Rotating Header Image

Where’s the “Chase executives lied about opt outs” headline? It’s more likely that the story I’ll see 7 times in one hour on cable news is “a woman found an alligator in Florida.”

Obama administration officials plan to meet with credit card company executives at the White House next Thursday, April 23, 2009.  Various reports leave it unclear as to whether or not the President will be in attendance.  According to CNBC, which is citing a Reuters report, he will not.  Rather, “Treasury Secretary Timothy Geithner, National Economic Council Director Lawrence Summers and other officials are planning to attend the meeting.”  However, according to FoxBusiness “sources do not rule out” that the President will attend.

The aforementioned Reuters report indicated a list of credit card industry representatives that may be involved, which was as follows: Discover Financial Services, Visa, Mastercard Incorporated, JPMorgan Chase and Co, Wells Fargo and Co, Citigroup Inc, American Express Co, Bank of America Corp, Capital One Financial.  If the banks do face any changes, I expect that they’ll whine that they need plenty of time to comply.  (Remember, Chase argued customers should only need 15 days to comply with its new rules, but it wanted 18 months to comply with new FED Regulation Z rules.) 

I note that an unnamed official was quoted to say the meeting is “basically just a part of our normal outreach to different groups to hear some of their concerns.”   A Capital One spokesperson said that “We have been invited to the White House.”  I’m also willing to bet that at the meeting these supposedly competitive company representatives will all get along with one another famously — they operate like a drug cartel, so I’m sure it will be one big happy family gathering.  Perhaps the White House chef will have some wine ordered in from the “old country” to serve with lunch (no fryer leg quarters with cream of mushroom soup for these invited guests).     

We already know that the theme on the part of the bankers will be the one we always hear: we have to manage risk.  But the reality is that what banks really mean (as evidenced by their actions) is that “if we can’t rate-jack and payment-jack account holders, and design card products with built in traps such that we can ‘have our way’ with customers [victims] any time we want,” we’re going to threaten that credit availability will suffer and costs will be higher.  And you know what?  I hope that when these banks later try to prove their point, it backfires on them and leads to a resurgence of community banks and credit unions.  Once gasoline prices double again (they will), we’ll all need to stay closer to home, anyway.

Somehow, in the minds of these bankers, they have grown accustomed to thinking that it’s “normal” and a valid “business model” to offer customers one set of terms, with the premeditated intent to change those terms into an altogether different proposition as soon as the account holder is “hooked.” 

In any other industry, this is called bait and switch, but with banks, they call it “managing risk.”  I do wonder how much risk all of those “clever MBAs and lawyers” working for these banks think is entailed in alienating a group of good-paying customers who have done nothing wrong? 

Of course, Chase has been the worst in recent times, using a blatantly coercive tactic to get customers to give up their previously promised promotional rates.  How does it help to manage risk, making payment terms so onerous (raising them to two-and-a-half times the previous rate) that customers can’t pay — literally pushing more and more American consumers into default?  These customers, already paid these banks once, by the way, with bail out money (so the banks want to double-dip). 

Well, I think it’s about time that our government did some “outreach” to “hear the concerns” that banks have created for consumers and small businesses, instead.   It’s ordinary working people, not banking executives, who are being massacred with an avalanche of change in terms notices by this group of thugs.  Hear some of mine (“Bob the Professor”):

1) Sooner or later, the bail out costs will come out of payroll deductions and increased fees and taxes on everything you buy: gasoline, cigarettes, car tags, property taxes, utilities, sales tax (have you noticed list of fees and taxes on your phone bill?). 

2) Your children and grandchildren are going to be footing the bill for this bail out debt, too. 

3) Talking about risk, I fear a new era of economic slavery (our ever-shrinking paychecks will be what’s left over after working for the government and the bankers most of the year). 

4) The problem that started this all in terms of consumer confidence and the tumble was the housing market (which has caused a year of separation/commuting in my family thus far); the bail out funds would have been less or perhaps not necessary at all if instead of bailing out banks, government had addressed the housing issue, first. 

5) Banks are knee-capping entrepreneurs — next to war or acts of terrorism, there is no greater risk to the possibility of an economic recovery, than that. 

Given that a significant portion of our so-called free press serves as nothing more than a mouth-piece for the financial services industry — as one of the most aggressive industries of all relative to advertising expenditures — I am also not surprised that reports about “invitations” to speak to Congress or the White House practically all include a “poor, poor, banks have to control risk” justification. 

Noting that Chase executives already lied about providing opt outs in testimony before Congress, I gather that there’s a good chance that they will not be held accountable by the media (or anyone else in our government) for whatever they say when they attend a meeting at the White House, either. 

Have you seen any significant coverage about these lies and misrepresentations with regard to the missing opt out despite the prior testimony in the major media?  Not me.  If I tune in to the national brand 24-hour news stations, it’s more likely that the story I’ll see 7 times in one hour is  “a woman found an alligator in Florida.” 

Where’s the “Chase executives lied to Congress about opt outs” headline?