Give consumers tools to combat credit card giants

More and more than Americans are turning to their recognition card game to assist wage bills, purchase grocery stores and simply do ends ran into in this troubled economy. As a result, consumer recognition card debt is now closing in on the $1 trillion grade — dual the amount held in 1996. This trillion-dollar tower of unbarred debt is looming big above our troubled economic system and baleful to decline an already parlous recognition crisis.

Recent news studies demo that even as the Federal Soldier Modesty have got cut involvement rates to seek and encouragement our economy, recognition card companies have raised rates on cardholders — even those who pay on clip — in an attempt to seek and stopper losings they've suffered in other countries of their business.

That's because the playing field between recognition card companies and recognition cardholders have go very one-sided in recent years. It's probably no surprise that it's average out American cardholders, and not the large recognition card companies, who are getting the short end of the stick.

The winds of alteration look to be blowing, however. In a historical move, the Federal Soldier Modesty recently acknowledged that there are partial and delusory patterns in the recognition card industry, and projected regulating regulations for doing away with many of them.

Some of the patterns the Federal identified as partial and delusory are the same 1s that we have got got proposed curbing in new legislation, the Recognition Cardholders' Bill of Rights (HR 5244): raising involvement rates on existing balances — and doing so even to good cardholders who pay on clip and never travel over their recognition limit; charging involvement on balances that have already been paid off; unfairly allocating payments to do it hard for cardholders to pay off higher involvement charge per unit balances; and selling fee-heavy "subprime" recognition card game to unsuspicious customers. It's encouraging that the Federal clearly holds with the demand for these solid and balanced recognition card reforms.

By the clip the Federal acquires around to finalizing its regulating proposals, however, they may be watered down and come up too small too late for struggling consumers who necessitate aid now.

Just as we couldn't wait for the regulators to acquire around to helping the billions of Americans facing foreclosure, we can't number on them now to move quickly and assist the billions of Americans being driven deeper into recognition card debt. The mortgage reform ordinances the Federal proposed over a twelvemonth ago still have got not been enacted. And, what is done by ordinance can easily be undone by regulation. Legislation is the lone solid and permanent solution.

It's probably no surprise that some in the banking industry oppose our measure and the Fed's new regulating proposals. These oppositions are pushing for zero intercession into the escalating recognition crisis just as they argued for a hands-off approach to the subprime crisis. The apparent truth is that Federal is the federal federal agency responsible for guidance our economic system and ensuring the safety and soundness of our fiscal institutions, and it have got affirmed what many in United States Congress have been saying all along: There are partial and delusory recognition card industry patterns that should be eliminated.

We are on the brink of cracking down on recognition card industry maltreatments for the first clip in decades. The Fed's recent action only adds to the unbelievable impulse for legislative reform that have been building. The Recognition Cardholders' Bill of Rights now have the support of leading consumer advocates, and groupings as diverse as The National Small Business Association and The Service Employees International Union (SEIU). It also have the support of 145 co-sponsors from different parts of the political spectrum; we may not hold on everything, but we make hold that American consumers rate a degree playing field.

Instead of waiting for the Federal to move or for the adjacent shoe to drop in the recognition crisis, United States Congress should take fleet action to reform major recognition card industry maltreatments and better consumer protections for cardholders.

Maloney, D-N.Y., chairs the House Financial Institutions and Consumer Recognition Subcommittee. Davis, D-Tenn., is a member of the House Financial Institutions and Consumer Recognition Subcommittee and the Congressional Blue Dog Caucus. Ellison, D-Minn., is a member of the House Financial Institutions and Consumer Recognition Subcommittee and the Congressional Progressive Caucus.