A proposal to create a nationwide cap on credit card interest rates would hurt millions of Americans by cutting off access to credit, President Trump’s former campaign adviser Steve Moore said in a new report.
Sens. Josh Hawley (R-Mo.) and Bernie Sanders (I-Vt.) are the sponsors of the 10 Percent Credit Card Interest Rate Cap Act, which would impose an all-in annual percentage rate cap of 10% on credit cards. Moore, an economist, leads the advocacy group Unleash Prosperity, which this week released a report on the problem with rate caps. Banks must be able to charge interest rates that correspond to the risks they take with customers who have lower credit profiles, he wrote.
“Without the interest rate penalties on late payments, many millions of low-income Americans with low credit scores may not have access to credit at all,” Moore wrote. “This is not disparate or discriminatory treatment. And the people who do pay their credit card balances, but have poor credit ratings, would be the big losers because credit would be harder or impossible to come by.”
Trump has expressed support for a national interest rate cap in the past. Asked about that support during an interview on Fox Business, Moore said he isn’t sure the president would follow through once he understood its effect on Americans.
“Trump has a bit of an economically populist streak,” Moore said. “I don’t know his position on this, but I could see him potentially saying this is not fair to low-income people.”
