Posted on 04/23/2005 8:08:04 AM PDT by tahiti
Pingie!
That may be a good point.
Usually a no fault divorce means that the two parties can negate or void the binding contract of marriage, usually bilaterally, to each other without stating that one of the parties is at fault for breach of contract.
For example, you do not have to prove cruelty or infidelity as the reason that the contract was breached and thus void.
A unilateral no fault dovorce may be a government infringement on contracts.
If there's anything that shows the problem is the irresponsible borrowers, not the lenders, it's this. The only reason for the data base and the pledge is to keep irresponsible deadbeats from being more irresponsible. I've known a few such and they're a plague on the world.
That is a correct statement.
Then why would you support the taking of property and taking of liberty by government from the payday lenders?
Government is not forcing the borrowers to initiate such loans with lenders, which of course would be government taking property and liberty from the borrowers if such laws existed.
I almost certain you would have a problem with government mandating whom you can borrow from and how much the cost of that borrowing will be.
I don't think the Gov't is "taking" anything.
This is simply consumer protection, like there is consumer protection against fraud and false advertising.
Pay-day lenders are SCUM...I hope they all choke.
Yeah, they go out into the streets and round up "poor" [actually, financially irresponsible idiots seeking a short-term fix] people at gunpoint and force them to sign up for a loan.
This is an industry created when check floating became more difficult, thanks to this computer age. Now if they could only get the computers to credit your deposit in a reasonable amount of time.
Stop me before I borrow again
The payday loan industry is booming. Growing from a few hundred facilities in the mid-1990s to about 10,000 today, it’s estimated that within a couple of years there’ll be as many as 25,000 places where people can go for fast loans for small amounts of cash.
The process is simple. Customers borrow against their next paycheck. A person needing $100 can get one by writing a check for perhaps $115 and dating it for a couple of weeks in the future.
The $15 fee used in this example is typical. Admittedly it’s not cheap. At the same time, payday loan costs can be less than the late fee on a credit card payment or the service charge for a bounced check.
Obviously, payday loan operators have tapped into a genuine need for fast, short-term, small-amount loans. Donna Tanoue, chairman of the Federal Deposit Insurance Corporation, has noted that payday loans "can provide a valuable service in emergencies - helping people meet day-to-day credit needs."
Customers borrowing that way do so voluntarily. For some working poor, those loans may be the best, perhaps only, option. We may think people agreeing to an exorbitant fee structure is a rip-off, but in a free society folks generally should be able do with their money as they see fit.
Do-gooders and meddling politicians – there’s considerable crossover here – don’t see it that way. Consumers must be protected from their own stupidity. Moreover, there’s an unstated premise that less than affluent people need even more protection, as if being poor automatically means someone’s dumb.
This week, the Illinois Department of Financial Institutions issues proposed regulations clamping down on payday loan operators. Loans can be for no more than $300, or $2,000 if secured by a vehicle. Consumers can’t get more than one payday loan a month. Customers will be allowed to refinance just twice, but only if the loan’s balance has been reduced by at least 25 percent.
Busybodies claim such regulations are needed to protect consumers. One state representative told the Chicago Tribune: "We need to have some parameters here so people don’t get sucked in and can’t get out." Ah, yes, those naïve, foolish, imprudent, thoughtless individuals who can’t be trusted to make the "proper" decision. Government must do it for them.
Claims a spokesperson for an advocacy organization backing the rules: "The fact is the industry makes tons of money by people who have to continuously borrow (cash)." What an outrage.
Yet it’s also true that the food industry makes tons of money by people who have to continuously eat. The auto industry makes tons of money by people who have to continuously drive. The energy industry makes tons of money by people who have to continuously warm or cool themselves. The music industry makes tons of money by people who have to continuously boogie.
While those industries are already regulated, you don’t see rules limiting how much you can spend or how often. Is that because they don’t appeal mainly to people living from one paycheck to the next?
