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December 11th, 2012:

Is there more redistricting for Texas in the cards?

The short answer is it depends.

For the most part, Republicans are content to keep the interim map used for the 2012 elections — if the courts allow it.

“I don’t sense a lot of anxiousness from either the state or congressional side to open back up congressional redistricting,” said Chris Perkins, a GOP pollster tasked with redrawing the Texas map in 2003. “But if they are forced to act, then they’ll have to do something.”

Privately, Republicans say they expect tweaking to incoming Democratic Rep. Pete Gallego’s south Texas district to include more Hispanics. But the political effect would be minimal and the district would remain competitive.

Democrats and minority groups hold out hope for a redraw that includes new favorable districts around Dallas and Austin. They argue that explosive minority growth in those areas demand new districts.

“I think there’s a good chance the court will make some changes,” said Michael Li, a Texas redistricting expert and Democratic attorney. “I think there’s a strong argument that something needs to be done in central Texas.”

This story is specifically about Congressional redistricting. Democrats hope for further tweaking of the State House map as well. As we know, the brief filed for the state by the Attorney General said that all the issues raised by the DC Court had already been addressed in the interim map by the San Antonio Court, so there’s nothing left to do. There’s no disagreement on that point for the Senate map, but the other two are still in dispute. The main thing I take away from this story is that there doesn’t appear to be any appetite for trying to redo the maps in a more Republican direction by the Lege. I’m not surprised by this – honestly, it’s hard to see how the GOP could realistically do better than they did without violating the DC Court’s ruling – but you never know. Here at least it looks as though if there is to be any further revising, it will be because the plaintiffs want it.

Simpson in, Hughes out to challenge Straus for Speaker

It started with an announcement that Rep. David Simpson would make the Speaker’s race a three-way, which I assure you sounds dirtier than it actually is.

Rep. David Simpson, R-Longview, filed papers to run for Speaker of the House, he said in a letter to colleagues Monday morning. He joins Rep. Bryan Hughes, R-Mineola, in challenging Speaker Joe Straus, R-San Antonio. The election will take place on the first day of the legislative session in January.

Almost before the electrons were dry on the webpage, however, it went back to a two-man race as Hughes dropped out:

State Rep. Bryan Hughes, R-Mineola, is dropping his bid for Speaker of the House and endorsing state Rep. David Simpson, R-Longview, for that leadership post.

You can read Simpson’s letter to his House colleagues, and Hughes’ endorsement, at the link above. Burka was skeptical of this when it looked like a dual challenge might be an attempt to oust Straus via divide-and-conquer. Simpson is a bit of an odd duck, a true-believer conservative who isn’t necessarily an orthodox Republican, for whatever value of “orthodox” is in play this week. It’s possible he could make a real run at this if he gets Democrats on his side, which would be ironic given how Straus ascended to the big chair in the first place. Democrats have every incentive to play hard to get, so a real race could work in their favor. But as was the case back in 2009 when Straus toppled Tom Craddick, none of this means anything until one person or the other can credibly claim to have pledges from a majority of the members. Basically, Straus is Speaker until he admits, or is forced to admit, that he’s not.

How the so-called “fiscal cliff” might affect Texas

There is of course a very simple way to avoid this.

Best when done in Acapulco

If President Barack Obama and congressional Republicans cannot avoid tripping off the edge of the so-called fiscal cliff, then the Texas budget could be more than $1 billion short over the next two years.

But fewer federal dollars flowing through the state budget would be just part of the problem for Texas.

The state could feel an even bigger pinch because Texas is so dependent on other federal dollars associated with defense, homeland security and border protection, said Eva DeLuna Castro, senior budget analyst for Center for Public Policy Priorities.

The potential for cuts to the state budget and to direct federal spending in Texas is serious enough that state lawmakers plan a hearing on the issue next week, with testimony invited from state agency officials and others about the possible impact.

Federal spending in Texas is about one-fifth of the total economy, DeLuna Castro said. Based on 2010 figures, $226 billion federal dollars were spent in Texas. Social Security made up $43 billion of the spending; Medicare accounted for $16 billion, and defense spending totaled $59 billion, DeLuna Castro said.

