(24 May 2009) - As long as Harper and his cabinet let the big banks write the rules, we'll continue to have a financial system that's good for them and bad for everyone else.
By James Clancy
National Union of Public and General Employees
We’re facing a serious economic recession. Unemployment is rising. Many families are worried about how they’re going to pay the bills and put food on the table. And they’re feeling the pinch of outrageously high credit card interest rates.
The Harper government has given billions of tax dollars to support and protect the big banks, and the Bank of Canada has reduced it’s interest rate for the big banks to almost zero.
So how do the big banks say thanks?
They continue to gouge vulnerable families with sky-high credit card interest rates.
This week the Harper government could have put an end to this gouging. They could have legislated a limit on the rates banks can charge and stopped the outrageous fees and penalties.
Instead, Finance Minister Jim Flaherty announced regulations to ensure "timelier and more transparent" disclosure of interest rate hikes.
What does that mean?
Apparently, credit card users will soon see a new summary box in each statement that will spell out key features, including the interest rate and how long it will take to pay off the balance if they only make the minimum required payment.
In other words, all people will get is a box that tells them, in a slightly larger font, just how badly they're getting gouged.
Rates as high as 28%
None of the millions of families in Canada using credit cards will get any relief from interest rates that can be as high 28% for some retail credit cards.
To get our economy back on track and to help vulnerable families we need the federal government and big banks to put a limit on credit card interest rates.
U.S President Barack Obama and American legislators have shown they get it. They’re helping consumers by introducing a bill that will stop arbitrary increases of credit card rates.
Why - during this devastating recession - is the Harper government sitting idly by while Canadian consumers continue to get fleeced?
As long as Harper and his cabinet let the big banks write the rules, we'll continue to have a financial system that's good for them and bad for everyone else.
James Clancy is the national president of the 340,000-member National Union of Public and General Employees (NUPGE), one of Canada's largest labour organizations with over 340,000 members. Our mission is to improve the lives of working families and to build a stronger Canada by ensuring our common wealth is used for the common good. NUPGE