Sometimes it’s just better to keep your mouth shut. Responding to Jason Tolbert’s post on Robbie Wills working as a lobbyist for predatory lenders, and the bill that Republicans and a few bad Democrats are hoping to pass, Senator Jason Rapert (District 18-Bigelow) attempted to defend the bill, and only succeeded in A) sticking up for lenders that prey on Arkansans with dishonest tactics and B) proving that he has no idea what the hell he’s talking about. These are the posts Rapert left on Tolbert’s blog:
This concept is virtually the same as the concept of Microfinance – which is embraced by humanitarian organizations around the world as the savior of poor people who are denied access to credit. Microfinance can be found on the Internet and studied very easily. The bottom line is large banks do not want to loan 1,000 loans for $100, they would rather do 1 loan for $100,000 – small installment loans (microfinance) allows people who need small sums of money to meet emergency needs to get help. I urge everyone to study the concept of microfinance before passing judgement because if this tool is denied – people with credit problems and emergency needs will be denied access to funds. The legislation limits the maximum term to 18 months and no matter what interest rate is allowed a company could also do this for lower interest and create good competition – good conservative free economic principles. My sole support for this idea relates to the fact that I see the parallel it has to microfinance and I have witnessed people who have benefitted from the concept.
So Arkansas does not face problems with poverty just as critical as the Third World? Then please explain why Arkansas ranks 2nd in our nation in terms of people living below the poverty level?I believe the poor and disadvantaged need access to credit to help them pull themselves out of debt and assist in emergencies just like anyone else. What some fail to admit is that NO ONE is serving the poorest in our society in this regard. If you do not allow a regulated small installment loan industry to serve people in our state, you throw them to the wolves who take advantage of them in true loan shark fashion. Please understand, just because some small installment loan lenders may choose to offer services at subjective high rates, there may be others that choose to serve the needs of the poor within this regulated industry and do so honorably and respectfully – doing a tremendous amount of good.
World Vision and Rotary International are fully engaged in Microfinance around the world:
Surely you aren’t saying World Vision and Rotary International are loan sharks?
People perish for lack of knowledge. Some banks are bad, not all banks are bad. Some politicians are dishonest, not all politicians are dishonest. Some activists are misinformed, not all activists are misinformed. You cannot paint an entire industry or an entire concept as bad simply because you go find one statement that says that. Please educate yourself fully before passing judgement.
This matter will be fully debated. If at any time I see that anyone is trying to take advantage of the poor in our state, then I will pull my support and fight to have the measure defeated. However, I believe having good regulation of this industry rather than forcing people to seek help from real loan sharks is a better option.
Okay, first off, the bill, SB568, which I should say is an attempt to amend the state constitution, doesn’t deal with microfinancing, which is actually a very good program that I would love to see put to work in Arkansas. Rather, what Rapert defends as a way to fight poverty in Arkansas is really an attempt to hand poor Arkansans over to dishonest lenders that will rob them blind. Does Rapert know that? It’s seriously hard to tell. Either the man is totally oblivious about the legislation or he’s being deliberately misleading in his characterization of the bill. I’m really not sure which is more dangerous. Remember, we’re talking about the lives and dreams of ordinary Arkansans here, people who go looking for a loan so they can buy a house, start a business, get financial help, etc. This bill is some seriously bad business for ordinary folks, and what Rapert is selling as a way to help the poor will really work to impoverish more of us.
Max Brantley has more on this, including a note that Justin Harris may have some worthy company:
Rapert also didn’t respond to one other question. Rapert and two family members head a 501c3 mission organization, Holy Ghost Ministries, which says it conducts revivals, seminars and humanitarian projects in the U.S. and Africa. Ministry annual expenses of around $60,000 are reported in a lump sum on the federal tax form. I asked after a breakdown, but Rapert has not responded. In that he’s also a sponsor of the state government transparency act, to create an on-line state checkbook, I thought he might support more transparency for his own taxpayer-subsidized nonprofit. (Contributions to it are tax deductible, thus making federal taxpayers his supporters.)
Rapert responded with a temper tantrum that is really worth the read. Talk about a wolf in sheep’s clothing.