Hearings to examine the affordability agenda.

Good morning to everyone who called this hearing to order. Let me first thank the witnesses for taking the time and making the investment of your talent for this committee to appreciate the issues that are challenging so many Americans around the country so I really appreciate you guys being here. Our committee seeks to answer a simple question. How do we make life more affordable for families in South Carolina and frankly, around the country? That is a question I hear all the time at home. How do we make this economy work for families who are already working hard, but too often there's just too much month at the end of the money? Housing is too expensive. Food is too expensive. Borrowing is too expensive. Everyday life is simply too expensive. A family in Wahala, South Carolina, trying to buy first home a small business owner in greenville trying to expand or senior citizen in rock hill south carolina living on a fixed income should not have to wonder whether washington understands what it means to choose yeah i mean this sincerely to choose between prescriptions or groceries affordability is not created by government programs more red tape or more spending we cannot afford. Affordability comes from promoting competition, innovation, and opportunity. That is why Senate Republicans have been focused on results that will bring relief to everyday Americans. We are approaching the one year anniversary of the working family's tax cut bill a bill that has put more money in the pockets of Americans who desperately need it. Because of this bill, ninety-seven percent of Americans received a tax cut this year, ninety-seven percent. And the people who benefit the most are people earning less than two hundred thousand dollars a year. Hardworking American families will take home more, nearly three hundred dollars a month more because of the working families' tax cut bill. Let's not forget, every single Democrat in the Senate voted against cutting taxes, which would have led to a five trillion dollar five trillion dollar tax increase. This committee has already advanced efforts to improve housing opportunity, create clear rules for digital assets, strengthen our markets, and make the financial system work better for everyday Americans. Our twenty first century Road to Housing Act, which just passed the Senate by historic margins. I think it was eighty five to four yesterday. Almost nothing happens in the Senate. Nothing happens in Senate eighty-five to four. We cut red tape, we are unlocking housing supply, and preserving local control. I look forward to President Trump signing that legislation into law. The Genius Act. Signing the law last year established the first of its kind regulatory framework for payment stable coins fueling financial innovation in America and creating economic opportunity The next step is solidifying American leadership in digital assets, in completing market structure legislation, and I'm proud of this committee's work to advance Clarity Act on a bipartisan fashion. Beyond legislation, we also have pushed for better implementation of my Credit Score Competition Act. So millions of Americans who's, who are today credit invisible will have an opportunity to earn the kind of credit scores and interest rates that they deserve by populating all of their information on the credit scoring agencies. And we have supportive, thoughtful regulatory right-sizing that helps protect consumers without driving up the cost of credit. Unfortunately, too many in Washington still believe the answer to every problem is more government. We saw this during the Biden administration. Reckless spending and heavy-handed regulation made life more expensive and made it more hard harder for businesses to invest lenders to serve their communities and builders to build. We should be clear, regulations, they have a cost. When Washington makes it harder for a bank to lend, a business to invest, a builder to build, and an entrepreneur to grow, those costs do not disappear. They show up in higher prices, fewer choices, and fewer opportunities for American families. That is why cutting red tape is also an affordability issue. Agencies should protect consumers, not be weaponized for a political agenda. The Biden administration should never have used the CFPB to target disfavored financial sectors restrict access to credit or punish responsible lenders. That made it harder for families and small businesses to access credit while making financial products more expensive. Senate Republicans are working to bring these costs down at the same time the Biden administration was working to raise those prices. Families in South Carolina and across the country are still living with the consequences of the Biden era policies in their monthly bills their mortgage payments and their household budgets. Families do not need more slogans. They need lower cost, better opportunities, and a government that gets out of the way as Americans try to build a better life. Today, I look forward to hearing from our witnesses about practical steps we can take to lower costs, expand opportunity, improve affordability, and reduce unnecessary regulatory burdens without growing government. Senator Warren, you're now recognized.

Uh, thank you, Mister Chairman, and I want to thank you for holding today's hearing on affordability. It's only Tuesday and our committee's already had a big week.

We have to.

Uh, yesterday the Senate passed our twenty first century Road to Housing Act, and now the House is on its way to passing it too. This is the biggest housing bill in more than thirty years. It will help build more housing, bring down costs, and for the first time ever stop private equity from snapping up homes that families are trying to buy and your leadership helped make that happen.

Back to me.

