Predatory Payday Lenders Ground Thousands of Troops

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This summer, Mother Jones reported on the ways the poor get taken by lenders who prey on the cash-strapped, including payday loans with average annual interest rates of 400%. It seems the government is finally paying attention. But it’s not the pound-of-your-flesh interest rates that have the government concerned. Rather, it’s the fact that soldiers whose debts amount to a third of their income cannot be sent overseas.

This policy exists because major financial problems are thought to make soldiers more vulnerable to bribes that would force them to reveal sensitive information. If that’s the case, it’s another example of the Bush administration hurting rather than helping national security. Since Bush took office, the number of sailors and Marines who could not be deployed as a result of financial problems has increased 150-fold.

Payday lending outlets cluster by the dozen around military bases, where soldiers are paid poorly. Currently, just 12 states have laws capping interest rates at 99%. Congress is now considering a law that would cap rates at 36%, and the Pentagon is on board. It’s about time.

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This is the rubber-meets-road moment: the early days in our first fundraising drive since we took a big swing and merged with CIR to bring fearless investigative reporting to the internet, radio, video, and everywhere else that people need an antidote to lies and propaganda.

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