As far as the state budget goes, automatic federal spending cuts – which would be triggered Jan. 2 by the sequestration outlined in the Budget Control Act of 2011 — could reach $1.1 billion and affect 13 state agencies, according to the state’s Legislative Budget Board.

Just as a reminder, this dispute is over 1) the Republicans’ refusal to approve an extension of the Bush tax cuts for families making under $250,000 a year unless those making over $250,000 a year get the same extension for the top tax rate, and 2) the stupid “sequestration” budget cuts that the Republicans insisted on as part of the deal they made when they took the debt ceiling hostage in 2011. They’re holding out on saving tax cuts for the wealthy even though they have no leverage since the law will change and all tax cuts will expire if nothing happens by the end of the year and the voters made their preference clear last month in the hope of reaching a “grand bargain” on deficit reduction that gives them everything they want. All that needs to be done is for the House to pass the bill that the Senate already passed to extend the tax cuts for all but the top bracket, and there’s a discharge petition in the House that needs 26 Republican signatures to force a vote on that. The sequestration cuts can be easily undone as well, it’s just a matter of the GOP accepting the results of the election and the reality that tax rates are going up no matter what Grover Norquist says. This isn’t rocket science.

I’ll continue to demonize the payday lending industry, thanks

Lawrence Meyers, a shill for the payday lending industry, has a sad.

[Loren] Steffy claims in his blog post (“Will lawmakers finally rein in paydayl lenders,” chron.com) that PDLs are “inherently predatory,” yet a loan cannot be predatory if choices exist, and a person enters into a transaction via free will, with terms and pricing disclosed. Steffy’s inference that borrowers do not “understand the consequences of the terms to which they’re agreeing” indicates he has never taken out such a loan nor visited a store that offers such loans. It is too common for people like him to make unfair pronouncements without the experience to draw upon.

Here’s Steffy’s blog post. If you think it’s unfair because Steffy hasn’t taken out a payday loan himself, then go read Forrest Wilder’s account of taking out a payday loan. Be sure to read carefully the bits in which Wilder describes the obfuscatory language used to describe the loan’s terms, despite the laws that Meyers touts that are supposed to provide borrowers with accurate information. What do you have to say about that experience?

Regarding allegations of very high average percentage rates, borrowers don’t care about APR because loans are not taken out for a year. Customers care about the loan’s flat fee, just like any other product. When you get dinged for a $2 automatic teller machine fee for a $200 withdrawal, do you scream about the APR? No, you scream about the two bucks.

Meyers is counting on people’s innumeracy here in waving off concerns about APR. We use APR to provide a consistent basis for comparison, since payday loans by their nature are short term, as noted. You can say that the rate for a loan that’s due in a week and for which you owe $20 on top of $100 in principal is twenty percent, but the APR for a loan if 20% interest accrued weekly would be 1040%. It’s not a trivial difference, and it’s not at all a mystery why people like Meyers would like to gloss it over.

Consumers have choices, and in the first half of this year, the Office of Consumer Credit Commissioner reported that 800,000 consumers freely chose PDLs over the following loans (the cost for $100 for 2 weeks):

Borrow from a friend or an employer ($0)

Credit card advance ($1)

Installment loan ($3 to $8)

Pawnbroker ($9)

Title loan ($10 to $12)

PDL ($15 to $23)

Online PDL ($25 to $30)

Bank overdraft fees ($40)

Loan shark (no maximum)

While I question how freely some of these choices were made, I do agree with Meyers on one point: Bank fees are too high, and have been for a long time. I have great hope that the Consumer Financial Protection Bureau will take steps to deal with that. Of course, the CFPB is also taking a look at payday lenders, so perhaps that isn’t what Meyers was looking for here.

Simply put, it costs a lot more to get a payday loan in Texas than it does in other states, where there is regulation of the industry. Given that it’s highly unlikely that Texas payday lenders have significantly higher costs of doing business than their counterparts elsewhere, the obvious conclusion is that they’re charging too much. If all goes well, the Lege will deal with that next spring.