Earlier in 2009, Congress passed and President Obama signed legislation requiring several new credit card rules. These rules were designed to protect consumers against further large increases in credit card rates and “hidden” charges. Under the terms of that legislation, most of those new rules were scheduled to take effect between February and August of 2010.
Many in Congress subsequently expressed concern that some credit card companies had raised interest rates and decreased credit limits on many consumers in advance of the effective dates of the changes. In response, H.R. 3639 was developed. This bill moved the effective dates of certain of the new provisions established in the previously-enacted legislation from dates in 2010 to December 1, 2009. As with most other major bills, the House first had to approve a resolution or “rule” setting the terms for debating H.R. 3639. This was a vote on a motion to move to an immediate vote on that rule.
Rep. Perlmutter (D-CO) was leading the effort in support of the rule for H.R. 3639 and on the motion to move to a vote on it. He first acknowledged that some of the changes in the previously-passed legislation would require significant time to implement, and that “many lenders have made an honest effort to come into compliance with these new rules.” He then said: “(H)owever . . . some lenders have not used this interim period in such good faith. Since the (previous legislation) was signed into law, instead of preparing to implement these consumer protection provisions, some credit card companies have raised interest rates and have decreased credit limits on their consumers in advance of the effective dates. Responsible cardholders . . . have seen their minimum payments and interest rates arbitrarily double and triple . . . and they're hit with new and hidden fees . . . Card issuers' actions highlight the need for protections . . . .”
Rep. Foxx (R-NC) was leading the effort against the rule and the motion to move to a vote on it. She first said the rule “provides for the consideration of a wholly unnecessary and potentially destructive bill that could further aggravate the struggles of small businesses and families who are suffering from an unavailability of credit during these times of economic uncertainty. Here we are on the 4th of November, and the majority thinks that this bill is going to be passed in time to move this date up to December 1. It's totally unrealistic . . . .”
Foxx then noted that she had opposed the previously-passed legislation “because it took the wrong approach to addressing concerns with the credit card industry.” She added that the effort in H.R. 3639 to accelerate the effective date of that previous legislation would increase costs to borrowers and “would limit the availability of credit to potential borrowers, which is just the opposite of what our colleagues think they are achieving. These provisions are inappropriate in a credit card market that is fiercely competitive, and those who are concerned about the terms of their credit cards should rely on individual responsibility to become informed.”
Foxx suggested that “consumers can always exercise the option of either avoiding carrying a balance or of shopping for a different credit card. Many people do not realize that credit cards were created to provide for a convenient form of payment for goods and services. They were not originally intended to serve as a loan system, which is how many people are using them now.”
Foxx added that “people who take out credit cards are not having guns held to their heads . . . If they don't like the rates of interest that they're paying, they should get other credit cards, but don't blame the credit card companies for extending credit to people who then are irresponsible.”
The motion carried by a vote of 228-176. All two hundred and twenty-eight “aye” votes were cast by Democrats. Six other Democrats jointed all one hundred and seventy Republicans and voted “nay”. As a result, the House moved to an immediate vote on the rule setting the terms for the bill moving up the date for certain new consumer protections for credit card holders.