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The Payday Loan Sharks Operate On Wall Street Now

The Loan Shark Protection Act would limit the interest charged on credit cards to 15 percent. A 15 percent cap would be too low — naively too low. Too bad the bill’s sponsors, Sen. Bernie Sanders and Rep. Alexandria Ocasio-Cortez, weren’t more careful, because their clumsy approach hands ammo to foes of those reining in truly abusive forms of consumer credit, the most obscene example being the payday loan.

As the name implies, a payday loan is a quick infusion of cash to tide the borrower over until the next paycheck arrives, when it’s paid off. But that’s not what usually happens. Here’s the usual scenario:

Joe takes out a $300 payday loan to be paid back in two weeks. He’d be charged something like $45 in fees and interest. That comes to an APR (average percentage rate) of 391 percent. Pretty high borrowing costs, but it’s for an emergency, right?

But more than 75 percent of borrowers don’t pay it right back. They typically turn the loan into 10 loans a year. Each loan is not a new $300 credit. It’s cycling the same $300 loan nine times, every time adding these high fees and interest. So Joe’s costs keep piling up, and he finds himself stuck in a debt trap. The debt trap is the payday loan’s business model.

Payday loan rates and fees vary from state to state, with some allowing astronomical borrowing costs. A typical payday loan in Texas carries an APR of 661 percent! In Nevada, Idaho and Utah, it is 652 percent.

Why do people take out such loans? Because they don’t know what they’re getting into. The payday loan storefronts market their wares as “quick” or “easy” money to be used in emergencies. Some lure customers into the net by giving them the first loan free at zero percent interest.

The ideal payday loan customer is a trusting member of the working poor who is not sophisticated about personal debt. Importantly, the borrower has a dependable trickle of income to tap. The money could come from a job or three, or a disability or unemployment check. (Payday lenders are fond of military personnel. And they always demand that borrowers have a bank account.)

A recent Wall Street Journal editorial tried to tie the unfortunate Loan Shark Protection Act to unrelated criticism of payday loan abuses. It praised payday loans as a welcome alternative to loan sharks and organized crime.

“The availability of legal loans is what helped to put Louie Legbreaker out of business,” the editorial said.

Actually, the loan-sharking business is alive and well, only Wall Street now runs it. Private equity investors include payday lending companies in their portfolios. The desperate folks borrowing from Louie Legbreaker at least knew who they were dealing with.

“Price ceilings on any good or service inevitably reduce supply,” the editorial piously states. You’d think that credit is a basic human right that cannot be denied. In fact, there are people even today’s payday lenders won’t bother with — those without assets or income.

In any case, curtailing the supply of debt traps that its victims have described as “soul crushing” and “a living hell” would not be a bad thing. This industry preys on individuals trying to survive on a typical income of only $25,000, for heaven’s sake.

Of course, pauperizing a large portion of our low-skilled workforce can’t be helping the economy, never mind the human cost. Face it, payday lending, and the politicians who protect it, are a blight on America’s moral standing. Honestly, I don’t know how some people sleep at night.

Follow Froma Harrop on Twitter @FromaHarrop. She can be reached at fharrop@gmail.com. To find out more about Froma Harrop and read features by other Creators writers and cartoonists, visit the Creators Web page at www.creators.com.

White House Cover Story For Alleged Abuser Rob Porter Implodes

Reprinted with permission from Shareblue.

The White House’s already-shaky cover story about how the administration quickly moved to get rid of a top aide after he was accused of beating his ex-wives suffered another embarassment on Tuesday, when it was revealed the White House initially tried to have the aide talk his way out of the problem. In a room full of reporters.

In the week since Rob Porter left the White House after the Daily Mail published photographs of his battered ex-wife, the administration has been completely unable and unwilling to explain why Porter kept working for chief of staff John Kelly — when Porter had failed his FBI security clearance after the ex-wives detailed his history of abuse.

