A Look at Credit Card, Mortgage Politics in Washington

In an article titled "Banks Sway Bills to Aid Consumers", Stephen Labaton and Eric Dash report for the New York Times on the politics swirling in Washington over pending legislation regarding curtailing certain credit card issuer practices and renegotiation of mortgage terms in bankruptcy.

Regarding credit cards, President Obama is scheduled to meet with a group of industry executives tomorrow at the White House. During his campaign last year, Obama set out changes he would push for regarding credit card issuer practices - saying he would "establish a five-star rating system so that every consumer knows the risk involved in every credit card ... [and] establish a Credit Card Bill of Rights to stop credit card companies from exploiting consumers with unfair practices."

Meanwhile, the American Bankers Association has sent a letter to the House Committee on Financial Services - which is marking up pending credit card legislation today. The ABA writes:

H.R. 627 is unnecessary and potentially counterproductive in light of the sweeping credit card rules adopted by the Federal Reserve Board (Fed), Office of Thrift Supervision (OTS), and the National Credit Union Administration (NCUA) in December 2008. Enactment of H.R. 627 adds further restrictions on the ability of credit card issuers to factor in risk when making credit decisions, and increases the already extensive operational challenges facing the industry as they prepare to comply with the Fed’s rules.