Credit Card Legislation: People Get Screwed Again

The credit card legislation passed by Congress in May 2009 provides only partial relief from the outrageous and oppressive tactics of the credit card companies. The relief that the federal legislation does not do, but which exists by law in many states, is to limit the amount of interest that credit card companies can apply. The law in many states have an maximum interest rate that credit card issuers or lenders can charge, and anything about that rate is usury, and a crime. For instance, in Ohio, the maximum allowable interest rate is 21 percent.

Credit card companies charge as much as 30 percent interest on credit card balances. But they pay nearly northing for the money they lend out. Many financial houses are now receiving taxpayer money during the so-call bailout of financial institutions for which they pay almost nothing. In addition, credit card companies charge merchants a certain percentage of every charge that is made.

With such enormous profits, into the billions, it is understandable why credit card companies have given tens of millions of dollars in bribes to members of Congress.

Further, legislation that allows credit card companies to increase the interest rates on prior purchasers, of people in financial distress, preys upon the vulnerable while profiting the credit card companies that bribe members of Congress for the right to gouge the public.

What the legislation does do in a way that makes the public think members of Congress are protecting their interest  looking out for their interest, is to:

• Prevent retroactive increase in interest rates−if the card issuers is not late for less than 60 days; or exceed your credit limit; or use too much of your credit limit.
   
• Had to give 60 days notice to increase interest rates;

Those provisions do not help the credit card user who encounters financial problems. Instead, it causes the financial problems to worsen. The legislation seems to protect the consumers−years after changes should have been made, and only made because of the public uproar−continues to give the screws to the public, as members of Congress have done for years.

Read the book, Congress and Other Cesspools, by Rodney Stich, available from amazon.com in print and ebook formats.