Trump’s Credit-Card Cap Would Feed the Weakest to the Sharks
Risky borrowers may find themselves in shark-infested lending waters.
Photographer: Mustafa Ozer/AFP/Getty Images
A month ago, President Donald Trump called complaints about affordability a hoax and a con-job perpetrated by Democrats. Now, he’s attacking businesses for ripping off Americans. The latest target of this naked cynicism is credit-card lenders, who are being told to cap interest rates at 10% for a year.
This is dumb policy that shouldn’t survive contact with the real world. But if it does, the most likely outcome would be a significant contraction in lending, especially to the riskiest borrowers with the fewest options to access credit. They’d be left with little option but to turn to more expensive and less regulated lenders. Trump would feed the most vulnerable to the worst sharks.