The State of Arkansas has historically been very serious about prohibiting usury

Question

The State of Arkansas has historically been very serious about prohibiting usury, the charging of excessively high interest rates. This policy was expressed in the Arkansas Constitution. The policy offended big banks and credit card companies. By federal statute and Supreme Court decision the Arkansas policy was forced to comply with the prevailing laws in the other states. The federal law even rewarded credit card issuers for incorporating in states that had no usury laws at all, because that allowed them to dramatically raise their rates in places like Arkansas. Some issues you may wish to explore: Are we as a nation too addicted to debt? If a state government wants to protect its citizens from themselves, should it have that right? Are bankers being treated too well by the federal government that claims to be looking out for the little guy?

Explanation / Answer

Usury Law.

Usury law means setting a rate of interest higher than the current market interest.

Are we as a nation too addicted to debt?

Yes, we can say that as a nation we ar too addicted to loans as for each and everything we prefre to take loans wheter it is home loans,car loans, business loans etc.

Consumer credit has doubled since the year 2000. Student loan debt has doubled over the course of the past decade. Business debt has doubled since 2006. And of course the debt of the federal government has doubled since 2007. And if we believe that we are in good shape i doubt because this mountain of debt is growing bigger day by day and we are being addicted towards it.

Because our income sources are limited whereas our debt are unllimited. It seems that we have not learn fron sub-prime crisis of 2007 till now.

If a state government wants to protect its citizens from themselves, should it have that right?

Yes, if a state government is thinking in interest of consumers it's good but laws like Usury are not good for citizens of any state. I would advocate that per supreme court decisions we should implement the same rates which are prevailing in other states. And goverment should also encourage it's ccitizens more on saving rather than spending which is the main reason for the loans being taken.

Are bankers being treated too well by the federal government that claims to be looking out for the little guy?

I wont say such because federal goverment aand supreme cousrt both are just trying to have a law common law prevalent in all states which will have good impact on the citizens as well. They will pay same interest on their debts in which ever state they reside.

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