No One is Stopping Banks from Ripping off Soldiers at US Bases

Fort_Hood_Natl_Bank-e1389936052936New Orleans    You find some dangerous things going along the side road on the way by Susie’s house, but I’m going to take you there with me to see some scary rip-offs of everyone, but especially soldiers and other members of the armed forces.

There was a report on the top ten financial institutions that make their money as a percentage of deposits from various banking fees like converting overdrafts to short term loans and the like.  Keep in mind that overdrafts are always big business for banks who scooped in $32 billion in 2013 along on fees for bouncing checks.  The drift of the storyline of the Wall Street Journal’s review of federal filings of banks was that five of the top ten banks reporting the highest level of bank fees as a percentage of deposits from 2010 were housed in Walmart stores, led by Woodforest Bank.  And, they were right, since obviously Walmart is aiding and abetting a ripoff of its largely low-and-moderate income customers, which I have to heartily condemn.

But, they were silent on another part of the story, which was equally predatory, and directed at vulnerable soldiers, which is likely the real story here:  the top ten banks making most of their money on these up to 300% interest rates on fees were almost always cheek to jowl with military installations and directly, if not solely, catered to the military.

Of the top ten, likely nine of the banks were designed to cash in on their proximity to military bases and the soldier’s syndrome of long months and short money.  So, yes, Fort Sill National bank, has a lot of stores in Walmarts and so does City National Bank and Trust Company, but both are headquartered in Lawton, Oklahoma, the home of Fort Sill.  First Convenience Bank is also one of the top ten on fee income and is number two in Walmart locations, but it joins Fort Hood National Bank in the number nine position on the list as both being headquartered in Killeen, Texas, which of course is the home base of Fort Hood.  Number seven and number ten on the list are lighter on doing business at Walmarts, but calling themselves the Armed Forces Bank of California located near all of the naval bases in San Diego and the Armed Forces Bank headquartered in Fort Leavenworth, Kansas, says it all doesn’t it?   Nor do I have much doubt about the militarily oriented predatory business model of Academy Bank headquartered in Colorado Springs, undoubtedly named in honor of the nearby Air Force Academy.   So, yes, perhaps Sunbank in Phoenix is just a small outfit with a huge amount of its money coming from fees, but I would bet money a map search puts them near the gates of Luke Air Force base.  Just as I would not be surprised at this point if Southern Commerce Bank in Tampa isn’t right up against MacDill Air Force base or the other military outfits from naval to boots on the ground in Tampa.  So, yes, Woodforest National Bank, based in the upscale Woodlands suburb of Houston is a bloodsucker for the Walmart crowd with branches in over 700 Walmarts, but the rest are putting dollar sign targets on the backs of uniformed military around the country and ripping them off right and left.

We have a Military Lending Act passed several years ago which was supposed to protect military from predatory loans, but both the top brass and Defense Department, Walmart, and Congress is allowing predatory financial institutions like these banks and others to deliberately, and almost exclusively, target military and military institutions to reap their ill-gotten gains.  How can Congress or the Consumer Financial Protection Bureau allow this?  This is when we have to wish Elizabeth Warren was a Senator in her birth state of Oklahoma or in Texas where she lived and taught so long, and not Massachusetts, but surely there are plenty of elected officials willing to stand up for the rank and file military against the banks?  Or, am I kidding myself again?


Conservative Institute Scolds Republicans on “Faulty Moral Arithmetic”

New Orleans  You honestly can’t find too many more conservative outfits than the American Enterprise Institute, so when it’s president, Arthur C. Brooks, issues an upbraiding to his fellow Republicans on the op-ed pages of the nation’s premier conservative mouthpiece, The Wall Street Journal, it almost gives a fella hope.  Almost, anyway!   And, when he makes the case that Republican positions are immoral because they do not embrace caring for the poor, it warrants some attention; though I’m not sure this guy has much long term job security anymore.

He cites a study by NYU psychologist Jonathan Haidt of 132,000 Americans that,

“…care for the vulnerable is a universal moral concern in the U.S…” holding that “citizens across the political spectrum place a great importance on taking care of those in need and avoiding harm to the weak.  By contrast, moral values such as sexual purity and respect for authority – to which conservative politicians often give greater emphasis – resonate deeply with only a minority of the population.  Raw money arguments, e.g., about the dire effects of the country’s growing entitlement spending, don’t register morally at all.”

I just know that Congressman Ryan was chafing at reading this as he shined up the House budget proposal and its 10-year plan to deal with debt, read subtext to hammer Social Security and Medicare.

Brooks argues to his elephant herd that they need to go in another direction, and actually “make improving the lives of vulnerable people the primary focus of authentically conservative politics.”  Big flappy ears are hearing the call of “compassionate conservativism” again from the Bush era, and I bet they are standing their ground.

Admittedly most of what Brooks really says is repackaging and better marketing of the same policies under the softer texture of “caring” for the poor and elderly.  So, he is not in favor of simply bashing the unions and bureaucrats, but is in favor of exactly the same policies that would devastate union members and government protections.

I’m not sure how he reconciles the morality of all that, which makes the Republican dilemma even more difficult than a simple rebranding or re-messaging of the same ol’ slop.  As my old lawyer used to say constantly, “if it looks like a duck, quacks like a duck, and swims like a duck, it’s probably a duck.”  And, not an elephant.