Jason linked to this piece on payday lending in the UK, and I was struck right away by math being poor on all sides of the debate. I’m not the type of libertarian to defend payday lending to the death, as I think it’s usually kind of dumb…but then again, I’d rather have the option to keep heat going in the winter if I didn’t have cash-flushed friends and family or an understanding bank willing to do business with the type of guy who was about to lose his heat for non-payment. But generally, yes, it’s spectacularly bad from a financial perspective. (Then again, the same people clucking are often the same yuppies who got ARMs based on the asset bubble of house prices, so…)

Still, this piece was pretty bad in conflating various “percents,” as was its source material. Here it quotes Times Online:

Payday UK said that the typical annual percentage rate (APR) for its deals was 1,355 per cent. The typical rate for a credit card is 20 per cent, while a high street bank charges about 18 per cent on an overdraft.

Well, “APR” and a “charge” are very different things. Both are percents, but the comparison ends there.

Payday lenders, such as Payday UK, Express Finance and Pounds Till Payday, offer loans of up to £1,000. Payday UK demands that £125 be repaid for a £100 loan, or £937.50 for a £700 loan. The loan is usually paid off within a couple of days, as soon as the borrower’s wages are paid into their account.

Well, if you get 100 but have to pay back 125, and you do so in a few days, that’s 25%, not 1,335%. If you carried the loan the full year, you’d be talking that kind of rate–but you don’t. So if a bank overdraft is 18%, I’m imagining they don’t let you carry that 18% over a whole year. They charge it immediately. So the relevant numbers are 18 versus 25. This works in the bank overdraft’s favor, but not so dramatically as 18 versus 1,335. That’s a deceptive comparison…ironically, the same sort of comparison used to get people to get a payday loan.

Of course, getting bank overdraft protection on this side of the pond requires a decent-sized deposit, an annual fee, and a credit check. I’m guessing most customers of payday loans don’t do that well on credit checks, don’t have tons of cash to make the bank feel happy that they’ll get paid back, and can’t afford an extra $100/year just to know they won’t have to go to a payday lender. And while the poor may be able to wallpaper their apartments in credit card applications, the reality of getting credit sufficient to pay off an electric bill is not necessarily so rosy.

So yes, if you’re a yuppie, you’re an idiot to get a payday loan, and the guys with the soft helmets will look at you and mutter, “retard.” But maybe you should think about the consequences of making the last refuge of the desperate job-holder illegal.

Speaking of, let’s deal with the rhetorical coup-de-grace:

I was recently on an NPR show on consumer debt, and a caller said his uncle, a former loan shark who did 15 years in prison, was mystified by payday lending, particularly since he had charged only 17%.

Wow, what a deal…now was that 17% accrued over an entire year, or was it due in a month or less?

Nah, I’m kidding. The real ludicrousness of this comparison is that payday lending companies tend not to break your legs when you default.

Dave Weigel of Reason Magazine may have been stuck with the job of political reporting, alienating some readers used to horserace-free think pieces, but damn if he hasn’t taken it and made it his bitch. Here’s Dave on the Oregon primary results:

UPDATE 11:07: Everyone except CNN calls Oregon for Obama. Bill Kristol informs Fox viewers that Oregonians are all “drinking lattes and sipping granola.” I’m confused as to how this is a greater character flaw than the Kentuckyian trend of “strongly disliking black people.”

CLINTON: Ha haaa! Well you know, anyone off the street with a scary black pastor can talk about change, but it takes a fighter to fight for change. And I’m a fighter. I’m tough. And if you lived my life you’d be pretty darn tough too. I mean, I had to go to Wellesley. That was my safety school. But I was strong anyway and I endured. And as president I’ll fight the insurance industry and the pharmaceutical industry and the health care industry, just as soon as they stop giving me millions of dollars!
FB: That’s that no-nonsense down-to-business style I like about you, Hillary Clinton! You don’t just talk about change. You talk about how much you don’t just talk about change!

Seriously, if at this point you still support Hillary “racist whites are more racist than sexist, so vote for me, because for sure they’ll keep voting for me over an Old White Man in November” Clinton, you should read this.

This woman is the poster child for privileged yuppies who gambled with their childrens’ futures and lost, but are unwilling to let go of the gamble to, you know, feed the kids:

When she was laid off in February, Patricia Guerrero was making $70,000 a year. Weeks later, with bills piling up and in need of food for her family, this middle-class mother did something she never thought she would do: She went to a food bank.

Oh, goodness! Why, we’re all just a paycheck away from doomsd- wait, how do you blow through the savings you can earn with a 70K/year job in a month? Oh, right, you keep hoping your house gamble will pay off:

Guerrero is estranged from her husband and raising her two young children. She’s already burned through her savings to help make ends meet, and is drawing unemployment checks. She has had to take extreme measures to pay for her interest-only mortgage of $2,500 a month. In fact, her mother moved in with her to help pay the bills.

This is like the person who complains they’ve done everything to lose weight, and nothing works. Well, you know, everything except diet and exercise. Lady, you have a house. Sell it, and move in with your mom wherever she was before. Or move into the apartment you can afford off your husband’s child support and unemployment. But if you’re hanging on to an interest-only loan, it’s because you think the market is going to turn around any day now and you can flip it for a profit.

But wait, we’re not done with her “extreme measures”:

Guerrero even applied for food stamps, but was denied.

“I never used the system. I’ve been working since I was 15-and-a-half. I needed it now and it turned me down,” she said.

