Dealing With The Lending Industry
Good for those conservatives who are opposing
the awful bankruptcy bill now wending its way through Congress. At the same time, though, I wonder what a real conservative/free marketer/libertarian would propose to do
about the credit-card industry. Lending abuses aren't new, and card companies certainly don't need congressional handouts to work their predatory magic. Companies like Citigroup, after all, make a good chunk of their profits off of loans with absurdly high rates to those least able to afford it (the poor or the debt-laden); this is
the free market in action! Short of heavy regulation or a return to the old usury laws regulating interest rates (which I think just peachy), the lending industry will do what it does.
Alternatively, I guess, you could make it much easier
for people to declare bankruptcy, which would certainly give credit-card companies pause before handing out cards with $10,000 limits and whopping fees to the cash-strapped. But most conservatives, I assume, would balk at all the moral hazards created here. So what's the answer?