Gregory Angelo: If Ocasio-Cortez, Sanders really cared about everyday Americans they would do THIS
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It shouldn’t be a surprise to anyone that the infamous socialists Rep. Alexandria Ocasio-Cortez, D-N.Y., and Sen. Bernie Sanders, I-Vt., unveiled a new policy that’s aimed at targeting Wall Street. However, the only thing their deceptively titled Loan Shark Prevention Act will do is hurt the pocketbooks of common Americans.
The Act would cap all interest rates on consumer loans at 15 percent, effectively eliminating credit line options for millions of Americans.
Credit lenders often times extend credit with higher interest rates as a precaution if the potential borrower has bad credit as a way to mitigate risk. For example, an auto loan lender can take back your car if you default on the loan. But for credit lenders, there is no guarantee they will get their money back. So lenders can charge higher interest rates to compensate for that risk that the borrow obliges to. If borrowers can show the lender that they can make payments on time and that they are becoming less risky, the lender can reduce the interest rate.
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Putting a cap on loans will only hurt Americans by making it too costly for credit lenders to risk lending potential borrowers credit. Thus, pushing borrowers into the hands of dangerous and illegal loan sharks. Exactly what the Loan Shark Prevention Act is aimed at preventing.
To deal with the loss of credit options resulting from the Act (which the bill’s authors outwardly acknowledge will happen), Ocasio-Cortez suggests that the already unprofitable U.S. Postal Service enter into the banking business by offering savings and checking accounts. So now, not only will someone wait an hour just to mail a package at their nearest post office but they can also bear the absurdly long wait times just to deposit a check.
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Even more incredible is the fact that these socialist politicians believe that capping interest rates will save money for Americans but have no problem raising income tax rates to nearly 70 percent, taking out trillions of dollars every year from taxpayers' pocketbooks.
Ocasio-Cortez and her comrade Sanders believe that this policy will specifically target Wall Street executives by reducing their profits; however, the Act’s implications will only hurt common Americans by eliminating potential credit options — further harming the people they claim to care most about.
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The Loan Shark Prevention Act aside, this would not be the first time that proposed socialist policies’ implications would hurt most common Americans. Take for instance Sen. Sanders’ "Medicare-for-all" plan, mandating a government takeover of private health insurance that over 200 million Americans rely on. On paper, these policies may seem like good ideas, but in reality, they would only add trillions of dollars in debt to the economy and potently spark another recession. Like Medicare-for-All, the Loan Shark Prevention Act will only expand government powers at the cost of eliminating a private sector option for Americans.
Policies that are aimed at taking down large industries such as health care providers or banks will cause more harm than good by hurting common Americans who rely on these services. If Ocasio-Cortez and Sanders really cared about everyday Americans, they would leave the services they rely on most, alone.