Alexandria Ocasio-Cortez and Bernie Sanders team up on Bank Legislation
David Dayen
May 9 2019, 9:34 a.m.
Excerpt:
ALEXANDRIA OCASIO-CORTEZ will announce her first major bill today, in partnership with Vermont Sen. and presidential candidate Bernie Sanders. Its something Sanders has proposed for many years: a 15 percent interest rate cap on all consumer loans, which would reduce what many Americans pay on their credit cards and effectively eliminate the payday loan industry.
The bill is called the Loan Shark Prevention Act, and its only two pages long. It includes language that would prevent lenders from adding fees to evade the interest rate cap and sets penalties for violators, including a forfeiture of all interest on the illegal loans.
According to Ocasio-Cortezs office, the freshman representative plans to suggest postal banking as a public option for consumer lending, though that is not in the legislation. A postal lending option would in theory minimize the impact on access to credit from the rate cap. Sanders endorsed postal banking during his 2016 presidential campaign.
The interest rate cap, often referred to as a usury cap in a reference to the biblical term, has been a mainstay of Sanderss left-wing agenda. He introduced similar legislation as far back as 2009, when Congress was debating the CARD Act, which added some more modest protections for credit card holders. While the 2009 bill specifically focused on credit cards, by 2016 Sanders had added all consumer loans to the plan.
https://theintercept.com/2019/05/09/alexandria-ocasio-cortez-bernie-sanders-bank-legislation/