Political News

Bernie Sanders and Alexandria Ocasio-Cortez team up on credit card interest rates

Posted May 9, 2019 12:03 p.m. EDT

— Vermont Sen. Bernie Sanders, a 2020 presidential contender, and freshman New York Rep. Alexandria Ocasio-Cortez are teaming up for their first major joint push in Congress.

The pair are unveiling new legislation Thursday that would cap credit card interest rates at 15%, according to information provided by Sanders' office.

The bill from Sanders and Ocasio-Cortez, one of the most popular figures on the Democratic left, are addressing an issue that many closely identify with another presidential contender, Massachusetts Sen. Elizabeth Warren.

Ocasio-Cortez has not endorsed any primary candidate and has indicated she could wait until New York votes next year before making a decision. But she and Sanders campaigned together for other progressive hopefuls in 2018 and Ocasio-Cortez appeared at a climate change panel hosted by Sanders late last year. They have maintained a close relationship since she entered Congress.

Their new proposal, called the Loan Shark Prevention Act, would cap the interest rate on both credit cards and consumer loans, while giving the Federal Reserve authority to temporarily allow a rate increase if the "safety and soundness" of a lender is threatened. It's similar to how existing legislation regulates loans made by credit unions.

Currently, the average credit cards interest rate is 17.7%, according to a CreditCards.com. Americans with poor credit scores tend to be offered higher interest rates. Maximum rates tend to be well over 20%.

The rollout of the bill comes as former Vice President Joe Biden's new campaign has begun to reshape the Democratic field. Biden has been criticized over the years -- most notably by Warren -- over his relationship with the credit card industry.

Warren, who has also seen a recent bump in support, co-sponsored a bill in April that would allow states to put caps on credit card interest rates for their residents.

Ocasio-Cortez has also been a leading congressional supporter of the Green New Deal, an ambitious and expensive plan to fundamentally remake the American economy around a blueprint to move the country to clean, renewable energy over the next decade.

She teamed with Massachusetts Sen. Ed Markey, who has already endorsed Warren, to introduce a Green New Deal resolution earlier this year. Sanders, Warren and other leading Democrats have endorsed the plan.

Next week, Ocasio-Cortez will -- alongside Markey and other activists, including the Sunrise Movement -- headline an event at Howard University in Washington to kick off what Sunrise is calling "a nationwide campaign to make the 2020 election a referendum on the Green New Deal."