The federal government’s $200 billion bail out for big bankers should come with strings attached that protect the ordinary consumer from predatory lending practices. USA Today did a two-part investigative series on how credit card and mortgage companies profit from ordinary consumer mistakes.
According to USA Today
“…banks sharply boosted credit card rates and fees, then enticed consumers to take out home equity loans to pay off high credit card balances”
Both Senators Chris Dodd and Robert Menendez are calling on credit card and mortgage companies to become more transparent and do more to protect the consumer.
“We’re seeing a confluence of issues,” Menendez said. “We have a perfect set of circumstances that will drive not only transparency, but true reform.”
Menendez is also demanding limits on credit card interest rate increases and a ban on charging interest on credit card penalty fees. He also wants to make illegal to issue credit cards to unemployed minors and college students.
This is exactly the type of aggressive action we need to take on behalf of Americans facing often overwhelming credit card debt . The credit card companies have been given too much power to make profits despite the consequences to society. Putting college students into credit card debt creates a society filled with debtors. So many college students today are facing tens of thousands of dollars in credit card debt before they’ve even landed their first real job. It’s time to put the brakes on this practice of giving students credit cards.