S1.E2 - The House Always Wins (Part One)

Summary

Debt Heads Podcast: Season 1, Episode 2 - "The House Always Wins (Part One)"

Release Date: April 22, 2025

Hosts: Jamie Feldman & Rachel Webster
Additional Reporting: River Levinson

---

1. Introduction and Recap of Part One

The episode opens with Jamie Feldman urging listeners to catch up on Part One for a fuller understanding. Rachel Webster provides a concise recap: in the inaugural episode, Jamie disclosed her personal struggle with debt, revealing that she's grappling with significant credit card obligations. They introduced Jamie’s mother, Sam, and Rachel herself, setting the stage for a deeper exploration into the pervasive issue of debt in American society.

Notable Quote:
Jamie Feldman [00:00]: "If you haven't done so already, go listen to part one, because things will make more sense that way."

2. The Rise of Consumer Debt Since 1983

Rachel introduces a pivotal point: prior to 1983, average Americans reportedly had no non-mortgage consumer debt. This stark contrast with the present-day scenario, where nearly half of Americans carry consumer debt, forms the backbone of their investigation. Jamie expresses astonishment at this transformation, questioning how such a shift occurred over four decades.

Notable Quote:
Rachel Webster [01:57]: "Prior to 1983, on average, people didn't have any non mortgage debt. So in essence, no debt."

3. Jamie’s Personal Debt Journey

Jamie shares her personal battle with $23,000 in credit card debt, emphasizing the emotional and practical challenges of managing debt without a fixed income. They sought guidance from virtual assistants like Siri, who offered standard financial advice that often didn't account for the complexities of freelance income streams.

Notable Quote:
Jamie Feldman [03:35]: "I had been carrying this debt in some capacity for so many years that the principal I originally borrowed had gotten really hard to distinguish from the interest that had accumulated over the years."

4. Investigating Credit Card Usage in American Consumerism

To understand the cultural entrenchment of credit cards, Jamie and Rachel, accompanied by their investigative reporter River Levinson, venture to a bustling suburban mall. Their aim: to observe and interview everyday consumers about their credit card usage habits. The trip highlights how ubiquitous credit cards have become as symbols of financial independence and adulthood.

Notable Quote:
Rachel Webster [08:33]: "One, we are professional journalists. And two, using credit cards in America is a hallmark of adulthood."

5. The Symbolism of Credit Cards as Adulthood

Through interviews, the hosts uncover that holding and using a credit card is widely perceived as a rite of passage into adulthood. The conversations reveal that for many, credit cards represent financial agility and the freedom to spend without immediate cash constraints.

Notable Quote:
Unnamed Mall Patron 2 [08:20]: "To have extra money."

6. Historical Context: Credit Cards and Gender Disparities

Delving into the history of credit cards, the podcast sheds light on the gendered barriers that existed prior to the 1970s. Women often lacked access to credit, necessitating male co-signers for financial products. This systemic discrimination limited women's financial independence and participation in the credit economy.

Notable Quote:
Donna [16:44]: "I am one of the first women that I know about to get a gold card in my own name."

7. Donna’s Story: Pioneering Women in Credit Access

Donna, a former radio DJ and media studies professor, shares her groundbreaking experience as one of the first women to obtain a credit card in her own name. Her determination to establish financial autonomy led her to challenge societal norms and the banking industry's discriminatory practices.

Notable Quote:
Donna [16:39]: "I wanted one in my own name."

8. The Equal Credit Opportunity Act and Its Impact

The narrative transitions to the enactment of the Equal Credit Opportunity Act (ECOA) in 1974, a landmark legislation that prohibited discrimination in lending based on gender, race, and other factors. This legal shift opened avenues for marginalized groups, particularly women, to access credit independently, thereby fueling the expansion of the credit card market.

Notable Quote:
Genre Discussion [21:58]: "And that ultimately led to the passing of what became known as the Equal Credit Opportunity Act, which made discrimination in lending illegal starting in 1974."

9. The Explosive Growth of Credit Cards and Interest Rates

Post-ECOA, the credit card industry experienced exponential growth. State laws on interest rates became battlegrounds, with states like South Dakota capitalizing on lenient regulations to attract banking businesses. This led to the proliferation of high-interest credit cards, making debt more accessible yet more burdensome for consumers.

Notable Quote:
Rachel Webster [24:04]: "Nebraska was like, stop acting like you got a losing ticket to the meat raffle."

10. Modern-day Debt and Financial Literacy

The hosts emphasize the current predicaments faced by consumers: high-interest rates, lack of awareness about these rates, and the compounding nature of credit card debt. Interviews reveal that nearly half of Americans are unaware of their interest rates and continue to carry balances, exacerbating their financial struggles.

