IDS 1: Usury is Bad Act of 2013

[Dereich]

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Sponsor: Sjoyce

[Donerail]

This sets an official max legal rate of interest (and other standards) and encourages other regions to adopt similar legislation.

[Supersonic]

6% as an interest rate? That's rather high.

[Dereich]

It depends on what we're talking about. If its the overnight rate or the federal funds rate its high. If we're talking about credit cards its low enough to stop any sane bank from issuing them in the IDS. From what I can tell the only thing this would do is drive business from the IDS.

[Donerail]

It depends on what we're talking about. If its the overnight rate or the federal funds rate its high. If we're talking about credit cards its low enough to stop any sane bank from issuing them in the IDS. From what I can tell the only thing this would do is drive business from the IDS.

Admittedly, the average credit card interest rate is around 15%, though that can vary upwards massively (some have had interest rates up to almost 80%). The issue is that some states (South Dakota, Delaware, Nevada to an extent) have removed or drastically raised their interest rates - these corporations are then allowed to 'export' that rate to cardholders across the country, which of course leads to staggering interest rates (say, of 79.9%). The solution could be a federal usury law, but this is what we can do as a region to fix it.

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Would this amendment address your concerns about jobs?

[H.E. VOLODYMYR ZELENKSYY]

I'm not that up on my monetary policy, so I'll probably be abstaining from debate (and voting) on this.

[Maxwell]

If you instituted this, wouldn't people just go over to Cash Now or Check in the Cash places and suffer even higher rates? That's my concern for legislation like this and why I don't think I'll institute it in the Midwest.

[Dereich]

I don't get what you're trying to do with this bill. It can't be enforced because its unconstitutional and even if it could it would just drive out credit cards and could make people resort to more risky ways to obtain credit. What are you hoping to accomplish?

[Donerail]

I don't get what you're trying to do with this bill. It can't be enforced because its unconstitutional and even if it could it would just drive out credit cards and could make people resort to more risky ways to obtain credit. What are you hoping to accomplish?

My primary concern was abusive terms and policies from credit card institutions - specifically massive interest rates. My goal was to curb those practices. My intention wasn't to drive out credit cards, but just to offer consumers more protections (of course, most of the credit cards are gone already, to SD and DE). I don't see the unconstitutionality of it, but regardless of that, those are my aims: if you have another way to do that, I'm open to anything - and it's fine if you want to raise the rates in the legislation too.

[Supersonic]

I'm not that up on my monetary policy, so I'll probably be abstaining from debate (and voting) on this.

I think I'm with you on this, monetary policy is not my forte.

[Velasco]

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This is the question. Your bill would be more useful if you promote it in the Senate, in case of being elected.

[Dereich]

I agree with Velasco's statement here. This is much more of a federal matter than a region one. In either case, I don't really agree with it. Any more debate?

[Dereich]

Seeing no further debate, this will now be brought to a vote. Legislator have may vote either aye, nay or to abstain. The vote will end once either all legislators have voted or 48 hours has passed.

[Dereich]

Nay

[H.E. VOLODYMYR ZELENKSYY]

Abstain.

[Zanas]

Abstain

[Supersonic]

Abstain.

[Dereich]

With a vote of 0-1 with 3 abstentions this bill fails.