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Home / Payday Loans Fate May Be Up to the VotersPayday Loans Fate May Be Up to the Voters
Last Updated on Wednesday, 18 June 2008 04:31 Written by rslcpol Wednesday, 18 June 2008 10:38
An interesting strategy indeed – direct democracy. From Stateline.org:
The fight between state lawmakers and payday lenders has entered a new phase as the industry is attempting to get on the ballot this fall in Ohio and Arizona and take its case directly to voters.
Until now, the industry has largely confined its efforts to battling state legislatures, many of which have moved to protect borrowers who take out the short-term, high-interest loans. Ohio, New Hampshire and Virginia lawmakers approved payday reforms this year.
Now industry officials are trying a new tack. In Ohio, they are seeking a referendum on the Nov. 4 ballot that would in effect reverse the Legislature’s action. In Arizona, an industry-led coalition is collecting signatures to qualify for a ballot initiative wiping out a state law that will shut down the industry in two years.
The strategy could be risky. If voters reject the ballot measures, opponents of payday lending say they would use the defeats to puncture the industry’s argument that such loans are popular with consumers who need small amounts of cash for emergencies. The borrower usually receives the cash after writing a personal check for the loan amount and a fee. The lender holds the check until the worker’s next payday, usually two to four weeks, when the borrower must pay off the debt.
A recent Zogby survey found 84% of likely voters in Ohio believe citizens should be free to make their own decisions about what kind of credit they can use, and 70% said the government should not be in the business of telling adults they cannot get a payday loan.
Independent research has shown that without the option of payday lending, consumers bounced more checks, filed for more bankruptcies, did not pay bills and even chose such dangerous options such as forgoing prescription medications.
The payday lending industry is extremely important to Ohio’s economy. Our businesses contribute $250 million to Ohio’s economy, employ 6,000 Ohioans to whom we pay nearly $173 million annually in salaries and benefits, we occupy a total of 1,600 locations, for which we pay $77 million annually in rent. The ripple effect our business has on the state’s economy is tremendous—all of which is at risk with the passage of HB 545.
The voters are the ones that will be hurt by HB 545 and they should decide if they want to submit to the state and have their choices taken away and their freedoms limited by the government.
More people use payday loans than those who do. The question is whether these people will vote to force their personal preferences on other people, or if they believe in free choice.
With the governor controlling the attorney general, and the attorney general approving the language on the referendum, it will probably come down to how the referendum is worded.
Given who is in control – the deck is clearly stacked against payday lenders getting a fair shake.
I wish that people would stop focusing on the 6000 jobs that will be lost with the enactment of this law. Don’t get me wrong, that is a HUGE # and it’s unfortunate that Strickland the Ohio General Assembly are not paying attention, especially given the high unemployment rate, the DHL/ABX Closing and GM shuttering. We need to attract jobs, not vote to do away with them!!!
However, the bigger issue is the focus for Ohioans on Freedom of Financial Choice!!! I don’t want others deciding where I can bank, where I can loan money, etc.
Secondly Payday Loans are 2 WEEK LOANS, not to be fairly and accurately compared to an APR— that comparision doesn’t make sense!!
We will overturn this “ridiculous” bill in November– guaranteed!!!