But on Tuesday, Politico reported this rather stunning revelation, which completely destroys the White House’s official timeline [emphasis added]:

In the hours immediately after the Daily Mail published a photograph of Porter’s first ex-wife with a black eye, White House press secretary Sarah Sanders hastily arranged an off-the-record meeting in the West Wing with Porter and four reporters: the New York Times’ Maggie Haberman, the Washington Post’s Josh Dawsey, Axios’ Jonathan Swan, and the Wall Street Journal’s Michael Bender. In that meeting, which hasn’t previously been reported, Porter relayed his version of events and fielded questions from the group.

Rather than immediately fire Porter, the White House sent him into a room with reporters to try to spin his, and their, way out of the story.

Off the record, of course.

Meanwhile, CBS News reported on Tuesday that the FBI had completed Porter’s background check long before he resigned.

That seems to indicate that the White House knew Porter was never going to be granted the security clearance that he needed to do his job, and that the White House knew why he was being denied clearance — because he was accused of beating his ex-wives.

So yes, the idea that Trump’s team sprang into action the moment they found out about Porter’s dark past and fired him within “40 minutes” is a complete fabrication. How long will the White House cling to it?

Dear Trump Voters: Now, Maybe You Try To Understand Us

The windowsill over my kitchen sink is an altar of sorts, full of small framed photos of our grandchildren and other mementos to keep me grateful.

The square ceramic tile leaning against the window started out with the painted names of our immediate family. It has since flowered to include the names of additional loved ones etched in various colors of Sharpie.

The red Matchbox car was a gift from my son, who stuck it in my Christmas stocking in my early single-mother days as a promise that one day I, too, would drive a car in my favorite color. He was right, and I do.

A recent addition is a white, palm-sized origami swan. After a speech I gave in December, 12-year-old Chéthan Chandra walked up to me and, with the gentlest of smiles, held out a little black box with a silver bow.

“I made this for you,” he said.

Chéthan is a triplet, and I’ve known his family for years, but that moment — that gift — moved me in a way I didn’t see coming. Like much of post-election America, I was feeling the weight of what loomed ahead, but staring at that delicate swan in my palm, and then looking into the face of that beautiful boy, I was transported. I stood in the eye of the hurricane, awash with a sense of calm.

This may seem like an odd way to begin a column about those of you who voted for Donald Trump, but I have my reasons. If you know these small things about my life, maybe you’ll hang with me here a little longer.

For months now, I’ve been hearing and reading about how those of us who didn’t support Trump need to understand those of you who did. We must listen to you, the argument goes. We must understand your anger.

I’m reaching my saturation point with this one-sided conversation, because it is always framed as a threat. Figure out why so many of my fellow Americans supported Trump, or lose more elections. This is an argument for political ambition, not reconciliation.

I don’t want to mock or ridicule you, but I also don’t want to pretend that my objections are irrelevant. Many of you Trump supporters regularly write to ask why I won’t give him a chance. I want to know how you can continue to tolerate a man so needy that, even as president, he requires campaign rallies full of cheering throngs to keep his ego afloat.

If being president doesn’t fulfill his need to feel important, what will? Doesn’t the answer to that scare you?

I don’t want to coddle you, in the thin hope that this will coax out your regret for electing the most dangerous man to ever inhabit the White House. This would do nothing to mitigate the harm Trump is daily inflicting on this country.

Even The Wall Street Journal‘s ultra-conservative editorial board has had its fill of Trump’s malignant behavior. Consider their response to Trump’s persistent lie that President Obama wiretapped his phones: “(T)he President clings to his assertion like a drunk to an empty gin bottle.”

That’s the image of our president, projected to the world.

His approval rating here in this country continues to plummet. A new Gallup Poll shows that only 37 percent still support him — a new low even for Trump. Fifty-eight percent of Americans disapprove of the job he is doing. This, during what is normally the honeymoon period for new presidents.

