By Lionel Waxman, Inside Tucson Business:

MY OPINION: The people have spoken

It infuriates credit card holders when the interest rate on balances gets jacked up to 30 percent. It was a similar fury that motivated Arizona voters in November 2008 to force payday lenders out of the state by the end of June 2010. The measure was passed by a 3-to-1 margin.  [sic.]  [NOTE: The measure, sponsored by the payday lenders, was defeated by the voters.  Had it been successful, it would have allowed the lenders to wipe out the 2010 sunset date and charge triple-digit interest rates indefinitely.]

Payday lenders charge upwards of 450 percent. Make your blood boil? Well, I should say. Makes your credit card issuer look downright benevolent, doesn’t it?

The legislation that let the scoundrels into the state in the first place had a 10-year lifespan when it was passed in 2000. Now, the few months they have to pack up shop and steal away into the night is being used to lobby for proposals for slight concessions that voters rejected last year. Reportedly, Gov. Jan Brewer is willing to listen to the payday lenders regardless of what voters said.

In exchange for their right to keep sucking the blood of Arizonans, payday lenders have offered a package of reforms that includes:

• A slight lowering of the interest rate on their loans — like from a confiscatory rate of 450 percent to a downright humanitarian rate of 391 percent.

• A ban on roll-overs — which, contrary to popular belief, is not a program in which the lender traps the borrower in his car and rolls it over.

• An interest-free repayment plan for those who just cannot make good on the bad checks they had to issue to get the loans.

• Wearing of strong perfume 24/7 to disguise the putrid odor of their business.

Except for the perfume, this is essentially the same proposal voters rejected. It is about the same proposal their industry spent almost $15 million on to try to sell it to the voters to no avail.

But Brewer has no trouble with the proposal. She says she sees no conflict. Apparently the will of the voters is irrelevant to her.

It remains to be seen how the new effort will be interpreted by the legislators. If state government sees no trouble in overturning the expressed wishes of the voters, then the initiative process should be terminated as a fraud. Why spend money and time organizing an initiative only to have it overturned by state officials?

On the other hand — you knew that was coming, didn’t you? — the payday loan industry did spend nearly $15 million trying to bamboozle Arizona voters. If we had any assurance of the money being spent entirely in this state, I would say maybe we need businesses willing to spend big money here for anything. Maybe we should overlook how they got this money.

Businesses that can throw around $15 million don’t grow on trees these days. That much money can be said to save or create 300 jobs. Good paying jobs. Jobs working families need. Jobs screwing fellow Arizonans who were not astute enough to get jobs working on behalf of a bunch of out-of-town jaspers financially raping their neighbors.

Hey, it’s the voters’ fault. They styled their initiative as a mere law. Maybe if they wanted the governor and the legislature to take it seriously, they should have made their initiative a constitutional amendment. Otherwise, they think the voters are just kidding around.

Seriously folks, in 1998 the voters of Arizona used the initiative process to enact the Voter’s Protection Act. This changed the state constitution in three significant ways:

1. It prohibits the governor from vetoing any citizen-approved measure.

2. It prohibits the Legislature from repealing such measures.

3. It permits the Legislature to amend a citizen-approved measure only if the amendment furthers the purpose of the citizen measure and passes by a three-fourths majority.

Essentially, this makes citizen-approved measurers virtually unalterable except by a subsequent vote of the people.

So relax. No matter how much money payday lenders throw around, no matter how Brewer feels about it, regardless of the feelings of the legislature, this effort by the payday lenders is doomed.

Contact Lionel Waxman at territorial@waxmanmedia.com or visit his website: www.newflashpoint.com. Copyright © 2009 Inside Tucson Business

[NOTE:  While Arizonans for Responsible Lending appreciates the stance taken by Mr. Waxman -- and the attention paid this issue by Inside Tucson Business -- the conclusion he reaches at the end is incorrect.  This is not a case in which the voters created or amended a law with an affirmative vote at the ballot box.  If that were the case, the Voter Protection Act would in fact hold sway, and we'd be out of the woods.

In this case, however, the voters rejected an attempt by the payday lenders to amend the law.  By doing so, the voters maintained the status quo, including the July 1, 2010 Sunset date in the law authorizing payday lending in Arizona.

While the will of the voters is clear, there is nothing in statute that protects the outcome of the vote.

The industry CAN STILL REMOVE THE 2010 SUNSET it faces, by getting legislation approved with 16 votes in the Senate and 31 votes in the House, and signed by the Governor.

That's why we must continue to FIGHT BACK and DEFEAT any legislation they run.]

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