Payday Lenders Drop a Bucket of Cash on Congress
The payday lenders are getting their money’s worth in this Congress. Last year, they made $6.1 million in contributions to Congress. That is roughly the same as JP Morgan Chase!
The Community Financial Services Association, their trade group, reported giving $2.7 million alone. Most of their attention was lavished upon Democrats in order to put off the Payday Lending Reform Act of 2009. The bill would have capped interest rates on payday loans.
Cash America spent $270,000 in the first quarter of 2010 on lobbying.
According to their filing, they paid Kevin Kimble to work on (or “against”) the following bills:
- S. 500/HR1608, Protecting Consumer from Unreasonable Credit Rates Act of 2009
- HR 1640 Interest Rate Reduction Act
- HB 1705/S.566 Financial Product Safety Commission Act of 2009
- HR 1214, Payday Loan Reform Act of 2009;
- S 582 Interest Rate Reduction Act
- HB 1456. Various bills relating the Truth & Lending Act (Overdraft, Service Charges & payday loan disclosures)
- HB 4173 the CFPA
- S. 3217 – “Restoring American Financial Stability Act of 2010″.
The payday loan act was a bit of a ruse. It purported to serve as a restraint on payday lending, but in reality, it was more of an effort by the payday lending industry to develop a set of legislative standards that would allow payday to continue its basic operations, while at the same time giving them cover through the imprimatur of Congressionally-approved space.
Even if some of these bills pass, they have already gotten their money’s worth. Senator Kay Hagan’s provision to limit the number of loans per year was never adopted.
When Congress starts defending payday lending with statements like this one, from Rep. Joe Baca (D-Ca), that legislation needs to “ensure that students, blue collar workers, teachers, police officers and others have access to legitimate payday advance loans if needed,” you know that the bags of cash are paying off. Baca serves on the House Financial Services Committee. He picked up contributions from Cash America, the Online Lenders Alliance, and Ace Cash Express.
My favorite payday mantra is the refrain about busted-up dishwashers and broken down cars. It is as if America was stuck in a Lucinda Williams song.
