Supporting the Troops--With Payday Loans

Alexander Cockburn provides the details:

Fortunes for the arms-makers, foodstamps for the grunts. Money sluices into the treasuries of defense contractors making those poorly armored tanks. Meanwhile an E-2 level Marine gets $1,337.70 a month. Married, this Marine gets a monthly housing allowance of $460.50 a month; unmarried, $289.20.

I was down in Oceanside, the town just south of Camp Pendleton, earlier this year, and as I pointed out then, you don't have to drive more than a couple of blocks through Oceanside's main drag before the economic realities of the American Empire become apparent. On the south side of the 4000 block on Pacific Coast Highway is a colorful store front with two big signs shouting "We Support Our Troops" and "Welcome Home Heroes". But the biggest sign of all says "PAYDAY ADVANCE". The other side of the road there's a pawnshop, one of several in Oceanside, and there are several other store fronts offering advance loans for Marines who can't make it to the end of the month...

...payday lending is almost never for that one emergency stop gap loan. The payday lending business model is based on developing these lethal borrowing patterns. 90 per cent of all payday loans go to borrowers with five or more loans in a single year.

The Armed Forces recruiters target poor neighborhoods. The payday lenders target the Armed Forces. At Fort Bliss in Texas, Paul Fain wrote earlier this year in Military Money, "the Army Emergency Relief office estimated nearly one-tenth of the 10,000 active duty troops stationed there have had to undergo credit counseling because of payday loans and other debt problems." Young soldiers and sailors, Fain went on, "are the perfect marks for payday lenders for reasons beyond financial naïveté. Though they often live paycheck to paycheck, military personnel are paid regularly, never get laid off and face penalties for failing to repay debts." Back to Oceanside. The enlisted servicemen and women hock stuff in the pawn shops and borrow against payday. The generals and the contractors buy up beach property and own stock in the institutions that bankroll the pawnshops. The military coming home from the war face rotten prospects in the service economy. The president was smart to make it a quick visit to Camp Pendleton. If, like Henry V in Shakespeare's play, he'd moved among the Marines in disguise and listened to their worries, he'd have got a rude surprise. But in the fake world of TV News pr, "heroes" aren't racked with worries like an 805 per cent annual interest rate.

I continue to be amazed by those who claim to "support the troops," yet when stuff like this is reported, inevitably their story changes to something like, "well, they volunteered." Volunteered in the same sense that young Iraqis "volunteered" for refuse haul-away, that is to say, when jobs are scarce in the economy, you tend to take what's available. In the US, that means going to the army and possibly getting shipped to Iraq. In Iraq, that means hauling garbage and hoping you aren't mercy-killed after being shot by mistake. Neither case is particularly appealing.

Oh, and for putting your life on the line, you get paid every two weeks just enough money to last maybe ten days--wow, talk about economic efficiency.