And the one speck of food that he left in the house was a crumb that was even too small for a mouse …
“And then he did the same thing to the other Whos’ houses, leaving crumbs much too small for the other Whos’ mouses.”
I am sure that many of you recognize these famous words from Dr. Seuss’s How the Grinch Stole Christmas, but for Indian Country, Grinches have been stealing Christmas, Easter, Memorial Day and every other holiday and non-holiday for far too long.
Recently, First Nations released a report titled, Building Trust: Consumer Protection in Native Communities. The report highlights the role of consumer protection laws, a safety net enjoyed by the rest of the United States’ citizens, and that serve as important protections, including:
- Intended to maintain adequate protection and high ethical conduct in transactions related to business and financial services; and
- Statutes that govern sales and credit practices involving consumer goods and can include prohibition of deception, unconscionable dealings, or usury caps.
But markedly missing in most reservation and tribal economies, the lack of consumer protections, opens up tribal citizens to financial abuses, including subprime lending, housing market collapse, abusive practices of predatory lenders, fraud and deception in loan transactions and a lack of access to mainstream banking services.
As we have pointed out in previous articles about the growth of community development financial institutions (CDFIs) in reservation economies, the growth came about as a way to meet the real need for access to credit in reservation economies, where:
- 28.9% of American Indians and Alaska Natives are under banked; and
- 15.6% are unbanked.
And where banks and credit unions fear to tread, predators lick their lips. Previous studies by First Nations demonstrate that Native communities use Refund Anticipation Loans (RALs) at higher rates than non-Native communities, and 71 percent of tribal leaders indicate that predatory lending is a problem in their communities.
In First Nations’ seminal report “Borrowed Time: Use of Refund Anticipation Loans Among EITC Filers in Native American Communities”, 10 states highlight that the cost of RALs and tax preparation fees stripped $22.8 million from already impoverished Indian communities.
In addition to combatting predatory lending and creating viable alternatives for capital, like CDFIs, in reservation economies, tribes can and have developed consumer protection laws to protect tribal citizens. For example, seven Native nations have passed consumer protection laws, leading to key tribal legislation that is an exercise of sovereignty and an expression that tribes take the protection of their citizens seriously.
Within the Building Trust report, First Nations made key policy recommendations for tribes that can help develop consumer protection laws, including:
Native leaders should consider jurisdictional issues and tribal infrastructure for enforcement;
- Native nations can offer access to alternative loan products;
- Native nations can collaborate with broader statewide activities; and
- Native nations can provide consumer and financial education.
It is past time for leaders and policy makers to put strong policies and practices in place to protect its citizenry. Don’t you think the time has come for Indian Country to quit accepting and fighting over the crumbs that are “much too small for the other Whos’ mouses?”
