The Community Financial Services Association has submitted a petition for withdrawal of the latest bit of policy-based evidence-making at the CFPB, its White Paper on Payday Lending and Deposit Advance Products. Ballard Spahr’s CFPB Monitor blog summarizes the petition. The critiques are clearly correct to me, most notably the lack of any support whatsoever for the normative claims made in the White Paper.
Reading the CFPB’s study, one is once again left trying to figure out “Where are the economists?” Having worked at the FTC, I couldn’t imagine how the economists there would let such a shoddy work product. Certainly this wouldn’t even pass the laugh test if it were submitted to a peer-reviewed economics journal.
The amazing thing is that the quality of the payday lending white paper is actually, if anything, better than the CFPB’s White Paper on Overdraft Protection.