Notable Quote:
Rachel Webster [26:55]: "Nearly half of us Americans do not know what our interest rates are. And nearly half of us also carry a balance on our cards."

11. Conclusion and Teaser for Part Two

The episode concludes by setting the stage for Part Two, promising to explore the aftermath of cultural phenomena like "Flashdance" and their intertwined relationship with the burgeoning debt culture. Hosts Jamie and Rachel hint at delving deeper into the systemic issues that have entrenched debt in the American psyche.

Notable Quote:
Jamie Feldman [28:35]: "By the time 1983 rolls around in a flash dance, debt expense explodes."

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Key Takeaways:

• Historical Shifts: The introduction of credit cards and legislative changes like the ECOA dramatically transformed American financial behavior and societal norms.

• Gender and Credit: Women faced significant barriers in accessing credit, a challenge that pioneers like Donna began to dismantle in the 1970s.

• Cultural Symbolism: Credit cards have become synonymous with adulthood and financial freedom, despite the accompanying risks of debt.

• Modern Predicaments: High-interest rates and a lack of financial literacy contribute to widespread debt issues, with many consumers unaware of the financial terms they are bound by.

---

Notable Quotes:

• Jamie Feldman [12:01]: "The visual of sitting in my bed in my shitty East Village apartment in, like, a hungover anxiety shame spiral, paying, like, $35 minimum payment on my balance, was very much not sexy."

• Donna [17:16]: "They didn't really have this sense that women could make and control their own money. So they weren't competent, you know, they didn't have any sort of credit history."

• Rachel Webster [25:03]: "I'm pretty sure. But they also said that banks can charge whatever interest rate they want as long as it's legal in the state in which they're located."

---

Upcoming in Part Two:

• Exploration of the societal impact following the release of "Flashdance."
• A deeper dive into how interest rates evolved and solidified the credit card industry's profitability.
• Insights into cultural celebrations and their role in shaping financial behaviors.

Stay tuned for the continuation of this investigative journey into the heart of America's debt-driven economy.

Transcript

[Jamie Feldman]

Hi, this is Jamie from Deadheads. This is episode two of this podcast. If you haven't done so already, go listen to part one, because things will make more sense that way. Or don't. We're not your parents, but you might enjoy it more. Okay, don't forget a jacket. And be careful crossing the street. We love you. Bye.

[Rachel Webster]

In our first episode of Deadheads, my co host, Jamie Feldman revealed she was in debt. I have a lot of debt. We met her mom, Sam, who loves Nick at night, the love bow. We met her friend Rachel. That's me. Who told her that no, she can't afford to buy a $300 bathing suit. Have you worn them yet? No. Okay, so let's start by returning those.

[Jamie Feldman]

I returned one.

[Rachel Webster]

Jamie became TikTok famous, acquired some trolls.

[River Levinson]

I'm glad you're in debt.

[Rachel Webster]

But more importantly, discovered that she is not alone. Even though she and everyone else in debt think so.

[Sam]

I never thought anybody was in credit card debt like me.

[Rachel Webster]

And finally, she surmised that getting out of debt might be more complicated than simply learning how to budget for the next several episodes. These two semi qualified sleuths.

[Jamie Feldman]

Yep, that's us.

[Rachel Webster]

Are going to try to get to the bottom of what makes debt so ubiquitous in our culture and why it's so hard to get out of it. Jamie, do you know what happened in 1983?

[Jamie Feldman]

I do. That's the year that the movie Flashdance came out and launched a generation of leg warmer enthusiasts.

[Rachel Webster]

That's not what I was thinking of.

[Jamie Feldman]

Oh, okay. Well, if it's not that, then it's also the year that Donna Summer was inspired by a female bathroom attendant to write the hit song she Works Hard for the Money.

[Rachel Webster]

Wow, I wasn't thinking of that either. But isn't it interesting that both of those cultural treasures, I would call them cultural treasures, featured women working blue collar jobs when all they really wanted to do was dance.

[Jamie Feldman]

That is interesting, but okay, what was the thing you wanted to tell me?

[Rachel Webster]

Well, this is crazy.

[Jamie Feldman]

Okay, get ready. I'm ready.

[Rachel Webster]

The thing about 1983 is that prior to that year, there was no consumer debt. Did you hear me?

[Jamie Feldman]

Oh, sorry, were you saying something? Yes, I was looking at my phone. I just got approved for a Venmo credit card.

[Rachel Webster]

Oh, good God. So what I was saying is that prior to 1983, on average, people didn't have any non mortgage debt. So in essence, no debt.

[Jamie Feldman]

Hold on. So nearly half of Americans have consumer debt in 2025, and just about 40 years ago, they had none. How Is that possible?

[Rachel Webster]

Good question. Let's find out. Do you get when you burn through your plastic stack?

[Jamie Feldman]

Welcome to Deadheads.

