Credit Card Legislation Passes in Senate
The Senate voted overwhelmingly on Tuesday to put new restrictions on the credit card industry, passing a bill whose backers say will make card-issuers spell out their terms in fewer words, using plain English, and treat customers more fairly.
This follows a similar House bill. After the differences between the two are worked out, a final bill goes to Obama for signature.
Frankly, I'm surprised it passed so quickly. This must be the give-away legislation for voters so as to distract us from the on-going bank bailouts and inadequacies in the housing rescue bills and stimulus. Not to mention the potential taxpayer subsidy behind this as well.
First, here's some data I didn't know:
Credit card debt has increased by 25 percent in the last decade, with delinquency rates up by more than a third since 2006, according to statistics cited by the White House. Americans pay $15 billion in penalty fees a year, accounting for about 10 percent of the industry’s revenues. About one-fifth of those carrying credit card debt pay more than 20 percent in interest.
The Times also has a piece today on how card holders with good credit and payment records may see their fees rise in response to the banks' new inability to rip off the more unstable among us. It's a curious piece, talking about how good payers have until now been getting a "free ride" but also, I think, trying to incite outrage among those of us with good credit histories. It also harkens back to the olden days of credit issuing when only people with good credit had access to it.
A time, I'd add, when there was a lot less wealth inequality in the U.S. I, for one, am willing to pay more for greater stability across the market, though I'm less enthused about subsidizing the banks' outsized profits that they've gotten used to since usury laws were relaxed in the 1980s. And until Obama reigns in these same old banks, then I suspect that that's exactly what I'll be doing.
(Photo by liewcf)
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