What to Know
- Sen. Bernie Sanders and Rep. Alexandria Ocasio-Cortez will release a plan Thursday to cap credit card interest rates at 15%
Sen. Bernie Sanders and Rep. Alexandria Ocasio-Cortez have a new target: credit card companies.
The lawmakers, who identify as democratic socialists, will unveil a plan Thursday to cap credit card interest rates at 15%, according to The Washington Post. The measure aims to cut current rates significantly: in February, the average credit card interest rate sat at 17.41 percent, up from 16.15 percent a year earlier.
In an interview with the Post, Sanders said: "Wall Street makes tens of billions from people at outrageous interest rates." The Vermont independent told the newspaper he was "sure" the plan would face criticism, but added, "Maybe Congress should stand up for ordinary people."
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The measure will have a tough time getting through Congress, particularly the Republican-held Senate. The bank industry will likely oppose it. But the proposal still sends a message: it comes amid a 2020 Democratic presidential primary during which contenders have tried to cast themselves as the strongest champion for workers and consumers.
Sanders has made his case for the presidency in large part by calling out what he calls corporate greed and the need for better protections for workers and consumers. Ocasio-Cortez, a first-term representative from New York, has caused a stir during her short tenure by embracing dramatic proposals, such as the Green New Deal, to overhaul the U.S. economy and tax system.
Sanders' office did not immediately respond to a request to comment on the legislation. CNBC could not immediately reach Ocasio-Cortez's office.
The bill comes amid mounting debt in the U.S. Outstanding consumer debt topped $4 trillion for the first time in February, CNBC previously reported.
The plan fits into a campaign strategy already deployed by Sanders and Sen. Elizabeth Warren, a Massachusetts Democrat and consumer advocate. They have not only put forward policies designed to boost consumers, but also criticized former Vice President Joe Biden — who has led most early polls in the Democratic primary — for being too cozy with Wall Street and credit card companies. Financial companies have a large presence in Delaware, which Biden represented in the Senate for decades.
Warren has said Biden was "on the side of the credit card companies" during a fight over a bill, passed in 2005 with Biden's support, which made it harder for individuals to declare bankruptcy and wipe out debt. Biden campaign spokesman Andrew Bates previously told Vox that, because the legislation "was a certainty" to get through the GOP-held Congress and White House, Biden worked to win "important concessions for middle class families" as part of the plan.
This story first appeared on CNBC.com. More from CNBC: