Tuesday, December 07, 2004

Credit Ratings, Insurability, and 'Discrimination'

I learned something new the other morning while watching C-Span. Joel Winston, Associate Director of the Federal Trade Commission, pointed out that one’s credit rating affects one’s insurability. I had never thought of that, but it stands to reason that people with poor credit ratings would be more accident prone than people who were careful about their credit rating. (The clown with no fear of the Repo Man is likely to be the same clown who has no fear of crashing into the car he is tailgating at 80 mph. Is that what that ‘No Fear’ sticker that partially blocks his windshield visibility is supposed to convey?)

Winston also mentioned that some people find it ‘discriminatory’ to tie insurability to credit-worthiness.

Well, of course it is discriminatory, but in a perfectly good and justifiable sense. All of us discriminate about all sorts of things and are justified in so doing. We discriminate when it comes to where we will live, where we will shop, who we will allow into our homes, where we will send our children to school, and a thousand other things. There is nothing wrong with discrimination as such.

What I have just written is so spectacularly obvious that I am almost embarrassed to have written it. But in a society in which the spread of stupefaction is as far advanced as it is in this one, communicating and repeating obvious truths is practically a moral obligation. If a black guy who happens to be a deadbeat finds that he cannot purchase auto insurance, then he is most certainly being discriminated against – but not because he is black, but because he is a deadbeat. Thus the discrimination is perfectly justifiable. The solution is not for him to stop being black, or to whine about ‘discrimination,’ but to stop being a deadbeat – which is in his power. If, on the other hand, he were refused insurance on the ground of being black, then that would be unjustifiable discrimination. It would be discrimination with respect to a parameter that is irrelevant to his insurability.