Lessons learned from the documentary Maxed Out
I sat down to watch James Scurlock’s documentary Maxed Out, totally prepared to be alarmed by the status of consumer credit throughout the nation. After all, I figured if someone had taken the time to produce a film about debt that it probably wasn’t going to be all sunshine and roses…unless it was produced by credit card companies, of course.
Scurlock does a great job of making some really poignant points without using any huge shock tactics. For example, while he does mention every American family’s share of the National Debt ($90k when the film was made), he doesn’t do anything like keep a running ticker on the screen to scare the pants off the viewers. He lays everything out and lets the viewer decide whether to run screaming to cut up their credit cards or instead to merely be a little more cautious with their debt load.
I learned some interesting things from this film.
The movie revealed some really intriguing things that I had never really thought much about before:
Credit wasn’t always so easy to get. When I entered college I got my first credit card. I’ve always thought of credit as accessible and easy to get. Apparently it wasn’t always this way. There didn’t used to be such a huge market for subprime lending. In the past, getting a credit card was a big deal. Now it’s just something a lot of people do when they become an adult.
Subprime lending is enormously profitable. Credit card companies might act like they are doing you a huge favor when they give you a credit card or loan despite your bad credit history. In truth, you’re exactly the type of customer they are looking for. If you have a history of late payments then thelender is pretty sure that they’ll be able to squeeze some profitable late charges out of you in addition to the high interest rate they’ll charge.
Credit card companies and the credit bureaus are in cahoots with almost everyone. Credit card companies and credit bureaus help fund political campaigns, they lobby with current politicians, and they even sponsor some of the so-called media financial experts who tell us how to get out of debt. In other words, they influence us even when we don’t realize it.
Credit bureaus have separate files for important people. I’m not entirely sure about the validity of this statement, but according to a man featured in the film there is a separate database for credit reports that belong to politicians, famous people, and anyone else who could really raise awareness if their reports had errors on them. The man says that this special database is treated much more carefully than the reports of all the “normal” people like you and me.
Debt collectors can be a little creepy. I’ve always just thought of debt collectors as people doing a job, but the folks profiled in this movie make the profession seem awfully sinister. One collector describes his job as that of a pirate: He puts debtors up on the plank and nudges them with the sword until they get right to the edge. The trick, he says, is to make sure they don’t actually jump off the plank, but instead get just freaked out enough to send in a payment. I’m not sure if his “jumping off the plank” metaphor meant declaring bankruptcy or committing suicide, but I get the feeling both scenarios are equally distasteful to these collectors because both result in no payment.
It’s hard to think of the growing consumer debt as someone else’s problem after watching this movie. Scurlock profiles people from various socioeconomic backgrounds and shows that nobody is immune to falling deeply into debt.
After I watched this movie I had the intense urge to go chop up every credit card in my wallet. This is a great film to watch if you need some convincing that maybe whipping out a credit card to fund every purchase isn’t the best idea. Best yet, it isn’t as dry as you might think a documentary about debt would be. I forced my friend to watch it with me, and even though I knew I would get a kick out of it because I find the topic interesting, he wasn’t sold on the idea. Thirty minutes into the film he was sitting up, letting an occasional “Whoa!” or “Sheesh!” escape. That’s a sign of a good documentary.
Related posts:
- 6 Lessons Learned From Being In Debt
- The Last Lecture – Lessons from a Great Man
- Watch James Scurlock’s ‘Maxed-Out’ Online for Free
- Hot Checks: Lesson Learned…The Hard Way
- Do You Consider Your “Collection” An Investment?
My wife and I watched Maxed Out a few months ago from Netflix.
We were pretty impressed with it until the end, when they started interviewing folks whose family members have committed suicide after racking up large debts. If I remember correctly, at the finale they were cutting back and forth between George W. Bush talking about stimulating the economy, and the weeping surviving family of a debtor that committed suicide. It seemed like a very cheap last-minute political stab that took advantage of these folks.
Of course, these folks ended their own lives during the Clinton administration, but hey, let’s jump on the W-hating bandwagon! It’s teh evil GOP!
If I was going to share this with someone just starting out, I would probably cut it off at about 75%, after it gets past the part where these folks are dealing with the consequences of their personal irresponsibility, but before turning it into a political issue and parading grieving family members.
Fair point Paul – although consumer debt has really exploded in the last few years, it was already well on its way during the Clinton era.
[...] today while watching this documentary (you can read a review on the Master Your Card blog), I got to thinking about it all again and the financial situation my family members find [...]
Jonathan –
We really enjoyed Maxed Out. This one really open’s your eyes as your image of these credit card companies shifts from this happy, fun, ‘we want to help you’ company that you see in their ads to a blood sucking, preying on the poor bunch of vultures. It’s truely an industry that survives on marketing and lobbying.
Looking forward to IOUSA. Seen the trailer?