Government Workers Reluctantly Turn To Pawn Shops Amid Shutdown
About 800,000 federal workers have now missed their first full paycheck due to what is now the longest partial shutdown in United States history. As these workers continue to feel the financial pinch, increasing numbers are turning to pawn shops to help make ends meet, the New York Times reports.
In a typical “pawn” transaction, the shop lends money to the borrower, who provides something of value as collateral. The borrower can repay the loan, plus interest, or consider the item sold to the pawn shop after what is usually a period of a few months.
Michael Mack, who owns a shop in Las Vegas, is waiving interest charges for furloughed federal workers in light of the ongoing shutdown. This is uncharted territory for some federal employees, who may find themselves setting foot in a pawn shop for the first time in their lives.
Mack recounted the story of one first-time customer who was there to pawn a piece of family jewelry in order to pay for Christmas dinner.
“She was so scared to be in there,” said Mack. “She never expected this to happen to her.”
Some federal employees have been surprised to learn that their pawned items don’t generate as much cash as they were expecting. A first-time customer in Virginia, a place with a heavy concentration of government employees, was disappointed to find that a television set would bring only $75 instead of the several hundred he was expecting.
This is bad. Wake up @senatemajldr and put the American people first.
Pawn Shop Owner Says He Sees 10-20 Federal Employees Every Day During Shutdown https://t.co/pvxIe0m5Jb
— Rashida Tlaib (@RashidaTlaib) January 16, 2019
Virginia pawnbroker Richard Andrews says he can usually tell if someone walking in the door is an affected federal worker.
“You can tell a lot by people’s shoes,” Andrews said. “They have dress shoes on. They’re not wearing tennis shoes or running shoes.”
The financial pressure on government workers during the shutdown will increase as time goes on. Like Mack, who is waiving interest charges for furloughed workers, pawnbrokers and other short-term lenders throughout the country have found ways to help those hurt by the shutdown.
Bruce Harris, a pawn shop owner in Kansas, told CBS that many of his customers remain confident that they’ll see relief soon when their tax refunds arrive. That optimism might not last, he says, if after that the shutdown continues. His shop is offering government workers payday loans that will carry zero interest to be paid in full upon workers receiving their first paycheck once the shutdown is over.
President Donald Trump and congressional leaders continue to negotiate an end to the shutdown, with Trump’s border wall funding remaining the central sticking point.
