Putting the bite on the sharks

Like mentally challenged children, some Georgia legislators are trainable. We're speaking of a group that, for the most part, isn't intellectually impaired. Rather, the legislators are morally handicapped, so the techniques we'd apply to children – love and patience, for example – don't work. A figurative two-by-four wielded so that it smacks a legislator alongside the head is an excellent device for training members of the General Assembly.

Consider Rep. Steve "Thunder" Tumlin, R-Marietta. "Some of this you learn the hard way," Tumlin says, just a tad bit grumpily. "I sure did, over that payday lending bill last year."

Here's what he's talking about: In 2004, the Legislature passed a law that banned a vicious form of loan sharking called "payday lending." The least sophisticated consumers – the poor, poorly educated and (this would become significant) military personnel – were conned into taking loans against their next paychecks. With 360 percent annual interest rates and high fees, the borrowers often were forced to roll over the loans again and again as the principal never diminished and the payments soared.

What was the motivation for the legislators to reverse their years-long crusade against Georgia's poorest citizens? Did they have an epiphany of conscience? Did some of that Christianity they're always blathering and bellowing about finally sink in?

Well, no.

Doing the right thing hardly ever enters the mind of a Georgia legislator. The reason the General Assembly banned payday lending four years ago was because of a threat from the federal government. The Pentagon brass made it clear that states that fed young soldiers to the payday loan sharks were going to lose military facilities and all of their economic impact. That was the two-by-four that slapped the heads of Gov. Sonny Perdue and his attendant clowns from the House and Senate, who otherwise were perfectly happy to see their citizens treated as prey.

The tenacious crooks in the payday lending business didn't give up. Last year, Tumlin was one of the legislators who carried the predators' water in an effort to let them do their dirty business once again in Georgia. After being soundly thrashed, Tumlin has emerged as a born-again consumer advocate. Hallelujah.

And he's not alone. But before I describe an amazing outbreak of consumer-positive legislation at the Capitol, it's worth keeping in mind what this government is all about: money and lobbyists slathering cash (and bimbos) on legislators.

Example: You may have heard Perdue beating his chest, proclaiming he is pushing a constitutional amendment to eliminate a tiny 0.25 mil property tax that goes to the state. Is Perdue doing this, as he boasts, for beleaguered homeowners? Hardly. The real reason is that the small tax empowers the state Department of Revenue to ensure counties assess property at fair market value. Without the tax, the department has no role in assuring fair assessments. Thus, politically powerful industries – my bet is the timber business and/or utilities – pushed the amendment. If passed, these corporations will be able to lean on local officials to get sweetheart assessments – sticking common folks with the taxes the industries dodge.

The downside to craven pandering by the legislators is that they can't exactly tell citizens what they're up to. To an outsider, it appears there is absolutely no focus, or what little there is among legislators is a state embarrassment. When Roy Barnes was gubna, he'd hand out cards with three letters on them: WET, standing for water, education and transportation. That was focus. Now we have a guv whose passion is state money for fishing tournaments, and a Legislature whose main concern is on denying license plates to University of Florida fans and invading Tennessee to steal its water.

But there really is a sinister "focus." As state Rep. Rob Teilhet, D-Smyrna, puts it: "This Legislature is a government of the special interests, by the special interests and for the special interests."

With that backdrop, it is quite astounding that a few consumer bills have not been, as most are, summarily trashed -- and that several of the bills' proponents are Republicans. "Good old-fashioned shame is having an impact," Teilhet says.

The Republicans – notably Tumlin and state Rep. Rich Golick, R-Smyrna – don't exactly see it that way. "I'm a conservative, a free market guy," Golick says. "Sometimes when you pit a common person against a giant company, that's not a free market. Our job should be to level the playing field."

Golick is championing a bill (H.B. 130) that would allow consumers to freeze their credit reports to thwart identity thieves. The three massive credit agencies – a "triopoly" – wanted to charge $10 bucks to each member of a family. Golick figures $3 is sufficient. The Senate, meanwhile, is picking up the corporate kowtowing – adding a measure (S.B. 361) that would have the governor's banking commissioner set the fee, which means the credit agencies would call the shots.

Another bill (H.B. 1344) that is still surviving the slings and arrows of lobbyists would put a small dent in the "car title loan" business, a first cousin to payday lenders. Aside from the predictable usurious interest rates, the real scam with these sharks is that if a borrower is late on a payment, the title loan company gets the car, sells it and keeps all the proceeds. Thus, a consumer might have pawned an $18,000 car and lose all the equity for a $500 loan.

The bill, sponsored by Golick and Tumlin among others, would let the title pawn company keep what it was owed and any expenses involved in collecting its money – but would return the rest of the value to the consumer.

And still another bill (H.B. 1030) would force income tax preparation companies to admit that the money they give to consumers is not a tax refund – but actually a loan against the refund. Those loans charge the unwary customers 300 percent annual interest. "Half of all the tax refunds with these companies are eaten in fees and interest," Teilhet says. "The least we can do is force the companies to disclose those facts."

Georgia's average Joes and Janes can only hope for better treatment. "We've been behind where we should be in protecting consumers," Tumlin says. "But we're improving."