Passing an urgency interim ordinance – normally reserved for extreme and unforeseen situations – is more than a bit premature, it’s perplexing.
What indeed, City Council, is the emergency necessitating the passage of a moratorium on payday loan and check cashing businesses? Discussion is welcome – after all this is a democracy – but there’s certainly no emergency, and passing a new law without due consideration is not only hasty, it raises questions about judgment and necessity.
On a prima facie level, “outrage” is easy to muster. These businesses, the argument goes, prey on the disadvantaged, charging the poor people who cannot get bank loans outrageous interest rates on small loans that can accumulate from different places and cause a spiral of debt from which people cannot recover.
The flip side is about the guy who can’t get a bank loan for $500, but desperately needs the cash to get his car transmission fixed so he can get to work and feed his family. He pays the loan back in a week and, yes, he takes a financial hit, but he still has a job and no high-falutin’ bank would have loaned him one thin dime.
That leads us to the main point: the City Council hastily voted 7-0 to pass a temporary urgency ordinance without an emergency at hand.
The vote is politically correct, of course – protect the poor people from themselves for they cannot protect themselves.
What could help? Education, information and, perhaps, a place where people in temporary need could get those types of loans. Of course, it’s a risky business for places like Check Into Cash and Advance America. People don’t always pay the loans back, and it’s not like they can send “Uncle Salvatore” out to break legs and collect.
Whether the City Council should be regulating an industry that it has gladly accepted money for a business license for is another question.
Payday loans aren’t pretty. And maybe the businesses are purely predatory. But the Council ought to thoroughly vet the facts before jumping on the politically correct bandwagon.
