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Military “protections” demonstrate stunning hypocrisy of predatory loan bill

Predatory loans [1]Members of the Senate Commerce Committee approved a bill [2] today that would jack up interest rates on small loans made in North Carolina to unprecedented levels. The bottom line on the bill [3]: Already high-cost loans will become bigger, more expensive and harder to pay off. 

The action came on a voice vote after several experts explained why the bill would be a disaster for already struggling consumers.

I know: No big surprise for the 2013 North Carolina General Assembly — a group whose motto ought to be “When corporate lobbyists say ‘jump,’ we say ‘how high?'”

Still, this morning’s hearing featured a moment of such blatant and downright stunning hypocrisy, it had to be witnessed to be believed.

Consider the following: Under the terms of the latest version of the bill trotted out this morning, several extra consumer protections will be added for military personnel on active duty — including an extended right to cancel the loan, a prohibition on mandatory arbitration clauses, and additional disclosure requirements. The lender even has to mail a copy of the loan to the borrower’s commanding officer!

The point of all this: To prevent soldiers, sailors, airmen and marines from getting ripped off, obviously. Even loan industry lobbyists — the people who drafted the bill — admit that, without these protections, vulnerable members of the military will be subject to exploitation.

But, of course, therein lies the rub: If vulnerable members of the military need protection, why not everyone else? Why not military veterans? Why not first responders? Why not teachers? Why not anyone desperate enough to pay 30% interest on a $1,000 loan in this era of historically low interest rates?

The answer, of course, is that lawmakers don’t give a damn about those other people. And truth be told, they don’t give a damn about members of the military either; they just wanted to make sure they could flip military officials from opposing the bill to “neutral” just like the industry “flips” two out of three borrowers into back-to-back-to-back loans.

In short, it was a sobering reminder of: a)  just how far our elected officials have sunk into the mire of cyncism and hypocrisy this session, and b) the fact that, as bad as things have gotten, there’s still lots of room for them to get even worse as long as legislators remain in town.