Today S. 398 received 2^nd reading tightening up regulations on the pay day lending industry. S. 398 has some good, yet there’s one prickly point that I regret not making an attempt to amend on 2^nd reading (we can’t amend on 3^rd). This bill creates a central database with the government. That’s right, to keep you from going to more than one lender, big bro will have a database of your loan(s).

The proponents of this legislation have good intentions; they want to help prevent our citizens from getting into a cycle of debt, borrowing from Peter to pay Paul. I’ve heard Clifford Bryant say a million times “I don’t like to put the key in the door of the drugstore and tell myself this day is for the banker”. Believe me, if Daddy taught me anything, it is to be careful of debt.

Ya’ll also know I’m uncomfortable supporting any kind of new regulation on most things. If Johnny wants to loan Jimmy some money and Jimmy and Johnny agree to the terms, why should the government get involved in the stipulations, interest rates, etc? Why do they need to ask government permission and then why should government offer the specifics. Can’t the market decide these things?

So you say we outlaw crack cocaine so government needs to intervene sometimes and protect our citizens. That’s a good argument. We all agree that crack cocaine should be outlawed yet no one would agree on outlawing cheese fries. Both are bad for you but these are two extremes. There is a line to be drawn somewhere. When in doubt, side with liberty has become my philosophy.
 
I cannot support S. 398 bill for one reason. I can live with the new regulations, but the database gives me grief. Last year, I voted against the narcotic central database, but didn’t raise any sand about it. Now we’re creating another big brother database and I can’t imagine when this slippery slope will end. It’s too late to amend this bill on 3^rd reading Wednesday, so I’ll need to sit this one out. Yet the next central database that comes up for any reason, let’s put on the brakes! Do I sound like an extremist? Consider what Barry Goldwater proclaimed at the RNC in 1964.

On Thursday (02.21.08) morning at 9:30 am I will be a guest on the ETV show “This week in the Senate” (click here to watch) with President Pro Tempore Sen. Glenn McConnell. The topic will be on proposed spending caps legislation and the discussion will also include sunshine on government expenditures. Below are highlights of the spending caps legislation. The cap would be a constitutional requirement capping spending on all government bodies in the state. Below are some reasons for a need for this cap:

STATE AND LOCAL SPENDING COSTING TAXPAYERS TOO MUCH: SC NEEDS SPENDING CAPS

Government Grew Three Times Faster Than Families’ Income
Since 2004, state spending has grown nine percent each year, but SC families’ income has only grown three percent

State Spending Is Skyrocketing
In 2007, SC state spending grew by eighteen percent – that is twice the regional and national average rate

Local Spending Is Out of Control
For the past ten years, local government spending has grown almost eight percent every year
In 2006, school districts, cities and counties collected more than $13 billion – almost twice the state budget
Local government raised more than $4 billion in local (government) fees, most of which cost SC businesses
Fees and other charges are increasing at a rate of 14 percent each year
Average millage shot up from 277 in 1997 to 357 in 2005

Existing “Limitations” Won’t Slow Spending
The SC Constitution (Article V, Section 7) has a loose limit on spending that can be overridden and is so high that state government will never come close to reaching it

SC Tax Burden is Growing Faster than Other States
South Carolina’s total per capita tax burden is one of the highest in the Southeast, and second highest in the nation among states with similar personal incomes

Government Spending Must Be Slowed
Without spending caps, economists predict that by 2010:
Property tax relief will be cut by 45 percent
SC will lose 6,557 jobs
SC will lose $852 million in investment
SC personal income will fall by $321 million

Limitations Must Be Comprehensive
Lawmakers must ensure that government does not cost more than everything else in the economy – state and local government limits should be tied to a multi-year averaged index of consumer purchasing power or the cost of consumer goods and services

Spending Caps Must Be Constitutional, Not Political
State government alone cannot be trusted to limit itself – the people must force them to do it and ensure that limits are not later overturned by lawmakers
Exceptions for extreme states of emergency – as declared by the governor – would allow for additional expenditures

Local Spending Must Be Capped
State spending caps alone will not save taxpayers from a higher tax burden — local government spending costs taxpayers billions of dollars a year. County, city and district spending must also be capped

Unless state and local spending is capped, the taxpayer burden will continue to rise and businesses will be forced to cut jobs and investments. Spending caps are the only way to ensure that taxpayers and businesses are protected from out-of-control government growth

Nothing in the foregoing should be construed as an attempt to aid or hinder passage of any legislation. Copyright 2008. South Carolina Policy Council Education Foundation, 1323 Pendleton Street, Columbia, South Carolina 29201. Visit the Policy Council online

Business lobbyists weaken efforts for strong anti-illegals law

The impact of illegal immigration on our state is staggering. It is estimated that state and local taxpayers paid $187 million last year to provide public services to illegal immigrants, such as medical care, education and law enforcement. It is also reported that the hiring of illegal immigrants in South Carolina has resulted in a reduction in wages paid to South Carolinians.

