Brad Daw has been playing Whack-a-Mole with Utah’s loan sharks for a long time now.
Once, the buzzards in the high-interest loan business whacked him. They built a big campaign war chest, enlisted the help of a since-disgraced state attorney general and defeated the Republican state representative from Orem in the 2012 election.
Daw won back his seat in 2014 and returned to the work of limiting the worst abuses of the payday loan crowd (they don’t really deserve to be called an “industry”) and other purveyors of debt who charge obscenely high interest rates.
This legislative session, Daw’s target is a kind of lender that even the common payday lending stores don’t want to be associated with.
It’s the crowd that deals in somewhat larger amounts of money, with longer repayment schedules. Businesses that had, while Daw was out of the picture, bamboozled the Utah Legislature into giving them the power to sue people who have fallen behind in their payments, have them arrested (usually by armed agents who are not sworn police officers) and, when the victims of the scam post bail to get out of jail, the cash doesn’t go back to the person who was arrested, as is normally the case, but is forfeited to the lender.
The nonprofit investigative journalism outfit ProPublica documented at least 17 cases — and there were probably many more — where people who were not keeping up their payments to a concern called Loans for Less spent anywhere from a few hours to a few days in jail.
This is an extreme example of a system that preys on the poor and powerless in ways that keep them poor and powerless so they can be preyed on again and again.
Daw’s legislation — HB319 — would ban such practices. Practices deviously designed to get around the fact that debtors prisons in the United States were outlawed by Congress way back in 1833.
Utah lawmakers are often heard to lament the phenomenon known as intergenerational poverty. That’s the trend of poor families to stay poor rather than realize the American dream of moving up the social and economic ladder, as so many have done before.
Such traps as high-interest, inescapable debt — along with factors ranging from limited educational opportunities, a lack of public transit, unequal pay for women, racial discrimination, lack of access to health care, unaffordable housing — go a long way toward explaining that sad trend.
The state of Utah may or may not see its way clear to provide more assistance for the poor. But it should not empower the buzzards that poison the land with triple-digit interest rates to make things worse.
Daw’s bill should be approved.