from twenty to thirty percent, of human beings who are willing and capable of visiting violence upon their fellow creatures. Is it any wonder that we must invest billions of dollars in police assets to discourage such violence? And at the national level, these same psychoses exist, with good and evil nations, since nations are only human tribes. And when the evil ones wrest control somehow, such as in North Korea, it is their own people who suffer, and we who are threatened.

And thus the need for a strong military, to discourage the adventurism of evil nations. While we might want to believe in the beauty of the pure, good human soul, it is clearly not universal. We made this mistake in the run-up to World War II, when we and our Allies disregarded the adventurism of the Germans and Japanese. It was our relative weakness that encouraged their boldness.

While tomes have been written by learned sages in hallowed halls, it still comes down to this. If we let you bully us, you will. If we show weakness, you will seek advantage. This is human nature, twenty to thirty percent of which is entirely disagreeable. This applies to individuals and nation states equally, as we are all human.

There are many stories of human goodness. Witness Houston, with volunteers flocking to the rescue, bringing their personal boats and monster trucks to patrol flooded neighborhoods, bringing succor to those poor victims of the storm. Irrespective of race or station in life, they were rescued and were grateful. But those good people are the seventy percent. We must still deal with the thirty. Police are a necessity. A strong military is essential.

We must be prepared to deal with evil, at home or abroad. Else it will deal with us.