Usury Proscriptions Forgotten in Mississippi

Living in a very Christian state, most Mississippians should remember the biblical proscriptions on usury.

Here’s one: “Thou hast taken usury and increase, and thou hast greedily gained of thy neighbors by extortion, and has forgotten me, saith the Lord God.” (Ezekiel 22:12)

Many Mississippi leaders have forgotten.

Once Mississippi’s maximum annual finance charge was 8%. Anything over was usury.

Indeed, such usury rules were the law of the land through most of the 20th Century. Starting in the 1980s, states including Mississippi began to relax these rules. Lately, Mississippi has caved in to special interests.

The 8% maximum charge remains in law today, but the legislature has added exception after exception. Today, every special interest has its own rule allowing higher rates.

Market forces tend to keep rates for credit-worthy borrowers reasonable. For the least credit-worthy, however, market forces tend to evaporate. Reasonable finance charge caps are their only hope for fair rates.

Mississippi Today reported 18 states, including Arkansas, Georgia and North Carolina, prohibit extremely high lending fees, with movement underway in Alabama to do the same.

Contrarily, economic freedom apologists funded by the wealthy Koch brothers’ network, e.g. MSU’s Institute for Market Studies, strongly push a worldly view that there should be no caps at all.

State caps on bank finance charges are 10% or 5% over the federal discount rate for traditional loans, 10% or 5% over the 20-year U.S. bond rate for mortgage loans and loans financed by stock, and 1.75% per month (21% annually) for credit cards.

Caps on closed-end credit sales charges are 24% and on loans over $2,500 are 15% or 5% over the federal discount rate.  There is no cap for mutually agreed upon finance charges for loans of more than $2,000.

Caps on rates for used car refinancing range from 18% to 28.75% and for mobile home financing from 15% to 25% based on amounts financed.

The top rate for pawn shop charges is 25%.

The top rates for small loan companies used to range from 14% to 36% based on the size of the loan. In 2016 the legislature added an “alternative” finance charge cap of 59% for loans over $4,000.

Getting kind of high?  Well, consider the following levels for the least credit-worthy.

Payday loan companies can charge up to $21.95 per hundred dollars for 30-day loans up to $500, an annualized rate of 263.4%.

Title loan companies can charge 25% per month for a contract up to $2,500, an annualized rate of 300%.

And, since 2016, there are “credit availability” installment loans with finance charges up to 25% a month plus a 1% origination fee for six-to-twelve month installment loans up to $2,500. That’s an annualized rate of up to 297%.

Mississippi’s Catholic Bishops called such rates “predatory.” Clarion-Ledger columnist Jimmie E. Gates called for “more stringent regulations on the amount of interest and fees they can charge.” Greenwood Commonwealth Editor Tim Kalich called the practice “sinful.”

“For the love of money is a root of all kinds of evils. It is through this craving that some have wandered away from the faith.” (Timothy 6:9-10)

Faithful Mississippians should think about these things as next year’s elections approach. Should our policy be to pray for the poor, or to prey on them?

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PERS Sees Taxpayers as Their Evergreen Money Tree

The PERS Board of Trustees seemed happy last week after hearing from their actuary. The funded ratio for PERS increased and investment returns were up.

So, are things turning up for PERS?

Only if you don’t mind your pocketbook getting raided.

Here’s the story. As the actuary report highlighted, PERS’ funded ratio moved from 61.1% to 61.8% (the minimum prudent level is 80%), investment returns for the year hit 9.16%, and wage increases were less than expected. But, as the report did not highlight, significant trends continued to weaken PERS – the unfunded pension amount increased, from $16.8 billion to $16.9 billion, the annual payout to retirees increased by $131.5 million, the number of retirees jumped up 2,713, and the number of active employees fell 1,695.

PERS now covers 104,973 retirees, up 28,830 over ten years. There are 150,687 active employees in PERS, down 16,435 over ten years. This trend of more retirees but fewer active employees is the fundamental flaw undermining PERS finances.

This flaw was exacerbated this past year when, for the first time ever, total payrolls covered by PERS fell.

Why is that not good?

PERS is funded by employer and employee contributions along with investment returns. These contributions are percentages of payroll, 15.75% for employers and 9% for employees. One of the actuary assumptions used to compute the funding ratio is that payrolls will grow every year, so total contributions will grow too. When that doesn’t happen, it throws off the actuary’s projection. When you add flat to negative payrolls to the negative trends above, the flaws in PERS funding become fatal, unless new money is found.