[Rachel Webster]

Welcome.

[Jamie Feldman]

Deadheads is an investigation into the American.

[Rachel Webster]

Economy from the perspective of people in debt. Like us, like everybody.

[Jamie Feldman]

I'm Jamie.

[Rachel Webster]

And I'm Rachel.

[Jamie Feldman]

And we named this podcast after our.

[Rachel Webster]

Because we know firsthand what it's like to lose sleep over debt, to live.

[Jamie Feldman]

In denial over debt.

[Rachel Webster]

To get out of debt, but find ourselves falling back into it.

[Jamie Feldman]

But most importantly, to start questioning why.

[Rachel Webster]

And how America became a country full of debt heads.

[River Levinson]

You gotta pay for that money, boy. You gotta pay for that money, boy.

[Rachel Webster]

When Jamie first started to tackle her financial situation, she was in about $23,000 of debt. Credit card debt, to be specific. And once she got over the shame of the debt itself, she had to start facing it practically. So one afternoon, we sought out the help of an expert.

[Jamie Feldman]

Hey, Siri.

[Rachel Webster]

Huh?

[Jamie Feldman]

Can you tell me how to get out of debt?

[Donna]

Get out of debt by focusing your.

[Jamie Feldman]

Budget, setting up a repayment plan, reducing expenses, increasing income, and saving whatever is left over.

[Rachel Webster]

Okay, let's make. Let's make a list.

[Jamie Feldman]

Okay, Number one, focus your budget.

[Rachel Webster]

What does that mean?

[Jamie Feldman]

Hey, Siri.

[Rachel Webster]

Okay, so it turns out that focusing your budget is just budgeting. And we'd already had some painful conversations and realizations about Jamie's spending and figured out a way to reprioritize the things in her budget. But Siri's advice assumes that you're a person making a regular fixed income, and nobody was really able to assist us with advice for people who have no idea what they'll be making from month to month. So we were already off to a rocky start. Then once we got to step two, things really started to fall apart. Okay, what's number two?

[Jamie Feldman]

Setting up a repayment plan.

[Rachel Webster]

Okay, so currently, the repayment plan is that we gotta pay it. We gotta pay it. How do you repay $23,000 on a freelancer's inconsistent income, especially credit card debt, which is something that Jamie found out is commonly referred to as bad debt. Means we're gonna have to look into the credit card details.

[Jamie Feldman]

I don't want to do that.

[Rachel Webster]

Bad debt is scary. The reason it's called bad debt is that it won't help you get a home or an education or anything that has the potential to increase in value.

[Jamie Feldman]

And I had been carrying this debt in some capacity for so many years that the principal I originally borrowed had gotten really hard to distinguish from the interest that had accumulated over the years.

[Rachel Webster]

Here's the deal. So we need to just, like, first of all, identify how many credit cards you have. So how many credit cards you have?

[Jamie Feldman]

Five.

[Rachel Webster]

Five. Okay. Sorry. And how much do you.

[Jamie Feldman]

I thought this was a. This podcast was non judgmental Safe space.

[Rachel Webster]

Five.

[Jamie Feldman]

Okay. So I had five credit cards, and clearly I was using them wrong. But was anyone using them right? I had to find out. I had to go somewhere where people might be using credit cards. Someplace familiar, somewhere where everybody knows my name. I had to go to the mall.

[River Levinson]

Hello. Can I ask you a question about your shopping trip today?

[Jamie Feldman]

Sure.

[River Levinson]

Did you buy anything today? Yes, I did. And how did you pay?

[Unnamed Mall Patron 1]

Card?

[Jamie Feldman]

Card?

[Unnamed Mall Patron 1]

Car?

[Jamie Feldman]

On a recent Saturday afternoon, we lured one of our city's top investigative reporters, restaurant critics, Rachel's sun river, to a busy suburban mall in the Tri State area to investigate how people were spending their money. And all it cost us was a fried chicken sandwich from the food court.

[Rachel Webster]

What did you order today for lunch?

[River Levinson]

Korean barbecue fried chicken sandwich.

[Rachel Webster]

What do you think about it?

[River Levinson]

The chicken is a little dry. I would have preferred it a little more juicy. And I think the bun, it looks almost faux brioche. It's not as soft as a brioche.

[Rachel Webster]

We had driven out to this palace of consumerism not to investigate the authenticity of the brioche, but. But rather to conduct a highly scientific poll of the American populace.

[Jamie Feldman]

And despite the subpar quality of the food court's fried chicken sandwich, it was well worth the cost to hear River's keen interviewing skills in action.

[River Levinson]

What do you like about your credit card? I can use it and spend money.

[Unnamed Mall Patron 2]

To have extra money.

[River Levinson]

I don't need to, like, bring a set amount of cash.

