FacebookTwitterGoogle+RedditEmail

Fighting Predatory Lending: a Glimmer of Hope in a Deep Red State

A couple years ago, two South Dakota men on opposite ends of the political spectrum got into a nasty fight over marriage equality. But after one offered the other an olive branch, they wound up forming a bipartisan alliance that won big this election year.

Their story offers important lessons for our divided country.

It all began with a Twitter feud between Steve Hildebrand, a gay former Obama campaign adviser, and Steve Hickey, a conservative pastor and former Republican state legislator. To defuse the tension, Hickey decided to invite Hildebrand out for coffee.

Eventually, the two men realized they had something in common: a deep concern about poverty and homelessness. They also agreed that the payday loan industry in their state was making these problems much worse.

Payday lenders give customers short-term cash advances, typically for two weeks, against their paycheck or Social Security check. But most borrowers can’t pay back the loan when it comes due — which is exactly what the lenders want.

According to the Consumer Financial Protection Bureau, the majority of all payday loans are renewed so many times that borrowers end up paying more in fees than they originally borrowed. In South Dakota, the average interest rate on such short-term loans is 574 percent.

In a show of bipartisan unity, Hickey and Hildebrand resolved to work together to crack down on these loan sharks. They formed a coalition, South Dakotans for Responsible Lending, to take the issue of predatory lending directly to the voters. Their goal: a 36 percent interest rate cap on short-term payday loans.

The coalition’s first step was to marshal a volunteer army of all ages, income levels, and political stripes to collect almost 20,000 signatures to get the proposal on the ballot. To build support, they held prayer vigils, gave talks at churches and Rotary and Lions clubs, and wrote letters to the editors of newspapers across the state. For Halloween, they painted pumpkins with their campaign slogans.

On November 8, despite being outspent 16 to 1 by industry opponents, the coalition won a crushing victory. More than three-quarters of South Dakota voters supported the rate cap measure.

Reflecting on their success, Pastor Hickey said, “Knowing that today in America we have reached perhaps the apex of hyper-partisanship, our efforts here of working together across the party lines is really a breath of fresh air, and we believe this is the way forward.”

Hickey also made clear that the coalition’s fight isn’t over. They’re worried the loan sharks may pursue new legal tricks to keep exploiting the poor, and they’re looking for ways to make credit more affordable for low-income South Dakotans. One option they’re looking into is using a fraction of the state’s reserves to guarantee affordable loans through credit unions.

But even though there’s more work to be done, this coalition’s bipartisan ballot box success is an inspiring example of how we can still make progress in our polarized nation.

This column is distributed by OtherWords.

More articles by:

Sarah Anderson directs the Global Economy Project at the Institute for Policy Studies.

Weekend Edition
September 21, 2018
Friday - Sunday
Alexandra Isfahani-Hammond
Hurricane Florence and 9.7 Million Pigs
Andrew Levine
Israel’s Anti-Semitism Smear Campaign
Paul Street
Laquan McDonald is Being Tried for His Own Racist Murder
Brad Evans
What Does It Mean to Celebrate International Peace Day?
Nick Pemberton
With or Without Kavanaugh, The United States Is Anti-Choice
Jim Kavanagh
“Taxpayer Money” Threatens Medicare-for-All (And Every Other Social Program)
Jonathan Cook
Palestine: The Testbed for Trump’s Plan to Tear up the Rules-Based International Order
Jeffrey St. Clair
Roaming Charges: the Chickenhawks Have Finally Come Back Home to Roost!
David Rosen
As the Capitalist World Turns: From Empire to Imperialism to Globalization?
Jonah Raskin
Green Capitalism Rears Its Head at Global Climate Action Summit
James Munson
On Climate, the Centrists are the Deplorables
Robert Hunziker
Is Paris 2015 Already Underwater?
Arshad Khan
Will Their Ever be Justice for Rohingya Muslims?
Jill Richardson
Why Women Don’t Report Sexual Assault
Dave Clennon
A Victory for Historical Accuracy and the Peace Movement: Not One Emmy for Ken Burns and “The Vietnam War”
W. T. Whitney
US Harasses Cuba Amid Mysterious Circumstances
Nathan Kalman-Lamb
Things That Make Sports Fans Uncomfortable
George Capaccio
Iran: “Snapping Back” Sanctions and the Threat of War
Kenneth Surin
Brexit is Coming, But Which Will It Be?
Louis Proyect
Moore’s “Fahrenheit 11/9”: Entertaining Film, Crappy Politics
Ramzy Baroud
Why Israel Demolishes: Khan Al-Ahmar as Representation of Greater Genocide
Ben Dangl
The Zapatistas’ Dignified Rage: Revolutionary Theories and Anticapitalist Dreams of Subcommandante Marcos
Ron Jacobs
Faith, Madness, or Death
Bill Glahn
Crime Comes Knocking
Terry Heaton
Pat Robertson’s Hurricane “Miracle”
Dave Lindorff
In Montgomery County PA, It’s Often a Jury of White People
Louis Yako
From Citizens to Customers: the Corporate Customer Service Culture in America 
William Boardman
The Shame of Dianne Feinstein, the Courage of Christine Blasey Ford 
Ernie Niemi
Logging and Climate Change: Oregon is Appalachia and Timber is Our Coal
Jessicah Pierre
Nike Says “Believe in Something,” But Can It Sacrifice Something, Too?
Paul Fitzgerald - Elizabeth Gould
Weaponized Dreams? The Curious Case of Robert Moss
Olivia Alperstein
An Environmental 9/11: the EPA’s Gutting of Methane Regulations
Ted Rall
Why Christine Ford vs. Brett Kavanaugh is a Train Wreck You Can’t Look Away From
Lauren Regan
The Day the Valves Turned: Defending the Pipeline Protesters
Ralph Nader
Questions, Questions Where are the Answers?
Binoy Kampmark
Deplatforming Germaine Greer
Raouf Halaby
It Should Not Be A He Said She Said Verdict
Robert Koehler
The Accusation That Wouldn’t Go Away
Jim Hightower
Amazon is Making Workers Tweet About How Great It is to Work There
Robby Sherwin
Rabbi, Rabbi, Where For Art Thou Rabbi?
Vern Loomis
Has Something Evil This Way Come?
Steve Baggarly
Disarm Trident Walk Ends in Georgia
Graham Peebles
Priorities of the Time: Peace
Michael Doliner
The Department of Demonization
David Yearsley
Bollocks to Brexit: the Plumber Sings
FacebookTwitterGoogle+RedditEmail