2280 Bethany Road
DeKalb, IL 60115
The Story of the Loan Shark
Midwest Book Award, Midwest Independent Publishers Association, 2010
An intriguing study of payday lending, loan sharks, and the consequences for the borrowers and society as a whole.
“Quick Cash is a major contribution to public discussions of subprime lending and borrowing. It deserves to be on the reading list of everyone who cares about recent developments in lending and borrowing…. Mayer establishes himself as the expert on the subject of subprime consumer credit, especially payday lending.”—Lendol Calder, Augustana College
With the financial and real estate crises of the late 2000s, subprime mortgage lenders and the homeowners they targeted have been a hot topic and a source of outrage. While financial regulation may help prevent this sort of calamity from happening in the future, lawmakers have largely chosen to ignore another kind of monetary predator who continues to prey upon working class Americans—the loan shark.
Loan sharks may conjure up an image of tough guys in fedoras looking to make a profit off desperate people in dire financial straits, but in reality, lenders who advance small sums of cash at high interest rates until payday existed long before organized crime entered the trade. Today the businesses that fill this niche in the credit market prefer the name ‘payday lenders,’ but most large cities are still a hotbed of usurious lending, and the landscapes are dotted with their inviting and brightly colored storefronts. Despite their more respectable name, these predatory lenders have endured through regulation, prohibition, and the rise and fall of the mob since the late 1800s.
In this intriguing and accessible book, Mayer presents the history of payday lending using the colorful (and sometimes criminal) city of Chicago as a case in point. With an eye to the future, Mayer also aptly assesses the consequences of high-interest lending—both for the people who borrow at such steep prices and for society as a whole. He argues that although some consumers gain from borrowing at high rates, payday lending in its modern form consistently traps many of the wage earners who pawn their postdated checks, leaving them worse off than they were before. Quick Cash is the fascinating and appalling story behind the unscrupulous lending operations that feed off America’s tough economic times and further victimize its citizens.
(2010) 328 pp.,
Robert Mayer is a professor of political science at Loyola University. He holds a Ph.D. in political theory from Princeton University.
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