[Rachel Webster]

Do you usually pay with credit cards?

[Unnamed Mall Patron 1]

Yes.

[Rachel Webster]

Do you use it a lot?

[Jamie Feldman]

Yes, yes, yes.

[Rachel Webster]

This investigation was going so well. We were so prepared. We planned the route, we planned the questions, we printed the release forms. But there's one thing we didn't do. Oh, sorry. Is it? Okay.

[Jamie Feldman]

Confirm the legality of recording audio at a shopping mall.

[Rachel Webster]

Oh, okay. Our understanding was that we were allowed to record in the mall.

[Jamie Feldman]

And according to the security guard, we were decidedly not allowed.

[Rachel Webster]

Oh, that's the. That's the mall's rules. Okay. We're in trouble.

[Jamie Feldman]

So we told him we would stop.

[Rachel Webster]

Thank you so much. We will stop. We're gonna stop.

[Jamie Feldman]

Okay. We didn't stop, exactly. We managed to find some people to talk to in the legally gray area, better known as the vestibule, between the parking lot and the mall entrance.

[Rachel Webster]

It was here that we were able to Defend our hypothesis that paying with credit is what people like to do.

[Jamie Feldman]

Even when they're not fully sure if they have a credit card or not.

[Rachel Webster]

Do you have a credit card?

[River Levinson]

Uh, yes, I think I do have a credit card. I do have a credit card. Yeah.

[Rachel Webster]

And for those who didn't have cards, they made sure to tell us that they were planning on getting them.

[Jamie Feldman]

I've been meaning to set one up.

[Mary Pat Truetheart]

I just haven't gotten around to it.

[Jamie Feldman]

And I plan to at some point. We learned two very important facts on this trip to the mall.

[Rachel Webster]

One, we are professional journalists. And two, using credit cards in America is a hallmark of adulthood.

[River Levinson]

And why did you get your first card? Um, I just felt like I was 18 and it was time for me to just like get a car. Yeah, all my friends, friends have one, so I wanted one too.

[Unnamed Mall Patron 2]

Everything played a part of it a little bit. I'm an adult now. Let me try this.

[Unnamed Mall Patron 1]

Why? I get one because I want to start having a more agile life. So.

[Rachel Webster]

Yeah, in fact, 75% of Americans get a card by the age of 25.

[Jamie Feldman]

Yeah, having a credit card is so adult. It's basically the NC17 rated movie Showgirls.

[Rachel Webster]

Oh, man. Another great tale of a wannabe dancer who has to work hard for the money.

[Jamie Feldman]

And working hard for the money is so, so adult.

[Rachel Webster]

When we were kids watching our parents be grown ups, we idealized the edgier sides of adulthood.

[Jamie Feldman]

It was never doing the dishes or paying the bills or mowing the lawn.

[Rachel Webster]

It was always a little bit sexy. Like walking around with a corded phone while applying lipstick.

[Jamie Feldman]

Tapping a keyboard with long nails, making.

[Rachel Webster]

Your high heels echo down a marble.

[Jamie Feldman]

Corridor smoking a motherfucking cigarette.

[Rachel Webster]

And boy, oh boy, was it swiping a credit card.

[Jamie Feldman]

The credit card looks at you with your dwindling cash flow and says, here, go ahead, try me on.

[Rachel Webster]

Don't I feel so sleek in your hand? Just swipe me, see what it does. Oof.

[Jamie Feldman]

This Chase Sapphire card is really doing it for me.

[Rachel Webster]

Like getting you perks at nearly every corporate venue.

[Jamie Feldman]

Want to get a $20 beer at Madison Square Garden for 16 bucks? Use your Chase card.

[Rachel Webster]

Are you still slumming it on a wobbly bar stool with a $20 glass of Chardonnay you ordered from an off brand iPad while balancing your carry on suitcase with your one free leg.

[Jamie Feldman]

Flash that Delta sky miles Amex and get into that lounge, girl.

[Rachel Webster]

Thanks to rewards points, everyone can be a vip.

[Jamie Feldman]

Security access perks.

[Rachel Webster]

It's wielding power so effortlessly, it takes nothing more than the flick of a wrist to get everything you ever wanted and double points for every dollar spent.

[Jamie Feldman]

More. I dreamed of using a credit card when I was a kid. A fantasy that was realized when I played the game Mall Madness, the new.

[Donna]

Shop till you drop game that really.

[Jamie Feldman]

Talks, which came with its own line of store branded credit cards.

[Donna]

With Mall Madness, you get it all. A bank account and your own credit car.

[Jamie Feldman]

Got your credit card. But as it turns out, my fantasy of swiping those fake cards as a child didn't exactly square with the reality of when I actually got my first credit card.

[Rachel Webster]

Tell me about your first credit card.

