Werther Effect and Loan Sharks

By Lee Eun-pyo

In recent years, we have heard of one celebrity suicide after another, and most recently a TV actor allegedly killed himself by asphyxiation in his car. There were numerous reports about him and his bereaved wife. Her distraught state at the funeral must have greatly upset many of their fans. Such an appalling loss of her husband might be too cruel for her to go on with her life.

Hearing the news of his suicide over a 4 billion won debt, I felt it was an outrageous amount for a 36-year-old man to have borrowed to do business, even for a famous entertainer. But it was revealed that his loan was 600 million and the interest snowballed to almost six times his principle.

The loan sharks, the so-called secondary financial companies, that charge 49 percent annual interest rate ― which they claim is legal, (but how can this ridiculously steep figure be legal?) ― are advertising and marketing so enticingly through the mouth of TV celebrities that financially-struck desperate people naively run to them without considering the consequences in case of default.

According to a report by one of the daily newspapers, a man who loaned 8.5 million won had to pay 40 million in two years saying that none of his principle was reduced while he paid the exorbitant interest. The debt itself just kept multiplying in time.

Having a debt can be risky and dangerous because things in life do not always happen as one wishes, especially with money. It is already warned in the context of Romans in Paul's life as ``Do not be owing of a thing to any man, except for love of the other (Romans: 13, 8). It is such a thought-provoking verse at a time like this when large U.S. financial companies with high debt ratio are on the verge of going bankrupt and people are committing suicide over money.

A high suicidal rate means that some people take the easy way out when in extreme physical, mental pain and/or financial hardship. But they do not realize what kind of disaster they create to the survivors and the loved ones. The post-trauma may unbearably haunt the survivors for the rest of their lives.

When a celebrity commits suicide, similar copycat suicides, known as the ``Werther effect" go up. This is the term that David Phillips first used in his 1974 study to explain a phenomenon in which copycat suicides increase after the report of a celebrity's suicide. The term is based on the novel ``Die Leiden des jungen Werthers" by Goethe in which the protagonist, Werther, shoots himself upon finding the girl he is madly in love with engaged to another man.

Depression, failure, and grave illness are possible reasons for suicide, but financial difficulty is also a primary reason. As a measure to ease the burden of high interest for people who borrow from secondary financial companies, the government should not authorize or legalize an absurd interest rate. There should be constructive ways for people to borrow money at an affordable interest rate. And if certain business incentives are given to people, like banker Muhammad Yunus who founded Grameen Bank for poor people, it will be beneficial to both bankers and the financially troubled middle and lower middle classes.

People, especially the young, should learn to have a practical sense of finance management. Also a hotline and various help, such as how-to classes should be provided to hopeless people who think they are trapped in a dark endless tunnel. There is always a light at the end of the tunnel no matter how long it is.

The writer is an English professor at Eulji University. She can be reached at elee@eulji.ac.kr.