Dodd’s Hock Shop Investors
Tags: 2010 Campaign, Financial Crisis, Senate Democrats.
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Hey, they’re just buying shares in one of the best Senators money can buy:
U.S. Sen. Christopher Dodd, who has won praise from consumer groups for taking on credit card providers over predatory lending practices, has collected thousands of dollars in donations from people affiliated with the so-called payday loan industry.
The Democratic senator raised more than $44,000 from pawnshop owners and other businesses that provide high-interest loans, often to those with bad credit, according to campaign finance reports. The amount, while a fraction of the $1.05 million that Dodd brought in during the first quarter of 2009, nevertheless raises questions among those who scrutinize the link between fundraising and public policy.
Dodd is chairman of the Senate banking committee, and a bill being fought by the industry that would cap the annual interest rate on consumer loans at 36 percent has been referred to the committee.
I work in the credit card industry and the highest I’ve seen on any of our credit cards is about 33%…so, capping us at 36% wouldn’t actually cause a problem and that, of course, brings into question whether Dodd is fighting for the little guy or fighting for his usurious donors? Given the amount of donations Dodd has received from the financial and loan-shark industry, I’m going to tend towards it being an eyewash for the people, payoff for the donors effort.
There certainly does need to be a major overhaul in how lending institutions do business. From my experience with my employer I figure the major problem is that the corporate bosses are frightened rabbits. Under desperate pressure to produce profits or lose their cushy jobs they try expedient after expedient to squeeze every penny they can out of the borrowing public. This resulted, ultimately, in the practice of sub-prime lending which wasn’t just confined to home loans – banks were also issuing credit cards to people with 500 FICO scores (during the worst part of this lending spree I was tempted many times to ask some of our “valued clients” if they realized that when a bill comes, payment is expected…)…charging them fees out the wazoo and essentially making glorious profits by soaking the poor. Now that things have gone south, the frightened rabbits are trying desperately to cut losses (while our formally “valued clients” with the lousy credit are laughing at us when we expect repayment)…and so, scattergun, they are shutting down accounts willy-nilly for the most trivial of reasons. Which means that clients with decades of good payment history can lose their credit if they are late a day or two.
I’m so disgusted with my industry that I’d like to quit – but jobs are scarce and the bills do have to be paid. So, I’ve got a couple irons in the alternate employment fire, but for now I’m stuck trying to clean up the mess created by fools afraid of cretins. And, of course, said cretins do decide where the big political bucks go, and so their goal is to ensure that whatever happens they are protected in their ability to demand that high quarterly profits remain the holy grail of American corporate life. So, regulate the heck out of them, right? Are you kidding? You want to change profit-motivated cretins for power-motivated bureaucrats? Where’s the upside?
The key to success is to get the Dodds out of the mix and get the banks to cease being multi-national conglomerates and become, once again, the servants of local business enterprise. We won’t have to regulate Citi if it ceases to exist and becomes, instead, a score of regional and local banks looking after local and regional interests rather than trying to compete with other global monstrosities (whom do you think I trust more – Bank of America, or Nevada State Bank?). As long as we keep going down the route of more government regulation, the longer things will get worse. Dodd isn’t going to fix things – he doesn’t know how and isn’t interested in that, anyway. His only concern is getting himself re-elected next year and he figures that if he builds up a large enough war chest he’ll be able to demonize his opponent, put out huge amounts of BS about what a swell guy he is and then count on the special interests who’ve bought him to do the rest. Waiting for Dodd to help the people is like waiting for organized crime to voluntarily go out of business in a fit of public spirit.
Thank you for visiting Blogs For Victory. If you enjoy our content, please consider making a donation to help us cover the costs of our servers.Mark Noonan is co-author (with Matt Margolis) of Caucus of Corruption: The Truth About The New Democratic Majority. He also blogs at Nevada News and Views. Follow Mark on Twitter.
7 Responses to “Dodd’s Hock Shop Investors”
Caucus of Corruption
Mark,
The 36% cap is directed toward predatory payday lenders, not credit card providers. These places have APRs in excess of 100% and allow loans to be rolled over, allowing them to get more interest on their interest. Those places prey on the poor and on the junior enlisted. Passing a 36% APR cap will put them out of business and I hope it passes soon.
“You want to change profit-motivated cretins for power-motivated bureaucrats? Where’s the upside?”
Then again, what’s the downside.
I do agree with you that we need to break up the big banks though. No bank should be able to have the affect our economy that the big banks do.
kmg,
The payday loan sharks are not as big a problem, in my view, as the major credit card issuers and their absurd way of doing business. The best thing for we, the people, to do is go on a credit card strike – all of use refuse to pay any credit card bill until the issuers start thinking about what they are doing.
casper,
Smaller is better – I’m so strong on shrinking things down that I’d like to see even our larger States broken up. It is rather silly, isn’t it, that California’s 30+ million people have the same number of Senators as Nevada’s 3+ million? Make it North, South, East and West California (North from above the Bay Area to Oregon, West from SF to LA and about 100 miles inland, South from Orange county to the Mexican border, East all that remains). Break up New York, Illinois, Michigan, Texas, Florida – turn 50 States in 58 or so (and then Obama can finally be ok with the number of States he visited). One thing to make larger – add 100 House members (I know, like adding 100 more boils to the body politic…but we’ve been at 435 since we had less than 1/3 the number of people we have today). Small, smaller, smallest is good, better, best.
No more Big Three auto makers – break them up into their brand names…we’ll have Ford, Chrysler, Lincoln, Dodge, Pontiac, Chevy, Cadillac – all competing furiously with each other and all of them nimble enough to swiftly adapt to changing conditions. No more banks “too big to fail”. No more faceless, blob-like multinational conglomerates which only benefit a connected few and are playthings for financial sharks…
Mark,
I’m not sure about the state thing. Who would get to draw the borders? As for the rest, I agree that smaller is better, at least in most cases.
Casper,
I would – I like drawing maps. Seriously, though; it won’t happen…but I’d like it to happen, and I think it a very good idea. Plus, it would mean that 3/4 of California would be released from Sacramento…make the suggestion and you might find a stampede of Californians willing to stick LA and SF with Sacramento…and let all the liberals who have screwed the pooch in California live by their own idiocy.
So in other words, you view this story as a net positive for Dodd.
This raises the question of whether or not we should keep the Senate, not whether or not we should slice up California.
Really? What sort?
3/4 of the area, maybe, but not the population. “West California” as you describe it would have a population of roughly 22 million, which is about 2/3 of California’s current population and some 2.5 million more than New York’s even without dividing that state.