Sen. Bernie Sanders, I-Vt., and Rep. Alexandria Ocasio-Cortez, D-N.Y., are introducing a bill Thursday that would cap credit card interest rates at 15 percent.
"This, to me, is not just an economic issue. It is a moral issue, where you have Wall Street and credit card companies charging people outrageously-high interest rates when they are desperate, and they need money to survive," Sanders said during a Facebook Live appearance with Ocasio-Cortez.
Sanders also pointed out that most major world religions have banned usury, because it is "disgusting" and exploits people who are economically vulnerable, as Ocasio-Cortez indicated agreement with him. He proceeded to describe the ugliness of a system in which "the poorer you are, the more desperate you are, the higher your interest rates are."
Ocasio-Cortez discussed her observations as a representative from an urban congressional district in New York.
"When we talk about coming together to solve our problems as a country, this is one of the best ways that we can come together," Ocasio-Cortez explained. "These predatory loans and high interest rates impact rural communities. They impact urban communities like those that I represent, and it's funny because you would think in a densely-populated community like the Bronx or like Jackson Heights that you'd be able to have a bank on every corner. But what we actually see is that in poor and lower-income urban communities, there are way fewer banks per capita."
Ocasio-Cortez later quoted author James Baldwin, who once said that "it's expensive to be poor," prompting her to elaborate that "if you're poor, your interest rates are much higher, you live in a food desert — so your average head of lettuce and average bit of spinach is much more expensive than it is in other communities."
Later during the Facebook Live event, Sanders referred to predatory lending as "economic brutality" — a characterization with which Ocasio-Cortez visibly agreed.
Prior to their joint appearance on Facebook Live, Sanders told The Washington Post he expected their bill to face stiff resistance in Congress, saying, "I am sure it will be criticized. I have a radical idea: Maybe Congress should stand up for ordinary people." The Post also noted the banking industry is likely to oppose the bill, because it earned $113 billion in interest and fees from credit cards in 2018 — a 35 percent increase from what it earned in 2012.
Sanders also called for universal banking through the postal system — an idea that was famously propounded by Sen. Elizabeth Warren, D-Mass., as far back as 2014.
"If the Postal Service offered basic banking services — nothing fancy, just basic bill paying, check cashing and small dollar loans — then it could provide affordable financial services for underserved families, and at the same time, shore up its own financial footing," Warren wrote in a statement responding to a report from 2014 arguing that post offices should move into "non-bank financial services for the underserved," according to Reuters.
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