Mike Kueber's Blog

June 23, 2012

Loan sharks and political corruption in Texas

Filed under: Business,Issues,Politics — Mike Kueber @ 6:59 pm
Tags: ,

San Antonio Express-News columnist Brian Chasnoff recently wrote a column that perfectly reveals how money corrupts politicians.  The column is headlined, “City taking on payday lenders because state didn’t.” 

The focus of Chasnoff’s column is the abusive lending practices employed by businesses that used to be known as loan sharks.  Their business plan, according to Chasnoff, is to provide “short-term, high-interest loans to people who can scarcely afford them, raking in huge profits by locking consumers into cycles of debt.” 

Historically, loan sharks charge illegally high interest, so technically these businesses no longer qualify for that appellation because their expensive lobbyists and outsized political contributions in Austin have managed to legalize their erstwhile criminal practices.    

Several cities in Texas, including San Antonio, Austin, and Dallas, are attempting to counter state inaction by adopting city ordinances to regulate these businesses, and I alternate between amusement and cynicism (and even some optimism) when I read about the supposed purity and idealism of city politicians with respect to this matter. 

One of our local councilmen, Diego Bernal, provided a colorful quote concerning how he deals with the businesses’ lobbyists – “I sort of tell them to go (expletive) themselves.”  That sounds like my kind of guy, but I am only cautiously optimistic that the City Council will not be eventually bought off by lobbyists and contributions.

1 Comment »

  1. pay day lenders and such are viewed as very bad players, but when some of the fees charged by banks are annualized they end up exceeding 100% interest!! yikes!!

    Comment by q — June 24, 2012 @ 6:56 pm | Reply

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