I'm in Stockholm this week for a conference and found a copy of the NYT sitting in the hotel lobby as I headed out to dinner last night. I found this bizarre lament from Ralph Nader in which he complains about having to fly coach on Southwest Airlines. The entire thing is mostly annoying and pathetic as he complains about service, food and leg room. Considering that Southwest has one of the best consumer service records in the industry I was left wondering just how out of touch with reality Ralph was. As the article ended I found out.

Remember in 1992 when George Bush Sr. was embarassed on the campaign trail when he was asked how much a carton of milk cost? It made him look completely out of touch with reality. Well guess what, Nader has never had a credit card. The Luddite claims they are leading us to the ruin of our civilization. So he bitches because hotels and airlines won't hold his room without one. Earth to Ralph: do your ride a horse instead of using cars? Candles instead of electricity. Is there anything you won't complain about?

Sweden is an interesting place. I recall Tyler Cowen telling me he could easily live here. I don't share that view, but I certainly can see some of the attraction. The people are nice; the city is clean and charming, and the weather had been surprisingly un-Swedish. But after chatting extensively with one of my hosts, Niclas Berggren at the Ratio Institute located here in Stockholm I'm not sure I could stomach tax rates in excess of 60% total and a mountain of state regulation on a variety of matters.

That having been said the place is socially progressive and certainly appears wealthy. I've counted more Porsches of various makes and models here than in any other European city I've visited recently. How people can afford them when they're paying about 8 bucks U.S. for a glass of beer (taxes to encourage clean living) is beyond me. More from my adventure here later this week.

M.D. Fulwiler - 8/12/2004

Does your debit card have the VISA or MASTERCARD logo on it? If so, it should generally be accepted anyplace a credit card is. I've never had a problem buying a plane ticket with my debit card, or renting a hotel room.

Pat Lynch - 8/12/2004

Grant

Certainly I would agree that if you're unable to use a debit card in exchange for a credit card that's a significant problem with the system. Still, I wonder if that is simply a "cost," albeit it a high one, of contemporary society. I hope you'd agree that credit cards are remarkably useful in helping society lower financial transactions costs, not unlike cars versus horses. But cars, like credit cards, have costs. Does that analogy makes sense or am I grasping for straws here? In both cases you lose privacy (you must register a car and get insurance). Also you have risks (accidents and identity theft).

Grant Gould - 8/12/2004

Mr. Nader's fears of credit cards are likely overblown, but a bit of suspicion here is quite justified.

About five years ago, having been royally screwed over by American Express (and perhaps also influenced by my family's deeply held phobia of all things debt-like) I resolved not to use credit cards. I naively belived my bank when they told my a debit card is an interchangeable replacement -- just plain Not True. It is truly staggering how many things stop working when you attempt to escape the credit cartel.

About a year into the experiment, I stopped being able to rent cars. Two years in, it was no longer possible to buy airplane tickets. Three years in, it was hotels. Last year I stopped being able to get my credit history -- "privacy issues" prevent the credit rating bureaus from disclosing to me my own credit history. This year the same happened to my wife, and so I finally gave in and got a credit card and everything cleared up (except the credit history mystery -- still trying to figure that out).

I don't blame Mr. Nader for finding something sinister about credit cards: There _is_ something sinister about them. The way that the companies resolutely stop any credit-card-like debit cards from working for more than the most basic transactions smells more than a little of oligopoly. It is nearly impossible to go through daily life without carrying debt these days, and that should make any of us nervous.
--G