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Afternoon of the Pawnbrokers

Home again in post-crash, subprime Indiana

“White Americans have always known how to develop aristocracies from local resources, however scant.”—Margo Jefferson

The bankers, inconsolable in the face of their lawbreaking, wept in slow-moving subway cars; I witnessed this phenomenon myself one day in late 2008 as I commuted to an Upper East Side townhouse, where my employer, an oil man who had lost considerably in the crash, fired me. From there I became homeless, broke, and dimly aware that I had absorbed the financial crisis into my psychic life, so I soon left for Bloomington, Indiana, a college town about fifty miles from where I was born. [1] There at my brother’s apartment I could rest easier on a spare air mattress, I believed, for three months or so. Three years later, I returned to New York. In the days between, I worked as a pawnbroker for a hillbilly named T—, who was himself a pawnbroker and the patriarch of a family of pawnbrokers.

I’m still not sure why I stayed in Bloomington. Maybe I was entranced by the recessional vision on offer there. Under the austerity regime of Governor Mitch Daniels, nicknamed “the Blade” for his budget-slashing jolliness, Indiana was left to ruin. The city of Bloomington, long a mirage of progressivism in a desert of rightist folly, was now steeped in Mad Max vibes: its parks teemed with anonymous drifters, who mixed uneasily with a professoriate and its attendant underclass of adjunct instructors and students. The edges of the burg blurred into a wilderness of mobile homes populated by a growing number of rural poor, a dream only darkened by the shadowy presence of the town’s overlord, the now-dead billionaire William Cook, who amassed his fortune by inventing medical devices for angioplasty in a state endearingly bynamed both “the Heartland” and “America’s breadbasket.” In my time there, I was unsurprised to read a Business Insider listicle designating Bloomington “the most unequal city in America.”

It was the right time and place, in other words, to become a pawnbroker; in truth, I could find no other work. After weeks of hunting for a temporary job, I answered a newspaper advertisement that called for a “holiday merchandiser.” Days later I received a cryptic voicemail, from what sounded like a child, providing only an address. Curious and short on cash, I soon boarded a city bus that beelined through the local housing projects before depositing me in a parking lot filled with pickup trucks and a rusted Dodge Neon. I reasoned, on account of some chainsaws propped against a fence, that I had arrived at a lawn care store, until a bearded man carrying a .22 rifle exited the building. It was then that I spotted an unfriendly sign with three golden balls: the international symbol of the pawnbroker.

I cursed my bad stock; I had given word to myself, plenty of times, never to return to this region, where one was able to pee freely in any given yard, but where the age of mortality had plummeted to the point where one would pee the bed, free of volition, before achieving the age of Social Security.

It Either Ain’t

The scene inside the pawnshop reminded me of the hoarder Plyushkin’s estate in Dead Souls. I saw racks of unredeemed collateral for sale: glass cases of Blu-ray discs stocked with not one but three copies of the movie Seabiscuit; rows of makeshift shelves holding orphan computer monitors and nearly state-of-the-art flat screens, one of which was playing Seabiscuit; an intimidating arsenal of mud-crusted, yellowy-orange power tools, the function of many inscrutable to the ignorant; home stereos and car speaker systems, undoubtedly stolen, of every make and design; the cheapest of all possible plastic laptops, arrayed in the style of a Best Buy display; microwaves stacked in the manner of Lego blocks; low-quality, probably unusable equipment for the aspiring DJ; tagged and taxidermied buck heads flanking a print of Boulevard of Broken Dreams; pool cues; camouflaged army helmets, good as new; boat motors, lightly worn; properly arranged fishing rods; a wall of brass instruments, not limited to saxophones and a tuba; woodwinds, or at least clarinets; half-cased violins abandoned by once ambitious child learners; guitars in the shapes of flying Vs and chiasma; white baby dolls encased in their original plastic-and-cardboard packaging; rows and rows of secured jewelry, curiously cheap, accounting for every cut and condition of diamond or birth stone; a militiaman’s fancy of shotguns, rifles, and revolvers; and original homespun art fashioned from what seemed to be river wood.

I wandered through the aisles until a woman with a bowl cut approached. As she breathlessly narrated, unsolicited, her recent bout with scabies, I recognized her voice from the voicemail. “We got ya,” she said menacingly and again at a child’s pitch, before leading me to a back office where a squat, goblin-like man with a white buzz cut invited me to take a seat.