So, how did the funding ratio go up if these trends are in place?

As your pocketbook is about to show you, lots of new money was found.

Starting this past July, PERS increased the employer contribution rate from 15.75% to 17.4%. This higher rate times total payrolls will up annual contributions by nearly $100 million. Over the 30-year period used to calculate the funded ratio, this adds nearly $3 billion to projected revenues.

That’s a lot of new money. Where will it come from?

Well, public schools’ share of PERS payrolls is 37.5%, state agencies’ 17.5%, universities’ 16.2%, municipalities’ 9.8%, counties’, 8.2%, community colleges’ 4.9%, and other public entities’ 5.9%.

If the legislature only squeezes the increased $18 million for state agencies into its already stretched budget, the remaining $82 million will be passed on to you, the taxpayer, in the form of increased school and property taxes, increased tuition and fees, or fewer teachers and reduced basic services. Another, big, unfunded state mandate forced on local governments.

If the legislature, which put PERS into this terrible financial bind to begin with, chooses to cover more of the cost, where will it get the money?

You know.

Here are some scattered estimates of the yearly impact from higher employer contribution rates based on audit reports: among school districts, DeSoto County $2.5 million, Jackson $2.4 million, and Rankin County $1.6 million; among community colleges, Hinds $880,000, Northwest $507,000, Itawamba $405,000, Meridian $262,000, and Mississippi Delta $209,000; among municipalities Tupelo $341,000, Meridian $325,000, and Greenwood $181,000; among counties, Madison $270,000 and Lowndes $183,000.

Yep, PERS sees taxpayers as their evergreen money tree…and the legislature lets them.


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Unseemly Politics Belies Christian Seeming Mississippi

In 2017 Gallup reported Mississippi had retained its spot as the most religious state in the U.S., with 59% of residents calling themselves “very religious” and another 29% “moderately religious.”

A Pew Research Center report published in 2015 counted 83% of adult Mississippians as Christian. That would approximate 1.9 million adults.

Making up most of the 83% were 79% associated with religious denominations; the other 4% were nondenominational Christians. The breakout by denomination showed 48% Baptist, 7% Methodist, 6% Pentecostal, 4% Catholic, 2% Presbyterian, 2% Church of Christ, less than 2% Episcopalian, less than 2% Lutheran, 1% Free Methodist and other Holiness Family Churches, and about 6% other denominations.

Pew reported 49% of adults attend religious services at least once a week. This suggests at least 1.1 million Christians attend church weekly in Mississippi.

They attend at least 4,465 Christian churches —the number may be significantly higher since all Missionary Baptist Churches are not enumerated. A Clarion-Ledger story in 2017 counted 2,132 churches in the Mississippi Baptist Convention, 987 United Methodist Churches, 364 Church of Christ congregations, at least 300 churches in the General Missionary Baptist State Convention of Mississippi, 191 Pentecostal Churches, 122 parishes in the Jackson and Biloxi Dioceses of the Catholic Church, 89 Episcopal Churches, and 80 Seventh-day Adventist Churches. The article did not include Presbyterian Churches of which there are over 200.

That’s lots of Mississippians attending lots of Christian churches, all studying the same Scripture, all bound by the same New Testament commandments – “Love the Lord your God with all your heart and with all your soul and with all your mind” and “Love your neighbor as yourself.”

All this makes Mississippi a truly Christian seeming state.


The same Pew report showed 44% of Mississippi adults considered themselves Republicans, 42% Democrats, and 14% leaned toward neither. Logically, that means the vast majority of Republicans and Democrats must be Christians, and should love each other.

Yet our politics belies that – the partisan voices hurling hate and vitriol and stirring up discord, the forces pitting Christian Republicans against Christian Democrats.

Surely those engaged in such unseemly politics cannot be among the faithful multitudes who are invested with the fruit of the Spirit – love, joy, peace, forbearance, kindness, goodness, faithfulness, gentleness, and self-control?

Implausibly, we even see some who wear the mantle of religion serving as political hacks and using hateful and disingenuous rhetoric to divide Christians.

Strong faith should be a bulwark against such invective, for the faithful know “Every kingdom divided against itself is brought to desolation,” as Jesus said, “and every city or house divided against itself will not stand” (Matthew 12:22-28).

How do you tell whom to believe? The test is simple. The faithful (think Billy Graham) pull believers together and build hope. The pretenders divide and destroy.

