BY: B. Keith Plunkett @Keithplunkett
True Conservatives understand that life is sometimes tragic, and that government can’t legislate away every pain that ails. Liberals, as Economist Thomas Sowell puts it, love to appear on the “side of the angels” in their attempt to correct every ailment of society. These are basic core differences in philosophy that affect our politics today, as they have for at least the past century.
The Democrat narrative that Republicans are against the impoverished, the sick and the elderly has an audience. We saw this in play nationally during the latest Presidential Election. But, it’s not a new tactic.
I have argued for some time that here in Mississippi, Republicans are still playing right into the hands of that liberal argument. For example, I don’t understand why Republicans are unwilling to expound upon how Medicaid expansion will harm current beneficiaries and the most needy. It will. In my opinion, the lack of such a necessary argument cedes the very ground Conservatives should be fighting for.
But, every now and again Republicans can be so bone-headed in their political application that they prove the point is more than a messaging nuance, and that sometimes the shoe fits. Two recent examples that show this perfectly are the falsely named ‘Mississippi Consumer Alternative Installment Loan Act’, and the now dead Financial Literacy Bill.
The ‘Mississippi Consumer Alternative Installment Loan Act’, or SB 2571, has little to do with offering consumers an alternative. SB 2571 allows small loan companies to charge upwards of 90% annual interest on installment loans–loans that are primarily targeted at low-income consumers.
The legislation was sponsored by Senator Terry Brown and pushed through the Senate Banking Committee. Senator Videt Carmichael introduced an amendment that would have only allowed loan companies to begin charging the higher rates as a profit protection against federal regulation. However, Lt. Governor Tate Reeves exerted political pressure and SB 2571 passed the Senate in early February without the amendment.
The banner was then picked up by Rep. Joey Hood in the House, whose parents run a loan company and whose Campaign Donation Disbursement Report reads like a ‘Who’s Who’ of small loan companies across the Southeast. Conflicts of interest, be damned. (The bill’s Sponsor, Senator Brown, hasn’t filed a disbursement report in 6 years, so who knows if he has received money from those in the industry, too.)
Rep. Hood argued in the House that the legislation would help small loan companies remain in business in the face of federal regulations that will reduce their ability to offer certain products such as credit life insurance. The only problem with that argument is that there is no federal legislation being proposed to do so. Facts be damned too, apparently.
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Rep. Andy Gipson put it best when he described the legislation as the equivalent for consumers of “getting one tire and paying for two.” He successfully fought to have the bill amended with the same trigger killed by Reeves in February. The Gipson Amendment added that the alternative loan structure in the legislation:
“shall only become effective if a binding regulation is adopted by the Consumer Financial Protection Bureau or other federal or state agency that prohibits the sale of credit insurance and other ancillary products offered with a loan .”
Gipson’s sensible amendment in the House was the same basic amendment introduced by Senator Videt Carmichael in the Senate a month earlier, and the amendment was again fought by the leadership in the Senate. A few House members even received personal calls from the Lt. Governor.
In other words, the threat of federal regulation–that does not yet exist–is enough to give some Republicans in the legislature a prime opportunity to allow loan companies the license to begin plundering the already shrinking resources of low-income Mississippians.
We’ll have to wait and see how Gipson’s amendment fares as the bill gets another look in the Senate. That will show whether this is really about protection against federal regulation, or just a good excuse to allow political donors and interest groups to gouge consumers.
The Mississippi Baptist Convention’s Christian Action Commission has come out against SB 2571 on the grounds that it preys on the financially vulnerable.
Keeping Consumers Financially Illiterate
Then, there is the demise of Financial Literacy Legislation also passed in the House and killed in two separate Senate Committees. The bill, introduced by Rep. John Moore and supported by Treasurer Lynn Fitch, would have required Mississippi high school seniors to complete a course in financial literacy before graduation. Currently, financial literacy is taught as an elective and less than 20% of high school graduates take the course.
Treasurer Fitch rightfully argues that this is a core reason that our state and nation are in the dire financial shape we find ourselves today.
What does Senate leadership find unworthy about providing low-income people both the education and the tools to pull themselves out of poverty? After all, we’re not talking about a handout here. This isn’t another entitlement program.
Conservatives believe that people should have the rights and responsibility to provide for themselves and their families. What part of this argument is lost on Republican leadership in the Mississippi Senate?
I won’t regurgitate the demographic data that my regular readers have read from me many times before. But, I will say this: If Mississippi Republicans don’t begin to take seriously the plight of the everyday working Mississippians who are scratching to stay afloat, then the self-congratulatory political celebrations that were held in 2011 will seem like a very distant past in as few as two election cycles.
The key to any good communication is knowing your audience. The fact that there are some Republicans that would refuse to forward an education policy that would put future generations on sound financial footing, while simultaneously taking advantage of that very fact by okaying predatory practices from their well-connected friends is a symptom of a greater ill.
Republican Legislators who call themselves true conservatives should be politically immunizing themselves against that illness as soon as possible. Otherwise they could find themselves part of a coming quarantine by voters.
About Keith: Keith Plunkett has worked on communications issues with a range of public officials from aldermen to Congressmen, and a variety of businesses, governmental agencies and non-profits. He serves or has served as a board member of several non-profit, civic and political organizations. Contact him by going to HorizonMediaMarketing.com or follow him on Twitter @Keithplunkett