The Need for Tighter Restrictions on Payday Lenders

      The Austin American-Statesman published an editorial titled: Tighter restrictions on payday lenders needed. The piece was written by the Editorial Board and is a good argument for the need to better regulate the local lending industry. The lenders at the heart of the issue are not credit unions or banks, they are payday lenders and auto-title loan lenders.
      The author of the editorial makes some good points throughout the article, but there are a few shortcomings as well. The article claims, "state lawmakers passed a couple of timid rules regulating businesses that make short-term, high-interest loans." Closely following this portion the editorial goes on to name a couple of Texas cities (including Austin) which have passed stricter rules restricting payday lenders, who because of there fees and charges have a predatory reputation. These are important statements for the reader. It tells the reader that state lawmakers have taken a soft approach while the cities are more concerned with tightening the reins on these companies. Other areas of the argument that stand out are the author's recommendations for lawmakers, as to what regulations should be placed on payday lenders. The Editorial Board goes on to describe the service provided by the payday lenders while explaining the vicious cycle that the borrower becomes entangled in.
      One area where this editorial falls short is the lack of a bold, absolute statement. The author would have produced a better argument had they got rid of the "predatory reputation" and instead called it what it is, predatory lending. Exchanging the words from the first sentence, "businesses that make short-term, high-interest loans" with the words, "predatory lenders" would have been ideal. It acts as a thesis statement which gives the article a clear objective right from the start. Another shortcoming of the article is the author's placement of facts, descriptions and opinions. One example of this is the author's recommendations for lawmakers. This should have been used towards the end of the article, not prior to explaining how these predacious businesses operate. Explaining how these payday loan companies take advantage of people should have been a priority of the argument and not placed in the sixth paragraph. Lastly, presenting a specific person or case would have solidified the claim that these businesses need to be more closely watched and regulated. Presenting the reader with examples of the stipulations placed on borrowers for their late payments or the actual interest rates offered by the payday loan lenders would have been beneficial to the argument. 
      The editorial's intended audience is not necessarily the would-be borrower, but rather the general public. The Editorial Board did a good job of presenting the story, but not a great job of presenting their argument. As to the author's credibility, this is not known and is probably not the most important factor with regard to this subject matter.