Opinion: Why does one unelected bureaucrat get to decide credit card fees?
(
The Hill Opinion by Thomas P. Vartanian and Willam M. Isaac). Director Rohit Chopra and his Consumer Financial Protection Bureau (CFPB) elevated politics over economics to give President Biden two applause lines in his State of the Union address this month as he took a victory lap for allegedly saving consumers $20 billion annually in credit card fees.
In an obviously coordinated effort with the White House against what the president has popularly labeled "junk fees," the CFPB reduced the allowable cap on credit card late payment fees from $32 to $8. But don't get fooled into thinking that you will save $24 each time you pay your credit card bill late, or that it is now easier to skip a payment altogether.
An opinion we co-authored last year explained - apparently unsuccessfully - how such economic virtue signaling ends up hurting the people who need credit the most. The analysis is simple: If government rules arbitrarily prevent lenders from recouping the cost of making credit available to poor credit risks - i.e., borrowers who don't pay on time - they won't make the loan and there will be no late fees to worry about.
That makes the White House's and CFPB's claim of saving 45 million Americans an average of $220 annually largely illusory. Lawsuits filed against the CFPB by industry representatives before the president's address will no doubt explain that, notwithstanding political slogans, there is no free lunch.
Direct's Comment:
Despite what this article calls "economic virtue signaling", what everyone in the mortgage industry knows is that
all credit report fees paid by borrowers went up dramatically in price.
What used to cost $54 is now $92. So, politicians can say anything they want to say. But ask anyone in our industry what really happened to credit report fees and they will tell you that credit report fees have gone up dramatically.
Brighter Days.(
Psalm 30:5). For his anger endureth but a moment; in his favour is life: weeping may endure for a night, but joy cometh in the morning.
Comment:
Jesus suffered deeply because He loves us deeply! He wants us to repent and be converted so that He can fully heal us.
When sore trials come upon us, it's time to deepen our faith in God, to work hard, and to serve others. Then He will heal our broken hearts. He will bestow upon us personal peace and comfort. Those great gifts will not be destroyed, even by death.
The gift of resurrection is the Lord's consummate act of healing. Thanks to Him, no condition is hopeless. Thanks to Him, brighter days are ahead, both here and hereafter. Real joy awaits each of us - on the other side of sorrow.
(Daily Joy, Russell M. Nelson, p.140).