[Jamie Feldman]

Okay, so I failed a class in college, and I wanted to retake it, but I didn't want to tell anybody that I was retaking it because I was too embarrassed. So I decided I was going to try to pay for it myself. And so I went to the Gap.

[Rachel Webster]

What did you do at the Gap?

[Jamie Feldman]

Well, I was at the Gap.

[Rachel Webster]

You were already.

[Jamie Feldman]

I was already at the Gap. And when I was there, I noticed that they had credit cards there.

[Rachel Webster]

Oh, no.

[Jamie Feldman]

And I was like, oh, my God, this is genius. I'll get a Gap credit card and I'll pay for my class on this Gap credit card, and nobody will ever know.

[Rachel Webster]

Oh, my God, I didn't even know you could do that.

[Jamie Feldman]

Well, I did. And so I did. Yeah. The visual of sitting in my bed in my shitty East Village apartment in, like, a hungover anxiety shame spiral, paying, like, $35 minimum payment on my balance, was very much not sexy. It made me feel pretty much like anything besides a sexy adult.

[Rachel Webster]

But what the Gap card did offer Jamie was at least a sense of freedom, like she could take care of this unfortunate situation on her own. And there was a time, not even that long ago, that this sort of secret financial workaround wouldn't have even been possible for women.

[Jamie Feldman]

Credit cards were not always as ubiquitous as Mob Madness fans like me would assume.

[Rachel Webster]

In our initial research into the origin of the credit card, we discovered that it was rare for women to have their own credit card before 1974.

[Jamie Feldman]

And that sounded so crazy to us because it was so recent, just before.

[Rachel Webster]

The birth of the millennial generation.

[Jamie Feldman]

Like, we knew people who were alive then.

[Rachel Webster]

I was very close to being alive then.

[Jamie Feldman]

We needed to know what it was like to live in a time when the act of women burning bras in protest was documented in the daily newspapers. But the concept of a woman using her own credit card to buy a new bra was not.

[Rachel Webster]

So we did what every semi qualified Sleuth does. We started combing Reddit.

[Jamie Feldman]

Thank you so much for taking this time. I really appreciate it.

[Donna]

You said you were going to pay me a thousand bucks. I said, you know, I'm really busy, but money talks, Donna. Walk that simple.

[Rachel Webster]

This is Donna, and no, we did not pay her a thousand bucks to speak with us. But if we could have put it on credit, we might have.

[Donna]

I turned 78 on my birthday, which was Valentine's Day. Of course, I waited for your birthday card, but alas, you didn't sin.

[Jamie Feldman]

In addition to being one of the silliest strangers we've ever met on Zoom, Donna is a former radio dj, professor of Media Studies at Emerson University, and music lover who is credited during her stint as a DJ in Cleveland for launching the career of the 70s era Canadian rock band Rush.

[Unnamed Music Enthusiast]

Like the band Rush?

[Rachel Webster]

I don't know them.

[Unnamed Music Enthusiast]

The holy triumvirate. Wait, you don't know Rush?

[Jamie Feldman]

No.

[Unnamed Music Enthusiast]

You don't know Rush the band?

[Rachel Webster]

No.

[Jamie Feldman]

Mm.

[Rachel Webster]

Mm.

[Unnamed Music Enthusiast]

Exit the Warrior. Today's Tom Sawyer?

[Donna]

No.

[Unnamed Music Enthusiast]

All right, I'm gonna hit you up a little itunes Axion.

[Jamie Feldman]

And just like Rashida Jones in the 2009 movie I love youe, man, we.

[Rachel Webster]

Also didn't know anything about Rush until.

[Jamie Feldman]

Paul Rudd provided us with some itunes. Action.

[Unnamed Music Enthusiast]

Are you ready to get your world rocked?

[Donna]

Ready?

[Unnamed Music Enthusiast]

Well, prepare to be Rushified.

[Rachel Webster]

Rush is the kind of band that inspires a very enthusiastic evangelical fandom in a very specific demographic. Working men, which Donna also understood.

[Donna]

And a record promoter friend of mine up in Canada sent me this album from this unsigned band, and he said to me, we're not going to sign them. They're not ready for prime time. And I dropped the needle on a song called Working man. And I knew immediately that this was a perfect record for Cleveland. Well, I get up at seven, yeah. Go to work at nine Got no time for living you something Working all the time. Cleveland back then was a factory. Now the sky was orange every night from pollution from Republic Steel.

[Rachel Webster]

And like the Pittsburgh portrayed in Flashdance, Cleveland was full of steel workers. And I like to think a lot of wannabe dancers.

[Jamie Feldman]

And every steelworker and dancer were picking up the tracks Donna was laying down on the radio.

[Donna]

Working man takes off. One thing led to another. They got an American contract with Mercury Records.

