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Senate tackles credit card regulation

Marketplace Staff Mar 3, 2009

Senate tackles credit card regulation

Marketplace Staff Mar 3, 2009


Steve Chiotakis: As the markets go, yesterday stunk. Losses across the board.
Values going back a dozen or more years.

Enough. It’s a new day. And a gabfest has commenced. President Obama is looking ahead with his stimulus package.
One that he hopes will be a reversal of fallout. The near $800 billion law of the land has gotten criticism from across the aisle for its uber spending, yet the president presses on with a message of hope. And immediacy.

President Barack Obama: I can say that 14 days after I signed our recovery act into law, we are seeing shovels hit the ground.

Mr. Obama says a couple hundred highway construction projects will start in the next few weeks. And he says the number of jobs that’ll be created or saved in the highway building program will top the number of workers let go in the last three years by Ford, Chrysler and GM. Combined.

Well, the Federal Reserve Chairman Ben Bernanke calls the economic recovery package ambitious. But he says there’s a lot of uncertainty that surrounds it. And it’ll be up to the American people to decide what to do with any tax cuts that are included.

Ben Bernanke: Households confronted with declining incomes and limited access to credit might be expected to spend most of their tax cuts. But then again, heightened economic uncertainties and the desire to increase precautionary saving or pay down debt might reduce households’ propensity to spend.

Bernanke continues to testify this morning about financial policy and no doubt a new $200 billion Fed program will come up, one that’s being launched today. It boosts the availability of credit to consumers and small businesses for cars, education, credit cards and other things.

Did you hear me say credit cards? Yeah, there’s also before that Senate Banking Committee today a look at regulations and what they can do to curb sky-rocketing credit card bills and mortgages. Here’s Marketplace’s Jennifer Collins.

Jennifer Collins: The committee wants to revamp our country’s regulatory system so it better serves you.

Senator Chris Dodd chairs the banking committee. He’s introduced legislation to protect credit card users against things like retroactive interest-rate hikes and sudden changes to their terms.

Steve Bartlett’s with the Financial Services Roundtable. He says gaps in credit card regulation are characteristic of our entire system.

Steve Bartlett: We right now have a regulatory structure that is a series of pillars with nothing in between. So we have to close those gaps so that the entire system is connected.

Bartlett says the government also needs legislation to better protect investors and home buyers. He rejects criticism that an efficient market requires less regulation.

Bartlett: So a better financial system and consumer protection go hand in hand, they’re not at odds.

Bartlett says he’d like to see something that’s consistent across every state.

I’m Jennifer Collins for Marketplace.

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