Governor Pledges To Rein In Payday Loans

In February Gov. Richardson announced plans to address the growing problem of payday loans by imposing regulations through the Financial Institutions Division. NMPIRG has been advocating in the Legislature for protecting consumers from payday and other predatory lending practices.

New Mexico is one of only a handful of states that does not currently regulate payday loans and other short-term predatory lending practices like car title loans. This results in a high number of predatory lenders; only Mississippi has more per capita. The highest concentration of payday stores is in the poorest parts of the state, Gallup and Grants.

Although advertised as short term loans, the average borrower in New Mexico has to roll over their loan six times. A two week loan becomes a three month loan with interest rates at 500 percent. The borrower is quickly paying more in interest than the original amount of the loan. Thousands of New Mexicans are getting caught in a debt treadmill as a result.

“We applaud the Governor’s efforts to protect New Mexicans from payday and other predatory lending practices, but we hope the rules developed will ban triple digit lending and give the consumer at least 90 days to pay off their loans,” said Jeanne Bassett, Executive Director of NMPIRG.

Students Launch Textbook Campaign

STUDENTS TAKE ON TEXTBOOK PRICE GOUGING—UNM PIRG’s student leader, Katryn Fraher, gathers signatures to help reduce the cost of textbooks. Students pay an average of $900 a year on their books.

This spring the NMPIRG campus chapter at UNM launched their Make Textbooks Affordable Campaign. Currently students are spending an average of $900 a year on textbooks, and the prices keep going up. Textbook prices have increased at four times the rate of inflation since 1994.

“Students are concerned about the high cost of college textbooks. With tuition rising, we are worried about our ability to pay for college as it is—the rising cost of textbooks adds to that concern,” Katryn Fraher, UNM PIRG student leader.

Students often have to buy new editions of textbooks which are barely different than the previous editions, making it difficult to find used books. Publishers are producing unnecessary new editions of textbooks simply to make more money.

In addition, students are often forced to buy a textbook bundled with other items, such as CD ROMs and workbooks, that are never used for the classes.

The campus chapter is working with the UNM Bookstore to look at setting up a book swap as other campuses have done.

NMPIRG Decries U.S. House Cuts To Student Aid

Despite strong opposition from NMPIRG and other state PIRGs, the U.S. House voted to cut $12 billion from college student loan programs, the largest cut in the history of the programs.

“The House completed the largest raid on student aid in history,” explained NMPIRG’s federal Higher Education Advocate Luke Swarthout. “At a time when college costs continue to rise and students are going deeper into a financial hole, Congress has decided to use students and families to pay for other priorities.”

Rather than cutting lender subsidies, the bill derives most of its savings by continuing the practice of forcing student and parent borrowers to pay excessive interest rates on their loans, and by increasing interest rates for parent borrowers.

Nearly 70 percent of the bill’s total student loan cuts of $20 billion come from students and families.

In the same budget bill that authorized these student loan cuts, Congress also called for up to $70 billion in tax cuts

SAVING THE ARCTIC—Though pro-drilling advocates promise to renew their fight, the Arctic National Wildlife Refuge was spared once again. The Refuge is the last pristine section of Alaska’s North Slope.

Arctic Protected For Now . . .

On Dec. 21, the United States Senate voted to drop a provision calling for drilling in the Arctic National Wildlife Refuge.

Arctic supporters celebrated the eighth straight year of stopping drilling plans. Unfortunately, the victory will again be a temporary stay in a longer-term campaign by drilling proponents to open the last pristine section of Alaska’s North Slope.

The Senate voted in late December to remove drilling language from the defense spending bill. Immediately afterwards Sen. Domenici of New Mexico declared, “We’re going to do ANWR next year, and we won’t get it messed up like we did this year.” The state PIRGs and our allies will be ready.

Soot Pollution Makes Air Unsafe For 96 Million

More than one third of all Americans live in areas with unsafe levels of fine particle pollution, or soot pollution, according to a Jan. 19 PIRG report, “Plagued By Pollution.”

PIRG researchers analyzed nation-wide data on 2004 emissions of soot, which can trigger asthma attacks, heart attacks, strokes, lung cancer and even premature death. Recent scientific studies show that adverse effects occur at levels below the current national health-based air quality standards.

Even at these too-lenient standards, 96 million Americans breathe air polluted with soot at levels that could cause harm. The state PIRGs are urging the Bush administration’s environmental officials to adopt a tougher standard for soot pollution.

FDA Lets Drug Makers Off The Hook

In a sweeping change to long-standing policies, the Food and Drug Administration’s (FDA) new drug-labeling rules would give drug-makers protection from lawsuits filed in state court.

The change comes despite lessons from unsafe drugs like Vioxx, which find their way to the pharmacists’ shelves even after safety trials expose dangerous side effects. There have been 60,000 deaths from Vioxx-associated heart attacks.

According to FDA whistle-blower Dr. David Graham, the “FDA is part of the problem.”

The FDA’s new rule would shield drug makers from the only recourse for consumers, by throwing out the claims of consumers even if the drug-maker defied state law, or if the FDA review was proven inadequate.

Coalition Presents Lobbying Reform Plan

With Congress under the gun to strengthen the rules governing lobbying in the wake of the Jack Abramoff scandal, a coalition including the state PIRGs has laid out a road map on how to do it.

The competing proposals moving through Congress each take some important steps, but none include the comprehensive reforms required to change the way in which business is done in Congress.

The coalition, which includes the state PIRGs’ national lobbying office, called on Congress to enforce ethics rules through an independent ethics commission, slow the revolving door, prohibit private interests from financing trips, ban gifts to members of Congress, and strengthen disclosure reports.

“With Congressional elections around the corner, senators and representatives are eager to take some action, but it ought to be strong reform that fixes the problem, not the symptoms,” said Gary Kalman, the PIRGs federal democracy advocate.