Money Vampires

Big news today is that Obama is calling the credit card companies to task, and the Republicans are against it.

Well, maybe the only news is in the first part of that sentence.  After all, we already know that whatever it is, the Republicans are against it — that is, unless it doesn’t make sense and is a continuation of the policies of the past 8 years, which also didn’t make sense and continue not to make sense. 

But this one hits the vast majority of people in the U.S. straight in the wallet — not the millionaires and billionaires paying the Republicans to maintain the status quo.  So it may be rather hard for the Republicans to be against it this time unless they are going to follow the tortured logic they have used on the subject of torture.

Of course, the tea parties of April 15 featured maybe 100,000 poor saps who were lured to them by the fact that vital pieces of information were withheld.  One such piece of information is that the taxes they were protesting didn’t apply to the vast majority of them.

So maybe that’s how you do it if you’re a Republican: just fail to mention certain facts so Pavlov’s dog will drool for you whenever you ring the bell.  Problem is that for too many Americans, the credit card bell has rung right in their faces for several years now, even before the Republicans started gearing up to try to invent reasons why present practices are okay.  That means the bell has gotten so annoying that even while you’re drooling, it’s a little hard to miss that something is very wrong.

When I was young I ran up some hefty credit card balances.  I paid them all off a number of years ago — but that was only after I began to notice that the more I paid on the balances every month, the higher my debt seemed to get, even though I was no longer using the cards.  (Before I continue, I have to mention that it wasn’t like this when I first started using credit cards.  Back then, you used the card and got charged a minimum payment.  You either paid the balance off or you paid the minimum payment, plus, hopefully, a bit more.  That was the end of it: either your balance disappeared, or it went down.)

Imagine my surprise when I paid those balances off and got socked with hefty fees the next month.  When I called and demanded explanations, all of the companies backed off and canceled the fees.  All of them. 

They did so with a conspicuous lack of argument, although one giddy gal did try to chirp that “unlike other credit card companies, we charge ‘pure interest.'”  Still don’t know what the hell that meant, except that whatever this “pure interest” was, it apparently was applied starting the instant the bill went out the door of the credit card company.  In my case it amounted to about 10% per day, every day, no matter what the balance was — or even if there was a balance (because if there wasn’t, the credit card company could and would charge interest on the average balance over the past few years).

Yes, as things currently stand, credit card companies can charge you interest on nothing.  Don’t believe it?  Run up a balance, and then try to pay it off.  It’s almost impossible.  They’ll charge interest because you’re paying off your balance.  They’ll charge interest because they’re afraid you won’t pay off your balance.  They’ll charge interest because you only made the minimum payment.  They’ll charge interest because you may have been a day late with a payment on another credit card balance.  They’ll lower your limit below your current balance and then charge you over-limit fees, and interest on the fees (I am eternally grateful that I bailed out of my personal credit card mess before this scheme was dreamed up).  They’ll charge interest on interest.  They’ll even charge interest on passing unicorns.

To top it off, they’ve convinced themselves that all this is okay.  That is, until you call them out on it.  Then all of a sudden they’re eager to make it disappear.

If I hadn’t hollered I would have paid the fees that month and indefinitely thereafter because there was no way to catch up.  The credit card companies had placed themselves on my payroll; they were on the clock from the moment they mailed their bills, even if I hadn’t yet received the bills.  In one case it turned out that the billing cycle had begun even before the bill was mailed. 

Thank goodness I realized I could fire them.  That’s the one remaining difference between a credit card company and a mobster.  I wonder how many people haven’t realized that, and how much it has cost these folks.  I do know some people who are afraid to pay off their credit cards because in this twisted world, doing so seems to damage one’s credit rating.  But carrying a balance does so, too.

What the credit card companies were doing to me, and to everyone who uses credit cards, is called loan sharking.  There used to be laws against that.  The sad part is, despite the dizzy logic that excuses these practices, they are unnecessary for the health of the credit card industry.  It got along fine for many, many years without them.

So it’s going to be interesting to see how the Republicans object to any change enforced on the credit card industry.  It’s also going to be interesting to note the extent of those changes, and if they will indeed make any difference.  I keep thinking of COBRA, which was originally intended as “health insurance reform.”  Instead it became part of the problem, a perfect example of government intervention gone awry.  The insurance companies don’t like COBRA, so they charge wildly inflated premiums for it.  Most of the jobless can’t afford the premiums, and so they do without health insurance just like they did prior to COBRA.  This is what I am afraid of when it comes to the subject of reforming the credit card industry.

Unlike health insurance, though, credit cards aren’t totally necessary.  And it could be that at this point, that industry has become so corrupt that it’s in most people’s best interest not to use credit cards, ever.  If so, that’s not very good for business, is it?

So Mr. Credit Card Mogul, are you still gonna hang onto those corrupt practices as if they were a lifeline?  We’ll know by listening to the Republicans.  And if I’m in the mood to laugh, I’ll have a dandy time listening the excuses you pay them to invent.  I can’t wait to hear “If consumers have a reasonable chance of paying off credit card debt, the economy will collapse!”  or some variation on that.  And I have no doubt we’ll hear it.

As for the economy collapsing — too late.  It already did.  It did so well prior to Obama taking office, and  it did because we maintained what had become the status quo.  There is no use continuing to argue to maintain it.  It doesn’t work, and it doesn’t make sense.

The current gang of Republicans on Capitol Hill may be a discredit to true conservatism, but they do have their uses nonetheless.  In this case, I want a list of the companies that are feeding the Republicans, ensuring that they will continue to spew this nonsense.  Then we’ll all know who the vampires really are.

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