Payday Loan Scam Still Going Strong In Ontario. Louis Shalako.

Louis Shalako

Simple charity will never be the solution to poverty. The problem is simply too great, too pervasive.

There are too many reasons. There is no one, single cause of poverty in this province and this country.

The subject is so complex, it is best to tackle the reasons one at a time.

***

The payday loan scam is still going strong here in Ontario, presumably in the rest of Canada as well.

This is the one, where people who are already well below the poverty line, whether working full or part-time, on the Ontario Disability Support Program or the so-called Ontario Works benefit, (welfare), the elderly, the mentally-ill, and yes, the addicts and the alcoholics, line up to borrow a hundred bucks, perhaps a couple of hundred, in order to make it through the month.

Sometimes it’s some small, unexpected emergency, a car repair or the kids need clothes for school. There are certainly legitimate reasons for a small, short-term loan in the family household.

Whatever. Ultimately, the scammers are taking the taxpayer’s money out of the mouths of the hungry.

My neighbour went to a so-called ‘cash-store’ last month. She says she went twice. She borrowed a total of $220.00, and at the end of the month, when she got her ODSP benefit, she repaid a total of $273.00.

The total term of the loans were less than two weeks. That is fifty-three dollars and some small change on a loan of a couple of hundred bucks, for less than two weeks. These interest rates are usurious, and the worst part, is, she’s starting off the next month, almost three hundred dollars down—in a hole, and her total benefit is the provincial disability benefit of $1,151.00 per month. She doesn't actually get all of that, due to some help from CMHA.

She’s on disability. The Canadian Mental Health Association kicks in on the rent, I don’t know how much because she doesn’t either. She’s out on a Community Treatment Order. Her social worker shows up every day to make sure she takes her medications, otherwise its back to hospital for her—maybe even permanently, although her illness seems to respond well to continuing treatment.

She’s back there every month, (I mean the cash store), and this has been going on for years. 

Basically, they’re like pimps, living off the avails of someone else’s disability pension. Sure, its nickel-and-dime shit, but they got a lot of them.

I told her, that if she could just stay away from there for as little as two months, she would have beaten them.

(This coming from a guy who maxes out the credit card every winter when things are slow, and never quite gets it paid off in summer, when things are a bit busier. The yearly rate on the credit card is 28 %, which seems more than high enough. Yet compared to the so-called payday loan operations, it seems almost benign. But it isn't, not really.)

This business is so lucrative, that the money stores have sprung up like mushrooms after a summer rain.

There must be twenty of them in this town, and that is in a city (Sarnia) of only 72,000.

***

I know a couple of guys, they got sucked into transferring their credit card balances to a service provider offering a much lower interest rate. It was an introductory rate—less than half of what they were paying.

It worked so well, that they ended up transferring their balances around about every six months…and they signed up for a handful of new credit cards as well. After all, it was so much easier to make the payments, and they were both working. 

Naturally, sooner or later, they ran into trouble. A layoff, a slowdown in the work, illness, a bad break. They were always maxed out and therein lies the problem.

Ultimately it turned into a bad debt for all parties. Their credit was destroyed, and the debt was ultimately uncollectable. When all this occurred, they were so enthusiastic, they sucked a few others in as well. Oh, yes, they told me all about it. The thing practically sold itself. 

Anyone that could get credit, that is, and there are a few who can’t, and never will.

It was good for nobody, in the end—not everyone ends up like that, of course. Some people smarten up and learn the credit game in the end. Maybe they just didn’t have so many bad habits. Maybe they’re just lucky. Maybe they’re continuously employed somewhere…in which case they can make the payments.

Once you scratch the surface of the problem, it quickly becomes clear that the solution to poverty requires a plan, one that takes into account all aspects of the problem. A plan that attacks from all directions at once, a plan that involves all levels of government, federal, provincial, regional, county and municipal. It will require the cooperation of certain institutions, banks, business, commerce, industry, and private NGOs.

It has to involve the individual as well.

This plan will require some very well thought-out tools and an enlightened, long-term policy that all can commit to.

END

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The Road to Hell. Louis Shalako.

Louis Shalako

Recently, a radio personality here in the local market said something interesting. He said that suicides are not reported as such out of respect for friends and family of the deceased. That’s fair enough, bearing in mind all funerals are announced, and that pretty much everyone who isn’t completely destitute gets some kind of obituary. The general public doesn’t necessarily need to know the cause of death, although there are often mentions of ‘a courageous battle against cancer’ and the like.

