Payday Pundit

Ohio House Speaker Jon Husted today explained why he thinks eliminating jobs and limiting financial choice is a positive path forward for the people of Ohio:

“We capped the [payday loan] interest rate at a level that created a reasonable expectation that the borrower could pay it back, that they wouldn’t be trapped in a cycle of debt,” Husted said. “We didn’t ban small loans, we banned a defective product.”

Right — they didn’t ban small loans, they effectively banned small loans.  Details, details.  Why is it that not one Ohio politician who voted for this atrocious legislation will step forward and say what they’re dying to say: “You know what?  I think the people of Ohio are irresponsible and have proven that they can’t handle their finances.  I voted to effectively ban payday lenders because I trust my judgment more than that of the people who elected me.”

These self-appointed nannies love to put the payday loan industry on the hook for “cycles of debt” that they have no quantifiable evidence to back up, but refuse to be held accountable for the possibility of 6,000 lost jobs:

Strickland, Harris and Husted said there is no evidence that 6,000 jobs will be lost as a result of the new law.

Evidence is a funny thing.  The Payday Pundit thinks Strickland, Harris, and Husted will have all the evidence they’ll ever need about Ohioans’ views on payday loans if the repeal initiative gets on the ballot.

From the AP:

COLUMBUS, Ohio (AP) — Democratic Gov. Ted Strickland and Republican legislative leaders will fight an effort by payday lenders to repeal restrictive caps on the short-term loans they offer.

Strickland, Senate President Bill Harris and Speaker Jon Husted (HYOO’-stehd) will serve as honorary co-chairs of a campaign fighting the repeal of Ohio’s new payday lending law. The law restricts annual interest on such loans to 28 percent, versus the 391 percent charged today, and limits consumers to receiving four such loans a year.

The repeal has not yet qualified for the Nov. 4 ballot. Signatures are due Aug. 31 and the industry plans an aggressive campaign for the repeal. Spokeswoman Kim Norris said the bill took away consumer choice and will cost the state most or all of the industry’s 6,000 jobs.

Kim Norris is on-point as usual — the law in Ohio will kill jobs and rob citizens of a financial choice.  And critics, as usual, refuse to explain that the “outrageous” APRs they quote are being applied to two-week loans.  The Payday Pundit thinks this announcement shows the opposition in Ohio is getting nervous…

An interesting letter to the editor in the Baxter Bulletin in Arkansas touches on motivation of city councils to ban payday lenders and other businesses they deem “aesthetically unacceptable.”  Definitely an interesting take on something we’ve seen repeated across the country in city council decrees — it’s worth a read.

PDL industry blog says the contributions are a sign of a well organized industry.   We would put it even stronger.   Contributing to candidates is participating in democracy.  It’s the right of every American and the right of every industry. 

As we told you when we posted this story, a three-judge panel of the 10 District Court of Appeals will hear the industry’s case today.  

The Payday Pundit will, of course, keep you  updated on any developments we here.  

TheStreet.com provides a useful service to consumers.

There’s a city council hearing coming up:  

A public hearing is scheduled for 6 p.m. Wednesday, Aug. 20, in the Springfield City Council chamber on an ordinance that would require payday and title loan outlets to be separated by at least 750 feet. The ordinance also would create a legal definition for what the city considers to be consumer, payday and title loan companies.

Go to the hearing and tell the city council to fix the potholes and leave small businesses alone. 

This letter in the Zanesville Times Recorder demonstrates  that payday lending employees have more sense that legislators.   

With the economy and the job market the way they are, it is terrible policy on our politicians behalf to be legislating our jobs away to other states. These were not low-end jobs, but rather very secure jobs that paid quite a bit. It is very fair to say that these companies took care of the people that worked there. Isn’t the most logical way to decide what is best for the public, to let the public decide?

The Payday Pundit wonders if the Ohio legislature has any regrets.

A thoughtful discussion on this blog provoked by the Arizona ballot initiative. 

The latest from the Columbus Dispatch:

As expected, Ohioans for Financial Freedom, the group of payday lenders that wants to overturn at least part of House Bill 545, is coming out of the gate fast and spending heavy on its advertising campaign, including a number of spots expected to run in Ohio during the Olympics.

The first ad will feature a man who says Ohio politicians are risking 6,000 jobs by shutting down payday lenders. He then points to his old truck, and says it should be his choice to borrow $100 and pay back $115 on payday if it breaks down. He asks viewers to sign the group’s petitions.

The ad highlights what are likely to be two common themes for payday lenders: financial choice and saving jobs. The industry has said that if the new law goes into effect, most of its 1,600 lenders will shut down because they cannot operate under the new 28 percent annual interest rate, which is down from the current 391 percent ($15 per $100 on a two-week loan.). The proposed referendum would allow the current interest rate to continue.

Sounds like Ohioans for Financial Freedom are off to a great start.