GOP Blocks Dodd Bill to Freeze Credit Card Rates

Created: November 18, 2009 16:55 | Last updated: July 31, 2020 00:00

Moments ago, Senate Republicans blocked a Democratic proposal to freeze credit card rates on existing balances through the holiday season. The bill, sponsored by Senate Banking Committee Chairman Chris Dodd (D-Conn.), would prevent credit card companies from hiking rates and fees on existing balances until the industry reforms passed by Congress earlier this year take effect. Although a few provisions of that law took hold in August, most don’t launch until February or August of 2010. In the meantime, many card companies are hiking rates and fees to beat the law.

“The industry has tried to make one last grab at their customers’ pocketbooks,” Dodd said, just before asking for the consent of Republicans to pass the bill unanimously.

No dice. Sen. Thad Cochran (R-Miss.) objected “on behalf of several senators on this side of the aisle.” There’s no word yet which other lawmakers he was referring to.

House Democratic leaders have already passed even stronger legislation that would expedite all the credit card reforms in the previously passed bill — not just the ban on hiking rates for existing balances. Dodd hasn’t signed on to the Senate version of the bill.

It’s worth mentioning that the Democrats — folding to pressure from the banks — were themselves responsible for delaying those reforms, which were initially proposed to go into effect much earlier this year.