Friday, March 9, 2007

Ruthless profiteering

When corporate America bows to demands of shareholders for higher and higher profits, social responsibility and conscience sometimes fly out the executive suite window.

Big Tobacco lured smokers into a deathly habit with fraudulent claims that puffing was safe. Cemeteries are filled with the gullible who believed the advertising and helped pour profits into the coffers of irresponsible corporations.

Major U.S. news media are now running scared because their 20 percent to 30 percent profits don't slake Wall Street's greed for higher profits. The nation's second largest media group, Knight-Ridder, was even sold and then broken up by the new owners to satisfy overpowering Wall Street avarice.

Now the nation's consumers are getting a peek into the ruthless profiteering of credit cards, which are gold mines for inexhaustible profits. They hook the unwary on charging purchases, then slap on interest rates and penalties that send balances soaring, leaving card members with principal and interest virtually impossible to retire.

One card member of the Chase Bank system testified to a Senate committee that $3,200 in purchases led to interest of $4,900, over-limit charges of $1,500, and late fees of $1,100. After being jolted with a subpoena, Chase executives apologized and canceled $4,400 of the hapless consumer's $10,700 total bill.

It's clear that some credit card companies have found a license to steal—legally.

These usurious charges are outrageous and don't reflect the real costs of servicing a credit card loan. Such unconscionable abuse of consumers must be reined in with new federal laws to protect the unwary, make the greedy more responsible, and ensure fair transactions.

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