Tuesday, April 22, 2008

Check Cashing Nonsense


We're always happy to have articles forwarded our way. TPS regular Rob Holub sent along the following piece on the regulation of check cashing businesses in the Cleveland area.

In short, the town of Parma is limiting the number of check cashing businesses within its city limits to 1 for every 10,000 residents; this means there will be no more than 9 at the current population level.

The mayor sums it up pretty well: "Some of these businesses charge high interest rates and fees for a short-term loan," said Parma Mayor Dean DePiero. "We want to make sure our residents are not taken advantage of."

This is bad economics rooted in political popularity. There are no residents being taken advantage of in this scenario; no one is being coerced into engaging in business with these check cashing groups. To the contrary, these businesses allow for a degree of time preference that is unattainable to workers sans check cashing places. Some people want to be able to spend their income sooner; these businesses allow for this to happen. They can't charge too high of an interest rate, or they would price many of their customers out of the market. I would be very willing to bet that their rates reflect very closely the time preferences of their customers. It would be interesting to see how these rates change over time and in response to certain economic ebbs and flows.

A good response question to the mayor would be, "What would an acceptable rate of interest be?" Better yet, ask a group against check cashing places the same question in private, then have them defend their position to each other.

It's popular for the mayor to take a stance like this because, sadly, legislating morality is almost an American political pastime. Many people don't use check cashing locations, feel that they charge too much, also feel that this is fundamentally wrong given their moral code, and therefore desire to change the world to fit their personal preferences. Here is West Virginia, we see the legislation of morality in the arguments over table games and slot machines. Drug prohibition is much the same argument as well.

Also-- check cashing places tend to be in lower income areas, and eliminating check cashing businesses gives the perception of "fighting poverty." It's not unlike swatting all of the flies from the air and claiming you've gotten rid of the refuse heap.

22 comments:

Buy RS Gold said...

Very cool. I always enjoy the interviews. Thanks for having this blog

Unknown said...

You ought to pay for the special privilege services but why don't we see positive part of it that in case of our urgency needs we can fulfill
our desire.What is more important your desire or a minimal fee for such special services that you need to decide.

checking cashing locations

Unknown said...
This comment has been removed by the author.
Unknown said...

Hi..nice post. Thanks for sharing. This information is very useful. For more details just click Payday Loans

Eddy Luis said...

Such a nice blog.
Cash for gift cards

Unknown said...

Hi, nice blog… Thanks for share. You can also use the alternative for this purpose. You just need to click on Car title loans to find more about this topic.

Unknown said...

Good work man...Keep it up
Auto title loans

Unknown said...

Good information if you need payday loans San Diego then click on it.

Unknown said...

Congratulation for your post.This post is very helpful and costly.I am so satisfied to get this post article. I was anticipating get such a post which is exceptionally useful to us.Keep it up.I know something data,to know you can click here
Check Cashing

writing tips said...

This post truly made my day. You can’t imagine just how much time I had spent for this information! Thanks
dissertation Writing Services

coursework writing services said...

I'm getting excited about this kind of beneficial information of your stuff in the future

deepak ogen said...

I am read your article and it’s helped me a lot, thank you so much for share this wonderful article, I really like to read this type of blog, keep sharing this type of useful information, I am suggest to my all contact to visit this blog and collect this helpful information, If any one searching website designing & development company in Delhi please visit my website, we are do for you any think like website build PPC service and many more so don’t waste your time and come on my website and grow more your business, Thank you so much for read my comment.Web Design Company in Delhi

Kala Kutir said...

This was be great I will read your blog properly, thank you so much for share this valuable information, I am enjoy to read this, it’s provided me lot of information, if any one grow up looking so please visit me website and I am share for you some tips so you will go and grow up your looks, thank you so much for read my comment.
Lifestyle Magazine

Unknown said...

Great blog it’s useful for me, I am enjoy to read this, keep share like this type of helpful information, I am suggest to my all dear friend to read this amazing article, If any one searching shipping company in India please Visit my website.
Sea Freight Company in India

Poojarao said...

Rice Bags Manufacturers
Pouch Manufacturers
wall putty bag manufacturers

Poojarao said...

we have provide the best ppc service.
ppc services in gurgaon
website designing company in Gurgaon
PPC company in Noida

Poojarao said...

we have provide the best fridge repair service.
fridge repair in faridabad
Videocon Fridge Repair in Faridabad
Whirlpool Fridge Repair in Faridabad
Washing Machine Repair in Noida
godrej washing machine repair in noida
whirlpool Washing Machine Repair in Noida
IFB washing Machine Repair in Noida
LG Washing Machine Repair in Noida

Poojarao said...

Bali Honeymoon Packages From Delhi
Bali Honeymoon Packages From Chennai
Hong Kong Packages From Delhi
Europe Packages from Delhi
Bali Honeymoon Packages From Bangalore
Bali Honeymoon Packages From Mumbai
Maldives Honeymoon Packages From Bangalore
travel company in Delhi

Online Front said...

Mostly I use to read the blogs and informative article daily, but today i found your blog very unique, providing the information and helpful to others. Keep it up and waiting for your new updates thanks. We offer multiple services in digital marketing, some of our services are:

Digital marketing Company in Delhi
SMM Services
PPC Services in Delhi
Website Design & Development Packages
SEO Services Packages
Local SEO services
E-mail marketing services
YouTube plans
Digital marketing service in Delhi

timeandxcess said...

Very cool. I always enjoy the interviews. Thanks for having this blog.
office automation services
hearing aid Pakistan
hearing aids in lahore
custom suits
ad agency
chemical industries in lahore
Architecture Designs in lahore
mbbs in china
hearing clinic in lahore

Tamika baden said...

Best Zoho HR management software for businesses.


Zoho People Help

a said...

masking tape
foam tapes



safe driver
safe driver dubai
residential moving