As the Obama administration continues its full-on assault on aspects of the private sector lending industry, Americans are now supposed to believe it’s purely a coincidence that the beleaguered U.S. Postal Service suddenly wants to offer financial products. The plan would see the failing agency begin offering those same loan products presently in the crosshairs of the administration’s Operation Choke Point to millions of Americans with little or no credit.
Democrats on the Hill naturally think this is a great way to save the Postal Service and protect low income Americans from allegedly predatory lending practices. But the plan is yet another unjustified interference with the free market in favor of a government-centered program and massive new bureaucracy in the making. Here are the top ten reasons your Post Office shouldn’t be your bank:
10. Because you stand in line enough already at the DMV
Government agencies have never been accused of being models for efficiency and customer service. Proponents of USPS lending believe that the sheer number of Post Office storefronts will provide greater access to financial products. They fail to acknowledge that private sector lenders already have thousands of accessible locations and an efficient online process for lending. The reason consumers overwhelmingly prefer private storefront and online lenders is because of the convenience and anonymity of taking out the loans. It’s hard to believe that that the USPS, already known for its inefficiency will provide anything close to the service consumers currently get from private lenders.
9. If you actually have a job, it’s not open when you get there
The Post Office opens after you start work for the day and closes before you’re done. So, if you have to be at your desk by 8:30 and punch out at or after 5pm, heading to the Post Office to get your payday loan is probably not going to happen. Improving access to services would mean extending hours — which would cost millions the Postal Service doesn’t have.
8. The same guy who gives you stamps would be your financial advisor
Say what you want about private sector banks and those payday lenders, but when you use them to access financial products you are dealing with individuals who have at least some financial expertise. There is peace of mind for the customer and because those companies are assuming the risk, they have a vested interest in making sure consumers make smart choices. The guy stamping “fragile” on that package for your aunt in Toledo doesn’t cut it.
7. It may actually violate federal banking laws
Not that this would matter to the Obama administration, but it may be illegal to begin with. The USPS proposal has suggested that loans would be repaid by having paychecks or government benefits deposited onto a “Postal Card.” The Postal Service would take loan repayments from what is deposited on these cards giving them first crack at your money. Even the left has sounded the alarm about this disturbing tactic, and when the President doesn’t even have the support of his base, you know there is something to be concerned about.
6. As if the IRS and NSA don’t have enough of your personal information
Elizabeth Warren and administration don’t want to talk about this, but pushing people to use the Post Office as their lending institution will give the government access to Americans’ financial information on a scale never before seen. With the CFPB tracking credit card purchases, the NSA monitoring communications, and the IRS being used as a political hammer, the last thing Americans — particularly low-income ones — need is the government having more of our personal information. That leads to more control over our daily lives and the potential involvement of federal law enforcement in debt collection.