(The opinions expressed in guest op-eds are those of the writer and do not necessarily represent the views of RedState.com.)
Behold the evolution of the “payday loan”.…
The 2008 global economic disaster was caused by the Big Government-Big Business crony fascism that is killing this country.
Big Government mandated Big Banks make millions of home loans everyone knew made zero economic sense — in the name of “lending equity.” To bribe the Big Banks into cooperating, Big Government allowed the Big Banks to make obscene fees on each and every idiotic loan they made — many times the fees they made on mortgages that actually made economic sense.
And round and round we went until the merry-go-round spun violently off its axis and hurtled into We the People. We the People were subjected to years of global economic catastrophe.
The Big Banks? After many years of making many hundreds of billions, Big Government bailed them out with trillions more. Of our money, of course. Because Big Government only has what it first takes from us.
Oh: And the first thing Big Banks did? With our bailout money? Pay themselves billions in bonuses.
Then Big Government went into the Big Bank protection business. The incredibly awful Dodd-Frank law made “too-big-to-fail” banks the only banks in town.
Big Government always is too onerous and expensive for small business. Only Big Business can afford the lawyers and compliance officers necessary. The bigger Big Government is, the greater the number of small businesses that go out of business.
Of course, Big Business loves Big Government murdering its competitors for them. Which is why Big Business lobbies incessantly for ever-more Big Government.
Dodd-Frank is incredibly onerous and expensive. So it has murdered thousands of small banks. Leaving Big Banks to dominate the marketplace.
But hope — and economic chutes of greenery — can continue to spring forth. As it has for poor people in the post-Dodd-Frank apocalyptic banking landscape.
Big Banks much prefer to lend money to billionaires. Small banks were the only banks that lent to poor people. So their demise has left We the Poor People in a world of hurt.
Say you’re an Average Joe, with below-average income and credit, and your car dies. You don’t have the cash (or Big Bank credit card, because they won’t give you one) to cover the repairs. But you need to keep getting to work.
Small banks used to offer Average Joes small lines of credit for just these sorts of situations. Oops.
Enter the “payday loan.” Which, as the name indicates, is a small lender lending you money until payday. Small lender because the Big Banks won’t lend to you with a ten-foot pole.
Big Banks don’t like these small-time “payday” lenders filling the gap created by Big Government’s murder of small banks. Big Banks view that gap as theirs — to (not) fill as they wish.
On Big Banks’ orders, Big Government has swung into anti-“payday loan” action. To further (re-)establish Big Bank dominance of the monetary sector. DC is extruding bipartisan legislation that will drive the “payday” lending business out of business.
DC wants to impose price caps on “payday” loans. Price caps, as we know, murder the products with the capped prices. See: 1970s gas lines.
DC remains, as always, steadfastly impervious to facts.
“Sometimes DCs denizens are nakedly obvious about helping their rich, crony benefactors.
“Silence from Congressional Liberals as Democrats Move Toward SALT Tax Cut for Wealthy’
“But far more often, Big Businesses’ elected officials obfuscate their cronyism. Dressing up ever-more Big Business assistance in “Help the Little Guy” verbiage.
“Ohio Democrat Senator Sherrod Brown is excellent at it.
“‘Protecting Ohioans from Predatory Payday Lenders:
“‘Fifteen years ago, we passed the Military Lending Act to cap interest rates on any loans to active-duty service members and their families.…
“‘Our bill, the Veterans and Consumers Fair Credit Act, would expand those same protections to everyone….’”
And now: Enter Big Media. Yet again doing their messaging portion of the Big Government-Big Business-Big Media crony-fascist cabal.
Here’s a little joint facetiously known as NBC “News”….
“Working as a teacher in Cleveland, Mississippi, was extremely rewarding, Jennifer Williams said, but she sometimes had trouble making her income stretch from paycheck to paycheck. So one day she borrowed $200, promising to settle up with the lender when she got paid a short time later.”
Stop right there. This is EXACTLY how a “payday loan” is supposed to work. You borrow a little money — until payday:
“Typically used by workers who run out of money before their next paycheck, the loans are easy to receive, not requiring a credit check, and are offered from storefront locations and online.”
As we said, these loans are for people who can’t pass a credit check — so Big Banks won’t lend them a dime. And since Big Government murdered the small banks that would lend to poor people, these “payday loans” are often the only thing between poor people and utter economic oblivion over relatively tiny dollar amounts:
“Payday loans typically extend for two weeks or less and can be made for as little as $100 and up to $1,000….
“Payday lenders and check advance companies say they provide a needed service – giving credit to borrowers who have no other access to funds, sometimes referred to as the ‘unbanked.’
“The Community Financial Services Association of America, an industry lobbying group, says 12 million American households use small-dollar loans each year.”
That’s a LOT of poor people being helped.
And look: Our old friend, the Communist-yet-accidentally-helping-Big-Banks joint the National Consumer Law Center (NCLC), LOVES destroying small loans to poor people. And their spokeswoman makes an assertion as economically illiterate as one would expect:
“Lauren Saunders, associate director of the National Consumer Law Center, a nonprofit organization that advocates on behalf of consumers, said research shows borrowers find better alternatives when states rein in payday lenders.”
If there were better alternatives to “payday loans,” you wouldn’t need the government to outlaw “payday loans.” The alternatives would simply supplant them.
“Payday loans” are an often life-saving service for millions of Americans. Which NBC “News” wants to destroy — because some people are less than entirely self-aware:
“When her first loan of $200 came due, she said she went to the lender to repay it – but wound up increasing the loan to $400….”
Ummm…: “I went into the grocery store to buy fruits and vegetables. But I wound up with ice cream and doughnuts.”
At SOME point, personal responsibility HAS to enter the equation, does it not?
You don’t dramatically damage a valuable product to tens of millions of Americans predicated upon the really unwise actions of a single individual.
Big Media NBC “News” — and Big Banks and Big Government — all want to do exactly that: de facto ban “payday loans.”
Which is how you with moral certitude know it’s an exceedingly awful idea.