Congress and Fed Take on Credit Card Industry

I’ve been highly critical of the Fed over the past several months in regards to their interest rate cutting spree and what it does to my purchasing power, calling them not-so-nice names of which I can only print bonehead, idiots, and stupid on this blog due to my self-imposed no-cussing rule.  The things I say out loud when reading such news rival my parents’ vitriolic descriptions of former presidents Nixon, Ford, and Carter.

But, yesterday the Fed did something that deserves a solid pat on the back (the harder the better, maybe we can knock some sense into them on other subjects!).  The Federal Reserve has proposed rules to prohibit unfair credit card practices!  This is only a few months after House Representative Carolyn Maloney introduced the “Credit Card Bill of Rights” bill in Congress (pdf summary here).

Needless to say, credit card issuers aren’t happy with either of these proposed rules changes.  Apparently they think they should be the only ones to change the rules of the game.  They claim the proposed new regulation from the Fed and the pending bill in Congress will A) make credit harder to get and B) more expensive.

What’s the down side to this argument?  LOL  Most of y’all know my “extreme” view on credit cards.  I’m not convinced they are necessary, and absolutely detest the practices of credit card companies.

A) “Make credit harder to get.”  Well, that means credit card companies may actually quit sending offers to dead people and dogs … or maybe they’ll quit sending credit offers to dead dogs first!  I would love to get my hands on the envelope Dave Ramsey held up at the FPU tapings last year that was addressed to “Mr. Toby Cocker” with the note scribbled on it: “Dave, this is my dog, Toby the Cocker Spaniel - and he’s been dead for 4 years!”  Heck, my dead ex-2nd-husband still gets credit card offers, and because they are presort standard mailings I can’t seem to have them returned to sender with the note “addressee deceased” on them.  Maybe, just maybe, credit card companies will stop sending card solicitations to underage minor children while they are at it!  Think of the hundreds of thousands of dollars Crapitol One could save on postage…

B) “Credit could get more expensive.”  Hmmm, considering all the recent rate-jackings and the 34.99% max interest rate, I am wondering just how much more expensive credit card companies can get.  Perhaps they are considering moving into payday loan interest rates of 300-800%?

Speaking of those blood-sucking payday loan parasites, they used the exact same argument (and in some cases the exact same words) when they tried to stop Congress from putting a 35% interest rate cap on their active duty military customers.  In fact, they cried about how they would go out of business if Congress put that restriction on them (really, where is the downside to THAT argument?). 

I am sad to say that two weeks ago when I drove up 41A past Fort Campbell, the payday loan places were all still open with signs about tax refund anticipation loans in their windows.  Obviously, the payday loan parasites have figured out how they can stay in business even with the 35% interest rate limit to their military customers. 

I have a feeling the credit card companies are blowing just as much smoke up everyone’s 4th point of contact when it comes to both the Fed’s proposed regulations and Congress’s Credit Card Bill of Rights.  I have just as much sympathy for them as they have shown me in the past (and continue to show their current customers): NONE AT ALL.

It’s not rocket science to realize the credit card companies are going to fight both of these reforms tooth-and-nail, with a powerful multi-million dollar lobby as their weapon of choice.  Do we “little people” stand a chance against this?  If enough of us speak up we do!  That whole “for the people, by the people, and of the people” thing can sometimes work if enough of the people make their opinion known!

Call every representative and senator you have and tell them to support the Credit Card Bill of Rights.  Use the phrase “I am a registered voter, and this is a decisive issue for me,” and make it true.  Make sure the person on the phone with you understands you WILL vote against the politician if s/he caves in to the lobby.  If you have your own story about unfair credit card practices, be sure to throw that in for good measure.

Of course, when it comes to credit cards themselves, the most powerful vote you have against them is with your scissors!  Cut them up, pay them off, and refuse to use them again!  Take your ball and go home, because credit card companies don’t want to play fair and they don’t want anyone to force them to play by set rules.  If enough people voted this way, they would have much more to worry about than the Fed or Congress trying to place fair limits on their unfair practices.