“T—,” he said, shaking my hand. “Truth is, I need a pawnbroker.”

T— spoke for the next twenty minutes in a rural idiolect of dropped g’s and Elizabethan diction. He told me he once traveled as a carnie before a kindly papaw from Terre Haute taught him the pawnbroking trade; now, he said, he reckoned himself something of a scholar, a liar’s bid to put on airs given that I had unadvisedly dressed up for an interview. Later, he continued, he quit the carnival circuit, had a number of children, and started his own business. I learned that T—, by no stretch a believer, understood his work as philanthropy; his pawnshop charged a “fair and charitable” interest rate to the cash-strapped souls he greeted into his shop. And, he swore, his clients maintained a “redemption ratio” of 80 percent; after getting a loan, in other words, they returned to redeem their collateral eight of ten times, a ludicrous claim I later learned was bruited by scheming brokers regardless of region. T—, not at all diverted by my confusion, boiled over with complaint about legislators who aimed to put him out of business, though he was an “accredited lender.” He maligned the police, too, for accusing him of accepting stolen property. When he ended his rant, T— leaned back, folded his arms over his chest, and said: “I’d buy that for a dollar.” I was confused at the time, but later I realized he’d stolen the line from Robocop.

When T— offered me the job, I felt as if God was communicating through a whirlwind, exhorting me not to take it. I hesitated. He did not like this, so he inched closer and closer to my face.

“It either is,” he coughed. “Or it either ain’t.”

I had entered the pawnshop that day a broke and desperate person; when I left, I was a subprime lender.

Moments later I was introduced to my fellow pawnbrokers, whom I came to barely know. T—’s two sons, W— and G—were the de facto showrunners when their father was away (drunk). Both were stocky, like high school wrestlers. W— was a self-proclaimed anarchist, at least until the Tea Party came along; his mutually exclusive life-goals were 1) to hide away in Costa Rica with a shotgun and 2) to become a pawnbroking mogul, mainly through the rhetorical force of speeches he planned to deliver at Pawn Expo, the mother of all pawnbroking conventions. His brother G— was plainly the more capable of the two; in an unthwarted, non-provincial modality, he might have been a statistics quant. In this life, he drank heavily and played Sega Genesis. G— seemed to be negotiating the state of his soul on a momentary basis, and the more I worked with him, the more I realized that his constitution could not bear the onslaught of human misery brought down on him during his transactions with the rural poor. To relax he would sometimes repeatedly beat the landline phone against the pawn counter, smashing it to bits and terrifying the hilljacks who gathered in the shop. One such hilljack was J—, a frail geezer with a white beard, whom I affectionately called “Whistleteeth” for probably obvious reasons. An informal pawnbroker, by which I mean I’m unsure whether he was stably paid, J— could play every instrument in the pawnshop, but his favorite was a banjo that he borrowed on Wednesdays, when he would jam with a bluegrass band at a local shithole. Rounding out the crew was a handsome young man called C—, who, though in his mid-twenties, had been married for seven years. This was not for religious reasons; no one at the pawnshop, as it happened, acknowledged the Lord. But they all wholeheartedly believed in aliens.

The phrase “redemption ratio” rang through my head on the bus ride home. It seemed to me that I had unwittingly exited the realm of New York leftism where Marx ruled as an absent godhead, poised forever to vengefully return. Here in the land of Weber, like a good American Protestant, I would suck at the scum of petty usury, unredeemed yet restored to my unfortunate roots. I had entered the pawnshop that day a broke and desperate person; when I left, I was a subprime lender.


My first day on the job was as I expected: business was good. A post-crash malaise had fomented the rural poor’s already healthy distrust of the banking system, and, anyway, many clients were among the longstanding unbanked, with credit scores approaching absolute zero. T— was selling loads of shotguns and rifles, many of which were purchased with money originally loaned by the shop. It was my duty to report these firearms to the FBI, an important task given that the police had, around that time, arrested a local proprietor for selling guns to known felons, arguing that Jesus had instructed him to do so.

It wasn’t long until I was introduced to the first principle of the pawnbroker: he makes his money on interest, not sales.

