If you think Utah's U.S. Senator Bob Bennett is in political trouble now, wait until the news of his vote against HR627 spreads and sinks in. By voting against this bill, Senator Bennett may have just handed over his seat to Utah Attorney General Mark Shurtleff in 2010.
Shurtleff formally announced his Senate bid on May 20th, and he may eventually be joined by Tim Bridgewater, who abandoned his bid for state party chairman last week, saying he heard all over the state that delegates wanted a more conservative choice for senator. And Shurtleff's internal polling shows Bennett might have cause for concern. Shurtleff's poll, which can be viewed HERE, shows that he polls ahead of Bennett among GOP delegates, and that 26 percent of those delegates viewed Bennett unfavorably. In a head-to-head contest, Bennett would get 38 percent of the delegate vote, Shurtleff 31 percent with 24 percent undecided. That's a pretty strong showing for an undeclared challenger, and it doesn't even factor in Bennett's vote against credit card reform.
Bob Bennett was one of only five senators voting against HR627, to amend the Truth in Lending Act to establish fair and transparent practices relating to the extension of credit under an open end consumer credit plan, and for other purposes. The others were Lamar Alexander (R-TN), Tim Johnson (D-SD), John Kyl (R-AZ), and John Thune (R-SD). Four more senators abstained (one Minnesota Senate seat still unsettled). The bill passed by an overwhelming 90-5 margin, with Utah's other senator, Orrin Hatch, being amongst the 90. Since the Senate made changes to the House bill, both must be reconciled before it can be sent to President Barack Obama for his signature.
-- Complete roll call vote results HERE.
-- Full text of HR627 HERE.
The Center for Responsible Lending issued a statement hailing the passage of the bill, saying "We commend the leadership of Senator Dodd and Senator Shelby, the Senate Banking Committee and the Senators whose votes ensured passage of H.R. 627, the Credit CARD Act. This bill, which received overwhelming bipartisan support, will provide consumers with significant protections from industry practices that extract billions of dollars in unfair fees and interest from cardholders every year.
We applaud the Committee for crafting safeguards for millions of American families at a time when our country is experiencing the worst downturn since the Great Depression. Consumers are the backbone of the economy, and the mortgage crisis is a stark reminder that unfair, deceptive lending practices are bad not only for individuals but for our entire financial system."
The Center also summarized the key provisions of HR627:
-- Restricting issuers' ability to raise rates on existing balances.
-- Requiring 45 days notice before hiking interest rates on new balances.
-- Requiring that payment amounts above the minimum payment be applied to the highest interest rate balances first.
-- Allowing over-the-limit fees only when a borrower affirmatively consents to having over-the-limit transactions approved.
-- Requiring that fees be reasonable and proportional to the violation of terms.
-- Prohibiting issuers from charging consumers a fee for paying a bill by telephone or over the Internet.
-- Requiring credit card statements to be mailed 21 days before the bill is due rather than the current 14 days.
The Christian Science Monitor posted an even more detailed analysis HERE. Additional media coverage and analysis posted by Time, CNNMoney, and the New York Times. Very cogent analysis by the Washington Post, which explains the two-tier system that emerged in which the preferred credit card holders' perks are subsidized by fee-gouging the other credit card holders.
I have no sympathy for what has clearly become a renegade industry. Every provision contained therein addresses a specific abuse by the credit card industry. The industry would promote incentives like "points", cash-back rewards, and "air miles" for preferred customers, then cry poverty and gouge other customers for more fees to make up for it. Indeed, because the credit cards companies collect $15 billion each year in penalty fees, comprising 10 percent of their total revenue, the companies actually have a vested financial interest in harvesting more penalty fees. So they kept changing the ground rules to induce and even entrap consumers into penalty situations. The BoycottCitibank website documents a particularly egregious episode. Consequently, they deserve this oversight. When Bob Bennett voted against this bill, he voted against consumers. He now deserves to be held rigorously accountable via an intra-party challenge.
Bennett was a prime target of tax protesters at "Tea Party" rallies last month, who booed the junior senator for supporting a bank bailout last year. On the other hand, this is offset somewhat by Bennett's opposing the Obama administration's efforts to slow down oil and gas exploration by holding up Interior Department nominees, and by his criticism of the administration over a memo warning of domestic terrorist recruiting among disgruntled veterans and gun owners.