[Rachel Webster]

Just like one of the dozens of oil fires that exploded in the Cleveland waterways around that time due to all the steelworkers working. Steel Rush blows up.

[Jamie Feldman]

And they were eternally grateful to Donna.

[Donna]

You don't do a mitzvah for the result, you do a mitzvah because it's the right thing to do. I am still in touch with those guys.

[Rachel Webster]

But Donna wasn't only an early adopter of Rush, she was also an early adopter of the credit card. And it was the credit card that bought her entry into what was a very male dominated career.

[Donna]

I mean, I still have my silly gold card. Okay.

[Jamie Feldman]

When Donna got her first American Express.

[Donna]

Gold card, it's over here somewhere.

[Jamie Feldman]

Women did not generally get approved for credit cards.

[Donna]

See if I can find it and grab it.

[Jamie Feldman]

And if they did, they were associated with her husband's card. There we go. But Donna didn't want a card in her husband's name.

[Donna]

I had that silly gold card now for 51 years.

[Jamie Feldman]

She wanted one in her own name.

[Donna]

And it's in my name. I am one of the first women that I know about to get a gold card in my own name. In the early days, if a woman did get a credit card, a man had to cosa. Women are supposed to know their place and they're supposed to be grateful for the fact that men are taking care of them. But the assumption was that women couldn't possibly pay.

[Rachel Webster]

And that was for married women. If you were single, divorced or even widowed, you likely needed to bring a man like any man to co sign for credit products at most banks. And we imagine it sounded something like.

[Jamie Feldman]

This, can I get a man like any man? I have to go to the bank. And if you didn't want to look for a man on the streets, hopefully you had a brother, an uncle, grandpa, even if they made less money than you did.

[Rachel Webster]

This just seemed so crazy to me. So we consulted our resident legal expert, my stepmother, Mary Pat Truthheart, to weigh in.

[Mary Pat Truetheart]

So in the law, we have this concept, you know, for segregation. Is it segregation de jura by law, or is it segregation de facto, meaning by facto. And so that's how it really was for women. It wasn't de jure necessarily, although in some ways, women weren't permitted to be bartenders, they weren't permitted to serve on juries, and that was by law.

[Rachel Webster]

That's crazy. What else was by jura besides, I.

[Mary Pat Truetheart]

Mean, so many things? I mean, honestly, it was ridiculous.

[Rachel Webster]

Do you remember having some understanding of why women were denied credit?

[Mary Pat Truetheart]

Yeah, it was. They didn't really have this sense that women could make and control their own money. So they weren't competent, you know, they didn't have any sort of credit history. And at that time, a lot of houses and cars and everything a Lot of property was just titled in the husband's name. And these women had nothing in their own names. Nothing.

[Donna]

But this is what women of my generation went through, okay? This was the norm. My mother was expected to quit her job. My mother was expected to be a housewife. Legally Speaking, she was Mrs. Samuel Halper. She wasn't Samuel. Her name was Beatrice. I knew that wasn't right. Getting the card in my own name really was about was just making sure I have an identity, making sure my name, because that's who I am, making sure my name is capable of being out there. Does that sound silly?

[Rachel Webster]

Did you know that Maya Rudolph's grandpa supposedly came up with the idea for the first credit card?

[Jamie Feldman]

No, I didn't know that. But I did know that the first credit card came out in 1950 and was called the Diners Club card. As is hinted in this extremely subtle commercial, Diners Club for just about everything.

[Unnamed Music Enthusiast]

Diner's Club, the first card.

[Jamie Feldman]

Diners Club, the first card. Diner's Club, the first card.

[Rachel Webster]

As the name suggests, the Diners Club card was designed for men of the same status and class to literally dine together without the hassle of remembering their wallets. Having a Diner's Club card was like having a tab at a bar, but fancier.

[Jamie Feldman]

It paved the way for what we now consider common practice, revolving credit.

[Rachel Webster]

But they still weren't available to anyone but these rich businessmen. And Donna, being a businesswoman, wanted to flash her fancy credit card with her clients at lunch, too.

[Donna]

When I started running my own consulting business in the 1980s, I would take a client out to lunch and the server would give the check to my client. I called the manager over and I said to the manager, no offense, but if I don't exist, how do I leave a tip? Nobody believed that I made enough money, and nobody believed that I was like a full time working person.

[Rachel Webster]

And in order to successfully do her job of finding songs like Working Man, Donna needed to have access to the world of working men. The credit card gave her that access.

[Donna]

Credit cards had a certain status in that society that made a real statement because that was something that only successful businessmen had. And I felt like it would make a statement if I had one.

[Jamie Feldman]

So as you can probably tell from Donna's personality, she was finally able to get her card after demanding they put her name on it.

