Up until the early 1800’s, if you were found guilty of not making good on a debt, you could be thrown into debtor’s prison. Even signer’s of the Declaration of Independence (James Wilson and Robert Morris) were incarcerated for their indebtedness.
Today, the practice of throwing people into prison is largely unheard of. However, some states, still allow debt collectors to get arrest warrants for debtors in default when their collection efforts have failed.
In fact, a concrete worker in Indiana was arrested in 2009 for failing to pay on a loan for his pickup truck:
After being handcuffed in front of his four children, Mr. Stearns, 29 years old, spent two nights in jail, where he said he was strip-searched and sprayed for lice. Court records show he was released after agreeing to pay $1,500 to the loan company. “I didn’t even know I was being sued,” he said, though he doesn’t dispute owing the money. “It’s the scariest thing that ever happened to me.” (Wall Street Journal)
And, according to this same Wall Street Journal story, one county in Oklahoma issued about 1,500 debt-related arrest warrants in 2010 alone.
Which makes you wonder: Can imprisonment help to change a debtor’s habits?
Well, I think it would be beneficial to define debtors. With many in the US are in debt already (not to mention the country itself) – I think it’s important to make a determination between those who are the “faithful” debtors vs the “unfaithful” ones.
I think I would be all for the habitual, debt-racker-upper, who ignores debts and pays when they feel like it to be thrown in jail for a night or two or three.. But not for the one who’s taking responsibility of their debt and paying them off as best they can.
Indebtedness doesn’t just affect the debtor – but can affect many other people. While many will argue with this, I believe the Great Recession was a result of people irresponsibly taking on more than they could afford. And, you might say, the current financial climate is owing to this fact.
Let’s face it, no one wants to go to jail (well, some might – but that’s another post). With the consequence of not making good on a debt and jail time – I’m sure more people would be motivated to do the right thing.
What are your thoughts? Should there be jail time for those who are habitually in debt and are not paying up?