THE BLOG
06/14/2010 05:12 am ET Updated May 25, 2011

Rep. Mark Ferrandino - ending the cycle of debt foisted on the poor

I was able to get a short (20 min) interview with Representative Mark Ferrandino today. Mark comes across as a total nerd - or what I would call a smart, straightforward, interesting guy. He's an economics nerd, not a software nerd - but cool is cool. He comes across as a very thoughtful caring guy.

First the question most wanted to know. No Ron Rockvam has not challenged Mark to a duel on the House floor. Mark says Rockvam has been just outside trying to marshal up enough votes. (I have this vision of Rockvam cackling evilly while trying to cast a spell over the various legislators as they pass by - where's Harry Potter when you need him.)

He's been involved in politics and the public sector for most of his life, growing up in a household that was involved in New York state politics, then going on to public sector jobs in D.C. and then state Medicaid. So he comes from a background of government, and a wide swath of government. That's a great set of training for a rep because they can dig in a lot deeper and ask the right questions with that skill set.

Mark also said that what happened to Matthew Sheppard was very significant for him. He saw that as a need to get involved in politics to insure nothing like that can happen again. I find this interesting because it was a great injustice that drove him to political office. What drives you in tends to be what you focus on in office.

Mark is clearly having fun in the job. To him the fun is being able "to have a positive impact on people." He clearly enjoys the work involved in the legislature. He also puts a lot of time in helping other legislators run for office.

So then we got on to payday lending. Rep Ferrandino speaks in very even measured tones about what payday lending is. He is very straightforward as to the impact it has. But in all that he paints a devastating picture of the "cycle of debt when using these predatory lenders." He sat down and worked through how the industry is set up, how it makes its money, what it tries to accomplish. It is an incredibly powerful argument that, looking at what the industry at core is focused on, and realizing that it is all about trapping people in a cycle of debt.

One point he brought up, and I was not aware of this, when someone pays off their loan in full, and has not come back for a couple of months, they will call them up and tell them "we have $500.00 for you" to try and draw them back in. That's not helping only when needed, that's trying to foster a never-ending cycle of debt.

Mark keeps circling back to the business model the industry has and how it revolves around this predatory practice. Because of this he understands how the industry is fundamentally, will always be fundamentally a system where - "this isn't access to credit, this is access to debt."

So will it pass? He isn't sure as both sides think they have the votes. Mark's guess is it will be 33-32 on the vote, but he's not sure which side will get 33. He said along with all the progressive groups helping lobby for it, the faith groups are also working hard to get it passed. (So here's hoping that some of the legislator's look to their religion for a guide - as every religion calls out usury as an evil practice.)

He thinks the payday industry has put in a million dollars lobbying for this. And because the mailers etc. aren't clear about what the bill is actually about (as the average Coloradoan understands usury is bad), they aren't terribly effective.

Mark discussed the argument of let the market decide, but while he supports the free market, he doesn't see the present system as a balanced market because across all the stores 98% of the loans are at the maximum allowed. And that's not a competitive market. On that topic, I then asked if weren't these loans similar to the mortgage loans made to people that couldn't afford them? And as most Republicans blamed those mortgages for the great recession, shouldn't they be opposed to usurious payday loans to the poor just as they are opposed to mortgages to the poor? He said that particular argument had not come up, but that it was similar.

On to what else. He's very satisfied with the job they have done with the budget. There were almost no amendments on the long bill, in large part because there is no money. But he thinks the JBC has done a really good job on the budget.

He also talked about improving the criminal justice center, looking for the best way to handle sentencing, etc. He gave strong props to Governor Ritter for his efforts on this. We also have a decrease in the corrections population this year for the first time in a long time - which saves us some bucks.

Finally Mark talked about looking at work on constitutional reform, calling out Senator Heath's bill as one of the best approaches they have coming up on this.

So what do we get with Representative Ferrandino? First off he has the skills and takes the time to truly understand the issues. But even more valuable, he then knows how to phrase these same issues in a way that is easy to understand, yet gets across the crux of the issue. This is very valuable in the political process because it is a powerful way to sell his proposals. Second, he clearly is focused on accomplishing what is best for the people in Colorado. I never heard him say a single word about political constraints on what he is trying to accomplish.

We're lucky to have him in the legislature.

And a pox on any legislator who votes against payday lending reform. If the Denver Credit Union can offer payday loans today at reasonable rates, the rest of the industry can do so too. And while the state should not step up to right every wrong, it should protect our weakest and poorest from the most egregious exploitation.

Podcast at Mark Ferrandino Interview