The Dow Jones Industrial Average gained 153 points today. That seems higher than the last few days and weeks. Since the banking and mortgage crises started in 2008, Washington did not regulate Wall Street. It got $700 billion. So it should be humming along. For some answers why it is not, Michigan Now’s Chris McCarus went to an Amish community 30 miles west of Lansing.
(NOTE: This story was originally broadcast in 2008 with an introduction different than this one above.)
David Hochstetler is 32. He wears a black top hat, a beard wrapping around his chin and no moustache. He’s Amish. He lives with his wife and four kids where two dirt roads cross, near Vermontville.
“We had ten children in our family and my dad, he was a farmer and he always did good in farming and tried to teach us don’t go deeper into debt than what you can pay off. And far as interest is what will eat you up. And for interest, if that’s all you can pay you’re really not gaining anything.”
Hochstetler says loans usually cost you money instead of make you money. Earlier this week, he had just finished grinding corn for the winter. Then the rain came. He talked about finances. Though he hasn’t heard much about the crisis on Wall Street.
“See we don’t have television so I’ve just heard that some banks closed in New York City. And that’s just about all we know.”
Hochstetler isn’t worried about the credit crunch. He’s less connected to Wall Street than most Americans.
“I don’t think as a rule the Amish are as quick to borrow money. We don’t have cars and we don’t have insurance either.”
General Motors had to sell half its stake in GMAC.. Ford Motor Credit is itself $1 billion in debt. Earlier in September, AIG insurance went bankrupt. The Federal government had to bail it out. David Hochstetler’s Amish view of credit is similar to what past generations of Americans preached.
“Just start out small. Buy used equipment. And start little and work your way up instead of trying to buy everything new and getting this huge bill and into debt before you even get started where you can’t even see any daylight.”
Hochstetler has followed his father’s advice on money management and what kind of job to do.
“The Lord has blessed us. We’ve had good years and we actually own these 80 acres. And we had about $30,000 in savings and made a down payment. And in the next 8 years we actually bought this property.”
U.S. Treasury Secretary Henry Paulson says Wall Street’s problems come from the home mortgage crisis. This is strange to many Amish.
“So far I’ve never actually in my years seen where an Amish guy lost his house or anything. But we do have a case now where there is a guy who is in debt. A couple hundred thousand in debt. And he just didn’t have any way out. He was a carpenter. People would pay him but he wasn’t getting his bills paid at the lumber yard. And finally has set three men to help him, they formed a committee. They help him manage his money. He can’t have his own check book. He can’t write out a check without their consent. He’s just helpless.”
This doesn’t sound as bad what’s happening right now in more modern America. No one wants to be helpless. And farmer David Hochstetler and his family have made sure they’re not.
For Michigan Now, I’m Chris McCarus in Vermontville, in Eaton County.