OBAMA’S CREDIT CARD REFORM IS A FRAUD at DickMorris.com
OBAMA’S CREDIT CARD REFORM IS A FRAUD
By Dick Morris And Eileen McGann 05.22.2009
The widely heralded credit card reform legislation making its way through Congress is a sellout to the credit card companies. Obama has proposed and Congress has passed a series of minor reforms that deal with the fringes of the problem – late billings, retroactive interest rate hikes, misapplication of payments and such – but fail to reform the most basic offense of the companies: their usury.
Congress explicitly rejected any limitation on the interest rate credit card companies can charge. It remains perfectly legal for them to charge rates that would make a loan shark blush.
In our book Fleeced, we explain how, until 1979, credit card interest was subject to usury limits of the various states. But the Supreme Court emasculated these limits by ruling that the state of the lender, not of the borrower, had the sole power to legislate interest rate limits. South Dakota swiftly jumped into the void the Court created, eliminating any usury limits. All the credit card companies moved there and took advantage of the regulatory vacuum to hike up their rates to unconscionable levels.
via OBAMA’S CREDIT CARD REFORM IS A FRAUD at DickMorris.com.
Finally someone hit it in the head of the nail of what the real problem is with credit cards, INTEREST RATES!. I was wondering after all these bailouts, Acorn, Soros, GE, money for Hamas and many others special interest groups leeching money from the system (except the American People) if we were going to get a relief from the credit card companies with a reasonable interest rate, well Obama just answer that question with a window dressing of the USURIOUS interest rates that credit card companies charge. NO RELIEF! is the bottom line.
Congress is a little late. Chase already raised my 0% balance transfer from a former card to 15.99%. My Federal credit union raised my 7.99% fixed rate to 14.99 variable. Home Depot (Citi Bank) raised my 12.99% to 25.99% back in March in anticipation of Congress doing something. Thanks alot from someone who pays their credit car bills on time, and has never missed a payment, They must be bailing out the gentlemen with a Hiatian accent in front of me at Sams Club last week, that went through 5 credit cards that were rejected, before the 6th one was accepted. He had a whole wallet full of credit cards. Think I’ll take out a home equity loan for 4.5% and pay all them off. Than when I’m underwater on my mortgage I’ll get some help…
I think all to often people just don’t understand how to use credit cards, don’t read the fine print and fail to control themselves. With regards to the much heralded promotional rate, there are good deals and bad deals. If you fail to understand the rules and fail to control yourself you deserve the high rates you receive. A bad deal is a low or even zero interest rate for a set period of time such as a year unless your balance is low enough and your are positive you have more than enough to pay it all off before the term is up. Otherwise, you will suffer much as another poster here, Art describes. He doesn’t have anyone to blame but himself.
A generally good deal is a low promotional rate that’s good for as long as you have the balance outstanding. These are most effectively used where one is transferring the balance from a credit card account that is more than 3 percentage points higher than the promotional rate. Upon transferring the balance one needs to cut up the card and eliminate any regular systematic credit card purchases outstanding. If not sure, call the credit card company to list the card stolen and they’ll give you a new account number thus removing any fear of automatic debits you forgot about. Thereafter and this is critical, you always, always make at least your minimum payment with plenty time before the bill is due. The Internet is best method of payment by far. Whether through your own online checking account or making ACH payments through your credit card’s own website. Many credit card companies will even allow same day ACH payments through their website.
I do have issue with Dick’s column on credit card interest rates. His prescription is for even MORE government involvement in the credit card business. This is ALWAYS bad advice. How many actually believe government intervention is good for business. We all like lower interest rates but legislating those rates are best done through the states as opposed to the federal government. With Morris prescription of lower interest rates there would be some unintended consequences, some good, some bad. The good is less credit for those that ought not to have it in the first place. The bad is with more stringent limits on interest rates for all, people with stellar credit histories will likely pay higher interest rates so as to offset the risk of those with a more so-so credit history. We will all likely pay approximately the same interest rate. In other words much like income redistribution, this is credit interest rate redistribution. Enough with micromanaging of business. If one is so out of control or not smart enough to read the fine print, don’t cry to the government for a bail out for your unwise behavior. Take some responsibility.
I GAVE UP CREDIT CARDS A LONBG TIME AGO. I ONLY HAVE A DEBT CARD CONNECTED TO MY CHECKING ACCOUNT. I KNOW HOW MUCH IS IN THERE AND IF I WANT (NOT nEED) SOMETHING MORE THAN THE BALANCE IT JUST HAS TO WAIT. I ALSO HAVE A BUDGET FOR EACH HOUSEHOLD NEED. I SHUDDER WHEN I SEE PEOPLE IN FRONT OF ME USE CREDIT CARDS FOR SUCH FRIVILOUS PURCHASES.
I FEEL ANYTHING AND EVERYTHING oBAMA HAS DONE AND IS DOING HAS SET THIS COUNTRY BACK SO FAR IT WILL BE INPOSSIBLE TO EVER GET BACK ON TRACK. I JUST CAN NOT UNDERSTAND HOW HIS RATEING CAN STILL BE SO HIGH WHEN YOU CAN ONLY SEE THE NUMBERS AND WHO EVER FEELS HIS IDEAS ARE RIGHT MUST BE NUTS. WE HAVE WORKED FOR 35 YEARS AND HAVE BEEN MARRIED 43 YEARS AND NEVER SEEN A PRESIDENT THIS BAD AND SPEND BUT GETS NO WHERE. HE HAS BEEN IN OFFICE WAY TO LONG TO KEEP PUTTING THE BLAME ON THE bUSH DAYS. IT’S OVER AND DONE WITH BUT THIS YOUNG KID HAS NO COMMON SINCE TO SEE WHAT HE IS DOING TO THIS COUNTRY. IT IS ABOUT TIME THAT HE STARTS TO OPEN HIS EYES AND SEE WHAT HE IS DOING TO US AMERICAN PEOPLE BUT HE LIVES IN OWN WORLD. I’M FED UP WITH HIM AND I PRAY FROM ALL THE STRESS MY HUSBAND AT 65 YEARS OLD AND I 61 SEE’S THE DAY THE ( R ) GET BACK INTO OFFICE SO WE CAN HAVE OUR LIVES BACK AND THIS COUNTRY WILL BE A STRONG PLACE AS IT USED TO BE BUT AS LONG AS OBAMA IS IN THE WHITE HOUSE NOTHING WILL CHANGE.
Bless your heart Susan. In the words of our former adolescent in charge, Bill Clinton, “I feel your pain”. Except I mean it sincerely.
It does not matter what the government does, the big credit card companies will always find a way to squeeze the American consumers.