George Mason University law Professor Todd Zywicki has written a compelling counter to a New York Times story on auto equity lending that was published Christmas Day.
Writing on The Volokh Conspiracy blog, which was posted on The Washington Post website, Zywicki does an outstanding job pointing out the fallacies, weaknesses and bias of the article with a full dissection of the arguments made in the story.
“As I have illustrated previously,” Zywicki writes, “The New York Times has come completely off the rails when it comes to ‘news’ coverage of consumer credit issues. Indeed, it appears that the paper is not even making an effort to distinguish news reporting from editorializing, as its Christmas Day article, “Rise in Loans Linked to Cars Is Hurting Poor” indicates. (The title in the url is equally suggestive — “Dipping into auto equity devastates many borrowers.”).
You can the entire blog post here:
Briefly, here are the major points Zywicki makes in the post:
- Those who use auto title equity loans have limited options;
- Consumers use auto title equity loans for pressing expenses;
- Auto title equity loans provide limited risk of financial breakdown;
- The risk and consequences of repossession are not as extreme as might be supposed:
- Consumers generally understand the costs and risks.
“At root, the fundamental problem with The New York Times’s article is that people are not as stupid as the Times reporters think that they are,” Zywicki writes. “Consumers use (auto equity loans) for a variety of complex reasons and those who use these loans typically do so because they are better than the alternatives – eviction, utility cutoffs, or the like.”
It is refreshing, and frankly rare, to read a fair and balanced article on our industry, members and products let alone a full-throated defense of the services we provide to consumers.