Obama Hails, Signs Dodd's Credit Card Bill

doddemailPresident Obama is not wasting any time backing up Sen. Chris Dodd, whose credit card reform bill was signed by the president today (see the signing ceremony on YouTube: Obama publicly praises Dodd).

Obama used the power of his email list to drum up support for Dodd, sending out a mass email that went to people on his own list and the DNC’s. Here’s an excerpt:

For too long American consumers haven’t had many of the protections they need and deserve. And some of the biggest problems have been in the credit card industry.
 
But today — thanks to the extraordinary efforts of your senator, Chris Dodd — I signed a bill that restores a sense of fairness and transparency to the credit card industry.
 
As Chairman of the Senate Banking Committee, Senator Dodd was the driving force behind this bill. He’s the one who built the bipartisan coalition that passed this crucial reform by a huge margin — 90 to 5.

The email also encouraged supporters to go to a special section of Obama’s website to thank Dodd (see picture above).

The message is clear: “See? Dodd isn’t actually cozying up to financial robber barons! In fact, he’s passed a great bill that will both thwart them and help families, and that I, Barack Obama, approve of. Click on the shiny button to show your support!”

It is a big win for Dodd, and an important step in his ongoing image rehabilitation program. But Dodd may still find that the public at large isn’t so quick to forget Dodd’s mortgage, the bonus scandal and his Irish cottage. Stories like this one, which place Dodd at a fundraiser with plenty of people from the Online Lenders Alliance, don’t help either (though there seems to be confusion over just who was holding the fundraiser).

Dodd Opponent on Political Talk Shows this Sunday

Dodd’s Democratic challenger, Merrick Alpert, will be making the rounds this Sunday to talk about his challenge to the longtime incumbent. He will appear on both “Face the State” on WFSB and “The Real Story” on FOX 61. “Face the State” also will be having a segment about the making of some sort of film about the Hartford Whalers, while “The Real Story” will also feature Tom Swan.

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27 responses to “Obama Hails, Signs Dodd's Credit Card Bill

  1. AndersonScooper

    Merrick Alpert should throw in the towel. Honestly, he has no path to the nomination, and were a miracle to happen, and he somehow gained traction, Dodd would just retire in favor of Blumenthal.

    Regarding this new law, it’s great in terms of preventing future abuse. But it doesn’t do much for those currently struggling under murderous interest rates of 20%, 25%, even 30%.

    Yes I know Senator Sanders proposed cap of 15% interest is probably too low to be workable. But Dodd should challenge Tim Johnson and Evan Bayh and still try to push through a national usury law of 18% or 21%.

    That would have immediate effect for millions of struggling families, and prove immensely popular.

    So thank you Senator for Round One. But please go for Round Two!

  2. Anderson –
    I thought you were pushing Bysiewicz or Murphy over Blumenthal.

    … retire in favor of Blumenthal.

    Change of heart?

    Yes I know Senator Sanders proposed cap of 15% interest is probably too low to be workable. …

    Why?

  3. Why?

    Because Dodd & Obama push the envelope only to the point of making a good public showing… they both firmly oppose transparency and good government when it comes to The Banksters that own the US Congress.

    But today — thanks to the extraordinary efforts of your senator, Chris Dodd — I signed a bill that restores a sense of fairness and transparency to the credit card industry.

    Good thing he remembered to add “to the credit card industry” because the Bush / Obama economic policies that are given a blank check by Senator Wall Street still thwart all attempts at fairness and transparency when it comes to The Banksters who financed Dodd’s campaigns.

    I thought Obama was serious when he campaigned on transparency and good government.

  4. AndersonScooper

    Chris Mc–

    Murphy will make his move in 2012. Why would he want to mess around now, and not wait for another term under his belt and a Presidential cycle? And taking down Traitor Joe would give him national props! (think about the coverage.)

    Otherwise I decided I was out on this w-a-a-a-y too early, and that it makes no sense to lame duck out of Senator Dodd in the middle of an important legislative session. Who knows, maybe he rebounds? Wouldn’t that be great. And in any case Dodd deserves for Dems like me to give him till the end of the year.

