On a beautiful day in Olympia, when the evidence of spring is all over the Capitol Campus, I had the opportunity to give testimony in front of the House Business and Financial Services Committee against predatory lending. Here is my testimony:
Members of the committee, my name is Rabbi Seth Goldstein and I am here representing the Jewish Coalition for Justice, a coalition comprised of rabbis and laypeople, organizations, congregations and individuals, committed to bringing the spiritual and moral teachings of Judaism and the experience of the Jewish community to bear on issues of public policy and communal concern in our state. The JCJ stands in opposition to ESSB 5312.
We are currently in a time of economic uncertainty as we as a nation move out of a recession, yet are still faced with issues of income inequality and a growing wealth gap. These issues are spiritual issues, for in my religious tradition, Jewish teachings and values are applicable on issues of civil society and interpersonal values, and this includes issues of economic justice. Applying these teachings to consumer installment loans in general and this bill in specific raises moral concerns.
We are taught in our sacred scriptures, in the book of Leviticus (25:14), “When you sell property to your neighbor, or buy any from your neighbor, you shall not wrong one another.” Fairness and honesty in our business dealings are paramount, and creating new loan products to roll back prior regulation, regulations which the Jewish community has advocated for in the past, does not in my opinion meet this test. Neither does lowering interest rates while establishing new fees, which is a semantic change, not a substantive change.
Judaism does not dispute the necessity of making loans and incurring debt. However, we are taught in our sacred texts that loans are meant to lift a person out of poverty, not keep him there. They are meant to strengthen, not weaken. They are meant to lead to self sufficiency and independence, not continued debt and dependency. [Maimonides, Mishneh Torah, Gifts to the Poor, 10:7]. Consumer installment loans again do not meet this test.
The types of loans spoken of in this bill prey on the most vulnerable on our society, trapping people in a vicious cycle of debt. When one is enriched at the expense of another, we must ask hard questions about what is fair and just in our society.