Washblog

She says that data the industry provides to her says that only 4% of customers ever get to the point of 312% interest.  It occurs to me, then, that it shouldn't be any big deal to cap the rates at 36%, since, if not many of their customers go over that anyway, it will prevent abuses without affecting their bottom lines much.

by eridani on Thu Feb 01, 2007 at 06:45:24 AM PST

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12% seems more than enough profit for them to me.

by Pen on Thu Feb 01, 2007 at 01:42:17 PM PST

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According to the Seattle Times this morning, Rep. Steve Kirby (D-Ft. Lewis), Chair of the House Insurance, Financial Services and Consumer Protection Committee, will not bring Rep. Appleton's bill before the committee, effectively killing that bill for this session. Kirby is quoted as saying, "Rather than the nuclear option, which is just to ban them [payday loans] in this state, we are trying to do things that interrupt the cycle of revolving debt..."

Immediately after killing the Appleton bill, Kirby introduced one of his own that would simply allow the borrower a once per year opportunity to set up a 60 day installment plan at no additional charge. This bill would otherwise leave rates and fees unchanged.

Money Tree CEO, Dennis Bassford (a maximum contributor to Kirby's election campaign), is more suppoprtive of the Kirby bill saying, "It is certainly a better attempt at good regulation than what it is being proposed by Rep. Appleton..."

Can we get a handwriting analyst over here?

Peace,
Chad (The Left) Shue  

by The Left Shue on Fri Feb 02, 2007 at 06:57:24 AM PST

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And this would be good for several strategic reasons, over and above the substantive issue -- the need to drive those bloodsucking vampires out of our state:

There are several bills before the Legislature that would restrict paid initiative signature gatherers. This is a direct attack on the Tim Eymans and Howard Richs of the world, and it is a good thing. The right wing bloggers, predictably, are calling it an attack on the initiative process. It's no such thing, of course, but rather an attempt to remedy the worst abuses of the system.

An initiative to restrain payday lenders, if successful, would put the lie to the whole right-wing propaganda effort and would prove that there are viable populist alternatives to intransigent legislators.

Such an initiative also would provide a mobilizing focus and a recruitment tool for Democrats in areas where people use payday lenders.

I personally will go to Rep. Kirby's legislative disstrict, which I am quite familiar with, to gather signatures for such an initiative, and I expect to have a lot of company. If we stand right outside payday lenders' doors while we collect them, I think we might bring ourselves a lot of attention and a lot of support.

There's no point in bashing Kirby, or Margarita Prentice. We'll need their help for other things, and they'll need ours, and their records are pretty damn good in many other areas. What's more, they are both darn near invulnerable to an electoral challenge, so why waste the time?  We'll just have to agree to disagree, and move forward.

This is what comes of having a "big tent" party, and we need to get down to some serious work and not just wave our arms about.

If perception is reality, then the world must be flat and the sun must revolve around it.

by ivan on Fri Feb 02, 2007 at 11:34:14 AM PST

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If the lenders who charge these rates want to kill a bill like this, that's part of the political process.  What I want to know is where is their solution to the actual problem.  Why do people have to depend on getting these types of loans in the first place?  Well, a couple reasons.  First, because they don't get paid enough, don't get enough hours on the clock, or have too many bills to pay from health care or other life expenses that just put them over the top.

So what's the solution?  Sure, we can cap these types of interest rates because they are rediculous.  But that's not a solution to the real problem.  Any real solution includes increasing the minimum wage so people trying to jump onto the ladder have more money to spend in our economy, thus boosting demand and helping everyone.  Any real solution must include getting national health care so expenses like that don't drive people in to bankruptcy, thus reducing emergency expenses and helping everyone.  Any real solution must include fully funding education from Pre-Ph.D so the doors of opportunity are open for people when they are ready to walk through them.

Same old argument.  I don't object to providing financial services like this to those who need them, and I don't object to businesses making money.  But without a solid foundation under all our feet, capping interest rates is like using acne cream on liver spots.  It just doesn't do anything to solve the real problem.

by chadlupkes on Mon Feb 05, 2007 at 01:26:04 PM PST

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