Maxed Out

REVIEW by Willard Manus

Chances are, you won't be the same after seeing MAXED OUT, a new documentary film that lifts the lid on the festering problem of credit card debt in the USA. Directed by investigative reporter James Scurlock, MAXED OUT is an important and hard-hitting work that comes out of a muck-raking tradition whose line descends from Michael Moore and Haskell Wexler to Upton Sinclair and Randolph Bourne. It is American journalism at its best, taking on the power structure in a bold and courageous way, exposing the greed and dishonesty of the banks and credit-card companies that operate almost at will in this country.

Here are some of the facts that form the backdrop to MAXED OUT. Americans owe over two trillion dollars in consumer debt. Every American household receives nearly fifty credit card solicitations in the mail each year. The nation's personal savings rate for 2006 was a negative one per cent, the worst showing in seventy-three years. Low and middle income households have an average of $8, 650 in credit card debt. From July 1, 2005-June 30, 2006 there were l,453,009 personal bankruptcy filings.

Not only is the U.S. government in debt--our negative balance of trade is in the billions--two out of five U.S. families are in debt, some so deeply and overwhelmingly they will never get out of the red, meaning they are condemned to a life of anxiety and vulerability. Our financial institutions are bleeding us dry and almost no one, certainly not the government, is doing anything about it. On the contrary, most of our politicians and civil servants side with the financial institutions, paying lip service to consumer protection but doing diddly squat to keep us from being ripped off.

One scene in MAXED OUT proves the last statement. In 2005, when Congress held its first hearings on the credit card industry in ten years, the Senate Banking Committee adjourned without asking a single question of the assembled heads of the likes of Citibank and Bank of America. Instead, these fatcats were allowed to read a brief, self-serving statement promising to look out for the consumer's best interests. No critics of the industry were given the chance to speak; the senators, you see, had to repair to the floor to vote on a "important" transportation bill. In effect, the credit card companies were let off the hook. The committee has never asked them back.

MAXED OUT reveals other shocking details. Declaring bankruptcy has always been one way for the average person to get out desperate, debilitating debt. But in 2005, President Bush signed a bill--written by the credit-card companies!--making it harder and more expensive to apply for bankruptcy. Bush also appointed an ex-credit card bigshot to "regulate" fraud and excess in the industry. Neither he nor anyone else from the financial establishment would agree to be interviewed in MAXED OUT.

Don't think, though, that Scurlock's film deals only with numbers and abstract issues. On the contrary, he focuses mostly on the human side of the problem. He gives a lot of camera time, for example, to Janne O'Donnell and Trisha Johnson, two women from Oklahoma whose children committed suicide because of credit card debts incurred during college.

It turns out that the banks give out cards on campus to just about any student who wants one. Unknown to their parents, Janne's son and Trisha's daughter signed up and went crazy with their cards, as many 18-year-olds do. The shame and guilt ultimately became so overwhelming that they both hung themselves. When the mothers testified before the Oklahoma Legislature on behalf of a bill that would have banned credit card marketing on college campuses, the industry lobbyists went to work and killed the bill.

The financiers in MAXED OUT do other reprehensible and outrageous things, like hoodwinking a mentally retarded man into signing a form refinancing the family home with an unpayable mortage, or charging 40% interest on marginally late payments, or urging people to take out home equity loans to bring down credit card balances (resulting in widespread foreclosures).

What MAXED OUT shows is that we're living in a house of cards--credit cards. And that it could all come tumbling down around us.