Our housing bill is an affordability accomplishment that everyone on this committee can be proud of. But it is not nearly enough to offset the economic policies of President Trump and the devastating impact that they have had on American families. So, let's set a baseline. When Trump took office, inflation was down to three percent and headed down. The first thing he did was slap tariffs. on nearly every item from nearly every country. These tariffs will cost the average American household more than twenty-five hundred dollars this year. Now, the Supreme Court struck down these tariffs as illegal and the administration has not lifted a finger to give consumers a refund on the very high prices that they pay. Then came Trump's illegal war with Iran. which caused energy prices to skyrocket. The impact of the war continues to jack up costs for every single sector of our economy. Families have spent forty-three billion dollars more on gasoline alone than they would have if Trump had never started this war. Trump spent billions to cut renewable energy projects, you know, the kind of energy that would actually lower utility costs. And Trump and Republicans have sent health insurance premiums soaring, with next year's premium hikes already on track to rival last year's record-breaking increases. In between these disastrous policies, it has been nonstop Trumpian extravaganza of corruption and incompetence. Anti-consumer mergers that will drive up costs for everything from cable TV to credit cards get rubber-stamped under the shadiest possible circumstances. The CFPB, which has returned more than twenty-one billion dollars directly to families that have been scammed, has been hollowed out and sidelined. Doge, Fired the USDA team responsible for preventing screw worm. And now an outbreak threatens to bankrupt ranchers and send already high beef prices through the roof. And one white-collar criminal after another gets DOJ dismissal or a trump pardon, sending a clear message that it is OK for wealthy insiders to rip off families and consumers. And what's the result? Inflation now sits at its highest level in three years, four point two percent, nearly double what it was last year. Americans are paying more for groceries, for health care, for gas. The Federal Reserve is forecasting higher inflation, higher interest rates, and slower growth. And the American people can see plain as day that as the economy gets worse, Trump gets more chaotic. Trump focuses on building his golf course and his giant ceremonial arch, getting the right marble for his taxpayer-funded gold-encrusted ballroom with no thought to the rising costs that are bearing down on Americans. The same guy who ran for office saying he would tackle inflation on day one now calls affordability a quote, hoax and a quote " made up" word. He says quote, " I don't think about Americans' financial situation." He says that he quote, " loves the inflation." Trump doesn't care about hard-working Americans. He cares about making himself richer by cutting crypto deals and making thousands of stock transactions with companies whose value he can boost. with deregulatory policies or giant government contracts. Trump's billionaire friends are along for the ride. They're getting richer by the hour, while American families are stuck with the bill. The world just got its first trillionaire and the Trump family's wealth is up by at least three point uh two point three billion dollars since just last year. And meanwhile, American's real wages since Trump was sworn into office eighteen months ago have fallen. Mister Chairman, I am glad that we are having this affordability hearing today. It is a stark reminder of the President's failures. Americans want Washington to make affordability our first priority. And instead, all Donald Trump is offering are higher prices, more chaos, and unprecedented. corruption. I look forward to our conversation today.

Thank you. I now recognize our first witness, Mister Cody Carbone, s Chief Executive Officer at the Digital Chamber. You're now, you now have five minutes.

