As much as I think that government is partly to blame for a lot of systemic poverty problems, I'm going to have to agree with you. I think it's fairly obvious that the poor make bad "loans" even when the interest rates are higher.

At the end, it's all about moderation and planning. One can plan for a high-interest loan, heck I've had one (14%) until recently. It's definitely been an incentive to save, and work on getting it re-financed on better terms.