On Wednesday’s broadcast of NewsNation’s “The Hill,” Sen. Pete Ricketts (R-NE) stated that the proposal to cap credit card interest rates at 10% from Sens. Josh Hawley (R-MO) and Bernie Sanders (I-VT), which is an idea President Donald Trump has previously expressed support for, will create unintended consequences and if companies can’t make profit “on certain products because there’s been artificial limits put on, they’ll just stop those products.”
Host Blake Burman asked, “Senator, let me show you a headline that’s in The Hill, ‘Hawley, Sanders Push for 10 Percent Cap on Credit Card Interest‘, President Trump supports this. … What’s going on here, Senator, with some of these sort of grassroots, economic populist, I guess, themes here, with Democrats and Republicans coming together?”
Ricketts answered, “Again, when we want to do regulation, we should make sure it’s about legal compliance and it’s about safe and unsound practices. Any time you try to get into an industry and have government pick winners and losers by setting artificial caps, you’re going to have unintended consequences. And, frankly, the people who generally bear those consequences are lower-income people. Go look at what happened when a lot of states decided they didn’t like payday lenders. They went after those and then a lot of folks who had no access to credit didn’t have a way to be able to replace that. And, in some cases, that pushes them into a criminal element or an underground world. And that’s not good for those folks.”
He added, “So, we always have to be careful when we’re thinking about regulation or setting new rules, what are going to be the unintended consequences, because the market will adjust to that. And if companies can’t, for example, make a profit on certain products because there’s been artificial limits put on, they’ll just stop those products.”
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