    We all know the end of the year polls will provide a reckoning. If Dodd closes the gap, together we’ll trounce the Republicans. If not, who knows? Maybe Dodd would retire on his own, as that would be the right thing to do.

    If Dodd were to retire, of course Blumenthal is favored to be the nominee. If not…. who knows?

    But it’s far too early, and again I’m hoping Senator Dodd will provide Connecticut with more good reasons to vote him another term.

  5. AndersonScooper

    Awesome! Kenneth Gosselin in the Courant reports Dodd interested in Round Two of credit card reform:
    http://www.courant.com/business/hc-dodd-credit-cards.artmay23,0,25650.story

    But Sen. Christopher J. Dodd, D-Conn., who led the effort to enact reforms in the U.S. Senate, was already looking ahead to more.

    In a conference call with reporters Friday, Dodd said there are still two major issues that remain unfinished business: a cap on interest rates and limits on fees that merchants pay when a customer uses a credit card for a purchase.
    […]
    Dodd said it was outrageous that a credit company could charge more than 30 percent interest on purchases. It was equally appalling, he said, that big credit card companies make so much money from small store owners and other entrepreneurs who have to fork over a portion of their profits when customers pay with credit cards.

    “And we’ve got to do something about it,” Dodd said.

  6. But Dodd says the Federal Reserve must not be audited because Monetary Policy must remain independent.

    And why must we maintain the secrecy over Fed bailouts?

    Yeah… we should disclose “sources and methods” of our intelligence services, but whatever we do… DON’T let anyone know which of Dodd’s campaign contributors… er… uhh… banks got the Fed’s $10 trillion bailout! That would be terrible for America!

  7. I have yet to have anyone explain to me the philosophical argument for the existence of credit cards.

  8. AndersonScooper

    Tim should we get rid of mortgages and car loans too?

    C’mon. Besides sheer convenience, credit cards allow consumers to make semi-major purchases and pay them back over time. Plus they can be an important emergency fund for people without money in the bank.

    It’s the loan-sharking element of the credit card industry that needs to be reigned in. No way should someone be extended more than a month or two’s wages/salary in revolving consumer debt.

  9. credit cards allow consumers to make semi-major purchases and pay them back over time. Plus they can be an important emergency fund for people without money in the bank.

    I really don’t know where I fall on this. But I certainly think there should be income required (and verified) and a 20% down payment on homes.

    As for cars… I’ll start out with a maximum 3-yr loan.

    And as for credit cards…

    No way should someone be extended more than a month or two’s wages/salary in revolving consumer debt.

    So you agree with me that there should be a national dialogue.

    As for convenience, we’ve got debit cards.

  10. There ought to be a national dialogue on the fractional reserve banking system.

    If I recall correctly… Rasmussen reported that 68% of Americans feel that US household debt is too high… and that people shouldn’t have gotten the credit in the first place.

    I’m not about to research that, but it was something like that. So I know most Americans share my basic view that something needs to be done about credit… and not just a restriction on interest rates.

  11. This bill is utterly stupid. It will cause the credit market to avoid those with bad or no credit, thereby depriving them of the ability to obtain a favorable credit rating, and also bring about a return of the annual fee for every credit card holder.

    Thanks, Dodd, for interfering with Americans’ freedom to contract. We appreciate it. It’s a shame you won’t be around to accept blame for the negative impacts that will no doubt accompany this bill.

  12. This bill is utterly stupid. It will cause the credit market to avoid those with bad or no credit, thereby depriving them of the ability to obtain a favorable credit rating, and also bring about a return of the annual fee for every credit card holder.

    Good point Dobb. Now, how many people writing in this spot – responsible credit card users all – have actually paid 30% on their outstanding credit card balance? My guess is – none. And why? Because they use their credit cards responsibly. The 30% uptick is a sanction that says to people who are irresponsible: Don’t do that. It’s comparable to the indigestion that occurs when one gorges oneself on a meal paid for by others. That kind of sanction is either necessary or not, If it is necessary and Dodd removes it, what does he propose to replace this sanction with?

