Jan Brewer- Filthy Ho Beast!

One of the first things I noticed when moving to Tucson in May was the overabundance of cash-stores. Little pay-day-loan operations dot the landscape, and perhaps not surprisingly, are particularly dense in the poor parts of town. For those of you not familiar with pay-day loans, here is how they work. You need cash immediatley for some emergency (meth lab burned down) or an impulse buy (diamond encrusted grill with your baby's name etched in gold across the incisors), but you have no savings (meth lab burned down last month too!), and pay day isn't until next week dog!

I need cash NOW!

So you pick out one of your favorite payday loan stores and you ask for $100. No questions asked, no credit report needed. You write them a post-dated check for $115 to cover the loan and service fee, and when payday comes, they cash the check and all is well. All is well provided you have a big enough pay-check to cover the loan, but if you were so hard up for $100 last week, chances are that after paying your bills and buying food, you're broke again.

No worries, the kind folks at the Payday loan store will let your loan roll-over. Its refinanced just like at a fancy big-people's bank! yay!

But

But what?!

But your loan has an average 400% interest rate. Keep rolling over your loan, and after a few weeks you're paying about $60 interest on your $100 loan. You may need to take out another loan! Do you see where this is going?

Many states, Arizona included are trying to pass legislation to limit the interest-rates that these stores charge. This is good. Some organizations are trying to ban these stores alltogether. This is even better. So whats the problem? More specifically, whats the problem in Arizona? The Problem

In 2000, a piece of legislation was passed which granted the payday industry a short-term rush of cash by making them exempt from the 36% intrest cap which the state imposes on all lenders. This is why they're able to charge a 391% yearly usuray rate. A proviso in the 2000 legislation placed a "sunset" on payday loans. This essentially stated that after July 1, 2010 the industry would shut its doors and get the hell out. Fast forward a few years to when something called Proposition 200 was drafted with the support of the payday loan industry. Prop 200 proposed to eliminate the sunset date and promised instead state government oversight of short-term loans. In an uncharacteristic moment of clarity, Arizona voters rejected prop 200 by a landslide. So goodbye loan stores, rigth?

Perhaps. But now it appears that currently acting governor, and 2010 Republican gubernatorial hopeful Jan Brewer, who was instrumental in drafting the language of prop 200 is in cahoots with the PDL industry. In cahoots is perhaps an understatement, they're rather more like two rats fucking in a wool sock. Steamy! Some of Brewer's top campaign advisors, and her campaign co-director are all high ranking PDL lobbyists and insiders. When questioned by reporters she was quoted as saying "I don't see any conflict". Say what?!?!

"I'm not going to make any comment on any legislation that might eventually end up on my desk, and, and.... GYYAYRTRRGGGGHHHH!!!! I WILL EAT YOUR SOUL!!!!!!!!!!!!!!!!"*

This shoudln't be shocking to anybody who has ever seen a politician open his or her mouth. It is so rediculously shortsighted though (and yes, I know politicians only think as far ahead as the next election cycle). Ridding our state of these predatory lenders can help the poor (their target audience) hold on to what little money they do have. Teaching financial literacy to the consumer public is one thing, but sometimes we need to admit to ourselves that people are inherently dumb, especially when it comes to money, and that suckers need to be looked out for and helped along. We help the poor become just a little bit more financially stable, and all of us benefit from it. The argument comes in many forms, and I'm not about to reiterate all of it here. Needless to say though, the state of Arizona, is in a financial nose-dive, and these are the kinds of things We The People should be doing to pull out. Not just cutting up the budget until there is nothing left.

*quotation may be out of context; our research staff is looking into it