Fighting Predatory Lending in Ohio
We are all witnessing the effects of a greed-driven and debt-ridden economic system. A timely case study of how to reform our economy at the grassroots level is on the ballot this election season in Ohio.
Last spring, the Ohio state legislature passed a measure with bipartisan approval that would reduce the maximum interest rate of payday loans from 391 to 28 percent, but the payday lending lobby managed to make it a matter of popular vote. They knew that with enough money it could influence the vote through misleading advertising and confusing ballot language. Tom Allio, a local Catholic leader and chair of the Ohio Coalition for Responsible Lending, wrote in a previous God's Politics blog post:
One thing remains clear in this ongoing "David and Goliath" battle in Ohio: The payday lending industry will do anything in its power to maintain its privileged, and predatory, position in the marketplace. Rumors are rampant that they are prepared to spend upwards of $15 million in this fight for their survival.
But faith groups and other organizations have rallied to the side of the most economically vulnerable. The Ohio Council of Churches explained in a legislative brief:
The faith community is aware that a prophetic tradition condemns usury, fraud, exploitation, especially if it is directed toward the poorest members of society. The payday lending industry has financially exploited economically vulnerable populations. Low-income families, the elderly, minorities and military personnel have all been targets of the payday lenders. In Ohio over 300,000 low to moderate income individuals have been caught in the debt trap.
Nearly all of Ohio's major newspapers have explicitly called for a 'yes' vote on Issue 5, including the Cleveland Plain Dealer:
Issue 5 on Ohio's November ballot, the pay day-lending issue, is a stark face-off between fairness and greed. A "yes" vote is a vote for fairness ... It should be impossible for anyone to persuade Ohioans that allowing an APR of 391 percent is good for them. But confusion is the lenders' pal, no thanks to hair-splitting by Secretary of State Jennifer Brunner and the panel that writes Ohio's ballot language. So here's Issue 5 in plain English: The pro-consumer vote is "yes." The pro-borrower vote is "yes." The pro-Ohio vote on Issue 5 is "yes." Anyone who says otherwise just wants you to run up debt -- at 391 percent APR.
Although primarily a national organization, Sojourners has worked locally in Ohio and trained teams of Windchangers around Ohio to implement our Vote Out Poverty campaign. We encourage church communities in other states to follow the example of Ohio, where people of faith have stood up and taken practical steps to help those whom Christ called "the least of these."
Nate Van Duzer is the policy assistant for Sojourners. Rev. Virginia Lohmann Bauman contributed to this post. She lives in Granville, Ohio, with her family and is the Ohio Field Director for Sojourners.