[Donna]

So I got in touch with American Express. I wrote letters, because back then, that's what you did. And I questioned like, you turned me down. How come?

[Jamie Feldman]

And it was letters and testimonies from Women like Donna. That ultimately led to the passing of what became known as the Equal Credit Opportunity act, which made discrimination in lending illegal starting in 1974.

[Rachel Webster]

Unsurprisingly, one of the act's supporters was the credit card industry.

[Jamie Feldman]

And that is in part due to the fact that women, minorities, and anyone else who'd been locked out of lending created an opportunity for a great new market.

[Rachel Webster]

So within a decade, nearly everyone who wanted a card had one or five.

[Jamie Feldman]

I feel like every every other day, at least in the mailbox, I get a another offer that states you're pre qualified. And I already have three credit cards. To be honest, I don't know how.

[River Levinson]

Many credit cards I have.

[Jamie Feldman]

I may be like, eight. Um, I don't know.

[Sam]

And so I applied for a bunch of credit cards. What I did not know is that they just send them to you in the mail when they accept you. They don't email you back and say you're accepted. Do you want to have this? Yes or no? They just mail them to you.

[Rachel Webster]

It's crazy. And then they just, like, kept increasing my limit.

[Unnamed Mall Patron 1]

And I was like, you guys, like.

[Donna]

What are you doing?

[River Levinson]

I do remember being scandalized. I just remember thinking, like, on what basis are they extending this amount of credit? It's just, like, so nakedly predatory.

[Rachel Webster]

How did it go from people begging to have the right to borrow on cards to this seemingly predatory state of.

[Jamie Feldman]

Affairs where everyone has more cards than they can count and an ever increasing credit limit?

[Rachel Webster]

The answer to these questions starts back in the 70s, just a few years.

[Jamie Feldman]

After Donna got her coveted gold amex and the Equal Credit Opportunity act was signed into law.

[Rachel Webster]

And like Flashdance and the Cleveland of Donna's radio DJ years, this story is set in the heartland of America.

[Jamie Feldman]

Ooh, a story.

[Rachel Webster]

Yes. About interest rates.

[Jamie Feldman]

Oh, that sounds boring.

[Rachel Webster]

No, it's interesting. Okay, so there's this bank in Minnesota that has credit cards with a 12% interest rate.

[Jamie Feldman]

Oh, damn, that's low.

[Rachel Webster]

I know. It was capped by their state law.

[Jamie Feldman]

Fascinating.

[Rachel Webster]

So one day, people in Minnesota start getting these letters in the mail from a bank in Nebraska promoting credit cards with an 18% interest rate. And people in Minnesota start signing up for them.

[Jamie Feldman]

But wait, that's a higher interest rate.

[Rachel Webster]

Exactly. Nebraskans were trying to get as much money as possible by reaching across state lines to acquire new customers. And this gets the Minnesota bank more steamed than a hot cup of Joe on a frozen lake in the dead of winter.

[Jamie Feldman]

I don't blame them, because they were.

[Rachel Webster]

Like, you're getting more money from our customers. And we can't charge that rate because of our stupid interest cap. And Nebraska was like, stop acting like you got a losing ticket to the meat raffle. Because, one, we're allowed to send mail, and two, if there's one thing people like, it's getting credit card offers in the mail from Nebraska.

[Jamie Feldman]

Really?

[Rachel Webster]

Yeah. And that argument, exactly the way I recounted it to you, went all the way to the Supreme Court.

[Jamie Feldman]

Wow.

[Rachel Webster]

Of the United States of America.

[Jamie Feldman]

What?

[Rachel Webster]

And the Supreme Court agreed with Omaha. They said, you're right. People do love getting mail from Omaha, Nebraska. And they especially love to sign up for credit cards in the mail, even if it means they're getting a shittier interest rate.

[Jamie Feldman]

They said literally that.

[Rachel Webster]

I'm pretty sure. But they also said that banks can charge whatever interest rate they want as long as it's legal in the state in which they're located.

[Jamie Feldman]

Damn.

[Rachel Webster]

So South Dakota.

[Jamie Feldman]

Oh, I know South Dakota. It's on all my credit card bills.

[Rachel Webster]

Exactly. And I'll tell you why. South Dakota, being next to Minnesota, gets wind of this idea of sending mail across state lines and thinks, huh, we don't have a lot of business here, just a lot of bison. Let's tell everyone in America that they can charge any interest rate they want as long as they byob.

[Jamie Feldman]

Bring your own bison.

[Rachel Webster]

No, bring your own bank.

[Jamie Feldman]

Oh.

[Rachel Webster]

So the next thing you know is enterprising Midwesterners start sending white collar jobs to Sioux Falls and taking vacations to the badlands and taking pictures of bison and thinking, damn, South Dakota is a great place for bison and banks.

