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Thursday, May 13, 2010
Payday Loans - Why You Should Care.
I don't like when businesses take advantage of other people. What do payday lenders do? Payday lenders offer loans to low-income people at 15% to 30% for a two-week period until next payday - that's nearly 400% to nearly 800% per year. I had to research to make sure that was right. I mean, how can that be right? But it is.
"Some people borrow $500 and end up owing $3,000," as a Colorado deputy attorney general observed.
Payday executives like W. Allan Jones, who is a major backer of Tennessee Senator Bob Corker (I have written about him before), know that these high rates often trap their "clients" into an endless cycle of debt - and they don't care.
The morality of payday lending isn't complicated. 400% and 800% interest rates are usurious by any definition of the word. The prophet Ezekiel put usury on his list of "abominable things," along with rape, murder, robbery and the worship of idols.
Then how about Christianity? We're a nation that prides itself on asking, especially among politicians, "what would Jesus do?" Unlike some other political questions, the New Testament offers a clear answer when it comes to usurious lenders. John 2:13-16 is pretty specific: He overturns their tables and drives them (along with sellers of ritual doves) from the Temple. And he uses a whip to do it.
Sarah Palin should be a big supporter of these changes, too. After all, she said she thought that "US law should be based on the God of the Bible" -- and we know what He thought about usury.