Payday Lenders Are Just A Symptom

Payday lenders receive buckets of bane for preying upon low-income, under informed borrowers, as ruminated upon in a recent NYT piece:

“The problem is that many people have difficulty weighing the trade-off between immediate benefits and future costs. When confronted with easy credit access, some inevitably borrow more than they can reasonably expect to repay. Once they get in over their heads, they borrow more, if the law permits. It was thus all but certain that millions of society’s most economically vulnerable members would borrow themselves into bankruptcy if confronted with easy credit access. If we are unhappy about that, the only recourse is to change the rules.”

….but rather than blame the payday loan centers….

“A more deserving target would be legislators who supported lax credit laws in exchange for campaign contributions from lenders — or, better still, those who have steadfastly resisted campaign finance reform.”

Or better, still, why don’t we get taught fiscal responsibility in school? We have to memorize the periodic table, but no time is spent on vigorish.

You can’t just pop the pimple, you gotta squeeze out the seed. — BEN POPKEN

Payday Loans Are a Scourge, but Should Wrath Be Aimed at the Lenders? [NYT]