Senate lawmakers in South Carolina are debating a bill today that would put regulations on payday loans in the state. Sen. Wes Hayes and others are pushing to put tighter regulations on the industry.

The bill currently would limit payday loans to a limit of $500 and consumers would only be able to get one at a time. This is of course to prevent the 1 in every 100 people who pays off one payday loan by getting another.

Since critics can always use fictitious anecdotes to generously spread their propaganda, perhaps I could employ the use of an anecdote to illustrate the reality of payday loans.

Sam Johnson is a 23 year old recent college grad living in Rock Hill, South Carolina. He works your normal 9-5 office job as an entry level employee trying to make it in the world. He takes home $950 per paycheck every other Friday.

Sam rents a condo for $750 a month. Two days before his rent was due, Sam's car broke down. Since he drove 20 minutes one way to work and no bus route went that way, he needed it fixed in order to get to work each day.

He spend $650 on repairs that he would have spent on rent. Rent wouldn't be late for another two days though, so it was ok. Except that he wasn't getting paid for a few more days. He realized that with only $100 left in his account, he couldn't pay his rent on time.

He contemplated paying late. But that was $20 a day in late fees. He didn't want to pay $100 in late fees. He thought about writing a check and hoping his landlord wouldn't cash it until he got paid. But bounced check fees and insufficient funds fees and overdraft charges plus his late rent fee would have been too risky.

But he thought he heard something about payday loans once. He went to go borrow $650 just for five days until he got paid. He got the money and paid his rent on time. When his $950 check was deposited, he paid back the $682 he owed to the lender.

Oh no wait...the Senate of South Carolina decided it would be better to protect Sam by not allowing him to borrow over $500, even though he could afford to. So Sam only got $500, couldn't afford to pay the whole rent, got depressed, lost his job, and moved back into his parents basement and now plays World of Warcraft all day long.

Thank you South Carolina Senate for limiting consumers' options in an attempt to "protect" them from potentially harmful decisions. Thank goodness the government knows what's best for us, goodness knows we don't!