Trump Urges Congress To Cap Credit Card Interest Rates As Republican Leaders Push Back On Plan

President Donald Trump urged Congress on Wednesday to pass legislation capping credit card interest rates at 10% for the next year, a proposal that has drawn criticism from Republican lawmakers.

Trump pressed Congress to take action on credit card interest rates during a speech at the World Economic Forum in Davos, Switzerland. Last week, the president pressured banks and credit card companies to lower interest rates for one year, but he didn’t address how he would force them to comply. A deadline had been set for Jan. 20, but institutions have yet to follow Trump’s directive.

“The profit margin for credit card companies now exceeds 50%, and they charge Americans interest rates of 28%, 30%, 31%, 32%. Whatever happened to usury?” Trump said on Wednesday. “So, to help our citizens recover from the Biden disaster all caused by this horrible president, I’m asking Congress to cap credit card interest rates at 10% for one year.”

“And this will help millions of Americans save for a home,” he added.

Leftist Massachusetts Sen. Elizabeth Warren, who has pushed for capping credit card interest rates, said last week that Trump called her to discuss the issue. Warren said that she told Trump “he had not lifted a finger to try to get something through on credit card interest rate caps.”

Democratic socialist Bernie Sanders (I-VT) and Republican Josh Hawley of Missouri also support the idea. Both senators introduced a bill last year to cap credit card interest rates at 10% for five years. Leftist Congresswoman Alexandria Ocasio-Cortez (D-NY) and Florida Republican Anna Paulina Luna introduced a similar bill in the House, but the legislation has not made any progress in Congress.

When Trump publicly floated the idea of capping interest rates last week, Republican leaders in the Senate and House poured cold water on the proposal. House Speaker Mike Johnson (R-LA) said last Tuesday, “The president is the ideas guy,” adding, “I wouldn’t get too spun up about ideas that are out of the box, that are proposed or suggested,” POLITICO reported.

“You’ve got to be very careful if you go forward in that,” Johnson continued. “In our zeal to bring down costs, you don’t want to have negative secondary effects. The problem is, if you do that, then the credit card companies, the negative secondary effect is that they would just stop lending money, and maybe they cap what people are able to borrow at a very low amount.”

Senate Majority Leader John Thune (R-SD) said, “That’s not something I’m out there advocating for.” Thune told NBC News that he believes Trump is getting bad advice.

“He may be getting advice on some of those issues, like, for example, the 10% cap on credit cards,” he said. “Don’t know where that came from. I don’t know. I don’t know the answer.”

Now that Trump has called on Congress to act on capping credit card interest rates, Republican leaders could find themselves in a tougher spot if they continue to publicly oppose his plan.

JPMorgan Chase CEO Jamie Dimon, who is also in Davos, said on Wednesday that a cap on credit card interest rates “would be an economic disaster.”

“In the worst case, you’d have a drastic reduction of the credit card business” for 80% of Americans, Dimon said, according to CNBC. He then quipped that the United States should test the idea in Warren’s and Sanders’ home states of Massachusetts and Vermont, “and see what happens.” The banker added that those on “the Left” who push for price controls “will learn a real lesson, and the people crying the most won’t be the credit card companies.”

“It’ll be the restaurants, the retailers, the travel companies, the schools, the municipalities, because people miss their water payments,” Dimon said. “It would be something else to watch.”