Amazon workers vote against unionizing in Alabama

Note up top that my comment was in response to someone saying that payday loans per se are a scam, a widely-held view in my social circles which I disagree with strongly.

> That's not using debt as a 'tool', that is weaponizing it against those can't fend for themselves.

Are you familiar with the concept of a poverty trap? We're not talking about people whose financial decisions consist of figuring out how to distribute their securities tax-efficiently across their accounts. There are lots of people for whom there are _very_ few degrees of financial freedom, where not being able to pay for car repairs can mean losing your job which can mean getting evicted, and where a precarious but livable existence can become a financial nightmare trap with a single stroke of bad luck and bad timing.

What's the discount rate on a loan for someone in that position? Why are you so confident that, a million miles away from your situation, you can make that decision better for them than they can for themselves? If someone is underbanked (like 22% of Americans), why are you so sure that a time-sensitive $300 emergency expense isn't worth $360, if they're confident they can pay it back (eg, when they get their paycheck)? If you're actually interested in the well-being of those who feel the need to avail themselves of tools like this, the New Yorker wrote an article about it half a decade ago[1]. There are a million other resources and even studies describing the demand side of the story, but it's a lot easier to just pat oneself on the back about how these poor illiterate people are being saved from themselves and then ignore the people whose weakened access to credit further immiserates them.

> I'm sorry but in Ontario, prior to January 1, 2017, the charge was $21 per $100 advanced, an effective interest rate of 14,299% (not a typo)

There are an impressive amount of things wrong with this short sentence and its implications.

1) This is the maximum allowable rate. It's completely consistent for someone to believe that the worst-possible payday lenders are on-net exploitative without claiming the entire industry is a scam.

2) The parent comment I disagreed with did not say "I was going to a pre-Jan-1-2017 Ontario payday lender, which I know is a scam". He said it of payday loans in general, a belief that's widely held in my social circles for the John-Oliver-related reasons I mentioned before.

3) Nothing in my comment said I was opposed to regulation, up to and including capping rates. Most people (poor or not) are pretty terrible at math, and desperation absolutely can push people further towards irrational decisions. Legally capping rates is a decision that, at a given rate, more people are falling prey to their innumeracy than are availing themselves of a costly but necessary emergency life-raft. There's nothing wrong with this legislative judgment call, but starting and ending your analysis at "look how high this number is!!!!" is just cosplaying compassion.

4) Again, the assumption that just waving your hands in the air and saying a number has any connection to the reality of poverty traps and the incredibly steep discount rates they impose upon people. Removing options from people isn't saving them from their misery, it's just displacing their misery into a million diffuse other problems that you don't have to think about.

[1] https://www.newyorker.com/business/currency/what-good-are-pa...

100% agreed, and to some extent people _do_ need to be protected from themselves where irrational decisions are likely. But the comment I responded to referred to payday loans in general as a scam, and anyone who's bothered to study this, qualitatively or quantitatively, firmly disagrees. Note that this doesn't preclude regulated rate caps, which are motivated by the idea that, at a given rate, the innumerate/irrational being harmed outweigh the harm done by removing an emergency liferaft from those for whom it makes sense.

You don't even have to be that smart or read high-quality sources to find this perspective! "Payday loans never provide value" is too dumb for even Vox[1]!

The reason I'm so passionate about this topic is not just garden-variety frustration at how stupid people are. "Helping" people by controlling what they can spend their food stamps on, whom they can have sex with, or how they survive and support themselves should come with a heavy, heavy burden of rigor. History is full of elites destroying the lives of others through their malicious "compassion" and refusal to actually consider that other people live different lives with different problems. The problem with things like payday loans is that the kind of IFLScience midwits that places like HN are thick with won't bother to do the most basic of research beyond clickbaity headlines, eye-popping context-free stats, amd comedy shows that pretend to be informative. It's repulsive.

[1] https://www.vox.com/xpress/2014/8/11/5991137/john-oliver-pay...

Free at the point of service is a great solution considering being hospitalized is exactly when you can't afford to pay for things.

That is as true for the union workers as for their employers, who were not harmed at all by the situation, in fact might have even benefitted.

The good economists also sees what is unseen.

Comments like yours remind me that I shouldn't jump to conclusion and ask 'why' instead before making an opinion on a matter. Thanks.