  13. The percent down on home mortgages is also a sanction that says to people who apply for a mortgage: If you can’t afford this down payment, you ought not to purchase this house. We know what happens when you remove that sanction, don’t we: The housing market collapses, bankers go a’begging to Washington, and the rest of us – responsible mortgage payers – end up shutting money to those who contribute to Sen. Dodd’s campaigns. Is there a lesson here? Could the lesson possibly be: When you remove the sanctions, some people begin to behave like pigs in a barnyard?

    But Utopia, for the utopianist, has no provisions that prevent people from sinking their teeth into apples offered by serpents.

  14. Dick Morris (http://www.dickmorris.com/blog/2009/05/22/obamas-credit-card-reform-is-a-fraud/) probably got this one right: “In our book Fleeced, we explain how, until 1979, credit card interest was subject to usury limits of the various states. But the Supreme Court emasculated these limits by ruling that the state of the lender, not of the borrower, had the sole power to legislate interest rate limits. South Dakota swiftly jumped into the void the Court created, eliminating any usury limits. All the credit card companies moved there and took advantage of the regulatory vacuum to hike up their rates to unconscionable levels.”

    Solution: Pass national legislation reversing the Supreme Court decision, bring back usury laws, allow states to regulate credit card ceilings, and reposition the borrower in the deciders seat.

  15. The appropriate regulation that’ll fix this mess:

    The Congress shall have Power… To coin Money, regulate the Value thereof, and of foreign Coin, and fix the Standard of Weights and Measures

    US Constitution, Article I, Section 8

  16. The 30% uptick is a sanction that says to people who are irresponsible: Don’t do that.

    Maybe I’m the only one around who thinks this, but if a credit card company can’t make a profit off of their customer with a maximum 15% interest rate, then they actually shouldn’t give that customer a card.

    The problem is that having access to a credit card is required for many commonplace things in our society — I’d rather see fierce usury laws coupled with laws destigmatizing lack of credit than a regulatory limbo where we have to treat owning a privately-issued credit card as a prerequisite for participation in society and have to walk on eggshells to avoid regulating credit card policies.

    The percent down on home mortgages is also a sanction that says to people who apply for a mortgage: If you can’t afford this down payment, you ought not to purchase this house.

    Likewise — not everyone needs to own a house. The problem with not owning a house is that there are all kinds of financial and tax advantages conferred on someone who invests a good share of their money in a residential property. Change those policies — or confer similar benefits (a density tax credit?) on renters — and then home ownership wouldn’t need to be promoted by Congress in the way that it is now. (To be fair, I don’t think there are any government policies setting a maximum % down payment — setting a low down payment and a high or variable interest rate is a problem, but not a government mandated problem.)

    Or we could get creative about the role the government plays in the credit market — hell, how many banks do we own now anyway? I bet our government could just pass a lot of beneficial policies at shareholder’s meetings instead of through Congress.

  17. AndersonScooper

    Where does Rob Simmons stand on capping interest rates? And how about Caligiuri?

    Are they with me, Dodd, and the American consumer?

    Or will they take an ideological position, like my buddy Jack Dobb, — and side with the credit card industry?

  18. Are they with me, Dodd, and the American consumer?

    And the guy with the bandaged head wound playing the fife, and the guy with the flag, and the drummer …

  19. Or will they take an ideological position, like my buddy Jack Dobb, — and side with the credit card industry?

    I’m not siding with the credit card companies, I’m siding with responsible consumers. My first credit card in college had an interest rate in the 20s. Now I have a 785 credit rating. The former is clearly related to the latter, as I wouldn’t have a very high credit rating if someone didn’t extend credit to me when I was 18. Sometimes I paid my bills in full and sometimes I didn’t, but that doesn’t matter: the bottom line is that fewer people with little to no credit history will be given credit cards thanks to Dodd. He is keeping up the Democratic tradition of screwing poor people while pretending to help them.

    Also, now each of us will have an annual fee, or a higher annual fee, on our credit cards thanks to this bill. Thank you, Sen. Dodd, for all you’ve done for this country.