The magnitude of the problem is obvious and seems to be getting worse each day. According to The Economist magazine, between 2000 and 2006, South Carolina was one of only three states with a growth rate in its illegal immigrant population that exceeded 50 percent.

Additionally, we have received testimony that the use of illegal workers has created an unlevel playing field. Businesses that operate with legal workforces cannot compete against those with illegal workforces in bidding on contracts.

The blame rests in Washington where Congress has refused to act on the issue of illegal immigration. All they have done is mandate costs and pre-empted our ability to act except in very limited areas. They do not even enforce the laws they have passed. It is within the narrow confines of those permissible areas and in the areas that are not being enforced that we sought to act.

Because of Washington’s failure to secure our national borders, the S.C. Senate has been working on this matter for more than a year. Last week, we amended our immigration bill and returned it to the House of Representatives. The House will now either concur in the Senate amendment, or the bill will be the subject of a conference committee where the differences between the two versions will be worked out.

What the Senate passed is much better than the status quo, and is much stronger than earlier versions passed by either the House or Senate. However, it is not as good a bill as it could have been.

Among other things, the bill requires employers to verify the legal status of their employees. We considered a provision allowing federal I-9 forms to be sufficient verification as an weakness, since the I-9 is the basis of the failed federal verification system we are trying to correct. Fake Social Security cards and fake out-of-state driver’s licenses are all that is needed for the I-9, and federal law prohibits scrutiny of these underlying documents. We, therefore, offered amendments to assure a meaningful employee verification system similar to a plan enacted in Arizona, which has been effective and upheld in the federal courts.

The first amendment removed the faulty I-9 as a verification option. Having lost that amendment, we offered another that created a South Carolina form similar to the I-9. But unlike the federal form, it could be scrutinized by state officials for its validity. Neither of these plans placed an undue burden on South Carolina businesses, but each was defeated by a business lobby spearheaded by the South Carolina Chamber of Commerce.

The people of our area need to know that we offered and fought for an amendment that would have required employers to take reasonable steps to ensure that the people they hire are legally in this country. They could have done this either by reviewing the applicants’ South Carolina driver’s licenses, participating in the federal government’s E-Verify system, or filling out S.C. I-9 forms.

None of these steps would have placed an undue burden on businesses and would not have subjected them to fines if they mistakenly hired an illegal worker who had false documents. In fact, we sought to accommodate any concern that senators had about our amendments being too burdensome on our small-business owners. However, no matter how hard we tried to make this work, it seems that the major problem our opponents had with our amendments is that they would be effective in stemming illegal immigration. That seems to have been the problem.

The state Chamber of Commerce and its lobbyists worked against our amendments and their pressure worked. Their allies defeated any attempt to have meaningful enforcement.

We believe that the future well-being of our state and its citizens requires us to be vigilant in our efforts to do everything we can to stem the influx of illegal immigrants into our state. That is why the Senate passed a call for a constitutional convention that would allow the states to protect themselves if Congress continues to fail to act. That is why the Senate passed a bill that would require all state-government business to be conducted in English only.

But we also need to ensure that our businesses compete on an even footing and that the businesses that hire legal workers are not put at competitive disadvantage by those that intentionally do not.

We report to you on our unsuccessful efforts to strengthen reform and, sadly, on the success the Chamber’s lobby had in blocking more meaningful reform. With federal pre-emption in so many areas, what we asked for in reform was not overreaching or unreasonable. In fact, we consider the intensity of the lobbying effort against our reforms by those with vested interests in keeping the flow of illegal workers open to be a testimony to the effectiveness of our proposals.

Sen. Glenn McConnell, R-Dist. 41, represents Charleston County and is President Pro Tempore of the S.C. Senate. Sen. Chip Campsen, R-Dist. 43, represents Berkeley and Charleston counties.

Thursday 02.14.08 was dominated with a committee report from S. 398 bill that deals with pay day lenders. We’ve agreed to work all day Tuesday 02.19.08 (happy b-day to me) instead of having Judiciary & Finance Committee meetings. Here’s some highlights of the committee amendment on the bill:
-one loan per customer at a time (industry-wide)
-one-day cooling off period
-monitored by a real-time statewide database
-establishes an extended payment plan option
        -no additional cost to the customer
        -equal installments up to 60 days (4 pay periods)
        -prohibits additional loans while in the plan
-requires a state board annual report to the General Assembly
-sets the loan amount to 25% of the customer’s income during the term of the loan or $500 whichever is less