“Every man must decide whether he will walk in the light of creative altruism or in the darkness of destructive selfishness” – the Rev. Martin Luther King, Jr.

“Living in the light of eternity changes your priorities” – Pastor Rick Warren.

Imagine the good works over one million Christian adults standing in the light, indivisible in love and peace, could perform in Mississippi.

Pray for leaders who will stand in the light to guide us.

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State Job Recovery More Modest than Terrific

Record numbers of jobs and job growth in Mississippi top political speeches by incumbent politicians these days.

Yes, more Mississippians have jobs now than before the Great Recession.

Yes, more Mississippians have jobs now than ever before.

But, there is more to the story.

Total residence-based employment (the number that includes part-time and self-employed individuals used to calculate unemployment rates) hit 1,223,887 in July. That was up 0.3% from 1,219,739 in July 2008 and a new record.

Total non-farm jobs (the number of jobs at Mississippi establishments) reached 1,165,500 in July. That was up 1.9% from 1,143,800 in July 2018 and a new record.

However, over the same multi-year periods, U.S. employment grew 7.2% and non-farm jobs 8.4%.

While employment was up overall, it was not up in two-thirds of the 82 counties.

Down counties with percentages include: Humphreys -43.6%, Issaquena -42.4%, Quitman -27.6%, Jefferson -27.1%, Jefferson Davis -25.2%, Sharkey -25.2%, Carroll -25.1%, Wilkinson -23.2%, Neshoba -23.1%, Leflore -21.7%, Washington -21.2%, Sunflower -20.1%, Jasper -18.7%, Jones -17.9%, Adams -16.4%, Stone -16.0%, Holmes -14.4%, Walthall -13.5%, Amite -13.3%, Clarke -12.4%, Kemper -12.2%, Claiborne -10.4%, Bolivar -10.1%, Coahoma -9.8%, Warren -9.4%, Panola -8.9%, Perry -8.5%, Lawrence -8.3%, Wayne -7.9%, Newton -7.3%, Greene -7.0%, Winston -6.5%, Franklin -6.4%, George -6.1%, Pike -6.0%, Leake -4.6%, Forrest -4.6%, Lauderdale -4.6%, Covington -4.4%, Copiah -3.5%, Montgomery -3.1%, Hinds -3.0%, Simpson -3.0%, Yalobusha -2.8%, Jackson -2.3%, Lowndes -0.8%, Marshall -0.7%, Yazoo -0.6%, Attala -0.3%.

At the same time, there were a few big gainers. Nine counties saw employment jump by over 15% since 2008.

Up counties with percentages include: Lamar 30.1%, Lafayette 23.9%, Union 23.7%, Webster 20.0%, Madison 19.3%, Tippah 17.3%, Choctaw 16.0%, Benton 15.7%, Clay 15.4%, Pontotoc 14.6%, DeSoto 14.4%, Oktibbeha 14.2%, Lee 12.1%, Noxubee 11.9%, Calhoun 11.6%, Pearl River 11.0%, Tunica 10.6%, Smith 10.2%, Tishomingo 10.1%, Lincoln 10.0%, Itawamba 8.6%, Alcorn 8.1%, Grenada 6.5%, Tate 5.9%, Scott 5.7%, Chickasaw 5.2%, Prentiss 4.8%, Tallahatchie 4.3%, Rankin 4.0%, Hancock 3.9%, Monroe 3.2%, Marion 1.9%, Harrison 1.3%.

What job categories grew?

In the private sector: social assistance 61%, transportation and warehousing 19%, educational services 19%, ambulatory health care 18%, professional and business services 11%, nursing and residential care facilities 10%, leisure and hospitality 8%, utilities 6%, retail trade 1%.

In the public sector: local government 1%.

All other private and public sectors remain below 2008 levels.

Some good news is annual average wages increased in all counties but George and Jefferson Davis.

Some not-so-good news is while Mississippi wages increased, they fell further behind national averages. For 2008, Mississippi wages averaged $33,508, behind the national average of $45,563 by $12,055. For 2017, Mississippi wages averaged $38,788, behind the national average of $55,390 by $16,602. Mississippi wages also increased just 2% faster than inflation since 2008 while nationally wages beat inflation by 8%.

So, yes, Mississippi has recovered jobs lost during the Great Recession and, overall, more Mississippians are working with higher average wages. But with so many counties still lagging below 2008 employment levels and Mississippi’s weak growth compared to national averages, things are really more modest than terrific.

(Data from the U.S. Bureau Labor of Statistics; historic data no longer available from MS. Department of Employment Security.)