[Jamie Feldman]

I mean, I do love bison.

[Rachel Webster]

The next thing you know what? All the banks are located in South Dakota, and all the credit cards have super high interest rates.

[Jamie Feldman]

Oh, man, you're right. That is pretty interesting.

[Rachel Webster]

This obscure ruling created the credit card industry as we know it today.

[Jamie Feldman]

Before the Marquette decision, 38% of American households had cards. And within a decade, that number had nearly doubled.

[Rachel Webster]

Our lifetimes have been marked by this simple economic reality because of a bank in Nebraska and an unfettered capitalist agenda that turned unsuspecting, newly awarded members of the financial mainstream into lambs for the slaughter.

[River Levinson]

Do you know what your interest rate is?

[Unnamed Mall Patron 2]

No, no, off the top of my head. No, not off the top of my head. No. That's horrible.

[Rachel Webster]

Do you know what your interest rate is on your credit card?

[Unnamed Mall Patron 1]

I think so. It's really high. Compared to other stuff, I think it's like 22.

[River Levinson]

My interest rate on my cards. 22.

[Rachel Webster]

Oh, I forget it. 29 point something. Yeah. Nearly half of us Americans do not know what our interest rates are. And nearly half of us also carry a balance on our cards. That means that we are getting charged an interest rate we do not know. That's compounding on our balance every single month. So are you the kind of person who pays off their balance every month?

[River Levinson]

Sometimes, depending.

[Rachel Webster]

Got kids, so it varies.

[Unnamed Mall Patron 2]

Sometimes you have your times where you kind of get out of hand, where you forget. But I try my best to keep it around maybe five to four days late, maybe seven days at the top.

[Rachel Webster]

Do you pay your balance off every month?

[Unnamed Mall Patron 1]

Sometimes yes, sometimes no. Like if it's a lot, I pay whatever I can and sometimes I pay it everything off.

[Rachel Webster]

They ever raise it without you asking?

[Unnamed Mall Patron 1]

Yes.

[Unnamed Mall Patron 2]

Raise my credit limit all the time? Yeah. Yeah, all the time.

[Unnamed Mall Patron 1]

I never have asked to upgrade my car. They just start upgrading it.

[Rachel Webster]

When did that happen?

[Unnamed Mall Patron 1]

When I started using it more.

[Rachel Webster]

Do you find that you spend more on your card when you have a higher limit?

[Unnamed Mall Patron 2]

Definitely, I guess because I paid everything back on time and they probably decide if I don't pay it back on time, they get a lot more money back for me eventually.

[Rachel Webster]

Hey, wait a minute. Uncapped interest rates were the first step in a long transformation of the banking industry from a boring necessity into one of the most profitable industries in the world.

[Jamie Feldman]

And once they had the incentive to make money with these interest rates, they started to figure out other ways to maximize these profits.

[Rachel Webster]

And by the time 1983 rolls around in a flash dance, debt expense explodes. Thanks for listening to Deadheads.

[Jamie Feldman]

Next week in part two of this episode, we'll find out what happened after Flashdance came out.

[Donna]

Spend, spend, spend is the marketing agenda.

[Rachel Webster]

We'll take a trip to our nation's capital to meet some cats.

[Jamie Feldman]

Are the cats tussling, making too much noise? We'll run late for a meeting with our all time favorite reporter. I think It'll take us 10 minutes.

[Rachel Webster]

To get there, so we'll be late. And we'll try to define what we consider to be priceless.

[Jamie Feldman]

Is your kid literally gonna die if they don't get anything for Christmas? No. But are cultural celebrations an essential cornerstone of how we derive meaning in this world? Yes. This episode was brought to you by the millions of free books at the Brooklyn Public Library and literally no one else.

[Rachel Webster]

Deadheads is written, produced and edited by us, Jamie Feldman and Rachel Webster. Additional reporting by River Levinson. Our theme song is Pay for that Money by the Defibrillators. Original music is composed by Ali helmline, and this episode was mixed by Jeff Stealey. Thanks to every woman who shared her debt story with us. Thanks to Flashdance, Donna, Summer, Mall Madness, Rush, Showgirls, Cheers, and I love you, man for inspiring this episode's theme and for explicitly allowing us fair use of.

[Jamie Feldman]

Their materials, which has been reviewed by a lawyer.

[Rachel Webster]

And speaking of lawyers, thanks to my stepmother, Mary Pat Truetheart, for explaining why women didn't get access to credit in the first place.

[Mary Pat Truetheart]

Rachel, they aren't smart enough.

[Jamie Feldman]

And finally, very special thanks, Donna Halper, for teaching us the significance of our names.

[River Levinson]

You gotta pay for the money, Bo.

[Rachel Webster]

Love you.

[Jamie Feldman]

Bye.