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Originally Posted by EinsteinsGhost
Might be true to some extent if the employer truly cares for the applicants and is not overwhelmed by applications. Rarely the case during times of high worker demand, much less now. Coupled with the long term economic disaster this has been, I fully expect a lot of people whose credit has been shot but they could be more productive and better employees than those currently holding their jobs. Credit can also get shot from medical disasters (bankruptcy), an alarmingly common issue here in America, more so with poor job
market.
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We now start getting to the meat of the issue. There are so many considerations when hiring someone, so many "wrongs" that can be committed to which someone is hired over another that was not as qualified due to various errors in the process. People are sometimes dismissed over clothing they wear (not inappropriate or bad, just that the interviewer doesn't care for it). I have seen some say they didn't like the tone of the persons voice, or that they had big teeth and smiled to widely all the time or they were homely, etc...
There are all kinds of reasons why a person may not get hired that has nothing to do with a job and are much more of an illogical position to dismiss.
You make the case about how people can have hard times and the bad credit could be the result of an honest misfortune. I don't deny this, but is it the norm? As I said, my wife worked in the industry and those of honest problems were usually proactive in resolving the issue (calling in before it was late, asking the business about what they can do to resolve the issue and limit the damage to their credit) to which often resulted in the business making great exceptions and working with the person. Those though, we a minority.
The norm was someone who was evasive, combative, disrespectful, devious in their discussions, accusatory, and reactive. They never took the initiative to solve their problems and much of the severity of their problems was due to irresponsible decisions, lack of ability to take care of their business. This is her experience though and while it may be limited, she did deal with accounts all over the country and in large volumes. Is it the norm? I honestly do not know, but I personally wouldn't be surprised if it were.
Quote:
Originally Posted by EinsteinsGhost
This mentality is one of those that is pushing American society in the exact opposite direction than "the invisible hand" alluded to when Adam Smith wrote about it in The Wealth of Nations. We're quickly becoming a nation of self-defeaters.
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I do not agree. I think by holding standards of such to a level, it spurs responsible attention to ones economic responsibilities. If the standard is good credit and we do not make exceptions for poor credit, then society adjusts its focus to obtain more, to obtain better. It is the attention to those who do not take such responsibility and the excuses we make for them I believe that leads to their continued abuse and neglect. If we set the bar, by human nature, most will reach to obtain it. There will be those who fail, but this is life and those are individual choices. Lack of consequences is what truly promotes poor behavior in my opinion.
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Originally Posted by EinsteinsGhost
The point wasn't necessarily on plastic form, but on credit itself, the crony capitalism that has been pushing this country towards economic disaster.
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Well, I won't directly argue against you with some of the pit falls concerning credit. In some cases it has been successful in spurring growth and allowing the common man to obtain things they normally would never be able to achieve. On the flip side, there is the issues with it inflating prices due to irresponsible use. Sure, we may have a lot more people buying things, but the result is increased debt to which can get out of hand rather quickly.
I have experienced the weight of such in my life (though never to the point of being unable to meet my responsibilities) and I have also been able to apply use to such to my own benefit. Currently, my credit card pays me, not I it and responsible use of my credit in the past has allowed me to actually live through an economic hardship for a period without having it be disastrous. Something that would not be possible without extensive forethought through savings and emergency reserves. Credit at times is the problem, and at other times it has been the solution.
I honestly think that the real problem is simply people and their growing comfort to being irresponsible. This I think is the true cause of much of our problems and the only viable solution for such is to let each be held to the consequences of their decisions. If we excuse them of it, they will never make steps to change their poor habits. proactively managing them means we must infringe on the rights of people to choose on their own. While such actions may benefit some, it is a violation to those who are responsible.
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Originally Posted by EinsteinsGhost
Are you telling me that a person with acceptable credit history is capable of performing the job? Are you telling me that a person with better credit history is better than another with just acceptable credit history to do the job? Or, is there more to doing a job? I've long admired a company for its philosophy and especially its beginning: Honda.