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Anomaly vs. Tsunami in Hood vs. Reeves for Governor

And so it begins, the anomaly versus the tsunami, the hope versus the expectation, the last Democrat versus the next-in-line Republican.

Mississippi’s only Democrat holding statewide office, Attorney General Jim Hood, has officially announced his candidacy for Governor. His all-but-announced governor-in-waiting opponent will be Republican Lt. Gov. Tate Reeves.

The night before Hood announced, Reeves was on stage in Southaven pumping up the crowd in advance of President Donald Trump’s highly partisan bashing of national Democrats. “They think they have a chance here,” said Reeves, as reported by the Associated Press. “They got ’em a Democrat governor in Louisiana, they got ’em a Democrat senator in Alabama and they don’t believe that there’s a difference between Louisiana, Mississippi and Alabama…. Let us send this message to the liberals all over the country: Not in our state.”

“It’s time for Mississippi to pull together,” Hood said the next morning as reported by Mississippi Today. “It’s time for this partisan, petty politics to stop.”

These two episodes well describe how this epic battle will be fought.

Reeves will ride the tsunami of highly partisan, conservative politics now headlined by Trump that swept Republicans into control of Mississippi state government over the past 15 years. Hood will stand as the Democratic anomaly, a pro-life, pro-second amendment, Christian candidate who has withstood the GOP surge since it started.

Indeed, Hood is the only statewide Democratic candidate since 2007 who has attracted votes in Republican strongholds. Against a strong Republican candidate, Mike Hurst, in 2015, Hood carried 32 counties that Reeves won against Democrat Tim Johnson. He also carried 33 counties that Trump won the next year. In that 2015 election, Hood won with 55% of the vote, Reeves with 60%. In 2016 Trump won with 58%.

Among the typically GOP counties Hood carried were Alcorn, Forrest, Lauderdale, Lowndes, Pontotoc, Simpson, Union, and Warren. In the bastions of Republicanism – Rankin, DeSoto, Hancock, Harrison, and Jackson Counties – Hood scored 50% to 100% better than other Democrats except in DeSoto.

It is this ability Hood has to appeal to voters who tend to go with Republicans that give Democrats hope. “Hood is the only active state Democratic politician with the name recognition, fundraising abilities and favorability to make a serious challenge to Reeves,” wrote columnist Geoff Pender a year ago.

Of course, it’s one thing to hold on to a post as the incumbent, it’s quite another to win an open seat for governor. In such situations money tends to talk. The Associated Press reported Reeves has well over $5 million on hand compared to Hood’s $750,000.

Then, favorable ratings with the voters matter too. A recent Chism/Millsaps poll shows Hood with a higher approval rating than Gov. Phil Bryant, 52% compared to 50%.  Reeves came in at 37%. (See the Jackson Jambalaya blog for more details).

Some think the Hyde-Smith/McDaniel/Espy brawl that climaxes in November will be a barometer for next year. The thinking goes a narrow Republican win or loss would hold out hope for Hood, while a GOP landslide would suggest Reeves will win as expected.

The dinger to that is Hood’s history of winning over usually Republican voters. He’ll have to do that to knockout Reeves.

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Uncertainty Dims Hallelujah Economic Times for Republicans

Stimulated by Trump’s tax cuts, the national economy grew 4.2% in the second quarter (final BEA estimate), up from 2.1% in the first quarter. Corporate profits jumped 3.0%, up from 1.2%. The national unemployment rate at 3.9% is the lowest since December 2000. Total nonfarm employment is nearly 150 million, the highest ever.  And average wages are the highest ever.

This should be hallelujah time for those in charge, i.e. Republicans.

It’s not. That nasty thing called uncertainty is the problem.

“The one thing all human beings do when they are confronted with uncertainty is pull back, withdraw, disengage,” said former Federal Reserve Chairman Alan Greenspan, “and that means economic activity, which is really dealing with people, just goes straight down.”

Uncertainty over continued economic growth is rising. Increasing oil prices due, in part, to sanctions on Iran; rising inflation due, in part, to tax cut stimulus during an already rising economy; other price increases due to tariffs; increasing costs for health care; and rising interest rates have the potential to negatively impact consumer spending. With consumption accounting for approximately 68% of GDP, lower consumer spending would slow economic growth.

Indeed, Kiplinger cautions growth will slow in the third and fourth quarters and average 2.9% for the year. The Conference Board forecasts growth will slow further to 2.3% by the end of 2019 due to “domestic and foreign headwinds.”

