Dems’ Bill is Latest Attempt at Capping Credit Card Interest Rates

Seven Senate Democrats have introduced a bill that would allow states to cap credit card interest rate charges, with the hope of reversing a high court decision which gives nationally chartered banks the advantage over any state-level laws.

Sen. Sheldon Whitehouse, D- Rhode Island, wants the Empowering States’ Right to Protect Consumers Act to effectively overturn the 1978 Supreme Court ruling.

Whitehouse said the ruling prompted banks’ credit card operations to establish headquarters in such locations as South Dakota, Delaware and wherever laws on interest rates are weak.

To gain popular support for the bill, Whitehouse wants to tap into the current anti-big bank wave, partly initiated by Bank of America’s plan for a debit card fee, which was rescinded a month after its announcement in the wake of widespread consumer backlash. The senator also wants to plug into Wall Street discontent from the various “Occupy” protests throughout the nation.