>> WHAT ALEXANDRIA AND I ARE
PROPOSING IN OUR LEGISLATION IS
NOT COMPLICATED T TAKES US BACK
WHERE WE WERE IN A NUMBER YEARS
AGO.
THAT NO BANK IN THIS COUNTRY
SHOULD HAVE CREDIT CARD INTEREST
RATES OVER 15%.
BRINGING BACK THE CONCEPT OF
USURY LAWS WHERE PEOPLE CANNOT
TRY, WHERE BANKS CANNOT TRY TO
GET BLOOD OUT AFTER STONE.
DAVID: 2020 PRESIDENTIAL
CANDIDATE, SENATOR BERNIE
SANDERS KEEPING UP WITH
CONGRESSWOMAN ALEXANDRIA
OCASIO-CORTEZ ON A NEW BILL THEY
SAY PROTECTS CONSUMERS AND
CHALLENGES WALL STREET GREED BY
CAPPING INTEREST RATES ON CREDIT
CARD LOANS AT 15%.
NOW WITH DEFAULT RATES ON CREDIT
CARD DEBT AT LESS HALF WHAT THEY
WERE ABOUT 10 YEARS AGO IS SUCH
A MEASURE REALLY NECESSARY?
WHAT DO YOU THINK?
>> WELL IT IS DESTRUCTIVE,
DAVID.
PRICES ARE NOT ARBITRARY.
THEY DON'T PICK THEM OUT OF A
HAT, WAGES, COMMODITY PRICES AND
INTEREST RATES AS WELL.
THEY'RE NOT DETERMINED BY
FEELINGS OR WHATEVER BERNIE
SANDERS THINKS OF THEM.
THEY ARE DETERMINED BY
ECONOMICS.
HIGH RATES OF CREDIT CARDS ARE
HIGH BECAUSE OF THE RISK OF
GIVING PEOPLE UNSECURED LOANS.
A LOT OF THOSE PEOPLE IN FACT
DON'T PAY THOSE LOANS BACK.
SO CREDIT CARDS, IF YOU PAY THEM
BACK ARE ACTUALLY A GREAT DEAL.
THESE TYPES HAVE CONTINUED.
INTERVENTIONS IN THE FREE MARKET
ONLY RESULT IN LESS CREDIT
AVAILABLE FOR EVERYONE DOWN THE
LINE.
>> WHAT ABOUT THE FACT THERE IS
A CAP RATE FOR CREDIT UNIONS AT
18%?
WHY ARE THEY HELD SEPARATELY
COMPARED TO BANKS?
IF WE TALK ABOUT JUST THE AMOUNT
OF PEOPLE THAT DON'T EVEN HAVE
ACCESS TO CREDIT CARDS IN THE
FIRST PLACE, IF THIS RULE WERE
TO GO INTO PLACE WOULD PROVIDE
30,000 POST OFFICES WITH THE
OPTION TO PROVIDE CREDIT CARD
RATES OR CREDIT CARDS IN GENERAL
TO LOWER INCOME PEOPLE THAT
WOULDN'T NORMALLY QUALIFY?
DON'T YOU WANT THESE PEOPLE TO
GO OUT THERE GIVE THEIR
BUSINESS --
>> POST OFFICE NOW GETTING, POST
OFFICE NOW OFFERING CREDIT
CARDS.
>> THEY NEED TO SURVIVE SOMEHOW,
RIGHT OR ELSE THEY WILL GO
UNDER.
WHY DON'T WE GIVE THEM
ANOTHER AVENUE.
>> THEY CAN'T EVEN PAY BACK THE
LOANS THEY HAVE ALREADY TAKEN
OUT, KRISTINA.
THAT IS THE WHOLE POINT.
>> ACTUALLY ONE OF THE REASONS
WE HAVE THIS SEEMING DISPARITY
BETWEEN BORROWING COSTS AND
BANKS AND CHARGES ON CREDIT
CARDS IS BECAUSE CONGRESS IN
THEIR WISDOM PASSED A LAW, THE
CREDIT CARD ACT IN 2009, WHICH
BASICALLY SAID YOU COULDN'T
RAISE INTEREST RATES ON EXISTING
BORROWING.
SO WHAT DID THE CREDIT CARD
COMPANIES DO?
THEY HIKED THE RATES ON FRONT
END OF THE LOAN TO MAKE SURE
THEY WERE NOT GOING TO GET
CAUGHT OUT IF INTEREST RATES CAN
GO OUT.
YOU CAN THANK THE GOVERNMENT FOR
ONCE AGAIN SCREWING UP THE
MARKETPLACE.
THIS IS TRUE.
AND THAT IS WHERE THIS BIG
DIVIDE BETWEEN BORROWING COST
AND CREDIT CARD RATES BEGAN.
