Predatory lending strikes again
The group Consumers for Choices ran an ad over the weekend asking people to send an angry letter to their representatives in Congress, demanding that they "protect choice" in financial services. Claiming that this is an initiative protecting Native Americans from discrimination, what Consumers for Choice fails to mention is that the "options" that they are trying to protect are predatory lending practices that prey on the most vulnerable populations, often saddling them with unmanageable and crippling debt.
For example, one of the organizations cited by Consumers for Choice is Western Sky Financial, which, before it stopped lending, was offering an interest rate of 355 percent. And yet, in exchange for sending an angry letter to allow organizations like Western Sky Financial to continue their predatory scam, Consumers for Choices is offering to enroll each signatory in a drawing for a $500 Visa gift card.
Catholic social teaching consistently leans in favor of the poor and the working poor. The lending practices that Consumers for Choice are trying to protect do nothing to promote the dignity of the poor. Instead, deregulated lending squeezes a profit out of people who are already poor and vulnerable.
"If you lend money to my people, to the poor among you, you shall not deal with them as a creditor; you shall not exact interest from them. If you take your neighbor's cloak in pawn, you shall restore it before the sun goes down; for it may be your neighbor's only clothing to use as cover; in what else shall that person sleep? And if your neighbor cries out to me, I will listen, for I am compassionate." Exodus 22:25-27
Image: By Michael Shanks (Own work) [Public domain], via Wikimedia Commons