Five Most WTF Poor Taxes

Poor taxes are charges poor people pay because of being butt-ass poor: lottery tickets (yeah, let's leverage that grocery money), check-cashing fees, rent-to-own. Still, in that egregious mix of soul-deadening capitalism, five "poor taxes" stand out.

Sung to the classic,

Just The Facts

  1. State income tax in Alabama, which up until 2004, took a share of any household income that met a $4,600 threshold. It was raised to $12,600 in 2006 thanks to a lobbying effort by a group of poor people.
  2. The fees for payday loans are extremely high: up to $17.50 for every $100 borrowed(1) , up to a maximum of $300. The interest rates for such transactions are staggering: 911% for a one-week loan; 456% for a two-week loan, 212% for a one-month loan.
  3. When this practice was legalized in California, the industry argued that payday loans were used for occasional emergencies for a short term. This is simply untrue. According to a Wall Street analyst covering the industry, "the average customer makes 11 transactions a year, which shows that once peop
  4. Lenders are squeezing U.S. consumers for as much as $4.2 billion annually in the steep fees charged on payday loans, according to a study released by the Center for Responsible Lending and other consumer advocacy groups.
  5. Forty-seven percent of American households pay no federal and income taxes. But the modifiers here, federal and income taxes, are important qualifiers.
  6. Caption: Is it just me, or are most transactions by poor people done in front of bars?

Repossessed Automobile Access Fee - Or, paying ransom on your legally owned items

Here's a fun fact: if your car is repossessed and you want to retrieve your valuables -- grandma's ashes, your sexual diary ... your wallet with ID and credit cards that might allow you to get your payments caught up -- it's gonna cost you.

That'll be 25 bucks or whatever the hell the repo company feels like charging that day. Oh, and don't bring anything but cash.

I've got to wonder what kind of low life snake would actually sit down and come up with an idea to squeeze a few more dollars out of someone at the bottom of their life? I'm guessing a car repossession is one of the larger turds in the shit sandwich that is that person's day. What better way to teach about human nature than to be charged to fetch your own stuff?

In a world full of Oxygen Bars and gold-plated cellphones, this is one of the ballsiest pocket searches imaginable. The template for this business model must be the burglar that phones you after stealing your purse and asks you to provide a PIN number because -- darn it -- there's no money coming out of the ATM.

Source: http://wiki.answers.com/Q/Can_the_repo_company_charge_you_to_retrieve_your_personal_item

Check cashing fees - Or, banks charging fees to cash checks that are written by their own customers

Banks make you pay a fee to cash checks drawn on them if you are a non-customer.

This concept turned me gay. Seriously. It is so inconceivable and mean-spirited that my life up until I discovered this little "poor tax" must have been a lie. And, although I have always considered myself the opposite of whatever "flaming" is, I have no choice but to surrender my ass to Dorothy -- a well-endowed Asian man partial to sparkly red shoes, gingham and toy dogs in picnic baskets.

To recap: banks charge non-customers to cash checks that are written by people who have accounts with the bank you are trying to cash that sonuvabitch in!

This fee is particularly galling for those who sold gold, semen or blood to earn that check. It goes from feelgood to tragedy pretty fucking quick when $50 is counted out by a smiling teller and there's a Lincoln missing. That $5 could be either the transportation or food portion of the week's budget. I am shocked beyond measure that this fee doesn't end badly on a daily basis.

"Wait, you're telling me there's enough money in this account, but you're still going to take out five dollars even though cashing checks is, you know, kind of a bank's job?"

I see it playing out along the lines of a fatal version of Abbott and Costello's, 'Who's on first?" skit with a bitch being stabbed in the eye. And, then I laugh and laugh.

At least a repossessed automobile retrieval fee could have some work involved -- a guy pointing disinterestedly in the general direction of your car. What the hell is this fee for? Roshombo for not having a bank account?

Or, could it be to teach children an early lesson about the real world?

Or, could it be any money they'd count out to the likes of you needs to be segregated along with all the other darker green money and a special tax is needed to set it free? If that's the case we need a Malcolm $ to set these motherfuckers straight. Power to the poor people, baby!

Source: www.bizjournals.com/sanfrancisco/stories/2005/09/05/daily12.html

Source: http://www.complaintsboard.com/complaints/wells-fargo-c446515.html

Internet Loans - Or, Holy Shit! How much interest am I paying?!

Do you know why banks hate you? It's because they see what Internet Loan Companies do to poor people and think, "Fuck! You middle-class pieces of shit aren't bleeding enough.

The business model for Internet Loan Companies (ILCs) begins with hiring the biggest, baddest motherfucking collection department in the world. They then transplant the brains of sociopaths into dogs that scare the shit out of junkyard owners, teach those dogs to collect money and make them supervisors of those collection departments.

Then, they buy another collection department in India and wrap it inside the first one.

Why? Because you can't pay back the money they loan you using the terms they give you. So, they will hunt your ass down by facebook, Twitter, Google and smoke signal right after you - of course - default.

But, the neatest trick they pull is that the money they loan you isn't the amount of your loan. (I know, that's some parallel world shit, right?) One of the up and coming ILCs, CashCall, is happy to loan you $1,500. After crawling up your ass to find out where your second cousin likes to get illicit blowjobs and where you are most likely to run if you had to ... get away from it all... they will make you sign a legal document that says you were loaned $1,500 -- but agreed to make an upfront payment of $500 prior to receiving it.

