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House refuses to outlaw young adult credit cards

Roll Call

On March 1, by a vote of 165 to 253, the House rejected a Democratic effort to amend the bankruptcy overhaul bill (HR 333) to prohibit dependent Individuals under 21 from owning credit cards without parental approval. The change was proposed under a motion to recommit the bill with instructions to add the credit-card provision.

Rep. John Conyers (D.-Mich.) wanted to amend the bankruptcy overhaul bill so that people under age 21 would not qualify for a credit card unless their parents co-signed the application or they could show "independent means" of being able financially-to pay the bills.

John J. LaFalce (D.-N.Y.) said that credit card companies "prey" on college students to get them to apply. "[College students] are suffering enormous stress," LaFalce said, "financial and emotional, and there have been suicides, dropouts from colleges, because the credit card industry deviated from the standards they had just a few years ago: That is, show sufficient income yourself, or have your parents sign the applications. ft Is as simple as that"

Conyers, the ranking Democrat on the Judiciary Committee, said, "Financial troubles caused by reckless lending to teens haunt some of them for the rest of their lives, costing them far more when they try to buy a car or home or take out future loans as they become responsible citizens ... [his is not about finger-pointing. It is all our moral responsibility, our children's, ours as parents, Congress', and yes, even the credit card companies, too. This Is a moral responsibility that none of us can shirk."

Judiciary Committee Chairman James Sensenbrenner (R.-Wis.), the main sponsor of HR 333, noted that the proposed amendment had nothing to do with the bankruptcy code. Rather, he said, it could come under the Truth-in-Lending Act, which protects consumers and strengthens finan-. cial institutions by enabling consumers to compare available "credit terms" and "avoid the uninformed use of credit"

Rep. Michael G. Oxley (R.-Ohio) found fault with the title of the amendment, "Issuance of Credit Cards to Underage Consumers." He pointed out that the credit applicants in question were of legal age and allowed to vote, and in most states were allowed to enter legal contracts at the age of 18.

Although the amendment has good intentions, he said, it is "certainly wrongly directed."

"These are, for the most part, responsible people," Oxley said. "We are really dealing here with stereotypes that are unfortunate because many of these people are responsible and treat credit in a responsible way, and they learn from their experience."

A "yes" vote was a vote for a Democratic motion to recommit the bankruptcy bill to add an amendment requiring parental approval for anyone under 21 to have a credit card and was, in effect, a vote for the amendment. A "no" vote was a vote against the motion to recommit and was, In effect, a vote against the amendment.

Copyright Human Events Publishing, Inc. Mar 12, 2001
Provided by ProQuest Information and Learning Company. All rights Reserved