Friday, January 28, 2011

Enough Really IS Enough

Wednesday I spent the day at our state capitol in Austin, for a legislative briefing followed by meetings with representatives and senators about legislation to close the loophole in state law allowing predatory lenders to charge exhorbitant (400%-900%) interest.

It is amazing to see how much of a problem this is across the Texas. Seniors, single parents, servicemen and women have all been victimized by a business seen more and more as exploitation in the garb of capitalism.

But I'm also seeing that this is not just Texas. Of course you know that, but there are times when the start reality of how these businesses ensnare what are supposed to be the sources of protection for consumers.

Take for instance the state of Mississippi...

"On January 11, 2011, a coalition of Mississippi’s religious and social justice leaders called Mississippians and the state legislature to end predatory payday lending. As the Mississippi House Banking Committee unanimously passed a bill that would extend predatory lending in Mississippi, Bishop Hope Morgan of the United Methodist Church reflected: “I come to bring good news to the poor—572 percent is not good news to the poor. The poor are being entrapped. We are better people than this.”"

"The House Banking Committee did not make the bill available for reading until after its vote. It makes the maximum term 28 days instead the proposed 31 days. The legislation also increases the maximum amount of a loan from $400 to $500, including fees. The bill includes a fee to fund the Consumer Protection Education Fund to benefit the Attorney General’s Office and the banking commissioner. The bill adds a default charge of $20 or 5 percent of the face amount of the check if the loan is not paid back in 10 days."

"Mississippi law enabling payday lending is set to expire in 2012."

"Reverend C.J. Rhodes, pastor of Mount Helm Baptist Church in Jackson, testified that the rates “are not just unjust, but sinful.”"

"The proposed bill would continue the debt trap payday loans set for poor Mississippians. As the Mississippi Economic Policy Center (MEPC) explains, the debt trap is created when a working family is unable to pay off the first payday loan and must take out multiple loans over the course of the year to cover basic expenses."

Mississippi's experience with the pay day loan industry is not good.

But as this video clip plainly shows, Texas' problem and Mississippi's problem is a national problem! The conversations regarding how these businesses impact minority neighborhoods, as well as low-income and working class neighborhoods are taking place across this country. It's time now for action to be taken.

In Dallas, call your council representative and tell them you support a resolution from the City Council to the state legislature supporting closing the loophole that allows these businesses to prey upon our most vulnerable citizens. No matter where you live in Texas, call your state representatives and senators and tell them you support legislation that would close that loophole. It's not the total answer. But its a start.

Enough really IS enough!

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