But I have been curious for a long time, as to just what percentage of clients of the Ontario Disability Support Program, or Ontario Works, (welfare), commit suicide in any given year. 

The most cynical answer is politics, it is public opinion. It is also a little bit about how such things work.

This figure is completely bogus, okay? I made it up: but let us say that there are roughly 750,000 ODSP clients in the province of Ontario, and let’s say there are a further 125,000 on Ontario Works benefits. (That part's real enough. - ed.)

If a half of one percent of that group, or those groups, committed suicide in any given year, this could now be compared to other social, demographic groups.

And the fact is, it would probably compare unfavourably.

That is to say, it would be more—

And knowing that, we could investigate the causes, and apply some remedy.

One would think.

We don’t know for sure—we don’t have those statistics. But surely gut instinct, as well as reason, tells us that the rate for people on these programs would be measurably higher than the suicide rate among plumbers, sport fishermen, snake charmers, mountain climbers, or any number of groups in higher economic brackets.

Surely this would be a political hot potato by any ethical standard.

Surely the opposition parties, both right and left of the currently ruling Liberals, here in Ontario, would make much of such a thing.

Maybe that would be just. Maybe that’s just—

But, in fairness to the Liberals, no preceding government has ever attempted to gather those statistics, for if they had, surely this would be a matter for the public record. And, (and this is gut instinct again), certainly no upcoming government would ever undertake to record, and to gather, and make use of those statistics, because they know the only answer is money.

And all they have are thoughts and prayers.

The road to hell has always been paved with good intentions.

Whoops. Almost forgot my point. But somebody somewhere, a cop, a doctor, a coroner, knew whether it was a suicide.

This information is available ladies and gentlemen.

They just don't want to know.

For obvious reasons.

END

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Some Respectful Suggestions for the Province of Ontario. Louis Shalako

Louis Shalako




Okay. I just sent this email to incomesecurity@ontario.ca 


Hey, guys.


May I respectfully suggest.

This government would do a very great service to Ontario’s 750,000 clients of the ODSP if they were to raise the allowable earnings from business and employment.

This might be to raise the rate for a single person from $200.00 up to $500.00 per month, and something on the order of $1,000.00 to $1,500.00 per month for single adults with a family of four, i.e., three dependents. A second spouse might qualify for another $350.00 in this scheme.

This government might also consider reducing the rate of clawback, say going from fifty cents on the dollar to something more like twenty-five percent.

The mileage rate for business, employment or medical travel should be raised one cent per year for the next fifteen years, reflecting relatively high fuel and transportation costs and the aging of the population, with a view to preventative medicine and quality of life.

This government should consider a Special Housing Benefit for clients of the Ontario Disability Support Program. This would be over and above proposed and pending provincial and federal housing benefits. This is because clients on the base pension are still at thirty-five or forty percent below the poverty line, this at a time when rents are easily running at 70 % of the pension, in this writer’s experience. Clients are still lining up at food banks, scrambling for odd jobs, and trying to avoid making the smallest mistake, which is stressful to say the least.

Certain disincentives to employment should be addressed, not the least of which is certain bogus mathematical processes of the ODSP and Ontario Works.

Consider the following problem, (and I know you will laugh when you read it. Yet you also know it is true.)

A client makes exactly $200.00 over the allowable limit in any given year. Let’s call it 2017. 

This entitles the ODSP to a fifty percent clawback, of $100.00, off of the total yearly pension and an overpayment is assessed.

The next year, the client works exactly the same hours at the same rate of pay. They’re $200.00 over the allowable earnings limit. Again, the ODSP has the right to assess an overpayment of fifty percent. And so, therefore, ergo, they take another $100.00 off of the yearly pension benefit. As we can easily see, a pension, (using nice, simple, round figures), that once stood at $13,500.00 per year is being eroded, at a rate of $100.00 per year, and yet the client is no better off—in fact, in this scenario, the fact that they are working, no more and no less hours, at the same rate of pay, chips away at their eligible benefit.

They’re losing a hundred bucks a year, for the privilege of saying that they’re working.

Of course, most of us aren’t really capable of doing the math, are we?

And we never think to ask the question.

Louis

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