Four workers robbed by their credit card companies sat silently at recent congressional hearings on the matter, afraid to share their horror stories with the people elected to represent them.
After long journeys to the nation’s capital from Chicago, Denver and Niagara Falls they were gagged by a GOP partisan maneuver — a demand that they sign waivers allowing their banks to discuss their private financial business publicly in any forum, at any time.
“It was a real tragedy,” said Lynda Tran, communications director for SEIU, the union that brought the workers to Washington to testify. “Their stories need to be told. We all know how bad the credit crisis is on Wall Street. The credit crunch on Main Street is another enormous danger and if it all bursts this economy will really be in trouble.”
With their permission, Tran released to the People’s Weekly World the testimony Congress wouldn’t hear.
“I didn’t want all my private business out there for just anybody,” said Marvin Weatherspoon, a Chicago grandfather whose interest rate jumped from 4.25 percent to 25 percent at Bank of America.
Weatherspoon is a linen department supervisor for Aramark at McCormick Place, Chicago’s convention center. As an SEIU Local 1 member, he ensures that all rooms have the linens they need for meetings and other events.
Weatherspoon became a Bank of America customer in 2000 when he consolidated $12,000 in debt to a new card issued by the bank. Since then his interest rate jumped over 20 percentage points and his minimum payments have more than doubled (from $160 to $342 per month).
On his October 2007 bill, Weatherspoon made a minimum payment of $257, $232.42 of which was interest. His payments are automatically deducted, and a Bank of America spokesman admitted that Weatherspoon has never even been 30 days late.
The bottom line of the rip-off is that he’s paid off only about $800 in principal over eight years of payments! He said he had intended to tell the members of Congress about the personal hardship the bank’s actions caused.
“I’m getting by, but not by much,” Weatherspoon said. “I don’t drive unless I have to and I can’t help my grandkids the way I’d like. When the bank increases my bill I have to go without — I cut back on groceries. Right before Christmas, they raised my minimum payment by almost $100, from $257 to $342 a month. They told me they changed their rules and there was nothing I could do. I cut back on Christmas presents in December and on food in January.”
Denver’s Susan Wones said, “I’m really upset that I couldn’t testify. JPMorgan Chase raised my rate from 0 percent to 23 percent in one month last summer, without notice or explanation.”
“As the credit card profits go up the spirit of the American people goes down,” said Christy Smith of Niagara Falls. “There is nothing worse than worrying every day how am I going to pay that bill and what I can put off or do without in order to pay it.”
The workers were muzzled as members of the House Financial Services Subcommittee on Consumer Credit met to discuss legislation that would add a few consumer protections to current credit card policy. For example, the bill — HR 5244, the Credit Card Holders’ Bill of Rights — would prevent card sponsors from applying interest rate hikes to existing balances.
The legislation, not surprisingly, is opposed by the banks and their Republican backers. “As with any government intervention in the free market,” Rep. Spencer Bachus (R-Ala.) said in a statement, “the bill presents a real danger of restricting the range of products and services that credit card issuers currently offer.”
Bill sponsor Rep. Carolyn Maloney (D-N.Y.) said her proposal will add balance to a market that has grown wildly off kilter. “The credit card industry has been clear about the responsibility imposed on consumers: make your minimum payments on time and stay under your limit,” Maloney said in a statement. “But what about the reciprocal responsibility of card companies?”
Steven Autry of Fredericksburg, Va. was among those silenced at the March 13 hearings. Autry, who describes himself as a long-time Republican who is now supporting government regulation of banks, said he didn’t sign the waiver because “we would have ended up in a banking journal five years from now as a case study.”
In 1999, Autry said, he picked up a Capital One Card because the 9.9 percent interest rate was advertised as “fixed for life.” But last year, without indicating any problem with Autry’s credit, the company hiked his rate to 16.9 percent.
In a recent statement the AFL-CIO said the credit crisis has its roots in “an economy where workers are given the ability to borrow or take on credit rather than given real or meaningful wage increases.”