Last Week Tonight with John Oliver: The Payday Loan Industry, Russia Bans Food Imports
August 11, 2014 5:33 AM - Season 1, Episode 14 - Subscribe

This week: Americans striking ISIS in Iraq with aerial bombardment. Russian gang steals 1.2 billion internet passwords. A three-day cease-fire in Gaza doesn't quite go the distance. A long piece on the payday loan industry. (16m) Russia bans Western food imports.
posted by JHarris (9 comments total) 2 users marked this as a favorite
 
man, that was some dang good reporting on the Payday Loans.
posted by rebent at 11:26 AM on August 11, 2014


News Recap
Obama bombs Iraq again, this time to hinder the efforts of ISIS in taking over the country. The President claims it's the right thing to do, and also that he really didn't want to do it. Newscasters emphasize that he was reluctant to do this -- often using that precise word. Oliver: "Reluctant has always been the best tone to use when inspiring troops about to go into battle!"

A Russian gang has stolen a massive amount of online passwords, so it's time to change them all... yet again... groan. Last Week Tonight presents a list of words you can use in passwords that no one will be able to guess. The first two: ALANALDANEWBATMAN and PITTSBURGHOLYMPICS2024. A crawl at the bottom of the screen offers more: "freeblagojevich", "johnmayer_egot", "lazenbybestbond", "mrlobsterbrownies", "teamheigl", "michaelbaymodernfellini", "veganandinevermentionit", "johnoliver=christiangrey", "mrschrisbrown", "kimye4ever", "vassarfootball", "moonitselfisfaked", "1000fishbutts" and "rieslingdelicious".

Gaza makes it successfully through a three-day cease-fire, although Israel claims rockets were fired at them before its end. "Is it too much to ask that a cease-fire in Gaza last a little longer than fucking Bonnaroo?" Even when they're hopeful, it's over depressing, unambitious things -- if not a sustainable peace, then maybe a sustainable quiet.

CNN reports on a new Android app called "Bomb Gaza," a game about killing civilians with air strikes. Oliver: "That's what I always thought the problem with Gaza was, no one had turned it into a game yet. It just wasn't fun until now." It's not the only one; screenshots are presented of the title screens of a few more, representing both sides. One presented, "Rocket Pride," looks a fair bit like a reskinned Flappy Bird. Gaza Assault: Code Red allows you to pilot a drone to attack Palestinian towns. Oliver: "Just think about that! Someone could have been playing these games on their commute to work, while real rockets were being fired! "Oh shit, I missed my stop! This is the worst thing that could have happened to anyone today!" War is a popular game topic, but diplomacy, regrettably is not -- which is why LWT offers its own game concept, "World of Peacecraft." "Critics are already calling it 'Uncomfortably boring,' and 'Off-puttingly complicated.'"

Main Story: Payday Loans
A nine billion dollar industry that's only existed for twenty years, a local news story informs us that there are more payday loan stores in America than Starbucks and McDonalds. Oliver: "I didn't know there was more than anything in the U.S. than McDonalds, including people and grains of sand!"

A selection of companies is listed: "You've got Fast Cash, Cash Central, Speedy Cash, Quik Cash with the word 'Quick' spelled wrong, and Kwik Kash with both Quick and Cash spelled wrong. 'Cause what could be more reassuring than a business that can't correctly spell either their product or the speed at which they're getting it to you?"

It's not just the payday loan business -- there's now services for matching you to lenders. One of them, MoneyMutual, has been hawked extensively on TV by Montel Williams. "That car repair bill: paid! Medical emergency: handled! Extra cash until payday: done!" Oliver: "Done! Thanks Montel! One question though: how the hell are you a financial spokesman? Hey everyone! Isn't that the guy who did that episode on how it's hard to be the less pretty conjoined twin? Everybody be quiet! This guy might have some pretty sound financial advice!"

Let's start with a definition. What is a payday loan? According to an ad voiced by a cheery young woman, the "Ace Cash lady": "A payday loan is a quick way to get the cash you need to cover an unexpected expense, like a car repair or a doctor bill. It's called a payday loan because the loan balance is typically due on your next payday." Oliver: "Clearly, this lady is psychotically friendly, and also, seems to have an appealing product. So, how much might a company charge for this sort of service?" Wait, why is the sky getting ominously dark?

From news reports:
"Often it's 300 or 400 percentage points on an annual basis."
"Average annual rates of 570 percent."
"Some of those rates, legally, are as high as 1,900 percent a year."

Oliver: "1,900 percent! Even the most demanding abusing football coaches only ask for 110 percent!"

Payday loan companies will claim that these are meant to be short-term loans, but studies indicate that three-quarters of industry volume is generated by customers who must re-borrow before their next pay period. "Payday loans are the Lay's Potato Chips of finance. You can't have just one, and they're terrible for you." And besides gigantic interest rates, miss a payment and you'll be hit by hidden fees as well. A number of people are presented who all say they thought they would be paying one thing, but ended up paying costs far higher. One man relates: "I borrowed 250, I thought I would pay 325, I actually paid 700 dollars, but it would have been 1,100 had I not gone to the bank and put a stop to it."

