House Progressives Rip GOP for Siding With Credit Card Giants on Junk Fees
"It is critical that the American people understand the House Republican Conference's firm and dedicated commitment to protecting the business model of unfettered, predatory fines."
Members of the Congressional Progressive Caucus on Wednesday slammed their House Republican colleagues for siding with credit card giants over U.S. consumers by attempting to roll back a Biden administration rule banning excessive late fees—a major profit source for card issuers.
The House's Republican majority is expected in the near future to schedule a floor vote on a GOP-authored resolution that would use the Congressional Review Act to undo the Consumer Financial Protection Bureau's (CFPB) rule lowering the typical credit card late fee from $32 to $8.
The CFPB is currently
fighting a Trump-appointed judge's injunction against the rule, which the agency estimates would save Americans more than $14 billion a year in fees.
In a letter to House Speaker Mike Johnson (R-La.), Rep. Pramila Jayapal (D-Wash.)—the chair of the CPC—and more than 50 fellow caucus members welcomed the "opportunity to highlight the Republican majority's enthusiastic support for junk fees, including exorbitant credit card fees."
The letter continues:
We think it is critical that the American people understand the House Republican Conference's firm and dedicated commitment to protecting the business model of unfettered, predatory fines imposed by large corporate banks against ordinary Americans. Thanks to the leadership of the Biden Administration and the CFPB, Americans will collectively receive $10 billion in annual relief from this rule, curbing junk fees levied by profitable credit card giants on consumers.
We look forward to a promptly scheduled vote that allows every House Republican to go on the record opposing an initiative that will rein in a loophole exploited by corporate giants to boost their profits at the expense of American households and create an average savings of $220 per year for more than 45 million people who are charged late fees by large credit card companies.
"We are unsurprised that House Republicans uniformly insist on defending large corporate banks’ current practice of overcharging Americans with credit card late fees," the progressive lawmakers added, "and welcome the opportunity to highlight the contrast in our priorities on the House floor this summer."
A new @POTUS + @CFPB rule means big banks won’t be able to charge over $8 in late fees for credit card payments.
Surprising no one, @HouseGOP is trying to block it 🫠@SpeakerJohnson: bring this bill to a vote & make your members' support for predatory junk fees official. pic.twitter.com/JuzHU921ur
— Progressive Caucus (@USProgressives) July 17, 2024
The House GOP's defense of junk fees undercuts the election-year narrative of ascendant pro-worker populism within the Republican Party, which is working aggressively to overturn labor protections enacted by the Biden administration.
In April, Republicans on the House Financial Services Committee voted unanimously to advance Rep. Andy Barr's (R-Ky.) resolution to undo the CFPB's rule on late fees. Every Democrat on the panel voted no.
The House Republicans who backed Barr's resolution have received millions of dollars in donations from leading credit card issuers and industry groups fighting the CFPB rule, according to the progressive watchdog group Accountable.US.
Sen. Tim Scott (R-S.C.), a vocal supporter of Republican presidential nominee Donald Trump, is leading the Senate effort to roll back the CFPB rule and has criticized the Biden administration for characterizing credit card late-payment penalties as "junk fees."
According to OpenSecrets, Goldman Sachs employees, executives, and PACs have been Scott's largest campaign contributors over the course of his Senate career.
Sen. Elizabeth Warren (D-Mass.) said during a Senate Banking Committee hearing last month that Republicans are "falling all over themselves to defend these junk fees."
"If you're wondering why Republicans are introducing legislation to protect junk fees and working overtime to come up with fantastical legal theories to kill the CFPB, I think the answer is pretty clear," said Warren. "Republicans are in bed with big business to rip off families and to protect corporate bottom lines."
