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The U.S. House of Representatives passed by a vote of 357-70 today, a so-called ‘credit-card bill of rights’ bill, following the adding of a provision that will require banks to apply consumers’ payments to balances with the highest interest rates first.

Uncollected credit card debt rose to 8.82% in February, and that’s the highest amount registered by Moody’s Investors Service Inc. since it began keeping records twenty years ago.

The legislation will also require credit-card companies to give forty-five days notice before increasing rates, and require statements to be mailed at least twenty-one days before the payment due date, and the provision will take effect ninety days after the measure is signed into law.

The House bill imposes broader restrictions than those enacted by the Federal Reserve in December, leading House Speaker Nancy Pelosi to say, “Very soon this will be the law of the land, and consumers will benefit. The House action today will give the legislation momentum heading into the Senate, and with a Democratic president who will sign final legislation there is little doubt it will get support needed in both chambers”.

The senior Republican on the House Financial Services Committee, Spencer Bachus, voiced concern however saying, “Too many restrictions will lead lenders, such as Bank of America Corp. and Citigroup Inc., to pull back on credit in the midst of a severe economic decline. Credit cards play a crucial role in the life of ordinary Americans. Any legislation affecting credit-card practices is going to have a profound effect. There are a great number of people whose rates will go up”.

Edward Yinglingm, who is the President and Chief Executive Officer of the American Bankers Association said in a statement, “It is vitally important to maintain access to credit at this difficult economic time. This is especially true for credit cards, which serve as a driver of economic activity and are relied on by consumers and small businesses as way to bridge short-term financial gaps”.

Obama's vision splits small businesses | Entrepreneurial

blogs.reuters.com1/25/12

What do small businesses make of Obama's State of the Union address and promises for job growth and tax reform?

polecat news and views: Obama's Vision for a Spartan America

donpolson.blogspot.com2/4/12

Obama's Vision for a Spartan America. BY JONAH GOLDBERG. President Obama's State of the Union address was disgusting. The president began with a moving tribute to the armed forces and their accomplishments. But as …

Can America Afford Obama's Vision?

President Obama’s vision of what America ought to look like in the future, would hugely raise government spending on health care, energy and education, and taxpayers would have to foot the bill for a larger, more intrusive government.

His $3.6 trillion debt proposal isn’t simply a bunch of numbers and tables however, but it’s the basis of his underlying philosophy. He believes that throwing staggering amounts of money at schools, hospitals and environmentally friendly industries, will also lay the foundation for the next economic boom.

Do his figures add up?

The Budget Office forecast is for a 10-year cumulative deficit of $9.3 trillion which is $2.3 trillion higher than the administration’s estimate, and it predicts that the government would spend an average of 23.7% of its GDP yearly, while only receiving 18.4% of GDP in revenue during the same period.

What would that mean?

It would mean yearly federal deficits averaging 5.3% of GDP and a budget gap of about $1.2 trillion by the year 2019.

What does Obama have to say on the subject?

"We cannot and will not sustain deficits like these without end."

It is not surprising then, that many Conservatives who envision a totally different society are in growing opposition to Obama’s plans. They mostly envisage prosperous and thrifty two-parent families who pay for their own health and auto insurance, and an economy in which a middle-class family’s tax burden is so low that there is money left over to save for education and retirement.

The Republicans are not the only ones that are showing mounting concern however, and Senator Kent Conrad, who is chairman of the Senate Budget Committee, recently expressed his skepticism about making the president’s "Making Work Pay" tax break, a permanent one.

Obama’s proposed tax plan would phase out at family incomes of $190,000 or more and carry a 10-year cost of $537 billion, and he has also requested an additional minimum of $234 billion in individual, and $100 billion in business-breaks on top of the initial one.

Obama’s highly ambitious agenda, which includes healthcare expansion, new spending on clean energy and education, and a cap-and-trade system (a cap and trade system is a market-based approach to controlling pollution that allows corporations or national governments to trade emissions allowances under an overall cap, or limit, on those emissions. to combat global warming) has also caused many others to express their concerns too.

U.S. Representative Richard Neal, Democrat of Massachusetts, who is a longtime member of the House Ways and Means Committee said, "I think the reality is going to settle in that we are going to have to pull back on something".

James Horney, who is the director of federal fiscal policy at the Center on Budget and Policy Priorities said, "Over the longer term, the federal government is going to need more revenue than Obama is proposing and anybody who has looked at the problem and doesn’t have ideological blinders on reaches that conclusion".

Will taxes have to go up if Obama’s plans are passed?

Robert Reischauer, former director of the Congressional Budget Office says, "The unvarnished truth is that as we move forward over the next five to 10 years, we are going to have to raise taxes across the board or significantly cut back programs which affect the middle class and the lower class", and Bob Bixby, who is executive director of the Concord Coalition said, "One of the mistakes Obama is making is saying nobody under $250,000 is going to be affected. The deficit is just too big, and you can’t get it all from families earning more than $250,000. Taxes are going to have to go up at some point!.