Oliver: "Eleven hundred dollars! It is not often that a metaphorical slippery slope costs as much as an actual ski vacation! Payday loan companies present themselves as a way for you to get back onto your feet. They don't want you to get trapped in debt! In fact they'll help you if you fall behind. Remember the friendly Ace Cash lady from before?"

Lady: "What happens if you can't pay back your loan? Sometimes people have a hard time paying us back. (smiles) We'll be there to work with you if that should happen!"

Oliver: "Yeah. No shit you'll be there for them! Your business model depends on it! Because an actual Ace Cash training manual for employees featured a diagram [depicted is a circular chart, labeled "The Loan Process"] which starts with a customer applying for an Ace loan, moves through them spending the money on that loan, being unable to pay it back, and being forced to apply for an Ace loan again. You'll notice that has certain roundness to it. It's basically a recycling symbol for human misery! (singing) It's the 'Circle of Debt! And it screws us aalll....'"

Lest you think that all payday loan companies are irredeemably evil, the CFSA, or Community Financial Services Association of America, would like to assure you that their members are different. Oliver: "They even brag about it, in one of the most boring videos on the internet." Video: "In our industry, let's be honest, there are some companies out there that don't even follow the law, let alone follow a standard of best practices like our member companies do."

How good are their companies, and their "best practices?"
Advance America: Agreed to pay $18.75 million to settle a class-action lawsuit over charging illegally-high interest rates in North Carolina.
Cash America: Ordered to pay $19 million in refunds and fines for overcharging service members and destroying documents. ("Illegally overcharging service members is a ballsy move. They must have been the ones driving around with the bumper stickers saying 'Extort Our Troops.'")

But these kinds of settlements are actually a rarity, "which brings us to why the payday loan industry is seemingly unstoppable: they are incredibly good at avoiding regulation." An example is the state of Texas, which tried to rein in the payday loan industry. "But they faced opposition from one particular state legislator."

Video clip, speaking is Texas State Representative Gary Elkins: "Members! I just do not see why this legislation could possibly be necessary unless it is the big institutions trying to squeeze the little guys!" Oliver helpfully explains, by "little guys," he doesn't mean borrowers, he means the payday loan companies.

The video continues, and another representative, then-representative Vicki Truitt challenges him: "But isn't it true that you have twelve very successful payday and title loan locations across this state? Isn't it true that you stand to add to your personal wealth considerably by killing these bills? Mr. Elkins, do you know the meaning of the term 'conflict of interest?'" Oliver (southern voice): "Do ah know it? Madam, I am the physical embodiment of that term at this very moment!"

"You might be thinking that that woman, Vicki Truitt, is awesome, fearlessly calling out how the payday loan industry influences politicians. Which is why it's going to be so hard to tell you that just 17 days after leaving office, she signed on as a lobbyist for Ace Cash Express, you know, the circle people." Texas has a finance commission to oversee the payday loan industry -- but it's run by William J. White, vice-president of Cash America! "That's right! The Chairman of the commission that oversees the payday loan industry is also, at the same time, a vice-president of one of the biggest payday loan companies in the country. I call dingo! I call dingo on that man!"

"So let's just quickly break all of that down. If you are helping to protect Texans from the payday loan industry, you would need to approach a commission overseen by the vice-president of a payday loan company, and then introduce a bill into the state legislature, where the owner of twelve payday loan stores will debate the merits of the payday loan industry with one of the payday loan industry's future fucking lobbyists. Apparently, even clusterfucks are bigger in Texas."

When Illinois passed an act regulating loans with terms up to 120 days, some payday loan companies simply changed their loan terms to 121 days. When Arizona forbade payday loans, many companies switched to title loans instead. Oliver likens it to Legislative Whack-a-Mole. Most amazing of all this is Ohio, where they capped payday loan interest rates at 28% for businesses licensed as short-term lenders. But, "where one mole falls... another mole shall rise." There are now no businesses licensed as short-term lenders in the state. There are now a number of companies registered as mortgage lenders, offering people "short-term mortgages of around $300." We get to watch a lawyer for one of these companies explain this to a judge.

Oliver: "Why even bother calling yourselves mortgage lenders?? Why not call yourselves Peanut Butter Octopus Companies?! You can't regulate Peanut Butter Octopi, they don't technically exist!"

And in those few cases where states succeed at imposing stringent regulations, payday loan companies have one last trick: partnering with Indian tribes to obtain sovereign immunity in order to avoid state regulations. "That's right! Some payday lenders are currently dressing themselves up as Native Americans. I thought only Johnny Depp was allowed to do that!" A clip is shown describing the efforts of one such company called (really) "Cash Fairy." As in: "You'd better get me that money by midnight, or yer gonna get a visit from the Cash Fairy." (That is, a man with a baseball bat.)