JONATHAN IS RIGHT, CENTRAL
REASON WHY THE RATES ARE SO HIGH
BECAUSE PEOPLE DEFAULT.
NO, CREDIT CARD COMPANIES
MOSTLY.
>> I'M NOT HERE TO DEFEND CREDIT
CARDS.
IT TAKES SUPERMAN'S VISION TO
SEE THE LITTLE LETTERS AT BOTTOM
OF STATEMENT BECAUSE YOU DON'T
KNOW WHAT THE HECK IT SAYS.
WHAT I AM HERE TO DEFEND ARE
FREE MARKETS AND FREE FOR
BUSINESSES TO WITH AS THEY DO IN
THE RULE OF LAW AND AGAINST TWO
PEOPLE THAT SHOULDN'T EVEN BE
RUNNING A LEMONADE STAND.
YOU HAVE ONE PERSON THAT STOPPED
AMAZON FROM BRINGING 40 TO
50,000 JOBS TO LONG ISLAND CITY
AND ANOTHER ONE THAT IS PROPOSED
EVERY TAX AND TAKING --
>> GETTING OFF TOPIC THOUGH,
GARY.
>> ENOUGH IS ENOUGH.
DAVID: I DON'T THINK IT IS
ENTIRELY OFF TOPIC.
>> WE'RE TALKING ABOUT CREDIT
CARDS.
DAVID: WE'RE TALKING UP ABOUT
TEAMING OF UP BERNIE AND AOC.
THEY BELIEVE IN SOCIALISM.
THEY DON'T BELIEVE IN
CAPITALISM.
THEY HAVE BEEN HONEST ABOUT
THAT.
IF YOU DON'T BELIEVE IN
CAPITALISM, YOU DON'T BELIEVE IN
SUPPLY AND DEMAND.
AS JONATHAN IS SAYING THERE IS
REASON WHY INTEREST RATES ARE
FIXED AT A PARTICULAR POINT AND
MOVE BASED ON WHAT HAPPENS TO
THE MARKETS.
IT IS INVOLVES RISK AN
CALCULATIONS IF YOU TRY TO
ARTIFICIALLY STEM THAT AT SOME
POINT WHICH HAS NO RELATION WHAT
THE MARKET IS TAG YOU WILL HAVE
CHAOS.
>> DAVID, IMAGINE IF THEY WERE,
IMAGINE IF THEY WERE ACTUALLY
ABLE TO PUT IN LEGISLATION ON
ALL THE THINGS THEY WANT TO DO?
DAVID: OH, BOY.
DISNEYLAND.
>> THE ECONOMY WOULD HEAD SOUTH,
COST WAS GO UP.
YOU KNOW WHAT WILL GO INTO THE
CRAPPER, IT IS SIMPLE AS THAT
THAT IS ALL I'M TALKING ABOUT
HERE.
WE CAN SIT HERE TALK CREDIT
CARDS FROM NOW TO NEW YEAR'S.
MY PAIN POINT, BUSINESS LEAVE
THEM ALONE.
WE DON'T NEED THESE PEOPLE.
>> GARY, QUICK QUESTION, DON'T
SOME BANKS OR FINANCIAL
INSTITUTIONS PROVIDING CARDS
WORKING TOGETHER SO THE RATES
CONTINUE TO BE HIGH.
>> OH, MY GOSH, NO.
>> THEY COULD INCREASE ANNUAL
APR RATE ANYTIME THEY LIKE.
26% AND HIGHER.
>> ONE OF THE REASONS --
DAVID: HOLD ON GUYS.
>> ONE OF THE REASON RATES ARE
SO HIGH ALSO BECAUSE COMPETITION
IS SO FIERCE IN THE CREDIT CARD
INDUSTRY THAT THEY HAVE ALL
UPPED REWARDS.
THE REWARD COSTS HAVE GONE
THROUGH THE ROOF.
SO ONE OF THE REASONS,
SERIOUSLY, IS COMPETITIVE COSTS.
SO --
>> YOU DON'T, IF YOU DON'T WANT
TO PAY HIGH INTEREST RATES, PAY
YOUR CREDIT CARD ON TIME.
>> THANK YOU.
>> WE ALL AGREE.
>> DON'T EVEN BORROW.
>> PERSONAL RESPONSIBILITY IS
KIND OF LIKE, OH, YEAH, TOTALLY
FORGOT ABOUT THAT, PERSONAL
RESPONSIBILITY.
THAT IS THE METHOD THE
CONGRESSPEOPLE --
DAVID: FOR THE RECORD 38% OF
AMERICAN HOUSEHOLDS HAVE CREDIT
CARD DEBT.
IT'S A MINORITY.
IT'S A BIG NINE NORTH BUT IT'S A