Though highly unusual, House Rules Chairwoman Louise Slaughter said Tuesday that her scheduling of a Jan. 27 hearing on a bill to cap credit card interest rates should not be seen as stepping on Financial Services Chairman Barney Frank's jurisdictional turf.
The bill, introduced by Slaughter and Rep. John Tierney, D-Mass., would cap the interest rates at 16 percent, while also putting a $15 ceiling on fees. It has 70 co-sponsors, and has officially been referred to both committees.
However, some may view its referral to Rules and Slaughter's scheduling of a hearing as the latest evidence of ongoing tensions between the two lawmakers, who don't pull their punches. Compared to other committee chairmen, Frank has been more willing to allow GOP amendments for House floor debate. He once, during floor debate on a bill he was shepherding, sympathized with Republicans that a GOP amendment should have been made in order.
Slaughter acknowledged Tuesday in an interview that she has yet to talk with Frank about the decision to press ahead with her hearing on a bill that would seem to fall under his committee's jurisdiction.
But Slaughter explained, "I don't think he has any objection. I left it pretty much to Tierney to talk to him since they see each other more often than Barney and I do."
Frank has no problem with Rules holding the hearing, said spokesman Steve Adamske. "We will see where the hearing goes," Adamske said. "It will be useful. We will look into it."
During debate in April over legislation that would crack down on credit card issuers, the Rules Committee made in order an amendment from Rep. Maurice Hinchey, D-N.Y., that would cap credit-card interest rates at 18 percent. Hinchey later withdrew his measure under pressure from House leaders, who argued that if it were to be adopted, it would throw a major kink into trying to clear the bill.
Ultimately, the Senate passed its own version of the bill, which the House later ratified and sent to President Obama.
The legislation would ban issuers in most cases from raising rates on existing balances retroactively, require a 45-day notice for any rate increase and prohibit billing on balances for days not included in the last billing cycle as a result of a grace period.
The Federal Reserve finalized rules on the bill on Tuesday, such as banning over-the-limit fees unless the customer opts for such protection; requiring those under 21 years of age to show they have the means to pay off their debt or have to get a co-signer; and prohibiting a rate increase for the first year an account is open.
Slaughter said her bill was prompted by what she views as continued widespread disappointment in the congressional reforms of the credit card industry.
Slaughter noted that she and other lawmakers had tried to include limits to the amounts of interest credit card companies could charge in the legislation passed last year.
"I think a lot of people felt that the reform bill -- I don't want to even call it that -- that the re-regulation was pretty weak," said Slaughter.
Slaughter said she doesn't blame Frank. "At the same tine, I appreciate how difficult it is for him get anything through that committee," she said.
Though battered, the industry is adamantly opposed to the Slaughter bill and has stymied similar efforts on Capitol Hill, arguing that it would restrict credit to consumers and result in higher rates and fees. But the banking industry is not taking anything lightly in the current political environment.
"It's government price control to eliminate the free market and greatly reduce the availability of credit for Americans," said Scott Talbott of the Financial Services Roundtable.
Slaughter said she is now pressing ahead with her and Tierney's bill not so much out of a sense of frustration, "but out of a sense of necessity." And she said Congress needs to act as quickly as possible on her legislation.
"We put the bill together. Rules has a lot of jurisdictional hooks that we don't take advantage of," said Slaughter. She noted her committee last summer held a hearing on legislation that dealt with the use of antibiotics in agriculture.
Slaughter said she does not expect any pushback from Frank, and that her efforts should not be seen as personal.
"Barney's a creature of legislation, as am I. We both understand how this goes. Many of us -- we've got a lot of co-sponsors -- felt it was really important to do something about this," said Slaughter.
"I've heard of one case where the interest was at 78 percent," said Slaughter. "I don't even know what you call that. That goes so far beyond usury it would have to have its own name."