Supreme Court Justice Brandeis wrote in a 1920’s decision: "Experience should teach us to be most on our guard to protect liberty when the government’s purposes are beneficial. Men born to freedom are naturally alert to repel invasion of their liberty by evil-minded rulers. The greater dangers to liberty lurk in insidious encroachment by men of zeal, well-meaning but without understanding."
Even the most well intentioned rules, regulations, and laws limit freedom and choice. Government at any level is too big when it unnecessarily interferes with basic rights. If we need protection, it’s mostly from politicians with a Big Brother mentality who think their job is to tell others how to live.
August 10, 2000
Michael M. Bates: My Side of the Swamp
Surely, some of these payday loan companies could provide short-term personal loans, like letting people borrow up to $2,000 and giving them 6 months to a year to pay back at a reasonable interest rate than offering these payday loans that do nothing but perpetuate the cycle of debt.
So borrowing up to $2,000 bucks won't perpetuate the cycle of debt?
Paying back $2,000 dollars within a year is nothing, bro. Lots of working poor people have steady jobs and/or are waiting for a huge check (like student financial aid, for example) and just need that hand up until then. They're not going to get it from banks or other financial institutions because of their credit. So unfortunately they turn to these cash stores that do more harm than good.
All I'm saying is that these payday loan stores should offer short-term personal loans instead of these rip-off two-week payday loans that trap people in these debt cycles and forces them to roll the loan over and over at obscene interest rates. The loan amount doesn't have to be high; a 90-day, $1,000 loan at 15% interest is a good example. Excellent business opportunity, IMO.
Well, the founders and a supreme court justice as well as me disagree with you. Words have meaning. Amendment V is unambigous in its meaning both then, at ratification, and now.
"This is simply consumer protection, like there is consumer protection against fraud and false advertising."
Consumer protection? Fraud and false advertising are not issues in this scenario. The borrower is fully aware of the consequences of their actions. That is how "free" people live.
You have the "right" to be dumb.
"Pay-day lenders are SCUM...I hope they all choke."
And thank the founding fathers and people like me that your right to make such a remark is fully protected from interference by your government.
1. No state shall...pass any bill...law impairing the obligation of contracts,
Not a problem. The state is not obligated to enforce illegal contracts. They aren't voiding any existing contracts, but are putting restrictions on which future contracts will be legal. Those will be enforced, and the obligations are not therefore impaired. I'd love to hear you alternate explanation - that still has such a thing as an illegal contract.
Amendment V
Nor shall private property be taken for public use without just compensation.
Again, no private property is being taken. The potential of greater future profits has never been held to be property. I'm aware there is a movement, largely here on the right, to hold such, but it's certainly not the case today - or at any time during our history. Claiming it is true, is the very epitome of judicial activism most of us stand against.
Amendment IX
The enumeration in the Constitution of certain rights, shall not be construed to deny or disparage others (rights) retained by the people.
OK. And?
You're saying the right to have illegal contracts enforced is a right? Or maybe we have the right that anything once legal must remain forever legal provided it turned a profit? Seriously, what is this unenumerated right you're supporting here. Please be specific.
Amendment XIV
Section 1. No State shall make or enforce any law which shall abridge the privileges or immunities of citizens of the United States;
The Illinois law also blatantly and almost contemptuously, violates the U.S. Constitution.
Well, I think I've gone through and shown that this Illinois law does not violate the U.S. Consitution. If it did, that same prohibition would, in fact, apply to the states, through the 14th - just as you assert. But as it does not violate the constitution, the 14th is silent about the States.
Enjoy,
Drew Garrett
If it is such a great business opportunity, why don't you try it with your own capital?
The reason for the short duration is that it is a lot easier to track down a deadbeat if he has only been gone for 2 weeks.
Rolling the loans over is the equivalent of making a longer term loan, except that the lender gets to see the borrower live & in person every two weeks, can get an interest payment, and can re-evaluate creditworthiness.