  20. AndersonScooper

    Dobb, people aren’t borrowing at 30%. Nor are they taking credit cards at 30%.

    What’s happening is that people are borrowing at 9-18%, then if they hit a bump in the road, the credit card companies use that as an excuse to jack their rates!

    Imagine if you missed one car payment due to health or a family emergency. Would it be right for them to then jack your rate from 9% to 25%?

    It’s simple loan-sharking, it’s friggin’ un-American, and it needs to be stopped.

    PS– That annual fee crap is just that, pure crap, meant to manipulate people into siding with the banks and their usurious practices. After all, it’s still a free market, right? Can’t you just find a new card that doesn’t have a fee?

  21. PS– That annual fee crap is just that, pure crap, meant to manipulate people into siding with the banks and their usurious practices. After all, it’s still a free market, right? Can’t you just find a new card that doesn’t have a fee?

    Turn your argument around. Can’t you just find a credit card that won’t jack your rate from 9% to 25%? I have four credit cards and none does that.

  22. Da’Fluff: “’We’re not going to give people a free pass,’ Obama said at the signing. ‘We expect consumers to live within their means and pay what they owe. But we also expect financial institutions to act with the same sense of responsibility that the American people aspire to in their own lives.’”

    Da’Reality, according to an AP report:

    Annual Fees will go up.

    1) “The free ride is likely to end for many who use their credit cards as a convenience and pay off their balances in full every month. Only about 20 percent of U.S. credit cards currently carry annual fees, according to LowCards.com. But that figure is expected to climb. Expect to pay at least $50 to $100 a year.”

    2) Banks will charge interest fronmm the date of purchase. No more 20-25 day grace periods.

    3) The new regulations do not restrict fees for balance transfer, cash advance or late payment. All are likely to rise.

    4) Consumers with lower credit scores will be frozen out of the credit card market, owing to stiffer regulations.

    5) No more reward programs for responsible card users. Credid card conpanies would be able to subsidize the rewards, because the will make less in finace charges and penaltiesunder Dodd’s new regulations.

    Or, to but it briefly, responsible card users will not be supporting irresponsible card users — the Obama doctrine in practice.

  23. AndersonScooper

    Pesci, that AP report is really just an industry press release dressed up in the guise of fairness. If I were you, I wouldn’t fall for their attempt to manipulate public opinion. It’s just scare tactics.

    Even if you pay your balance in full every month, it’s not like the credit card industry was losing money on you. (They still get all the interchange fees, generally running 2-3%.) The free market will still result in fair deals for you and others with both good credit and significant financial resources.

  24. Bill Ayers, Reverend Wright, Chavez, Ahmadinejad……so, Obama supports Chris Dodd. What’s the big deal?

  25. Pesci, that AP report is really just an industry press release dressed up in the guise of fairness. If I were you, I wouldn’t fall for their attempt to manipulate public opinion. It’s just scare tactics.

    Sure thing.

    CT caps installment finance rates at 19% on used automobiles.

    Pretty high – unless it’s ‘D’ paper where lenders have learned they need 5 times the collection staff as higher credit customer groups require.

    19% is not high enough to factor (sell on the open market) ‘D’ paper as there never were any buyers at that rate (way before any sort of meltdown).

    So lenders offer dealers a steeply discounted advance (7000 car, 1000 down, 6000 balance might draw 4500 for example) *plus* charge the dealer a 500 “set up fee”.

    Thus a used car that should have been sold for around 4000 (according to what the dealer actually walked off with) instead sold for 3k more thanks to too many people looking out for our welfare.

    Like always – the poorest of the poor get victimized by those well intentioned souls that labor under the delusion that the market can be regulated.

    Guess again.

  26. scanman1722

    Dear Sam, Rob, and that no-name lawyer trying to get more clients,

    Good luck getting votes when the president comes to a Connecticut town near you.

  27. This credit card reform act included an amendment that will allow people to carry guns into national parks and wildlife refuges and national forests. However, that part of the bill won’t take effect until February 2010 because the entire bill doesn’t go into effect until then.

    (If you are wondering why this was part of the credit card bill, don’t ask me).

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