Maybe because they look at your balance sheet and say “Hey, what about this house thing you have listed under ‘assets’? Maybe you could sell that?”

If you made $70,000 a year, and presumably your husband made a little something too, then the idea that you’d gamble your children’s ability to eat on whether you could flip a house you’re not even paying principal on is pretty sickening.

To have burned through her savings in a month means she burned through $2,500 plus utilities and food. But with a $70,000 a year job, she should be bringing home around $4,000 a month. Which meant that despite making $1,500 over her housing cost, she couldn’t salt any of that away. And remember, this is before help from Mom or the soon-to-be ex.

What all that means is that this wasn’t “oh but for getting thrown out of work, there could go you or I,” but it means she had to make poor decisions and keep making them repeatedly to get into the mess she’s in. I feel bad for her kids, but I really can’t feel sorry for her. You made your bed, lady, now try really sacrificing like actual poor people do.

The rest of the article tries to be scary but can muster precisely zero data. All we have is a woman who kept making bad decisions and wants us to bail her out. As someone who didn’t jump on the house bandwagon, I’m pretty pissed off. I’d like to have a house, too. Who’s willing to pay my food bills to make that happen?

Here’s a piece I’ve been meaning to blog about for a while, because it’s almost a perfect libertarian just-so story. It’s also why I don’t support the Lew Rockwell/Ron Paul style of federalist libertarianism.

Frequently I hear about how regulations are good to “address social problems.” Some of these, like sewage disposal or even restaurant cleanliness don’t bug me much or at all. Could the free market come up with a regulation system on its own? Sure, it can and it has. But if the government does it, the question for me is one more of means than goals. If government does it fine and everybody is happy with that, then so be it. Let the perfect not be the enemy of the good.

But frequently “social problems” are “quality of life” issues, and the difference between a social problem and someone’s aesthetic preference are blurred to the point of incoherence. Whether it’s Rudy Giuliani banning crates on the sidewalk in the name of Law and Order or the local privileged white yuppie decrying the encroachment of Wal*mart from his favorite Starbucks, people on the left and right forget that the regulations that enforce a certain vision of how other people ought to live their lives can do real harm.

Case at hand: In Oregon, a state so beloved of government mandates that you can’t pump your own gas (yes Oregonians, everybody except New Jerseyans is perfectly free to grab that handle and pump and pump until they’re spent, without a lick or a spit of training), Measure 37 allowed people with rural tracts of land to parcel off pieces of it. In William Kitchen’s case, it was to give to his son and grandson as well as an acre to sell. But there wasn’t access to the parcels Kitchen intended to create, so he spent tens and thousands of his life’s savings to build a road from the main road to that part of his 32.25 acre lot.

Ah, but then Oregonians decided that they didn’t like housing going up on farmland. So people in the city voted to make people in the country keep their land in big, unbuilt lots, or make sure housing was as dense as possible to maximize the stretches of green.

Measure 49 now requires that landowners of high-value, exclusive-use farmland – such as the Kitchens – to subdivide in parcels no larger than two acres.

The problem is that the part he wanted to give to his son needed to be big enough to have a little space, and maybe, I dunno, farm a little. Still, they weren’t scofflaws, those Kitchens.

The Kitchens would have begrudgingly reduced Bill’s parcel to two acres, William said, but another provision of Measure 49 prevented Bill from building his house at the end of the road the family built.

The new rules also compel property owners to cluster new houses near existing homes, which would force the Kitchens to build Bill’s home close to Phelps Road and would leave the family with the road to nowhere

Well, surely the Republicans will put this right, greedy propertarians they!

“This was not the intent of Measure 49,” Rep. Patti Smith, R-Corbett, said, as she toured the Kitchen property. “It was created to fast-track small subdivisions like this. That’s what people voted for, and I think that is good land-use planning. This family did all they could do.”

Translation: we know better than you how to use your land, so suck it, Mr. World War II veteran. Next time build your road faster before we change our minds about what you can do.

Rep. Smith feels bad, and hopes the legislature will ease up on such people, because, um, families. Or something.

But not because there’s anything wrong with trying to decide one rule that will apply equally well to every situation millions of other people have.

Passing laws, even “good” laws like requiring vaccinations or making employers post signs to tell their staff to wash their hands, has a cost on the people being regulated. It may well be that the cost ends up being worth it for some other value (not having Salmonella). But just because the equation works out positively doesn’t mean there isn’t a negative in there.

Unfortunately, people extrapolate from the fairly few and sensible regulations that all regulations are without cost, because any benefit must outweigh the costs. They forget that real 83-year-old World War II veterans might have the fruit of a lifetime of hard work wiped out because someone thinks their life will be easier if they don’t have to think about all the ugly ways other people choose to live.

In this sense, “quality of life” regulations are no different from laws banning certain sex acts: they exist to make some people live the way other people would prefer they live, even without direct harm befalling the people who agitate for the restriction. Just because you think the one you agree with is better than the people on the other team who advocate for the one you don’t agree with, don’t think you’re not doing the same thing. You’re just goring a different ox. But an ox is still going to die a painful death.

South of the Mason-Dixon line, they voted their race.

North of the Mason-Dixon line, they voted their genitalia.

And as usual in liberal** Massachusetts, white men decided things.

* Oh yeah, I went there. I think god’s endorsement of Huckabee is in question.

** Seriously, blue laws and white men.

“Maybe Romney should have cried, too.”

Unfortunately, the guys at SCO disabled his choked_up() subroutine in the last update.