Another Payday Shakedown?

On the same day that La Socialista (a.k.a. The State newspaper) announced yet another round of cuts, we happen to be delving into the newspaper’s ongoing obsession with the payday lending industry.

Coincidence?

Absolutely … but the fact that La Socialista is once again ramping up its attacks against payday lenders means the paper could very well be laying the groundwork for yet another major advertising pitch.

Wait … what?

For those of you with short memories, La Socialista embarked on a near-daily, gratuitous assault on the payday lending industry for months last year – penning literally dozens of negative “news stories” and editorials.

Of course, after this sustained bombardment, the paper turned around and offered the industry an opportunity to correct its “distorted” coverage … by purchasing advertisements, of course.

Such journalistic blackmail – shameful as it may be – would certainly be easier to pull off now, seeing as the “wall” between the editorial page and the rest of La Socialista has been completely demolished by several rounds of layoffs.

Not that it was ever really much more than a baby-gate to begin with …

Anyway, from the Cotton Boll Conspiracy:

… executive editor Mark Lett will add the editorial and opinion pages to his duties, to fill the void left by Brad Warthen’s departure …

Hmmm … an executive editor running the editorial page … ask any paper if that’s a kosher relationship and see what they tell you.

Nonetheless, even as payday lenders have agreed to subject themselves to dramatically increased government regulation this year, the bloodsuckers at La Socialista aren’t satisfied … far from it, in fact.

They’re pushing for a total ban … except in typical legislative fashion, a “total ban” (and the thousands of jobs it would cost) isn’t something lawmakers are likely ever going to vote on directly.

So some lawmakers are pursuing a “backdoor ban” instead, which would basically adjust the math on payday loans to the point that they are no longer profitable for the industry.

That, as we’ve noted previously, would screw over 80-85% of the people who use the payday lending responsibly – all in the name of “protecting” the 10-15% of people who don’t.

More nanny state government, in other words.

Along the way, in keeping with that “nanny state” theme, we’ve seen draft legislation that would put government in charge of maintaining a database of payday lending transactions.

Except these transactions wouldn’t be conducted between private citizens and government … or private businesses and government.

They’d be conducted between private citizens and private businesses, and government would collect and store that information on its own (which means according to our interpretation of FOIA, any one who ever felt compelled to get a payday loan would be subject to being publicly ‘outed’).

Oh, and of course the industry would have to pay for that government intrusion with a new “per transaction” fee.

To us, that’s not just regulating an industry – that’s government setting a terrible precedent for intervention by plunging itself into a whole new classification of private financial transactions.

Why does that concern us?

Well, we’re libertarians. And government assuming new areas of authority within the free market is something that obviously doesn’t stop once it starts.

Back when we started covering this issue in November of 2007, we had no idea what “payday lending” was.

In fact, we had no interest in the issue whatsoever until we stumbled upon a shocking story about a clique of ambitious lawyer-legislators who were looking to turn a profit by suing the industry they were simultaneously voting to regulate.

We thought that little scam set a terrible precedent, too, and so we started digging into the issue.

What we found was that – similar to the cigarette tax issue – South Carolina was on the verge of passing some ludicrous public policy simply because the press and a bunch of opportunistic politicians decided to seize upon an unpopular industry.

Well, we’d like to ask again now the same question we asked then … who will they go after next?

It’s okay to hate on payday lenders, just as it’s okay to hate on big tobacco or any other industry – for any reason you choose.

What it’s not okay to do is to allow that hatred to cloud one’s respect for the proper role of government – or one’s “journalistic standards,” assuming you claim those.

We’ve never claimed such standards, but La Socialista does.

And while we continue to unapologetically advocate for a limited role for our state government, S.C. lawmakers continue seeking new ways to expand government’s influence further into our lives.

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