As we called for on April 25th, President Obama today demanded a new credit card bill on his desk by the end of May. This will be the 2nd time, the President has responded to a direct article and plea by Global Perspectives, by promoting our policy suggestions. On April 25th, www.bootheglobalperspectives.com published a compelling true story about a woman who lost her credit, car, and house as a result of a promotion by Chase Bank, and it's associate bank WaMu. The article was published and also made available to political leaders. People throughout the nation have copied and sent this article and other complaints to the President. Today, the President acted, based upon thousands of complaints from American citizens.
Big bankers, and the credit card industry are fighting back, but the President persisted saying:
"Americans know that they have a responsibility to live within their means and pay what they owe," Obama said in his weekly radio and Internet address Saturday. "But they also have a right to not get ripped off by the sudden rate hikes, unfair penalties and hidden fees that have become all too common."
The Credit Card Holders' Bill of Rights has passed the House and awaits action in the Senate, possibly in the coming week.
"You shouldnt have to fear that any new credit card is going to come with strings attached, nor should you need a magnifying glass and a reference book to read a credit card application. 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," the president said.
The House measure would prohibit double-cycle billing and retroactive rate increases, and prevent companies from giving credit cards to anyone under 18.
Obama further said: "There is no time for delay. We need a durable and successful flow of credit in our economy, but we can't tolerate profits that depend upon misleading working families. Those days are over," he said.
Presidents Obama called it "abuse that goes unpunished," and the president stressed the need "to strengthen monitoring, enforcement and penalties for credit card companies that take advantage of ordinary Americans."
Credit-card executives say the new restrictions could backfire on consumers, making it harder for banks to offer credit or put credit out of reach for many borrowers. They also contend that the new rules ordered by the Federal Reserve beginning next year address many of the consumer-protection concerns expressed by the president and members of Congress.
The bill's boosters are tapping into public anger over corporate excesses and the conduct of companies receiving billions of dollars in taxpayer money.
"Instead of fine print that hides the truth, we need credit card forms and statements that have plain language in plain sight"
The new credit card law does not go far enough. Credit card companies still use the "credit scoring" system to officially cut off the credit of some people and raise interest rates to unethical levels on others. We must continue to keep working toward fairness, honesty and transparency.