Beyond this, I was taking quick to the trade, mostly because it isn’t complicated; although for a profession with ancient roots, pawnbroking is a subject of excessive cultural misapprehension. At least I knew, when I arrived, what many who have never been to a pawnshop don’t: the pawnbroker is not mainly a buyer and seller of secondhand goods, though that’s part of it; instead, he makes most of his money from the interest collected on loans given to clients who offer their own stuff as collateral. Usually this is a practical matter. Let’s say you haul your lawn mower to the pawnshop in November, needing cash for the holidays. The idea, understood by both parties, the broker and you, is that your patchy brown and frost-damaged yard won’t require care until the following March or April, when the first sprouts of green life begin to mock the surrounding deadness. This mutual understanding will give way to a few moments of haggling or posturing, during which the broker will likely perform an informal examination of your goods. He will then offer you a loan—let’s say you take it. Come spring, when you want to mow your yard again, you return to redeem the object; at this time the pawnbroker will demand that you pay back the original amount of the loan plus whatever interest has accrued over those cold months. If you don’t, the pawnbroker keeps your mower; if you do, the broker has “earned” his interest.

It follows that if a pawnbroker sees value in your item, he will try to dissuade you from selling it, and he will offer you a loan instead. Unfortunately for any client, the pawnbroker knows more or less immediately whether he will offer a loan; there are only so many secondhand goods he can sell in the shop if the client defaults. It is disadvantageous for a broker to loan big on electronics, for example, because they will rapidly depreciate in value during the course of a loan. It is less bothersome for a broker to offer maximum payout on collateral that will retain its value over time; the client usually pays back a higher principal on such collateral, and the broker can sell it for more if the loan defaults. This is one among many reasons, I’ve come to believe, that tradition-obsessed rural Americans fetishize your “hard goods”—Winchester rifles, Fender guitars, Harley-Davidson motorcycles—that appreciate in value over time. At any rate, this preference for interest over sales is the first thing that alights in the mind of a pawnbroker when he fondles your grandmother’s necklace or tests the integrity of your lawn mower. If this first principle fails him, he will simply look your item up on eBay and offer you a fraction of its resale value.

Then there is the matter of storing collateral. T—’s shop resembled a nineteenth-century establishment more than a modern pawnshop or payday loan center. As an accredited lender, he could, in theory, lend on anything. The way he saw it, if a pawnbroker wants to make money, he has two options: he can charge exorbitant interest rates (most do, especially in the American South), or he can augment the space wherein he stores collateral. Given T—’s charitable bent, he chose the latter option. In practice this meant that the pawnshop, unbeknownst to any outsider, was home to a vast archive of other people’s property—a Limbo of unredeemed collateral.

Misery Index

It doesn’t matter if you can store collateral, though, if you have no capital. At T—’s shop, capital was replenished during two boom periods: tax return season and student loan disbursement. The first of these is obvious: the rural poor did not to earn enough income to yield tax refunds that would allow them to go on vacation or conspicuously consume. So, they flocked to the pawnshop to redeem collateral, like necklaces and rings; if they hadn’t, these family heirlooms would have been melted down, for the pawnshop is where sentimental value goes to die. On either side of tax season, student loan payday would bring in a throng of newly cash-rich students, usually mothers, who often matriculated at scam technical colleges. Caught in a double debt-cycle, these student mothers would have to pay their loans eventually, but in the meantime, without steady access to day care, they spent cash on expensive distractions for their children, only to pawn these items when the loans ran dry.

One such student mother, with the unfortunate surname Disney, demonstrated the disgusting effects of this cycle better than any other client. When her student loans were disbursed, she would come into the shop to buy jewelry, video games for her children, car audio equipment, and anything else she could get her hands on. She would divert us with stories of her coursework at Ivy Tech, where she learned the ins-and-outs of Microsoft Word. This student mother had an ebullient, infectious, even defiant personality that softened the pawnbrokers. The last time I saw her, though, she had cracked. She arrived silently, without her gaggle of children; I turned to the pawn counter to find her waiting, absurdly, in a Mickey Mouse T-shirt. After a few moments of silence, she set a gold ring on the counter and asked for a substantial loan. Her eyes flashed with a basic craziness, as if daring me to challenge the ring’s authenticity. I took the ring and pressed it against a magnet. It was real, and I knew it to be valuable, but I didn’t want to give her the loan: she could never pay it back. When I told her as much, she silenced me. “My granddaddy will pay it, you may have heard of him.” She pointed to her shirt. I then noticed that the pawnbrokers had gathered behind the jewelry display on the other side of the shop. They were red-faced, swallowing their laughter. “Walt Disney,” she said. For the next couple of minutes, she abrogated her family history. Knowing that I had reached the limits of interpersonal reason, I gave her half of what she asked for. She thanked me and turned to leave the shop. It was then that I saw she was naked from the waist down.

