I Am a Banker

Not really.  This is a thought experiment.
I run a bank in an average American community.


My customers save money.  They have passbook savings accounts, certificates of deposit, and individual retirement accounts.

My customers borrow money.  They have personal loans, car loans, home mortgages, and credit cards.

I make plenty of money as a banker.  I take the money my customers are saving and lend it to others at interest rates higher than what I am paying the savers.

I also charge fees for some of the services I provide.

Some of customers are not very well off.  They are struggling.  They live paycheck to paycheck.  That means that by the time they get a paycheck, they have run out of money from the last one.

Sometimes it is hard for them to pay their bills on time.  Sometimes they miss due dates.

This is an opportunity for me to make more money.

You see, if they are afraid of missing a due date, because being late with a payment will result in late charges and may harm their credit rating, they may write a check for a payment and hope it doesn't hit before their next paycheck goes into their account.  But they don't want the check to bounce.  So they have authorized me to pay the check with money that's not in the account yet, even though that means I will charge them an overdraft fee.  Their account may be overdrawn by only a few dollars, for only a day - or maybe only a few hours.  No matter.  I will still charge them an overdraft fee of $37.50.  And if two checks come in before the paycheck, it will be $75.00.  I know it's $75.00 they don't have, and the record keeping didn't actually cost me a penny, but the $75.00 is pure profit, and I'll take that any time I can get it.

I can also make big bucks on the credit card account they have with me.  The federal government lets me charge 20% interest.  This is a gold mine when I'm dealing with people who often cannot pay off the balance every month.  I charge my best customers much lower rates, because they are credit-worthy.  I charge the highest rates to the people whose credit ratings are lower.  Yes, I know, that takes money from them they cannot afford, makes it more likely they'll make a late payment, keeping their credit rating low and their interest rates high, but that's the way this business works (because I like it that way), and I am going to keep charging them high rates to make up for the fact that every once in a while someone declares bankruptcy and I may take a loss.

What's that, you say?  It isn't right for me to charge the highest rates and fees to the people who can least afford it?  You cannot be serious.  I am not running this bank as a charity.  I'm here to make money.  I can't be worried about these customers as people.  What kind of businessman would I be if I did that?

The socialists say the way I run my business contributes to the plight of the working poor, making the problem of little upward mobility for them worse.  Cry me a river.  I am in business to make money.  If I try to make money from customers who have plenty of money, they will take their business elsewhere. They know their business is valuable, and they act accordingly.  The folks who are scraping by have no idea if the bank down the street will give them a credit account or a car loan, and they are afraid to find out.  So they'll stay put.  That's the way I like it.

How do I sleep at night?  Very well, thank you.  I'm one of the 1%, you see.  If you think I lie awake at night worrying about the well-being of the 99%, you have another think coming.  They aren't even smart enough to go to the polls and vote in their own economic interest.  A lot of these working class folks vote Republican!  Can you believe that?  They should vote for democratic socialists, but they believe what they are told about class warfare and the politics of envy, so they keep voting for politicians who promise them a rising tide that will lift all boats, even if mine is a luxury yacht and theirs is a canoe.  And never you mind that sometimes their canoe is foundering while it's full steam ahead for my yacht.  Let me know if you hear them yell for help when their canoe overturns, and I'll see if I can find something buoyant to toss in their direction.  Maybe their church can help.

Socialism will never take hold here in the good old US of A, as long as the masses remain convinced they are not an exploited proletariat but merely temporarily embarrassed millionaires.  They'll never be millionaires.  Certainly not with any help from me.  After all, I have to make a profit.

I love America: the country that allows me to buy politicians who will keep the rules the way I like them.