I don’t celebrate those numbers, but I won’t apologize for them either. I’ve reached a point where I think it’s time for you to try to understand people like me, who are doing everything we can to limit the harm of this dangerous man.

Like you, I love my family and my friends.

Like you, I love my country, too.

We have this in common, you and I, no matter who is president. I’m trying always to remember that.

Every morning, I walk to that window in my kitchen. I look at those little framed photos, and I study Chéthan’s swan. For just a moment, I stand in the eye of the hurricane, and I am calm. It’s enough.

News Media Must Take A Moral Stand

“Five minutes for Hitler, five minutes for the Jews.”

That, according to legend — and a Facebook page for alumni of The Miami Herald – was the routine response of an eighties-era editor whenever some hapless reporter was working overly hard to bring “balance” to a story where none should exist, where the moral high ground was clearly held by side or the other. I don’t know who the editor was, but that riposte brims with a wisdom sorely lacking in modern news media, obsessed as they are with the fallacy of journalism without judgment.

Take as Exhibit A Gerard Baker, editor-in-chief of the Wall Street Journal. In a Sunday interview with Chuck Todd of “Meet The Press,” he explained why his paper declines to label Donald Trump’s manifold falsehoods as lies.

“‘Lie,’” he said, “implies much more than just saying something that’s false. It implies a deliberate intent to mislead.” It is better, he argued, to report a given Trump claim, juxtapose it with the facts and let the audience make up its own mind. Otherwise, he said, “you run the risk that you look like you are…not being objective.”

Besides, he added, Hillary Clinton also spoke some untruths, but media were not so quick to label her a liar.

Of course, the plain fact is that Trump is a liar – and a fantastically prodigious one at that. Baker’s preferred method of handling this would be like reporting on each individual drop of water that falls, but never mentioning the storm.

And likening Trump’s untruths to Clinton’s is like likening Kareem Abdul-Jabbar’s scoring to Zan Tabak’s. Abdul-Jabbar is the leading scorer in NBA history. You’ve probably never heard of Tabak, though he also played in the NBA and, once in awhile, scored a basket.

Baker’s is a mindset that has become all too common. With the obvious exception of certain partisan news outlets, some reporters, fearful of being tagged for “bias” on contentious issues, seek to safeguard themselves by ritually quoting a source from Side A and another from Side B while avoiding even painfully obvious conclusions. They call this “fair and balanced.” It’s actually gutless and dumb.

Five minutes for Hitler, five minutes for the Jews.

And then what? Five minutes for ISIS, five minutes for Charlie Hebdo?

Yes, these are outlandish examples. They are also logical extrapolations.

The plain fact is, journalism without judgment – moral judgment – cannot exist. If you doubt it, try a thought experiment. You’re a news manager on a day when the mayor is cutting the ribbon on a new hospital and there’s been a mass shooting at the mall. What’s your top story? Is it the shooting? Why? Won’t the hospital directly impact more people? If you go with the shooting, what angle will you take? What resources will you commit? What answers will you demand?

Congratulations, you just committed multiple acts of moral judgment.

Yes, news media must strive to be fair, to hold all sides to rigorous account, to offer a balanced view. But occasionally, there comes a point – subjective, but no less real for that – when pretending to moral equivalence between those sides is a lie, an act of journalistic malpractice.

In these perilous times, with authoritarianism coming to the White House and bizarre untruths infesting our national discourse, that is a sin we can ill afford. No one ever had to remind Cronkite or Murrow of the need to speak the truth when the truth was plain and the moral imperative clear. No one should have to remind this generation of journalists either.

There are two sides to every story, goes the axiom. But you know what?

Sometimes there’s only the one.

IMAGE: U.S. Republican Presidential Nominee Donald Trump is shown on video monitors as he speaks live to the crowd from New York at the Republican National Convention in Cleveland, Ohio, U.S. July 19, 2016.   REUTERS/Mario Anzuoni