These episodes disabused me of one of pawnbroking’s myths, largely perpetrated by reality television; namely, I realized that the pawnbroker is not much of an appraiser. Mostly he is conditioned by his market: he knows strictly about the goods pawned by certain clients in a given area. Even the pawnbroker’s infamous haggle has little to do with the value of the good in question; it is much more about gauging the client’s intentions. Above all else, the broker needs to decide, on sight or by consulting his ledger, whether the client will return to collect his property. If he does not, the pawnbroker does not get the loan back with that usurious fee; maybe the item will later sell, but that’s not nearly as profitable as if the client redeems it and then somewhere down the road pawns it again. So instead of a storehouse of knowledge about the history of goods, the pawnbroker carries a mental index of the local poor: their problems, complaints, justifications, excuses, and the way they make their money. With this index, he tries to predict a poor person’s rate of redemption.

Still, certain clients saw T—’s shop as a reliable alternative to the local bank. Many were contract laborers who didn’t need their tools during the winter. Others were musicians who pawned their instruments between gigs.

A pawnbroker’s mental index of the poor is also his burden. It’s a state of misery wherein the technics of usury persistently butt against the vicissitudes of poverty. The truth was, even if most of our clients knew the rules of the game, they were too desperate to play it; the 80 percent redemption ratio cited by T— was, I now saw with my own eyes, bullshit. Too many times a day, a client would pop up to the desk, addled and for all the world alone, grasping a half-dozen Blu-ray discs, seeking a loan for “gas money to get home.” Such a person might be an addict from the nearby projects; they could just as well harbor an undiagnosed illness, having rarely (if ever) seen a physician. It was usually impossible to know what their burden was, but you knew they weren’t coming back to redeem their collateral.

Still, certain clients saw T—’s shop as a reliable alternative to the local bank. Many were contract laborers who didn’t need their tools during the winter. Others were musicians who pawned their instruments between gigs. There were also roving Mennonites, who arrived in large groups, blue-clad and ready to haggle over power tools. T— and his family loathed the Mennonites because they “ain’t never paid property taxes”; they wondered aloud whether these “monks” were permitted on religious grounds to use power tools in the first place.

Other clients were deranged and dangerous. One day a Charles Manson clone slithered up to the counter with a canvas bundle; I recoiled. When he unveiled his goods, I saw a handful of glistening knives emblazoned with swastikas. “Take these?” he hissed. I turned him away. A few minutes later, I told the rest of the pawnbrokers. Incredulous, they berated me for rejecting his Nazi paraphernalia, which they knew to be highly collectible in those parts. They also warned that he might return with a vengeance. In a way, he did.

I Learned Nothing

Did I learn nothing? Ten years later, I can hardly see through my rage: rage at the unpunished hubris of those heisters, crapulous with greed, who hijacked the zeppelin of the economy and crashed it into those of us living below, whether we were in a hedge-fund-owned trailer park or a McMansional subdivision or, in my case, a rent-stabilized Brooklyn apartment building. Still, I found the same subprime manipulations, the same moral hazard disguised as honorable lending, carried out by a family of pawnbrokers who professed to hate the bankers most of all. There is no cultural divide between the coastal financial elite and the petty usurers in flyover states; there is only the capitalism of small differences, the scalability of exploitation. The operations are the same.

I knew it was time to quit when I arrived one day to hear the whistling winds of change, by which I mean the song “Winds of Change” by the German band Scorpions, played at an extreme volume on the floor of the shop. T— and his sons, giddy with vengefulness, had begun attending Tea Party rallies, and they in turn became crazier with anger and more solemn and more expressly racist. It wasn’t long before they traded their anarchic witticisms for ready-made inanities directed at socialists and immigrants—a turn that alienated, most of all, their black clientele. I put in my final two weeks, explaining that I planned to help manage a local youth shelter, where I would surely work with the same people. They didn’t care. History had arrived at the pawn counter like a shimmering piece of someone else’s collateral, and in time they’d be the ones to collect the interest. I hear they’ve opened another shop.


[1] I was born in Seymour, Indiana, “Small Town” of John Cougar Mellencamp.