We at CFIF have consistently highlighted the peril of federal, state and local government efforts targeting…
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New Study Shows How Overregulating Short-Term Lenders Harms Consumers

We at CFIF have consistently highlighted the peril of federal, state and local government efforts targeting the short-term consumer lending sector.

Less than two years ago, we specifically sounded the alarm on a New Mexico law artificially restricting interest rates on short-term consumer loans.

Well, a new study entitled "A New Mexico Consumer Survey:  Understanding the Impact of the 2023 Rate Cap on Consumers" that surveyed actual borrowers confirms our earlier warnings:

Key findings include:

•Short-term,small-dollar loans help borrowers manage their financial situations, irrespective of the borrower’s income.

•The rate cap has failed to improve the financial wellbeing of New Mexicans, specifically those who had previously relied on short-term, small-dollar loans.


November 27, 2023 • 03:57 PM

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Obama’s Deficit Reduction Plan: More Spending, More Taxes, Less National Defense Print
By Troy Senik
Thursday, April 14 2011
How Obama plans to build on even this limited budget-cutting, however, was never articulated. Lines were drawn in the sand, however, about how he wouldn’t.

Hillsdale College Professor Paul Rahe – who has the distinction of being both a wag and a world-class intellect – is a high priest of the aphorism. Reviewing President Obama’s Wednesday speech on fiscal policy, he was characteristically concise: “[It] was in keeping with the President’s habitual practice. He said nothing, and he said it at considerable length.”
For the most part, Rahe is right. Masochists who wade through all 76 paragraphs of Obama’s tepid rhetorical porridge will find little of note.
All the tropes were familiar. The construction of the Transcontinental Railroad was cited as the definitive determination of the utility of big government. Uncontroversial statements such as “I will never accept cuts that compromise our ability to defend our homeland or America’s interests around the world” inevitably preceded a sentence that started with the word “but.”  The President even went so far as to say that “we would not be a great country” without programs like Social Security, Medicare, and Medicaid. Way to dispense with the first 125 years of American history.
Obama’s lack of substance was all the more notable given the fact that his speech was billed as a rejoinder to the audacious 2012 budget proposal laid out last week by Wisconsin Congressman Paul Ryan, Chairman of the House Budget Committee. Ryan, who presented a plan that would overhaul Medicare and Medicaid and dramatically reduce the federal budget deficit, was widely hailed for his courage in introducing a plan that was sure to draw fire from Congress’s largest caucus: those without any better ideas. Beltway wisdom held that if Obama didn’t respond quickly and substantively he would look intellectually overmatched. Fast it was. Substantive it wasn’t. In fact there were only five identifiable principles in Obama’s speech:
1. We’ll Lower Spending Without Cutting Any Failed Liberal Programs – Obama pledged to “[build] on the savings that both parties agreed to last week.” Bad move, Mr. President. The Bible is pretty clear about the disutility of building on sand.
As details emerge about last week’s budget deal, it’s becoming increasingly clear that the $38.5 billion supposedly cut from the federal budget included huge chunks of money that Congress never intended to spend and accounting gimmicks as far as the eye could see. It deserves the ultimate epithet in fiscal policy: a California budget come to Washington. 
How Obama plans to build on even this limited budget-cutting, however, was never articulated. Lines were drawn in the sand, however, about how he wouldn’t. No cuts to fields like “clean energy,” education or transportation – three areas that are already experiencing abject failure despite previously huge taxpayer subsidies that were only augmented by Obama’s 2009 stimulus package.
2. We’ll Balance the Budget on the Backs of America’s Armed Services – Good liberal that he is, Obama could only find enthusiasm for cuts in one of his 15 cabinet departments – the Department of Defense. Anyone who understands the inner workings of Pentagon budgeting knows that there’s plenty of fat to be trimmed. But does this vital national function really deserve a special focus in an executive branch populated by entirely superfluous cabinet departments such as Commerce, Labor and Housing and Urban Development?
3. All the Healthcare Savings We Need Will Come from ObamaCare – Obama only addressed healthcare costs as a driver of debt by repeating the long-discredited notion that his hallmark healthcare overhaul will reduce the deficit by $1 trillion. That’s a claim contingent on Congress making trillions of dollars in cuts in Medicare payments for doctors and hospitals – something that would destroy the system and that any observer of politics who is not currently suffering the effects of mercury poisoning knows is as close to a political impossibility as you can get.
4. We’ll Reform our Marquee Entitlements Without Changing Anything about Them – On Medicare, Obama only said that he rejected a voucher program that would leave seniors at the mercy of a free market system that he had praised at the top of the speech. As for Social Security (a task Ryan left for the President to define), he said with characteristic self-reference, “As I said in the State of the Union, both parties should work together now to strengthen Social Security for future generations.  But we have to do it without putting at risk current retirees, or the most vulnerable, or people with disabilities; without slashing benefits for future generations; and without subjecting Americans’ guaranteed retirement income to the whims of the stock market.” Translation: There’s only one change I’m willing to make. Which brings us to…
5. Your Taxes Are Going Up – Only a few months after Obama’s self-coronation as centrist philosopher-king in the wake of the extension of the Bush tax cuts, the President is already considering a repeat visit to your pocketbook. And he is doing it in the most disingenuous way possible.
Obama repeatedly referred to his proposal as “reducing spending in the tax code.” For a native English speaker that might sound like the government putting itself on a diet. But for those who drink Potomac tap water, it means raising your taxes, the absence of which are conveniently known as “expenditures” when they don’t meet the needs of Washington panjandrums.
After last year’s midterm elections, political sages assured us that Obama was preparing for a Clintonesque renaissance. Less than six months later, however, he’s talking up ObamaCare, defending out of control spending, gunning for America’s armed services, standing pat on entitlements headed towards insolvency and pledging higher taxes. The president’s mouth may have moved towards the center. But his heart continues to be stationed on the left.

Notable Quote   
"In economics, the law of diminishing returns states that the benefits gained from an enterprise will be proportionally smaller the more money, time, or energy is invested in it.Thankfully this is not true in the realm of ideas, as the career of the economist Thomas Sowell attests. Now 93 years old and the author of more than 40 books, Sowell's most recent contribution, Social Justice Fallacies, tackles…[more]
— Christine Rosen, Washington Free Beacon
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