Those foreign headwinds include the growing likelihood for an all-out trade war with China and a shooting war with Iran, plus decaying relations with long-time allies, particularly Germany, Canada, and Turkey.

Uncertainty over whether last month’s uncertainties – the future of FBI U.S. Deputy Attorney General Rod Rosenstein, Mueller investigation guilty pleas, keeping government from shutting down, and the Kavanaugh nomination – will be replaced by another big set of serious uncertainties is of concern.

Who will be in charge come January after mid-term elections is another uncertainty, escalated by Trump’s comment that there will be “violence” if Democrats take control. So too is what impact the rapidly rising national debt, spurred by massive new spending, will have on the economy.

Much uncertainty, of course, comes from the President himself.

“It takes quite a President to preside over an economy with unemployment rates below 4% and not to benefit politically,” read an opinion piece in the Huffington Post.

The New York Times reported that Mick Mulvaney, the federal budget director, told a gathering of party officials in early September that Republicans would fare better in November’s elections if they could “subtract” the president’s divisive persona from voters’ minds, and stress instead that the country is in a “pretty good” condition.

“You may hate the president, and there’s a lot of people who do, but they certainly like the way the country is going,” Mr. Mulvaney said, adding of voters: “If you figure out a way to subtract from that equation how they feel about the president, the numbers go up dramatically.”

An article in the Washington Examiner pointed to Trump’s low approval rating and predicted “grim tidings” for Republicans in mid-term elections.

A glimmer of hope for Republicans is there is still over a month for uncertainty to dim while the economy will still be sparkling.

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What Political Happenings Will Be Big Things by Election Time?

Mississippi politics will be a happening thing through the next two Novembers.

Senate candidate Chris McDaniel didn’t seem to help himself on his national Morning Joe appearance when he said “I’m gonna ask them after 100 years, after 100 years of relying on big government to save you, where are you today? After 100 years of begging for federal government scraps, where are you today? We’ve been dead last for 100 years.” This was in response to a question about how he could convince black voters not to fear him. Gov. Phil Bryant condemned McDaniel’s “characterization of African-Americans as beggars. This does not reflect the beliefs of the Mississippi Republican Party or the average Mississippian.”

Sid Salter called McDaniel’s comment “stunning – even for him.” And the Morning Joe audience in Oxford booed it. But McDaniel’s disparaging sentiment is no stranger across the length and breadth of Mississippi. Will this be a big thing or a little thing come November?

Democratic candidates Mike Espy and David Baria also appeared on Morning Joe. But Republican Senators Roger Wicker and Cindy Hyde-Smith did not. It appears both will also dodge appearances in statewide televised debates. Will this cagey behavior become a big thing or a little thing by November?

If prognosticators are right, former U.S. Secretary of Agriculture Espy and former Mississippi Commissioner of Agriculture and Commerce Hyde-Smith will face each other in a late November run-off in. In that scenario Mississippi agriculture may become a really big thing if farmers side with one ally over the other.

President Trump’s growing trade war with China and resulting tariffs on Mississippi ag exports to China, particularly soybeans, have already become worrisome things to farmers. To ward off McDaniel and get Trump’s endorsement, Hyde-Smith is 110% behind everything Trump, including his tariffs. The general GOP line is that Trump will cut a great deal and everything will work out. That may be less likely now that Trump has doubled down on tariffs to force China President Xi Jinping to accept a deal. However, Xi Jinping will not kowtow to Trump. Losing face like that would jeopardize his newly won “president for life” status. So, will Trump’s trade war with China be a big thing or little thing in November? Espy’s chances may hinge on the answer.

Attorney General Jim Hood surely didn’t get a boost to his gubernatorial aspirations when his prosecutors failed for the third time in two years to convict Hinds County District Attorney Robert Shuler Smith of a crime. Will this be a big thing or a little thing for black voters in Hinds County next year if Hood is on the ballot for governor?

Then there is Lt. Gov. Tate Reeves and the controversial $2 million frontage road project MDOT Executive Director Melinda McGrath said was to be built only because of political pressure from Reeves’ office. The now-in-limbo road would primarily serve the subdivision in which Reeves lives. Reeves said he knew nothing and did nothing. Hood announced his office is investigating. Will this be a little thing or big thing for either in next year’s governor’s race?

Some happenings may seem little, some big. But voters get to decide which, thereby determining if they are helpful or hurtful to our ambitious politicians.

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