Payday loan companies are maddeningly difficult to regulate. The thing is, people sometimes need them. A Pew survey found that most people who used them said the companies took advantage of them, but most also said they provide relief. 41% eventually had to resort to borrowing money from family, or pawning possessions, or taking other measures, which they could have just done in the first place. And their celebrity commercials are everywhere.

So, Last Week Tonight offers a celebrity commercial of their own, to remind people to explore all their better options first.

"Hi, I'm Sarah Silverman. If you're considering taking out a payday loan, I'd like to tell you about a great alternative. It's called Anything Else. The way it works is, instead of taking out a payday loan, you literally do anything else. Sell your sperm! Sell some blood! Throw yourself in front of a rich guy's car, he'll throw money at the problem just to make that shit go away!"

"Are you an old person and need money? Take things. You're old! No one's going to stop you, you're not going to go to jail! Go to the grocery store right now, fill up a cart with everything you need and walk the fuck out of there!"

"You know what? People will pay you to pee on them. This is true. Doodies too! Doodies are more, like double! I know this for a fact, I... it doesn't matter, but it's something that you have to do every day anyway, right? By not doing it, you are literally flushing money down the toilet. It's irresponsible: there's money inside of you! It's like Dorothy having the power to go home the whole time."

"The point is no decision in your life will be worse than dealing with these payday loan motherfuckers. They're motherfuckers. They're fuckers of mothers. So if you're thinking about getting a payday loan, just simply pick up the phone, then put it down again and do literally anything else. Do it now!"

Russia
Tensions between Russia and America have escalated since the annexation of Crimea. This week, tensions rose to a whole new level. Putin showed a picture of Obama with a poodle alongside himself with a cheetah. Then a laser light show was held wishing Obama a happy birthday by illustrating a banana being inserted into his mouth.

Oliver: "If you had told me fifty years ago that Russia would one day attack the United States with lasers, this would not have been what I was expecting. Also, to be honest, that [the light show] was not the work of the Russian government, it was a bunch of Russian students, presumably from their racist AV club."

"This, however, was the Russian government:"
MSNBC: "Putin has banned food imports to Russia for one year, including food and vegetables from Europe, beef and pork from Australia, and soybeans and chicken from the U.S."

Oliver counters by noting, hey, our chickens and soybeans are single, they can play the field. Chickens are on Tinder right now, and soybeans on Grindr. "Soybeans are gay. How is that a surprise to people?"

To show Russia what they're missing, um... let's just say it involves a stripper pole, someone in a giant raw chicken suit swinging around it, and the words "Work that pole like a rotisserie, you dirty bird!"

Finally, a few outtakes of Sarah Silverman doing her lines. "Suck a dick. Suck a dick! Suck a dick."
posted by JHarris at 12:22 PM on August 11, 2014


"So let's just quickly break all of that down. If you are helping to protect Texans from the payday loan industry, you would need to approach a commission overseen by the vice-president of a payday loan company, and then introduce a bill into the state legislature, where the owner of twelve payday loan stores will debate the merits of the payday loan industry with one of the payday loan industry's future fucking lobbyists. Apparently, even clusterfucks are bigger in Texas."
this bit was truly genius reporting.
posted by rebent at 12:39 PM on August 11, 2014


I think I started noticing this a few weeks ago, but it kept jumping out at me this week: it seems John Oliver's started doing the not too uncommon late night talk show host thing where he repeats the silliest part of the joke, sometimes just twice but sometimes this week ("Bella. Team Bella. Team Bella...") more than five or six times?

Leno's the first one I noticed doing this, over a decade ago, and I assumed that was part of what made him kind of a hack?
posted by nobody at 3:53 PM on August 11, 2014


I think that's something he picked up on Daily Show. I agree, it's largely unnecessary and kind of distracting, although it's been a minor foible for me so far. I think he mostly does it to fill out time while the studio audience is laughing/applauding, so he's not just him sitting waiting for the ruckus to peter out. He doesn't seem to do it on The Bugle, for instance.
posted by JHarris at 5:08 PM on August 11, 2014


Yeah, and I don't think he did it at all in the first few weeks of this show, or if he did it flew under my radar. I might find it extra frustrating because it ends up emphasizing the broad stroke bits, where I like him best when he's being either dry or cutting.

But I still like the show. This just stuck in my craw enough to make me want to come by and say something.
posted by nobody at 5:22 PM on August 11, 2014


I really liked the Silverman sketch.
posted by Ik ben afgesneden at 5:20 AM on August 12, 2014




Also, I'm not sure why I keep spelling Oliver's first name as "Jon," probably because of Jon Stewart. I should be really sensitive to John spelling issues, considering my own first name.
posted by JHarris at 12:37 PM on August 15, 2014


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