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Credit Card Reform Email Print

By GeneG
02/10/2006 11:24:30 AM EST

Credit card debt is one of the most insidious diseases attacking the body politic. Our credit cards are stealth weapons in the war on the middle class. They create debt at rates faster than at any other time in history. We don't spend money we funnel it into that great vacuum in the sky, the banking system. Because of credit, with ever increasing, usurious interest rates our economy floats on columns of air. To move toward correcting this problem I propose two ideas that the lawyers among us can translate into the necessary legalese to put forth as legislation.

First, credit cards obtained through unsolicited applications should be treated as gifts up to the specified limit. An unsolicited credit card with a $5,000 limit becomes a $5,000 gift. If the user continues to use the card after the limit is reached, the responsibility for payment on charges over the limit settles on the holder of the card as it does now.

Second, credit card issuers cannot sell uncollected debt to third parties for anything less than the full amount of the debt, interest included. At present, credit card interest is structured in such a way that the majority of card users pay for their purchases several times over, creating huge profits for the banking industry. Card companies continue to collect interest as long as the card holder pays, and when the card holder ceases to pay, card issuers sell the "debt" for pennies on the dollar to collection agencies. Under this provision, card holders could not sell the "debt" for less than dollar for dollar.

These two provisions will place some of the responsibility for our current credit mess squarely where it belongs: on the shoulders of irresponsible lenders.

Comments welcome.


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Are credit cards stealth weapons in the war on the middle class?
Yes 33%
No 0%
No, credit cards are great for the economy 33%
No, there is not a class war in this country 33%

Votes: 3
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