Credit Card Legislation

In their continuing effort to in some way control private businesses, the Obama administration is demanding that Congree get him a bill to sign that restricts rate hikes and so forth that credit card companies may charge customers. My thoughts on this are pretty simple. When you use a credit card, you are taking a loan from the credit card company and are agreeing to their terms and conditions. Don't like the conditions? Don't use the card. Don't like their fees? Close your account. It's not that difficult.

Here are a few more observations about the whole situation:

1. The federal government can't do seem to do things right that it is supposed to do like secure the border or strengthen and stabilize the dollar, yet they feel they can now run credit card companies.



2. Obama said, "And the abuses in our credit card industry have only multiplied in the midst of this recession, when Americans can least afford to bear an extra burden." Basically, you can't charge people higher rates because they won't be able to pay. Inability to pay makes a customer very risky to a credit card company. Higher interest rates are the credit card company's way of factoring in that risk while still making credit available to higher-risk clients. If you don't let them charge higher rates, they will have to tighten their underwriting standards and eliminate the higher-risk clients from obtaining credit at all. Perfectly fine with me (Extending credit to those who can't afford to pay is what got us in this whole mess to begin i.e. subprime loans, etc.), but somehow I don't think that's what Obama was gunning for. The politicians are once again playing checkers instead of chess. Let's think a little deeper guys.



3. Obama also said you should not "...need a magnifying glass and a reference book to read a credit card application" as well as "...we need credit card forms and statements that have plain language in plain sight...". Do you think he's passed on that gem of genious to the IRS in reference to the ridiculousness of our 60,000+ page tax code? Didn't think so. Well I say this to Obama. The last credit card application I filled out came with 2 pages of terms and conditions. When you manage to whittle the atrocity known as the US Tax Code down to 2 pages or less, you can whine to the credit card companies about how they present their statements, forms, and terms to the customer. Until then, stay the hell out of it and quit saying things that show your economic illiteracy and make you look like an idiot. On another note, how sad is it that the leaders of a country founded on the idea of liberty with limited government have managed to fill up over 60,000 pages with ways to confiscate your property?