Yet Another Reason to Hate SCOTUS: It's Made It Easier for Payday Lenders to Prey on the Poor
Washington Monthly / By Kathleen Geier
Yet Another Reason to Hate SCOTUS: It's Made It Easier for Payday Lenders to Prey on the Poor
Antonin Scalia opines that its OK for lenders to compel borrowers to sign away their rights.
April 21, 2014 |
The Supreme Court doesn’t like poor people very much.
Recent rulings by the Court have had a profoundly harmful impact on the health, lives, and livelihoods of poor folks. The best-known example is the Court’s ruling on the Affordable Care Act, which allowed states to opt out of Medicaid. That is an option that 24 states have chosen to take. It will leave nearly six million low-income Americans without health insurance. They would have had that insurance were it not for the Supreme Court. How many people will lose their health, and their lives, because the Supreme Court denied them health coverage? I would love to know.
Moreover, the ACA decision was hardly the Court’s only front in its war on the poor. In another recent ruling, SCOTUS bent over backwards to make it easier for payday lenders to rob poor people blind. As Emily Bazeldon reports in today’s New York Times Magazine, class action lawsuits can be a powerful tool to crack down on predatory lenders. However, one thing the payday lenders usually do is to force borrowers to sign away their rights to file lawsuits and to agree to lender-friendly “individual arbitration” instead.
A disturbing 2011 5-4 Supreme Court decision written by Justice Antonin Scalia stripped away consumers’ rights to file class action lawsuits if they’d agreed to mandatory arbitration — no matter how fine the print on the agreement they might have signed. Writes Bazeldon:
The text of the law was clear, Scalia said — it “was designed to promote arbitration,” and states couldn’t get in the way. Judith Resnik, a professor at Yale Law School, told me that Scalia’s interpretation was “in no way consistent with what we know Congress was doing in 1925.” Back then, “arbitration was negotiated between merchants, not imposed by merchants on their customers and employees.” Nevertheless, at least 139 class-action lawsuits have been thrown out by courts, according to the nonprofit group Public Citizen. Burke’s suit, which was against one of the lenders who had not settled, was dismissed in February.
More:
http://www.alternet.org/scotus-makes-it-easier-lenders-prey-poor
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