Tuesday, March 25, 2014

Louisiana's anti-poverty program

Debt for everybody!  We don't care if it's that student loan you took out to get that useless degree from an unaccredited for-profit college, or if it's the payday loan you take out every other week just to keep up.  You're gonna owe somebody some money.

 And it's going to be money you will struggle to pay back for pretty much ever.
James said his legislation, House Bill 239, addresses what he describes as the industry’s predatory lending practices by capping interest rates at 36 percent.

“The heart of the issue is that we have to change the enormous interest rates being charged,” he said. “I have 12 payday lenders in my district. They are strategically placed to prey on working-class folks who just need a bridge to get from point A to B. Their model is to get people to keep coming back.”
And the reason you have to do this is because of freedom. 
Amy Cantu, a spokeswoman for Community Financial Services Associations of America, said increased regulation of payday lending in other states has had the unintended consequence of forcing lenders out of business. Consequently, borrowers turn to unlicensed and unregulated lenders both in the U.S. and offshore.
According to John Maginnis, the financial lobbyists might have the upper hand with regard to this bill. They've done such a great job, in fact, that Maginnis and Errol Laborde spent a few minutes on last week's Informed Sources basically agreeing with their position.

 Here's a link to that show.  Also of note there is Errol's "Top 8 stories of the past 30 years" list which somehow leaves out any mention of the Macondo oil disaster.. or anything having to do with oil and gas really. They don't even talk about coastal loss.  It makes you wonder which lobbyists help Errol make out his lists.

But I digress.  Back to the topic of all this money Louisiana's political leadership thinks you should owe. Bobby Jindal thinks it's a bad idea for anyone to ensure that the student loan you took out actually goes toward paying for anything of value.
Louisiana Governor Bobby Jindal on Friday slammed the Obama Administration’s plan that would require “career colleges to do a better job of preparing students for gainful employment—or risk losing access to taxpayer-funded federal student aid.”

According to the Secretary of Education, Arne Duncan, the administration’s “gainful employment program” is designed to reform “low-performing programs” that leave students “saddled by debt and with few—if any—options for a career.”

“The proposed regulations address growing concerns about unaffordable levels of loan debt for students enrolled in these programs by targeting the lowest-performing programs,” he said, “while shining a light on best practices and giving all programs an opportunity to improve.”
The reason for this is, again, because of freedom.. and also maybe because President Obama is racist, or something.. but mostly for freedom.
In an editorial at the Washington Times, however, Gov. Jindal accuses the administration of “[t]argeting only institutions that serve non-traditional students…who come from disproportionately low-income, African-American, and Hispanic communities.”

He claims that the new federal standards — intended to protect students by “requiring institutions to tell current and potential students about key outcomes, like average debt levels, earnings, loan repayment rates, loan default rates, and completion and withdrawal rates” — will drive “quality programs” out of business.
And that's the Louisiana anti-poverty program.  We make sure the institutions that prey on the poor aren't ever in any danger of becoming poor themselves.

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