Credit Cardholders' Bill of Rights Act of 2008

CREDIT CARDHOLDERS' BILL OF RIGHTS ACT OF 2008 -- (House of Representatives - September 23, 2008)

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Mr. ELLISON. Let me thank the gentlelady from New York, who has done absolutely heroic work on this bill, and let me echo her words: no more abdication from Congress. We are a coequal branch of Congress, and it is time for us to do our job.

Americans all over this country want to know what does the Congress care about the debt that they are drowning in because of these credit card practices. If the Fed says they are deceptive practices, who are we to just let them go on and step back and say, well, somebody else will do it.

No, it is time for the Congress to do something about it now. To do otherwise is to abdicate our responsibility. Nobody at the Fed holds an election certificate. All of us do. It is time to take this thing by the charge.

The fact is, about $8,000 worth of credit card debt is what Americans are holding on average for people who have a revolving balance. That is a burden that people cannot sustain. The fact is, we would not be in this situation if we had the active regulation that Americans expect from their government.

We have seen now nearly 30 years of stagnating wages. Americans have had flat wages, on average, if you look at folks who are working hard every day to put food on the table. Because the wages have been flat, we haven't had the savings to buy the things that we need.

What has been happening is people have gone to their credit cards, and as we have gone to the credit cards, the credit card companies, some of them, have been using unfair, deceptive practices that have got to be brought to a stop now. If the Fed says they are wrong, they are wrong.

We shouldn't have to wait on them to tell us what to do. We should do our job.

I just want to thank Chairwoman Maloney and Chairman Frank for bringing this bill to the floor now. I hope this bill can be wrapped into the rescue that is being contemplated for the financial meltdown that is going on now.

This is what we should be doing, and it needs to go into effect now. We need to deal with the credit crisis now, and credit cards must be a part of it.

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Mr. ELLISON. Madam Speaker, the gentleman from California has made the point that if this bill passes, that interest rates will go up and that credit availability will decline. Is the Congressman saying that credit card companies will retaliate against consumers with higher rates if Congress proscribes practices that even the Fed considers deceptive?

Mr. CAMPBELL of California. Will the gentleman yield?

Mr. ELLISON. I yield to the gentleman from California.

Mr. CAMPBELL of California. Yes. What I said was that they may. And it would not be a retaliatory basis. It would be because the credit markets are currently in great turmoil. And because they are in great turmoil already, credit is restricting and the rates are going up. That is happening not just with credit card debt, but with car loan debt.

Mr. ELLISON. Reclaiming my time, so for practices the Fed says are deceptive, if they are proscribed, you believe that is something that the credit card companies will react with interest rate increases on consumers for?

Mr. CAMPBELL of California. No. What I am saying is that we should, as I've said----

The SPEAKER pro tempore. The time of the gentleman has expired.

Mr. CAMPBELL of California. Madam Speaker, I yield myself a minute just to respond to that, that what we have here is that the unfair and deceptive practices should stop. The Federal Reserve is probably going to do that. But by stepping in now, they will be considering all of the responses they got, and by the way, the lady from New York mentioned about the credit card companies are against the Federal Reserve proposal. I'm sure they are. But the Federal Reserve will make the decision they believe is right based on the statute which says they are supposed to crack down on those unfair and deceptive practices. And they will do that.

But what we don't want to do is send more messages to the marketplace now that we are stepping in to do things that may include some things that aren't unfair and deceptive, or that may mess with the financial markets because they are very, very fragile at the moment.

I reserve the balance of my time.

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Mr. ELLISON. Madam Speaker, thank you again for allowing me to address this final point.

This issue that I put to our colleague and friend, Mr. Campbell, regarding whether or not deceptive practices, practices that have been deemed to be deceptive by the Fed and that are proscribed in this legislation today, whether these things will result in rate increases or lack of availability.

In fact, they will do the opposite, Madam Speaker. They will provide transparency, they'll provide fair rules, and most importantly, they will help to keep good lenders good.

If you have a good lender, a good credit card company who is playing fair and acting ethically, and yet their competitors are allowed to engage in universal default and things like this, the net result will be that they will be at a competitive disadvantage when they don't do these unethical practices, things that the Fed has deemed to be unfair. So it's very important that we keep a nice level playing field and maintain the high standards in the industry.

This is actually a bill that will help the credit card industry because it will send a signal that the rules are fair, even, and ethics are the priority.

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