Williams, Todd Rail Against 'Ultimate Indignity' of Higher Credit Card Interest and Fees

“NBC Nightly News” has found another populist cause for President Barack Obama to champion – banks passing along higher costs to issue credit to borrowers instead of bearing the brunt themselves.

An April 22 “Nightly News” segment went after major credit card companies, claiming it was the “ultimate indignity” that taxpayer money from the TARP bailout had been used to save the banking system at the behest of their elected leaders, while those same banks were making credit card rates and fees higher.

“There’s more economic news tonight,” anchor Brian Williams said. “It has to do with credit card rates. They’ve become as you know, the ultimate indignity. Banks that depend on taxpayer bailout money to stay alive, upping the interest rates for their credit card customers. This has not gone unnoticed apparently at the White House. They are taking on this topic tomorrow.”

In the segment, NBC White House correspondent Chuck Todd essentially confirmed the assertions of conservatives who say [1]the mainstream media has no clue what the tea parties were really about when he bizarrely claimed the April 15 Tax Day tea parties were part of the rising tide of public anger over the credit card fees.

“You remember last week and we had all those tea parties and there were a lot of angry people about the tax dollars,” said Todd, [2]who had initially dismissed the tea parties. “Some of that anger had to do with what you just brought up – U.S. banks like Citi, like Bank of America, like American of, American Express – three of the largest credit card issuers you can think of. They’re getting billions, with a “b,” of money from the federal government. They also get to borrow money at almost a 0 percent interest rate. Yet, what’s happened in the last few months? People have noticed their credit card interest rates have gone up and have gone up in some cases dramatically.”

What Todd is neglecting to point out is that some of what is going on with credit card rates and credit in general is a sign of the general economy. Banks were leveraged 40-to-1 in some cases, and as CNBC’s Michelle Caruso Cabrera [3]pointed out recently, the higher interest rates and fees are all part of the de-leveraging process.

So banks (who are now risking taxpayer money) have been forced to be a little more careful with their credit card customers. But Todd reported in advance that Obama was going to straighten out their practices in favor of the customers.

“So the president is going to have a meeting with 14 of the top CEOs of credit card issuers and he’s going to flat-out tell them things have got to change. You got to make these interest rate increases, you got to do more disclosure – in a way, make those increases a lot easier to understand. And make it in such a way that it doesn’t look like you’re basically taking advantage of the federal government with tax dollars and passing on that savings only to their bottom line.”

“CBS Evening News” ran a similar one-sided segment [3]on its April 20 broadcast, attacking credit card companies for higher fees and rates.