President Obama today will sign new legislation restricting the often highly predatory practices used by credit cards to add fees and change interest rates on credit card holders. From MSNBC.com:
The new rules, which would go into effect in nine months, would prohibit credit card companies from giving cards to people under 21 unless they can prove they have the means to pay the debt or a parent or guardian co-signs for the card.
Under the bill, a customer would have to be more than 60 days behind on a payment before seeing a rate increase on an existing balance. Even then, the lender would be required to restore the previous, lower rate if the cardholder pays the minimum balance on time for six months.
Consumers also would have to receive 45 days' notice and an explanation before their interest rates increased.
A recent Pew study showed that 100 percent of credit card issuers examined "apply payments . . . likely to cause substantial monetary injury" to cardholders and 93 percent of issuers can change the interest rate at any time by altering the contract signed.
On a related note, if you are looking for a great case study of religious conservatives' selective if not blind interpretation of the Bible, this is it. At sites like Wallbuilders.com, the creative interpretation of scripture is employed to validate low or no taxes on inheritances, income taxes and capital gains taxes, and even the elimination of the minimum wage. But the Bible's exceeding clear prohibition against usury in Levitucus 25:37--"Thou shalt not give him thy money upon usury, nor lend him thy victuals for increase"--is simply ignored.
Though unfortunately not available online to non-subscribers, there is a great article by Tom Geoghegan in the current issue of Harper's about usury and its contribution to the current economic crisis, and how our economy, based so much now not on producing things but on financial services, is unsustainable for all but a few of us. I highly recommend it.
And God bless the credit card companies.
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