Blame Democrats for No Credit Cards
Democrats, in their attempts to appear voter-friendly, are now trying to pass more legislation that may result in absolutely no credit cards for consumers. Their last legislation resulted in credit card companies having to boost interest rates to offset the restriction to raise rates only on delinquent people. So now democrats will push credit card companies to fold-up and perhaps relocate overseas just like other businesses driven out by democrats.
It's a simple matter of economics and risk. And; most likely, democrats understand but are attempting to appear as if they're looking after consumer interests so they can get re-elected... all at the expense of the economy.
Here are the details:
Senate Banking Committee chairman Chris Dodd (a democrat, and who was recently involved in a loan scandal and hence is now struggling for re-election), has proposed an interest rate freeze on the estimated 700 million credit cards now in circulation.
This preposterous legislation is unlikely to go anywhere in the Senate, where Republicans and the few democrats who understand and place the economy first, will surely squash this nonsense.
Banks say that capping interest rates would cut their profits and force them to lend less money, which would reduce spending and worsen the economy. And they're right. But democrats would rather get re-elected than to tell the truth and to protect the economy.
Once democrats successfully chase the credit industry out of the country; as they have done with many other US businesses, at least then credit companies will be able to engage in a free market. Isn't that bizarre? A business has to flee the United States in order to engage in capitalism.
Congress has already passed legislation that puts new rules for credit card lenders into effect in mid February. The law, signed by Obama in May, limits when and how banks hike rates. That stupid law is the reason why banks are having to raise rates now, since they cannot adjust them later on delinquent payers. Thus, now we all suffer, even those of us who pay on time because the banks can't raise the rates only on the late payers.
Remember a time when capitalism reined free in America? When companies had the freedom to compete for customers, to offer discounts, rewards and so forth. Ah, those were the good old days.
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