What’s Wrong With Gov’t, Part 4,323,876

This is absurd.

With its grand clubhouse and 18-hole course that Arnold Palmer helped design, the former Whitewater Country Club near Peachtree City didn’t seem to be the kind of project that would need help from the federal government.

Yet when a businessman wanted to revive the struggling club, the U.S. Department of Agriculture, through its Rural Development branch, agreed to guarantee 90 percent of his $6 million loan.

The turnaround plan flopped — leaving taxpayers on the hook.

18 comments

  1. Mad Dog says:

    Erick,

    Glad you posted this. Well done. Why is government helping bankers make money?

    Could it be that too many banks have legislators like Cagle and Richardson on their boards of Directors?

    Just another conflict of interest issue.

    I won’t put it off just on Cagle.

    I’m just saying banks have an unusual amount of power in this state.

    Including holding companies that own over lenders that seem almost as bad as title loans and paycheck loans.

  2. conservativecore says:

    This is par for the course, pun intended. I mean how many courses does the state currently own, again? Just another good conservative south move I guess. Maybe Sonny can turn his 100 acres next to mossy woods or oaky road or wherever into a course and sell it to the state. Or better yet he can get Saxby to have the Feds buy it before he is sent to the back bench

  3. DougieFresh says:

    If a golf course is needed, won’t the market forces decide the matter? Every time we tinker with what I think is a natural force, we get burned.

    Of course, someone will justify this boon-doggle in their own mind because they love golf. But, until we as individuals are willing to say no to the subsidies we like, we have no right to say no to the ones we hate.

  4. gatormathis says:

    what they failed to mention in this same time period, the Solid Waste Management Authority of Crisp County was given a USDA Rural Development loan of 70 million dollars. It was a guaranteed loan from the banks, that was backed by the USDA.

    70 million bucks, that’s a lot of dough to spread around. You would think a newspaper would be curious enough to want to know where it all went.

  5. Why did USDA classify Fayette, an affluent Metro Atlanta county, as being an “undeveloped rural area?” Fayette has a population of over 100,000 and the highest median household income of any county in Georgia.

  6. conservativecore says:

    They reviewed the data while sitting on a bridge to nowhere in Alaska. Clearly the cold must have caused dimentia and they probably transposed some numbers.

  7. IndyInjun says:

    This is different than the Georgia congressional delegation’s vote to bail-out airline pensions?

    The risks are transferred to the public, with all rewards reserved for the private interests.

    What did Delta CEO get? $10 million was it?

    They loot public company finances, then throw underfunded pensions on the rest of us.

    So what we end up with is thousands of Georgians who have no pension paying the pensions of some of the highest-compensated union members in the world.

    All courtesy of the GOP, your party of “fiscal responsibility.”

    Say again how bad the dems are?

  8. Mad Dog says:

    Peggy,

    In Georgia, Bank Holding Companies can own a variety of financial institutions. Usually, under the umbrella of the holding company, the ‘owned’ banks operate under seperate names.

    For example, when Cagle et al sold Southern Heritage Bank to Gainesville Bank & Trust Bancshares, GBTB, Southern Heritage continues to operate with a sign outside that says, Southern Heritage Bank. You can pull up Southern Heritage Bank online and get the exact wording used to show the relationship to the holding company.

    The holdiing company, GBTB, owns three consumer lending operations. I don’t know the names or the type of operations.

    Title loans are legal in Georgia and have an annual interest rate as high as 360 percent. (I’m not sure about that information. Please correct me if I’m wrong.) The first month of the loan has the highest rate and the rate does step down.

    Paycheck loans are very short term unsecured personal loans. The interest rate is also over 100%. Many service personel get screwed with this type of predatory lending.

  9. Mad Dog says:

    Other states offer paycheck loans, for example California.

    The rates are as high as 900%

    The term is less than 14 days or until your next paycheck.

    That is why the name, paycheck loans.

  10. DougieFresh says:

    Mad Dog,

    These loans are not inherently bad, and the interest rates as quoted sound bad, but are misleading.

    The loans are meant to be short term in nature, and the company has to make a profit, which means “processing fees” and such would be a large portion of the finance charge. The company has to pay employees and turn a profit, and it simply would not be an available service if the interest rates were not high.

    The problem are the people who mis-use them.

    The going rate in Georgia is about 1.3 % of the borrowed amount per day of the loan. So, if you borrow $10,000 for 14 days, that will amount to a finance charge of $1,820. That sounds rediculous, but these loans are not made out in amounts of $10,000. They are generally in amounts of a couple hundred dollars.

    If $100 is borrowed for 14 days, thats $18.62. Taken as a yearly rate, that can be quoted as a rediculous 484%, but that does not accurately reflect the situation. The $18.62 made by the loan company has to pay for the employee who processed the loan, the risk that the borrower will skip without paying (paycheck loan consumers are not your best credit risks) as well as utilities, advertisments and profit.

    I once considered taking out a paycheck loan when I had a cash crunch once (way back in college) and I would have looked to them as lifesavers if they would have let me borrow $100 bucks for 2 weeks for only $18, if it meant they saved me over a $1,000 in hassles.

    If one truly wants to help these “victims”, I think it would make more sense to teach them about financial responsibility, and not blowing through Friday’s paycheck by Sunday.

  11. Mad Dog says:

    Dougie,

    I’m glad you’re defending bankers. They need all the help they can get. You, Casey Cagle, Glen Richardson, ….

    “I once considered taking out a paycheck loan when I had a cash crunch once (way back in college) and I would have looked to them as lifesavers if they would have let me borrow $100 bucks for 2 weeks for only $18, if it meant they saved me over a $1,000 in hassles.”

    That’s part of the rub, Dougie. The lenders won’t loan a hundred bucks. Nor, with fees, are the rates as simple as you make them out to be.

    Read the link on how this industry treats our Service Personnel and get back to me with your personal thoughts on financial responsibility.

    The real top rate can be $45 per $100 borrowed per week.

    Not the $18.62.

    As for risks, the lenders don’t have to loan the money. So if the borrower skips, using your logic, too bad for them. They should learn how to manage risk!

    Duh! I wish some of you apologists for bankers would hold banks responsible instead of taxpayers.

  12. gatormathis says:

    One of the culminating events of the signing of the 70 million dollar USDA Rural Development loan, was that a lot of contracts were signed in correlation to this recycling plant “beginning”.

    One was that the trash hauler Taylor was involved with got a 25 yr exclusive contract to haul to and fro the plant. Just one tipping fee estimate for this time period was to be 325 million bucks.

    So figure since Dec 1996, almost ten of those years have already passed.

    Time flys when you are having fun. Especially when you are making big money.

    When I quizzed the AJC Reporter why he didn’t mention the 70 million dollar loan, during this same time period, I received this reply:

    ” Thanks for the email. Solid waste was probably a direct loan, a different USDA program than the loan guarantee I wrote about.”

    I also figure it would be great to know the amounts lawyers, project vendors, and project developers make off these size deals. And how many other USDA Programs that loan money are there.

    Looks like so far, we got a Golf Course Division, a Nursing Home Division, and a Trash Dump Division.

    How many more do we need?

  13. Mad Dog says:

    Gatormathis,

    Did you read the audit report on the millions spent by the US government to oust Castro?

    Some of the money was spent buying cashmere sweaters in Cuba. (ALL of the money was to be directed to Cuban political activists working to get rid of Castro. I guess when you’re fighting a dictator in camo fatigues, your side has to look good, too.)

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