No Reason to Bring Payday Loans Back
M oore County residents have at least a couple of reasons to be surprised - they should be appalled - by the suddenly surfaced effort to revive the infamous payday loan industry in North Carolina.
For one thing, this misguided and unsavory campaign is being sponsored by one of our own. Actually, let's rephrase that. Though state Sen. Jerry Tillman represents our county, among others, he is not really one of us, hailing instead from up Archdale way. This is all the more reason to elect somebody else next time around - someone who is from here and shows more evidence of sharing our values.
There's another reason for local concern: If the payday loan snake is allowed to slither back out from under its rock, among its most hard-hit victims are likely to be Fort Bragg personnel and their families.
In 2007, indeed, Congress enacted - and President George W. Bush signed - the Military Lending Act, which put certain controls on loans to members of the armed forces. Since its passage, the number of such members seeking counseling for crippling debt is said to have shrunk dramatically.
Preying on the Vulnerable
But the military has enjoyed even greater protections in our state. Years before the feds did that, back in 2001, North Carolina had already taken more stringent steps to outlaw payday loans within our state's borders, at least in theory. In reality, it took several more years to stamp out the predatory little loan shark offices that had sprung up everywhere, with a special concentration in places like the sleazy neighborhoods crowding in on military bases. It took a 2005 state court decision to drive a stake through the industry's heart.
It is that ban that, for no valid reason we can think of, may now be lifted.
Payday loan schemes seek to prey on the most vulnerable in our midst by ensnaring them in loan upon revolving loan until they're hopelessly mired in debt. In the past, investigations showed that some North Carolinians ended up paying as much as $8,000 in fees on a loan that originally totaled $200.
Tillman claims that the new payday loan industry, if there is to be one, will be kinder and gentler and less voracious in the usury it inflicts on its victims. We'll believe that when we see it. The step he proposes seems certain to create far more problems than it solves.
'The Same Rip-Off'
The baseball-capped Tillman has struck us from the beginning as singularly ill-equipped for the state Senate position he now holds, and this does little to assuage such doubts. Tillman portrays his sponsorship of this proposed legislation as somehow being an example of looking out for the little guy, those with bad credit and nowhere else to turn.
But it seems more a matter of a legislative newcomer falling victim to the blandishments of a half-dozen lobbyists, the most powerful of whom is former state House Speaker Harold Brubaker, who is now pandering to well-heeled corporate vampires out to suck blood from the most helpless among us.
N.C. Attorney General Roy Cooper said it right: "This is the same rip-off we ran out of our state years ago. ... Payday lending was a bad idea then, and it's a bad idea now."
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