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Prime Rates and Prime Rib: dealing with consequences not causes

Jack Layton just announced that the NDP would cap credit card rates to 5% above the prime rates (presumably the commercial banks’ prime). All good and all although my credit card rates are around that. But what are the causes of increasing indebtedness of Canadian households? Sadly talking about credit card rates misses what the NDP should be talking about; namely the path of productivity and income growth over the last thirty years and increase in income inequality. There was a time when the NDP talked about such things.

Capping credit card rates sounds more like incremental policy drift than a policy vision. Same thing could be said of all the other parties at this point.

And that too is the point.

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