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Credit Scores: The Progression of Class Warfare
You happily set your pen down having just filled out your umpteenth job application this month. The uncertainty of it all has you asking yourself why you haven’t gotten even one call back for an interview. Then one morning you sit down to read the paper as has become your routine since losing your job 6 months ago. An article leaps off the paper at you! The newspaper article reads: “Employers checking prospective employees’ credit scores, On The Rise.” Your heart sinks into your stomach and you feel queasy. You begin to breath rapidly and inconsistently. But, you remember what your doctor had told you your last visit before your medical insurance you had had through your previous employer lapsed, “Calm down, take slow deep breaths and if that doesn’t work breath slowly into a paper bag.” Damn this anxiety disorder, as the doctor had labeled it, you think to yourself. The doctor had prescribed a little white pill to help if the above mentioned remedies failed, but the prescription is too expensive to pay for. Besides if you had any extra money it would be thrown at the credit card bills, rent, and utility bills that have gotten out of control due to your decreased revenue and this recession the newspapers, t.v. and President keep saying has ended. After a few reps of your rhythmic breathing
techniques to calm your nerves you read the entire article.
The article suggests that employers are using your credit score to determine your “character“ (Are you reliable and trustworthy? Do you pay your bills on time? Do you pay your bills back at all?…etc.) while totally neglecting the fact that in doing credit score checks on prospective employees, employers are actually creating a new form of discrimination. This concocted formula also known as your FICO score does not take into account job loss, wage reduction, or medical emergencies as viable means of measurement. Instead, it analyzes and methodically, perhaps somewhat intrusively, catalogs an individual’s use of credit (applying, charging, paying, etc). Similarities between the FICO scores and Credit Ratings are undeniable. Credit Rating Agencies provide levels of ratings on financial instruments like government bonds, governments’ themselves, currencies, stocks, derivatives, etc. These ratings vary from AAA which is very good to C which is “junk” (aka: defaulting on the debt obligation), with a few kinks or variations here and there dependant upon which ratings agency is doing the rating. It is important to note that there are three major ratings agencies, Moody’s, S&P (Standard & Poor’s) and Fitch IBCA. These rating companies are at the heart of the fraud that has been perpetrated on the American people. By being the “cheerleaders” (providing junk bonds with AAA ratings) Moody’s and its counterparts, in essence, have used “credit scores” to dupe many investors (individual, pension funds, cities and municipalities) into buying something that is worthless. Why should the FICO score be seen any differently? In my humble opinion credit scores are an extension of “class warfare” under the guise of progress. Discrimination is discrimination no matter how you try and justify it.
In the end, I hope this story brings to light the mega-problems that these misguided attempts by employers to use FICO scores to “weed-out” unworthy applicants creates. Essentially employers who do this are discriminating these applicants due, in many times, not because of their “character;” instead due to external forces beyond their control along with current social structures that have been erected which prevent them from gaining any traction and necessary financial momentum for upward mobility. To compound the issue of losing one’s job with the added stress that knowing your credit score might be the reason for someone else’s application being held in higher regard than yours seems illogical to me. But what do I know. It seemed illogical to me to add a trillion dollar healthcare bill onto the nearly 13 trillion dollars ($13,000,000,000,000) are government owes already, but that didn’t stop it from being passed by our “elected” representatives. By the way, that breaks down to $117,000 per tax payer according to http://www.usdebtclock.org/. It seems that a downward spiral has begun in the United States and credit scores, rating agencies, and the government are only intensifying and perpetuating this trend.
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