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Editor’s Note: President Barack Obama and members of Congress are promising a new law to stop credit card companies from using fine print to exploit cardholders. But there’s a catch in the bill – a one-year delay so the companies have time to adjust their business models, essentially another loophole that is hastening rate hikes and credit-limit cuts before the new law can take effect.

Sadly, this rush to beat the new restrictions is hitting the most vulnerable Americans the hardest, from recently laid-off workers to U.S. soldiers whose low pay and frequent deployments make them easy prey for credit card rip-offs, as Brent Budowsky notes in this guest essay first published at The Hill:

As Memorial Day arrives, veterans and military families will be victimized by continued credit card interest rate and fee hikes, and under the House-passed credit card bill, abuses will continue until next Memorial Day, because the effective date of the key provisions of the House bill is a year from enactment.

The President demands passage of the credit card bill by Memorial Day, and is holding a town meeting this week, saying credit card rip-offs do great and unfair damage to Americans during a recession with high and growing joblessness.

Does the President oppose the one-year effective date in the House bill, and favor an immediate end to the rip-off practices he condemns?

If someone is drowning, do we wave the life preserver but say, “Tough luck, you can’t have it for a year”?

Small business is the great engine of growth and innovation, yet millions of small-business owners are victimized by paying for bailouts, then being denied loans by banks hoarding money — and then, needing credit to run their business, having their interest rates hiked, fees increase and credit limits slashed.

Should small-business owners endure another year of these abuses?

Across the heart and soul of America today, millions of workers are desperately trying to save their companies, keep their jobs and make ends meet. Should they spend another year suffering interest rates hiked to as high as 30 percent, rates once banned by usury laws and imposed by organized crime?

Homeowners throughout the land will be on their knees tonight, praying to God that they can continue making payments to avoid being the latest victims of our Grapes of Wrath.

Having paid for the bailout, should they be forced to fall to their knees for another year, begging banks not to impose additional hardships that the President, the House, the Senate and the Fed all claim are abuses that should be ended?

Mr. President and ladies and gentlemen of the Congress, I have been in this town a long time and have seen many things, but even by the standards of “business as usual,” this is horribly and terribly wrong.

If Congress passes this bill, with this effective date, at this time, in this nation, with this hardship befalling so many of our people, this will be remembered by voters as a dark day for Democrats, Republicans and Congress.

When 600 million credit cards receive a “change of terms,” voters -- who receive these letters before this bill is effective, in states and districts throughout the nation -- will rise against those whose votes imposed this pain. Any delayed effective date is a lethal weapon against hard-hit Americans, and will be a lethal weapon to be wielded by any challenger against any incumbent unless this provision is dramatically changed.

Any bill that allows these abuses to continue for another year, or any prolonged period of time, under the guise of ending these abuses, is a fraud against good Americans who are enduring enormous pain through no fault of their own, and deserve far better from those they elect to serve them.

The effective date should be immediate, or the President and Congress should formally ask banks to freeze interest rates for six months, at least, before passage.

Brent Budowsky was an aide to former Sen. Lloyd Bentsen and Bill Alexander, then chief deputy majority whip of the House. He holds an LL.M. degree in international financial law from the London School of Economics. He is a columnist for The Hill newspaper where this article first appeared. He can be e-mailed at [email protected].

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