ARTICLE I
BILL OF RIGHTS
SECTION 1. INHERENT AND INALIENABLE RIGHTS All men are by nature free and independent and have certain inherent and inalienable rights among which are life, liberty and the pursuit of happiness. To secure these rights and the protection of property, governments are instituted among men, deriving their just powers from the consent of the governed.
SECTION 15. RIGHT OF EMINENT DOMAIN Private property shall not be taken or damaged for public use without just compensation as provided by law. Such compensation shall be determined by a jury as provided by law.
SECTION 16. EX POST FACTO LAWS AND IMPAIRING CONTRACTS No ex post facto law, or law impairing the obligation of contracts or making an irrevocable grant of special privileges or immunities, shall be passed.
SUPREME COURT OF THE UNITED STATES
No. 98—963 JEREMIAH W. (JAY) NIXON, ATTORNEY GENERAL OF MISSOURI, et al., PETITIONERS v. SHRINK MISSOURI GOVERNMENT PAC et al.
[January 24, 2000]
Justice Stevens, concurring.
"therefore, I make one simple point. Money is property;"
Can it be any clearer that this Illinois law is unconstitutonal.
Great! Price the service out of reach in the name of making it cheaper. Typical Libthink.
Why?
What does the Constitution have to do with anything?
I'll probably get flamed for this...but the payday loans and car title loans are forms of legalized thievery.
Laws to reign these blood sucking leeches in is fine by me.
Now, the next thing that needs to be done is to end all state lotteries.
How is this any different from any other regulation of the financial services industry such as laws regulating userus loans?
Constitution? You're kidding, right? We don't obey any Constitution. Lip service, yes, obey, no way.
Business or usury?
Pingie!
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.
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.