The Credit Card Conundrum?

Obama signed a new credit card bill into law today.  It does things like limit surprise interest spikes, and had a lot of industry resistance, but it passed by wide margins.  But it’s not the bill that interests me.  It’s some speculation I’ve heard about what happens next.

There has been some discussion that the credit card companies are now going to start using people who pay their bills responsibly to make up the difference for those that don’t.  After all that’s happened in Washington, I can understand the concern some people have in this matter.  I can also understand the concern given liberalism’s sterling track record of bungling all it touches.  But let’s say for a moment that this is actually true, and one of these companies is dumb enough to try and wring those who can pay for those that don’t.

Here’s how it works:

1. Yes, the credit card issuer can control the policy, but they can’t control you.  The government might be able to force you to pay them money, but the banks can’t.
2. That means you can drop your card account.  Credit cards are not a life necessity.  They’re nice to have around, yes.  Can you live without them?  Maybe not as conveniently, but yes.
3. So, for those of you fearing backdoor attempts to make up the costs of deadbeats at your expense, and the companies who might consider using you responsible credit card holders as piggy banks for the losers, it won’t work.  The companies will lose customers and whine without being able to make up the difference.
4. This is of course presuming all of them are dumb enough to try something like that at the same time.  If one company does it and the rest don’t, kiss that one dumb company’s credit card business goodbye.

Yes, there may be problems, but there is a countermove.  If a credit card issuer wants to try and make up the difference at your expense, just don’t be their customer anymore.

Read more here:
Obama Signs Bill Overhauling Credit Card Industry (Fox News)

Filed under: Commentary and Opinion on May 22nd, 2009 No Comments