Attorney General Richard Blumenthal has begun yet another campaign. This time his target is the credit card industry. He has alleged, and the industry has admitted, that creditors are increasing rates and fees on credit worthy customers. The credit companies have alleged they are raising these rates and fees to help offset the risk incurred by less credit worthy borrowers and to recoup losses faced after increases in defaults during the down economy. Blumenthal alleges that it is not fair for the credit worthy borrowers to have to face additional burdens to help credit card companies deal with the problems of less credit worthy customers.
But isn't that exactly what the progressive tax system used by the United States does? The whole justification for taxing the rich at rates that are grossly disproportionate to the poor is that they can afford the burden. The House certainly thinks so, the healthcare bill that passed the House imposes new taxes on the super rich to help buy insurance for those who don't have it. And even here in Connecticut there was a move recently made by Democrats, including our favorite former candidate for Mayor Tim O'Brien, to make our income taxes far more progressive so that the more wealthy would be stuck with a higher tax bill.
If it is fair for the government to disproportionately rely on the more successful and more economically stable citizens to fund all of its social programs then it should be just as fair for a corporation to do the same. Perhaps after he is finished posturing as the champion of the common man Attorney General Blumenthal can take some time to explain to the voters who are about to pay the bill for the healthcare overhaul why we should be so glad that now our 18% interest rate on our credit card is back down to 12.5%.
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