[SpicyLemonZest]

I don't disagree with anything the author is saying. But the corollary, which the article doesn't really acknowledge, is that reforms like credit card interest caps and the Credit Card Competition Act would substantially limit consumer access to credit. That's the argument that banks raise every time and why interest rate caps always die in committee.

If advocates want to team up with Dave Ramsay and say "that's right, credit cards are bad, we want them to be less available", perhaps things could change one day. I'd donate to that cause. If we keep pretending that we could have exactly the same system with lower interest rates, I don't think we'll ever get anywhere.

[willio58]

> But the corollary, which the article doesn't really acknowledge, is that reforms like credit card interest caps and the Credit Card Competition Act would substantially limit consumer access to credit.

That's a good point, and of course there are downstream affects of this, but I wonder if that's a bad thing. We're not talking about reduction in ability to access say mortgage debt or something of that nature, we're talking credit card debt. Making it possible for a person to be in $10k, $20k, $40k+ in extremely high interest credit card debt doesn't seem like a positive for our economy overall to me. It really just masks the root of the problem, which is that people are working paycheck to paycheck and can't afford the occasional emergency.

[fragmede]

What is this hypothetical tens of thousands of credit card debt made up of though? Yeah, some of it is going to be unnecessary luxuries, but some of it is going to be essentials like baby formula and groceries. Limiting how high the interest rate can be can only be a good thing. Usury is considered a crime in-and-of-itself in other countries.

[s1artibartfast]

I increasingly think people should have the option to define if they should be treated as an adult or not, kinda like an organ donor on their license.

Those who opt out would be protected from their own choices.

[SpicyLemonZest]

I think you're severely overrating the average level of financial literacy. If Alice has $3,000 in the bank with no credit card debt, and Bob has $10,000 in the bank with $7500 in credit card debt, who's richer? A lot of people will tell you that Bob is (he has three times as much money!), and a lot of reasonable, hard-working Bobs will tell you with a straight face that they're paying off as much as their budget allows each month. I don't think our financial regulations should require telling Bob that he's a child who can't be trusted to take care of himself; people shouldn't offer him products that are designed to exploit his mental accounting bias.

[s1artibartfast]

Thats exactly what I am talking about. Make a class of people that are protected on the basis of the illteracy, comprehension deficits, or lack of self control.

Let people decide if they want to be protected from their choices.

> I don't think our financial regulations should require telling Bob that he's a child who can't be trusted to take care of himself; people shouldn't offer him products that are designed to exploit his mental accounting bias.

It seems you want to protection and agree it is needed. If it hurts Bobs feelings, make the system opt out instead of opt in.

[SpicyLemonZest]

To me, making the system opt out means ensuring that half the stores you go to and constant junk mail aren't urging you to get free credit cards. Credit cards should be more like investment brokerage accounts: something that anyone can open, and can do irresponsible things with, but clearly messaged as an advanced and complex financial product rather than something a typical person should make an everyday part of their life.

[s1artibartfast]

But credit cards arent a very complec financial product, and the vast majority of people can manage them just fine, and get the benefit.

Do you have any reason to think junk mail is big factor in people getting credit cards? I would assume most people like the idea of convenience, and dont think they will go into debt. most are right.

[eudamoniac]

But... Bob is a child. Why do we need to put training wheels and kneepads on every aspect of our world? Are we trying to completely decouple decision making from outcomes? Let the stupid people be stupid and let the smart people thrive, I say. If there is no such thing as a bad decision, nor is there a good one, thereby there is hardly any life left to live. Let people pilot their own lives.