While the rest of us are wondering whether we will be able to buy enough food after April 2013, ‘Wonga’, founded by Errol Damelin, but better known for the financial involvement of Adrian Beercroft (a mate of David Cameron’s, a Tory party donor and a wannabe employment law ‘reformer’) has just announced that profits at Wonga are up, up, up and away. Its net income in this Time of Austerity has risen 269 percent in just this last year, to a grand total of £45.8m (on revenues of £185m).
In case you have been incommunicado of late, Wonga makes very short-term small loans of up to £1,000 to poor people at an APR interest of 4,214 percent (and no, that’s not a misprint). Last year, the company made loans to two-and-a-half million poverty-stricken desperates, who needed to keep the gas on and the beans on the toast till next payday.
At the moment, the Office of Fair Trading is looking into Wonga, and, while it does so, it has asked the company, ever so politely, “to modify aspects of their debt collection practice … considered by the OFT to be aggressive or misleading practices”. The OFT investigation will cover such thorny issues as:
1. Whether Wonga is giving loans without first checking adequately that the borrower can afford to repay them. (As Wonga is lending to people who can’t make it to payday, you would think the answer to that one was pretty obvious.)
2. Whether Wonga is inappropriately targeting particular groups of people with clearly unsuitable or unaffordable credit. (Again, as the company is lending to people who can’t get money at lower interest rates than Wonga’s, you would think the answer was pretty obvious here, too.)
3. Whether Wonga might be “Rolling over loans so that charges escalate and the loans become unaffordable.”
4. Whether Wonga is “Not treating borrowers that get into financial difficulties fairly.” (OFT launches review into payday lending, 24 February 2012 and OFT requires Wonga to ensure improved debt collection practices, 22 May 2012)
Nothing, you note, about Wonga’s interest rates. [u]Four thousand percent plus[/u] is all perfectly legal in our capitalist Nirvana.
It all shows how true and appropriate still are the following words of Friedrich Engels: “And how the poverty of these unfortunates, among whom even thieves find nothing to steal, is exploited by the property-holding class in lawful ways!” (Condition of the Working Class in England, Chapter 2, 1844)
So long as society has been divided into exploiter and exploiting class, into haves and have-nots, it was ever thus, as noted by Matthew in the New Testament:
“For unto every one that hath shall be given, and he shall have abundance: but from him that hath not shall be taken away even that which he hath.” (Parable of the ten virgins, 25:29)
In Matthew’s day, productivity was low. Under capitalism, however, so massive has been the increase in humanity’s ability to produce the necessaries of a comfortable and dignified existence for the whole of humanity, that there is enough for all, and therefore no absolute need for anybody to be down and out.
It is one of the major indicators of capitalism’s decay and decline that millions in this country are so destitute that they are driven to dealings with Wonga and their ilk, while hundreds of millions in the oppressed countries do not have even that option but are left to starve.
In the short term, everything from soup kitchens, to hunger marches to demonstrations outside supermarkets to shame the profiteers into handing over their surplus stock rather than sending it as waste to landfill must be preferred to borrowing from Wonga. All such companies need to be assiduously boycotted, and the working-class tradition of mutual self-help revived.
Longer-term, however, our indignation needs to be justly roused against this humiliation of our class. The capitalist class, by its inability to lift the poor out of this misery even in rich countries like the US and Britain, has proved that it is unfit to rule.
We must be ready, able and willing to join the struggle to overthrow capitalism and to render every assistance when the working class takes over the function of ruling society and organising the economy.
When capitalism has been overthrown and communism substituted, the economy will be run directly to produce for people’s needs, and to that end, nothing will be wasted – unlike under the capitalist system where nothing happens unless some rich ****** can make a huge profit.
When the working class has overthrown capitalism and established socialism, all working-class people will be able to play our part in seeing to it that everybody has their basic needs fully met, and that, incidentally, nobody’s skills, talents and capacity for production are squandered in unemployment, underemployment, or employment in useless activities.