Pfcs. Samir Nasir, (right), of Grayson Ga. and Akil Floyd of Canton, Oh., soldiers based at Ft. Leonard Wood watch videos on a phone at Lambert-St. Louis International Airport on Saturday, Dec. 20, 2014, as they wait for their flights home for the holidays on leave. Several battalions moved through the airport after arriving as early as 1:30 a.m. from the central Missouri Army base. Many of the troops are in the middle of basic training and had been up since 4:30 a.m.Friday before leaving. Photo by Christian Gooden, cgooden@post-dispatch.com
Paying verbal homage to America’s military service members is the easiest thing in the world for politicians to do. But if those politicians act in the interests of some big, influential industry — say, car dealers, or payday lenders — to the detriment of the troops, you can safely assume all their patriotic speechifying is bunk. The Trump administration is currently failing the bunk test.
Because rank-and-file military personnel tend to be young, with modest but reliable income, they are often exploited by unscrupulous lenders. The Military Lending Act is designed to counter that. For one thing, it prohibits automobile lenders from tacking financial products onto auto loans made to military personnel, since those products are often unnecessary and overpriced. And the federal Consumer Financial Protection Bureau regularly monitors payday lenders to ensure they aren’t violating the MLA by ripping off military personnel with high-interest loans.
According to The New York Times and National Public Radio, the administration wants to stop enforcing those protections. If the exposure of this attempt to sell out the troops doesn’t shame the White House into backing down, Congress should intervene.
The Consumer Financial Protection Bureau’s regular monitoring of payday loan operations is an important deterrent to the bilking of U.S. service members. For example, in 2014, the bureau issued a $10 million fine to one of the biggest lenders for ensnaring low-income borrowers, including military personnel, in high-interest loan schemes. Knowing the bureau is watching can make these companies think twice.
But now, the Times reports, the bureau wants to stop the monitoring and respond only to specific complaints. Interim Director Mick Mulvaney claims the bureau doesn’t have legal authority to keep monitoring without new legislation. The powerful payday loan industry would be sure to make that an uphill battle.
At the same time, NPR reports, the administration wants the Defense Department to get rid of the prohibition on car dealers rolling unnecessary financial products into loans for military personnel — something the powerful car dealers’ lobby very much wants.
Opponents to these changes point out that the rules are there for a reason. “When I drive down the strip outside a military installation and count 20 fast-cash lenders in less than four miles,” one official wrote in a memo quoted by the Times, “that’s not a convenience, that’s a problem.” Others have noted that military personnel who become ensnared in financial traps can endanger their careers and even pose a security risk.
Forty-nine Democratic and independent senators have signed a letter to the financial bureau imploring it to continue monitoring payday loan companies, and some are raising the alarm about the proposed auto-loan change. If congressional Republicans mean the glowing things they say about our troops, they should have no problem joining the effort.
