Bernie Sanders Wants to Make it HARDER to Build Credit

Sen. Bernie Sanders’ new plan to cap credit card interest rates may sound like a good idea, especially to those who are finding it difficult to pay back credit card debt. But rather than making it easy for poor people to borrow money and pay it back, Sen. Sanders’ plan would actually make it difficult or even impossible for people with limited finances to obtain credit.



While banks would be forced to cap interest rates at 15%, they would not be forced to offer credit cards on the same terms that they currently do. This means that, in order to obtain a card, a bank would most likely require customers to show a good credit score to ensure that loans are paid back in a timely manner. Such a move would automatically limit or even prohibit lower class and lower-middle class people from obtaining a card.

Moreover, individuals with limited financial resources wouldn’t be the only ones affected by the proposed new law as high interest-rate cards aren’t just for the poor. They are also the only option for those who are obtaining a credit card for the first time, especially if such individuals do not have a sizeable bank account. Furthermore, many self-employed individuals aren’t able to obtain a credit card with a low interest rate from the get-go, as banks are leery of giving low-interest rate cards to individuals with a fluctuating monthly income.






In short, Sen. Sanders’ new proposal would make life exceedingly difficult for hundreds of millions of people across the United States. To make matters even worse, people presently unable to earn a credit card should the new legislation become law would probably never be able to earn a card as they would have no way to earn a good credit score and prove themselves to be low-risk credit card users. 

As most people know, without a good credit score, it is nearly impossible to purchase a home and thus build equity. Without credit access, a large number of people would be stuck in perpetual poverty even if they are able to manage what finances they have in a wise, cautious manner.

Naturally, the implications of putting an arbitrary cap on credit card interest rates haven’t crossed Sen. Sanders’ mind. Rep. Alexandria Ocasio-Cortez, who is backing the new proposal, doesn’t seem to have thought of the results of the proposed bill either. It’s not hard to understand why, given the fact that both Sen. Sanders and Rep. Ocasio-Cortez embrace a socialist form of government in which large corporations are automatically viewed as evil simply because they turn high annual profits. Ironically, it is socialist ideals such as capping interest rates that wind up doing the most harm to the very people who were meant to be helped.

It is a sad fact that many people have high credit card debts that are difficult or even almost impossible to pay off. In some instances, overly high interest rates are a large part of the problem. However, Sen. Bernie Sanders’ proposal to force banks to lower interest rates to 15% for everyone is not the solution. In fact, capping interest rates would only make matters worse than they currently are.

~ Liberty Planet


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