So, the $1,000 that lands in your account is actually only two-thirds of what you you owe for your principal. And, guess what? They're not charging interest on $1,000 actual dollars, but on $1,500 mindfuck dollars. That phantom $500 alone should be enough to say WTF, but wait! It gets even better ... for them.

Western Sky Financial, one of the most patronized ILCs, is a relative kitten with upfront fees (calling them origination fees), but a bear on the back end.

"For a $2,600 loan, Western Sky Financial publishes a 139.22% APR. For this loan, you would make 47 payments of $294.46 for a total of $13,839.62. Of course, you are really only getting $2,525 in proceeds, since Western Sky charges a $75 origination fee...To put this in perspective, imagine buying a $10,000 car using the same terms. You would need a $288 down payment to pay the loan origination fee so that you could borrow the full $10,000 to buy the car. Then you would make 47 payments of $1,166.17 for a total of $55,098. That would be the equivalent of paying for a brand new BMW yet driving a stripped down Nissan."

Source: http://www.ripoffreport.com/loans/cash-call/cash-call-i-borrowed-2-525-l-92668.htm

Source: http://www.debtorsunite.com/Blog/Debtors-Fight-Back/June-2011/What-Interest-Rate-Does-Western-Sky-Financial-Char.aspx

Health Insurance - Or, how I learned to stop living and love dying

Caveat Emptor is Health Insurance Industry -speak for, "Bend over; we're driving." Buyers are certainly welcome to beware all they want; still, the bear about to bite off their nuts has: keys to their house, their work schedule; access to their bank accounts; a list of their next of kin, a pact with their ursine brothers that everybody gets a bite and a lust for bloody nuts. As far as what the buyer can do about it; there are always two options -- take it like a man or scream.

The bears like it better when you scream.

While middle class folks are certainly curmudgeonly about health insurance; health care costs force poor people to accept the frayed limits of their existential capacity to survive and provide for their beloved poorlings. There is no "skip a vacation" option for poor people. It's more skip a meal; or, skip an apartment.

Medicaid? Yeah, good luck with that. In its own words - "Medicaid does not provide medical assistance for all poor persons. Even under the broadest provisions of the Federal statute (except for emergency services for certain persons), the Medicaid program does not provide health care services, even for very poor persons, unless they are in one of the designated eligibility groups."

You know that 47 million uninsured Americans meme? Medicaid likes to wipe its ass with their sob stories. Cost-wise, I could rail at Blue Cross Blue Shield of CA, which decided it would raise rates by 59% in 2011, but were apparently talked down by Jesus with a bullwhip and chair.

Which is kind of a good thing, because the nation's car dealers were waiting to see if they could get away with, "Oh, sorry. That $20,000 car is now gonna cost you $31,800. Why? Write the check and shut up!"

But, why pick on BC/BS? According to leftist rag the Wall Street Journal, the average deductible for health insurance plans rose from $770 in 2005 to $1,200 in 2010. Wait! Isn't that the $1,000 I borrowed from the Internet Loan Company to pay for the drugs I needed to live? Oh, shit!

Source: http://articles.latimes.com/2011/jan/05/business/la-fi-insure-rates-20110106

Storage Units Late Fees - Or, a very high priced method of giving my shit away

People to this day are griping about $800 toilet seats paid for by the Pentagon. Screw that! Poor people don't have $800 lying around. What they do have is $17, which could buy them one lock at a Public Storage facility. Public Storage, founded in 1972, is a multi-billion dollar company (and home of the $17 padlock) with the best consumer leverage EVER: Give us your shit; pay us money and your shit won't disappear.

Heart surgeons tried to rip off the model, but between the anesthesia and patients dying on the table; it didn't translate nearly as well.

So, you can't afford rent, but you'd like a safe place to keep the Kaypro that your dying grandmother left you in the will she wrote on the back of that Olive Garden napkin? Will a 5' x 5' space in St. Paul, MN suffice? That'll be $84 a month, or more commonly known as $1,008 annually. Damn! What is it with companies wanting $1,000 from poor folks?

Want boxes? That will be $3 - per box. Want to get your name in the system so they can bill you? That's a $20 administration fee. Whatever this administration shit is; it's damn lucrative.

But, the real costs come when you "show your poor." (No, not 'you're', I hate people that get that wrong!)

Showing your poor means missing a payment.

Then it's on! After a quick, tearful call to their peeps at the Internet Loan Company to share the joy, your friendly neighborhood self storage facility operator wracks you with late charges that in no time at all can double or treble your fees. Or, more.

Even better, you can't even get to your shit because they block your access. And, when all your money has deserted you, you've missed two or three rental deadlines and they've decided you won't be making any more timely payments, they sell your shit to strangers.

Let me put that last thing in context: the only thing you wanted was a safe place to put stuff that -- based on your observable behavior -- was valuable to you. So, all that money you paid to keep your stuff safe right up until your layoff/illness/groceries splurge at Whole Foods was a preamble to you crying in some piss-soaked alleyway about heirlooms and retro t-shirts that some strangers are enjoying immensely. Or, tossing in the trash, whichever hurts worse.

Actually, that is why the poor are better people than the rich. Not only are they contributing to a healthy bottom line for everyone -- a thousand dollars at a time -- they are the kind of loving people who pay to give their valuables a safe and secure home before donating them to strangers.

Ain't that noble?

Source: http://www.legaljet.com/consumer-law/class-action/i-would-like-to-file-a-civil-suit-against-a-storage-company-for-selling-my-stuff-without-giving-me-i