Why not debtors' prison?

otherone said:
Why must the state be accountable for a business' failure of due diligence? If you make bad loans, you should fail as a business.
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Yeah, thats what I was getting at. Someone will be punished, not by the state putting them in a cage, but by not being able to borrow as much in the future.
 
Tpoints said:
then prisons would be an appropriate punishment when debts can't be expected to be paid back
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Why??
Prisons are expensive to build and staff and maintain.
The debt could not be paid by an inmate, in fact more would be spent on upkeep.

How could anyone think this was ever a good idea? (likely the reason they no longer exist)
 
Tpoints said:
if you're just saying we need a balance between too much fear of irresponsible loans and not enough, we agree.
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No the point is that responsible loans can default. You don't know in advance which ones will, it's called uncertainty and it exists.

In my example, every loan was responsible. Each borrower would repay if able.
 
How in the hell does someone in prison ever have a chance of paying off a debt?

Not a very well thought out question.
 
Big Finance would never allow debtor's prison.
The demand for credit would plummet.
People wound not purchase things unless they had the money.

I haven't read the every post in the thread, but it seems that everyone thinks the amount of loans would stay the same and we would have a huge prison system bulging at the seams with debtors.

I don't see that. I see people taking less loans.
 
The Gold Standard said:
If someone owes you money, you have the right to get that money back or equivalent property. Any judicial system, whether public or private, can handle that. What you don't have the right to is to enslave someone because they owe you money.
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So you think that if we enter into an agreement where I agree to pay you fifty bucks for a concert ticket and I never show up because I got sick or lost my fifty bucks, that you should be able to use force to come and take fifty bucks from me?
 
Acala said:
So you think that if we enter into an agreement where I agree to pay you fifty bucks for a concert ticket and I never show up because I got sick or lost my fifty bucks, that you should be able to use force to come and take fifty bucks from me?
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If you didn't pick up the tickets then no, of course not. If you were sent the tickets with the agreement to pay for them, and then never did, then I can absolutely use force to get my money from you. I can't use force to take your car, or $100, but I can to get the $50 owed me.
 
I think you guys are unfairly attacking Tpoints. Assuming you're not an anarchist, jailing debtors is an interesting question. There's a fine line between theft and not paying back a loan, correct? What if someone borrowed money with no intention of ever paying it back? What if you pay cash for car and they never give it to you? Is that theft? Ultimately however I agree that a debtors prison would be a bad idea from a practical standpoint. I think a good compromise is to strengthen bankruptcy laws.
 
Also isn't it interesting that you can't be put in jail for not paying another private party but if you owe the government it's a whole nuther story!
 
Madison320 said:
I think you guys are unfairly attacking Tpoints. Assuming you're not an anarchist, jailing debtors is an interesting question. There's a fine line between theft and not paying back a loan, correct? What if someone borrowed money with no intention of ever paying it back? What if you pay cash for car and they never give it to you? Is that theft? Ultimately however I agree that a debtors prison would be a bad idea from a practical standpoint. I think a good compromise is to strengthen bankruptcy laws.
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Advocating the unconstitutional is not something that tend to get treated with kid gloves on this forum. And one can never attack Tpoints, it's impossible. One can only counterattack.
 
Good point acptulsa--isn't bankruptcy written into the Constitution? If the gov't/citizens want to change it, there should be a Constitutional amendment--don't recall one for the student loans exception.

Anyways, bankruptcy is now something pretty much only for the rich, it costs quite a bit to file for it since Bush II from what a friend told me.
 
The Gold Standard said:
If you didn't pick up the tickets then no, of course not. If you were sent the tickets with the agreement to pay for them, and then never did, then I can absolutely use force to get my money from you. I can't use force to take your car, or $100, but I can to get the $50 owed me.
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I find this interesting. If it was fraud - when I told you that I would pay you I had no intention of doing so - I agree that you can use as much force as is needed to recover the money stolen from you.

But let's assume the harder case - that I fully intended to pay you but disaster struck and I could not. Under common law it would be a breach of contract but not a fraud. Can you use force to recover your money from me? Enter my home by force and take something at gunpoint? Where do we draw the line and why?
 
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Acala said:
I find this interesting. If it was fraud - when I told you that I would pay you I had no intention of doing so - I agree that you can use as much force as is needed to recover the money stolen from you.

But let's assume the harder case - that I fully intended to pay you but disaster struck and I could not. Under common law it would be a breech of contract but not a fraud. Can you use force to recover your money from me? Enter my home by force and take something at gunpoint? Where do we draw the line and why?
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Well, I'm no expert on common law, but I would think the two would involve different amounts of force. It is was proven fraud maybe I should be able to kick in your door and take my $50 back. If you intended to repay but couldn't due to hardship, maybe I could put a lien on your property that would guarantee I'm paid back if you ever sold it. That is still force, but to a varying degree. Either way I don't think it is disputed that I have a right to claim the $50 I am owed.
 
The Gold Standard said:
If you didn't pick up the tickets then no, of course not. If you were sent the tickets with the agreement to pay for them, and then never did, then I can absolutely use force to get my money from you. I can't use force to take your car, or $100, but I can to get the $50 owed me.
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There are more possible nuances that may matter.

It is possible to have a breach of contract where the aggrieved party is not worse off than he was before the contract, but lost the benefit of the bargain. For example, suppose I am selling widgets for 10% above my cost. You agree to buy some, then later back out BEFORE I have delivered them. I am not out of pocket any money but have lost the benefit of the bargain we made. And you gained nothing in the transaction. Under the common law of contracts, I would be entitled to recover the benefit of my bargain - my 10% - from you.

Now suppose I delivered the goods, you used them, and you never paid me. I am out of pocket 90% of the purchase price and did not gain the 10% benefit of the bargain. This time you gained by the transaction and I lost.

Yet a third possibility, we make a deal and I prepare to deliver a custom-monogramed widget to you. You refuse delivery and refuse to pay. I can't sell the mongramed widget to someone else so I am out my cost plus the markup I would have gotten. But you gained nothing in the transaction.

In which scenarios can you recover by force and how much? And why? (Libertarian law school exam)
 
The Gold Standard said:
Well, I'm no expert on common law, but I would think the two would involve different amounts of force. It is was proven fraud maybe I should be able to kick in your door and take my $50 back. If you intended to repay but couldn't due to hardship, maybe I could put a lien on your property that would guarantee I'm paid back if you ever sold it. That is still force, but to a varying degree. Either way I don't think it is disputed that I have a right to claim the $50 I am owed.
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Consider how a pure market might handle it. With no government to intervene, people might require third-party performance bonds so that in a breach situation you simply make a claim on the bond. Or, and this just hit me, the contract itself could include remedies. For example, the contract could say "if either party fails to perform, the non-performing party consents to the aggrieved party or his agent entering upon the other party's property to recover goods or specie equal in value to X". Now you have consent to a self-help remedy for breach.
 
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Debtor's prison? Not a good idea. Indentured servitude would be more feasible.
 
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