The default rate on these loans is astronomical.
This is one area where I really believe there is free enterprise & competition. For a lot less than the cost of a McDonald's franchise you can start up an independent payday loan operation. There is no differentiation in the quality of your product, and your customers should be price-sensitive.
Making the operation profitable depends entirely on your ability to collect from sub-sub-prime borrowers. Despite the possible profits, you will not find me putting any money into one of these businesses.
In a pawn shop, you must furnish them with something of value, in return for a loan. You get 10-20% of its value as a credit line. This item(s) is stored for a set period, with a typical 10-20% monthly fee. It has worked for years, but now without available credit, and with living and gas prices high, these shyster shops are proliferating even more.
There are always folk that can't handle money properly... and usury is still against the law, except to a politician!
"The state is not obligated to enforce illegal contracts."
Where is the "illegal contract" you speak of? Offer, acceptance, and consideration have all been forthrightly agreed upon by both parties.
To enter into a contract of mutual benefit is an unenumerated right.
"If the founding generation that adopted the Ninth Amendment and the generation that adopted the Fourteenth Amendment were correct about natural rights, then constitutional legitimacy requires a lawmaking process that provides an assurance that the rights retained by the people, or the privileges and immunities of citizens, will not be disparaged, denied, or abridged."
You cannot contract for an illegal deed. You cannot contract without an exchange of value. You cannot contract to give up inalienable rights. You cannot contract yourself or another person into slavery. You cannot contract indentured servitude without an end to term.
All of these are illegal contracts. Get the idea. Whether entered into and accepted willingly or not, the state will not enforce them. This is true now, and it was also true at the time the ninth and fourteenth amendments were ratified.
As far as loans, we have long recognized legal limits on allowable interest. Usury was a crime at the time of the founding, in case you weren't aware - in fact, they were far stricter about it than we are today. If you charge above the legal limits, it is an illegal contract, and the state does not have to enforce it.
Was any of that unclear?
Again, you might disagree that these things should be illegal. Bully to you. But that's not the case now, which is what we were discussing.
Drew Garrett
Amendment XIII
Section 1. Neither slavery nor involuntary servitude, except as a punishment for crime whereof the party shall have been duly convicted, shall exist within the United States, or any place subject to their jurisdiction.
Why did it take a constitutional amendment to accomplish this goal?
Was it because government was constitutionally prohibited, prior to the ratification of Amendment XIII from interfering with these contracts and property rights?
Senator Lyman, principal draftsman of both the Thirteenth Amendment and the Civil Rights Act of 1866, posed the question “…what rights do citizens of the United States have?” He answered, “They are those inherent, fundamental rights which belong to free citizens or free men, in all countries, such as the rights enumerated in this bill, and they belong to them in all the States of the Union.” As examples of “natural rights” and “inalienable rights” he offered these: “The right of personal security, the right of personal liberty, and the right to acquire and enjoy property.”
Granted, prior to the ratification of Amendment XIV the U.S. Constitution was not recognized as having jurisdiction within the boundaries of a sovereign state.
So, prior to the ratification of Amendment XIV, which you allude to, ("Usury was a crime at the time of the founding, in case you weren't aware") the power to enact usery laws by the states was only limited by their own state constitutions.
"As far as loans, we have long recognized legal limits on allowable interest."
Does that make such "legal limits on allowable interest" constitutional?
Of course not. The number of laws are too numerous to name that are presently enacted that are unconstitutional.
"If you charge above the legal limits, it is an illegal contract, and the state does not have to enforce it."
I think you meant "change."
I understand your point.
I am suggesting that the group that opposes the "change" of the usery law, should challenge the entire usery law constitutionally, as I stated in my original post.
If you don't think the Gov't should ever be in the business of protecting people from themselves, then you should be all for taking out guard rails along wountain roads.
I would be a little more sympathetic to the payday lending business if I did not believe that there is a lot of price fixing in the business.
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