Reader's Alley
By The Helena IR - 12/25/06
Letters to the Editor
Skewed tax cuts
The article last week about who received how much from the 2005 Republican-sponsored state income tax cuts was revealing. I am in a middle income group with 56,300 other Montana families. On average we received a $64 tax cut for the year. For my part I put $32 of it towards my utility bill which — thanks to the Republicans and their utility deregulation fiasco — rose $300 last year. I put $16 each toward my two kids in college expenses which rose more than $1,000 each last year. Boy, wouldn’t it be great to be in the wealthiest tax bracket with those 1,586 Montanans who earned more than $500,000 last year. They each received an average $30,187 income tax cut. I guess the Republicans figure they need it more than I do.
John Wilson
405 Monroe Avenue
Payday loans defended The Helena IR has fallen prey to the misrepresenations of the payday loan industry perpetuated by consumer activists.
The argument concerning the APR omits two points. First, between the average customer default rate of 7 percent and average monthly storefront expenses of $9,000, a payday lender cannot survive on a fee of less than $13 per hundred borrowed. Second, in his landmark paper “In Defense of Payday Lending” (The Free Market, Vol. 23, No. 9, Sept. 2003), Dr. Thomas Lehman proved that “The real price signal to which the borrower responds is the flat fee that is charged to hold the postdated check,” not the APR.
Capping loans at 36 percent will drive payday lenders out of business. This short-sighted limitation of consumer choice will force borrowers onto the internet (which costs $30 per hundred) or to bounce checks (with bank and merchant fees of $60 per check). That’s why payday lenders no longer loan to the military.
Furthermore, our FOIA request of the quoted DoD study showed that this report does NOT specifically state that payday loans resulted in a loss of military security clearance. In fact, it was combined indebtedness from all debt sources.
Lawrence Meyers, President
Payday Lender’s Capital LLC
633 Ocean Ave. #3
Santa Monica, Calif.
Skewed tax cuts
The article last week about who received how much from the 2005 Republican-sponsored state income tax cuts was revealing. I am in a middle income group with 56,300 other Montana families. On average we received a $64 tax cut for the year. For my part I put $32 of it towards my utility bill which — thanks to the Republicans and their utility deregulation fiasco — rose $300 last year. I put $16 each toward my two kids in college expenses which rose more than $1,000 each last year. Boy, wouldn’t it be great to be in the wealthiest tax bracket with those 1,586 Montanans who earned more than $500,000 last year. They each received an average $30,187 income tax cut. I guess the Republicans figure they need it more than I do.
John Wilson
405 Monroe Avenue
Payday loans defended The Helena IR has fallen prey to the misrepresenations of the payday loan industry perpetuated by consumer activists.
The argument concerning the APR omits two points. First, between the average customer default rate of 7 percent and average monthly storefront expenses of $9,000, a payday lender cannot survive on a fee of less than $13 per hundred borrowed. Second, in his landmark paper “In Defense of Payday Lending” (The Free Market, Vol. 23, No. 9, Sept. 2003), Dr. Thomas Lehman proved that “The real price signal to which the borrower responds is the flat fee that is charged to hold the postdated check,” not the APR.
Capping loans at 36 percent will drive payday lenders out of business. This short-sighted limitation of consumer choice will force borrowers onto the internet (which costs $30 per hundred) or to bounce checks (with bank and merchant fees of $60 per check). That’s why payday lenders no longer loan to the military.
Furthermore, our FOIA request of the quoted DoD study showed that this report does NOT specifically state that payday loans resulted in a loss of military security clearance. In fact, it was combined indebtedness from all debt sources.
Lawrence Meyers, President
Payday Lender’s Capital LLC
633 Ocean Ave. #3
Santa Monica, Calif.
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