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On that knowledge alone? No. It is an element of assessment like many others. You can evaluate many things and each thing you evaluate will begin to give a better picture of the person. Nothing is definite, there are no guarantees, but I think it can be used as a part of such to identify ones responsible nature if attended to properly.
Also, I don't think that credit history is completely useful past the point of its extremes. The extremes are maybe the indicators of note. For instance, someone with a 400 credit rating obviously has issues. It takes roughly 6 months of paying past 30 days to achieve a 200-300 drop in a rating. That's a lot of late payments and having a low credit rating can be a fair indicator of responsible attention to ones bills. It can indicate possible reckless spending, failure to attending to proper financial planning, or management of ones business.
On the other side, a 820 credit rating can indicate someone who may pay close attention to these responsibilities. The process of obtaining a number is as complicated as the tax code. Paying consistently over the minimum payment can help raise the rating and on the flip side, closing an account can drop the rating. I lost 60 points once by closing a bunch of accounts that were in perfect standing because I don't like having a lot of credit cards (many I only opened because I was able to get a 15% off on a large purchase to which I used it, paid it off the same day and then never used it again) as I believe an inactive account is a security risk.
Did the change in score mean I am a bad person? No, even though closing is considered bad, I didn't care, I was actually being more responsible because I was managing my accounts and I wasn't going to be a pawn to some stupid point system. It made sense to close them, it was logical to close them, I closed them.
The point loss was not excessive and in less than 6 months of my normal use, it was back up to where it was before (with actually a small gain). In the end, it is not this alone that is indicative of anything, but as an addition to other assessments, the extremes of a score can be a fair assessment of ones attention to their responsibilities.
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Originally Posted by EinsteinsGhost
Soichiro Honda went against perceptions. He identified talent, not from their qualifications or history, but from their capacities to get something done. Even today, you would rarely see a Honda CEO holding big degrees, sometimes just bachelors would do. Try that with American manufacturers that have run the company into a disaster zone.
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Some companies have different practices on hiring. I think it would be difficult to claim all of them share the same process. Each holds different qualifications or focus as important. It really depends on the business and its own policies. I know of many businesses who have practices similar to your example.
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Originally Posted by EinsteinsGhost
This is where the hiring failed. As an employer, the priority should be identifying strengths and weaknesses from the person sitting in front of you, not from his personal life. Do you support the idea that companies shouldn't hire single parents (unmarried) because they exhibited irresponsible behavior? Or that are divorced because they've now demonstrated a lack of making proper choice or at least inability to resolve conflicts? Or, fire an employee who was caught cheating on his/her spouse because that is a sign of irresponsibility and unreliability?
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I support the idea that a company can hire who they choose based on whatever criteria they decide. Its their business, they are the ones that will ultimately be responsible for consequences of poor decisions. I think it contrary to individual liberty and contrary to the foundations and purpose of the US to dictate to a company who they can and can't hire or demand they hold to some policy to which you or I may claim is better.
Honestly? It really is none our business unless its our own business. Dictating to them is overstepping our authority.
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Originally Posted by EinsteinsGhost
And I've known, worked with, procrastinators with excellent credit history. What was the point?
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Note that paying 29 days late does not incur a credit mark. It takes over 30 days to achieve such. He pays his bills up to the last minute. In doing such, he puts stress and costs the company he owes money to. They expend resources to contact him, file internal late payment notices, etc... His procrastination puts pressure on others to which if he had been attentive to his responsibilities, would not be so. In the work place, the example I gave results in a guy who doesn't do anything until the last minute and then pressures others in the workplace to help him finish on time. This person dumps his responsibilities on others because he waited too long and can't complete them in time without help.
My point is both in support of your mention as well as mine. It supports your mention because as you said, a person with an excellent credit rating can still be a procrastinator (as I said, paying 29 days does not incur a mark), but it also supports my point that there is a relation to ones habits with their credit and that of their work ethic. Is it an absolute? No. Does it always mean what we may infer from it? No. Can it be used in conjunction with other assessments to get a more accurate representation of a person. I think yes.
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