Prior to choosing Joe Biden for veep, credit-card reform was mentioned fairly often as a part of Barack Obama's agenda during the campaign. After Biden was chosen, there was some reasonable speculation that Biden's relationship with the credit-card companies--many credit-card companies are located in Delaware, because of weak usury laws--might derail credit-card reform. Biden was also a supporter of the bankruptcy bill that was a huge boon to credit-card companies as it made it harder for consumers to file for bankruptcy under chapter 7. Obama hasn't mentioned the idea too much since, but it looks like he's still going forward with it and is meeting with heads of the credit-card industry today, in advance of a push for reform which is good news as long as he sticks to his platform.
Other than on TAPPED of course, there's been little discussion of how much the credit-card system resembles predatory lending. When you think of their methods (sneaking in hidden rate raises and penalty fees, applying interest to past rather than future debt, raising interest rates based on behavior with other credit accounts), credit-card companies do, as Robert points out, resemble predatory lenders. Their goal is to find really creative ways to quickly and arbitrarily increase the debt owed. I'm not saying that the White House should be figuring out a catchy way to describe credit-card practices as exploitative, because that might be counterproductive if the banks are already willing to go along with the changes the administration is proposing. But the fact is that these practices are exploitative, and in the past, failing to fully explain that has led to conservatives painting regulatory efforts that aid consumers as coddling the irresponsible.
I'm sorry, could you try to stay awake while I'm blogging?
-- A. Serwer