Chairman Scott, Ranking Member Warren, members of the committee, thank you for the opportunity to testify today. I'm honored to be here this morning. My name is Cody Carbone, Chief Executive Officer of the Digital Chamber. the world's largest digital asset and blockchain trade association. Our members span more than two hundred and fifty companies, from the world's largest exchanges and banks, to startups, innovators, builders, and developers. I'm here to talk about how digital assets can make life more affordable by calling attention to a hidden tax most families never see but they feel, the cost of moving money and the cost of moving assets. It's simply too expensive and takes too long to move money and assets today. Nearly one in four American households live paycheck to paycheck. And the Federal Reserve reports more than a third couldn't cover a four hundred dollar emergency without borrowing. For those families, a credit card swipe fee or a three-day hold isn't just an inconvenience inconvenience. It's an overdraft, a late fee, or a payday loan. Yet digital assets and blockchain are the first real chance in decades to help people move the money they've earned more easily. To make sending money as simple and efficient as sending an email. And to end that tax. Today, I will discuss how digital assets can help lower costs in three areas. First, the cost of moving money across borders. Americans send more money abroad than any nation on Earth, more than one hundred billion dollars last year. It costs six point five percent to send, more than double the international target, and takes three to five days to arrive. That's more than six billion dollars a year skimmed out of working families' pockets. A worker sending a hundred dollars home to a foreign country sees only ninety-three dollars and fifty cents arrive. However, if they were using a dollar-backed stable coin, that family keeps the full one hundred dollars and receives it in seconds. The same wall hits the freelance designer in South Carolina, paid by a client in Europe or a manufacturer in Ohio, paying an overseas supplier. Which is why business-to-business payments are already the single largest use of stablecoins today. The rails work and cheaper cross-border payments make American businesses more competitive. Second, closer to home, more competition in everyday payments. There's real cost embedded in how we pay today. And Americans deserve more choice. A regulated stablecoin is one more option. Cheaper to process, settling in seconds, and it's a tool banks can offer too. Under the bipartisan Genius Act, banks themselves can issue these products. This isn't about taking anything from the system we have, it's letting a cheaper, compliant rail compete, so a merchant can pass a discount to customers at the register. And third, the biggest purchase most families will ever make, a home. Today, thousands of dollars vanish into the process of transferring a home. Closing costs of up to five percent, often more than ten thousand dollars, much of it just to establish who owns what. and to move the money. Tokenization attacks that directly. It records ownership clearly, settles in seconds instead of weeks, and strips out the layers of middlemen who each take a cut. Independent analysts estimate that cut of tokenization can cut t- transaction costs by thirty-five to sixty-five percent. This is big in housing, but the same approach reaches car titles, equities, treasuries, small business invoices, and more. And it opens the door the other way, too. Tokenization provides for fractional ownership, which lets a family own a piece of a wealth-building asset for as little as a dollar instead of being locked out like they have for decades. Tokenization is real, it's growing, and the savings are already proven in the institutions using it today. This committee deserves real credit. The Genius Act is working. And finishing the job through the Clarity Act is the best chance Congress has had to set clear rules of the road. Clarity is closer than has ever been, and I'd urge the Senate to finish it this year. Clear US-based rules are what unlock tokenization for ordinary Americans, keeping this activity onshore and creating good paying jobs. Because in the end, the cost of moving money and moving assets is real, and it shows up in every household budget. The Digital Chamber is proud of our role in helping Americans shed that burning burden in working with this committee. Thank you for your time, Mister Chairman and Ranking Member Warren, and I look forward to your questions.

Thank you very much. All right, next witness will be Mister Kevin Brown, the President of the National Association of Realtors. You are now recognized and thank you all for your support of the housing bill as well.

Yes.

Thank you. Thank you, Chairman Scott, Ranking Member Warren. Members of the committee, thank you for inviting me to testify at today's hearing on America's affordability agenda. My name is Kevin Brown. I'm the two thousand twenty-sixth President of the National Association of Realtors. the largest trade association in the country with nearly one point five million members. I'm also a broker owner with Better Homes Realty, Rockridge and Oakland, California. Every day, realtors work with families and individuals who have saved, worked hard and maintained good credit, yet still cannot find an a an affordable home. The numbers are staggering. Housing remains one of the largest drivers of econ- economic growth in the country, making up nearly a fifth of the US economy. But the supply of homes to purchase has collapsed. The American population has grown nearly thirty percent since nineteen ninety five, yet the existing housing stock has actually dropped more than twenty five percent, from one point five eight million units in nineteen ninety five to one point one eight million units today. The median annual home price has skyrocketed to over four hundred thousand dollars, and the average age of the first time home buyer is now forty years old. This is not sustainable. Thankfully, under the leadership of this committee, meaningful changes are on the way. The twenty-first century Road to Housing Act is the most consequential housing legislation in decades. The bill strengthens many existing programs and streamlines others while cutting red tape and removing barriers to h- housing development. In particular, the bill reforms federal housing programs such as the Home Investment Partnership Program and the Community Development Block Grant program, to be more flexible and effective. The legislation modernizes financing for rural, manufactured and modular housing. It updates FHA multifamily loan limits to reflect today's market. It also streamlines federal environmental review and increases coordination across agencies. On the state and local side, it provides resources and incentives, not mandates, to help communities build and preserve homes. The Housing Supply Frameworks Act requires HUD to work with stakeholders to develop guidelines and best practices for addressing zoning policies that block housing production. The bill includes funding to develop pre-reviewed design libraries of ADU's, duplexes, townhouses that can help streamline permitting. It also creates planning grants to support affordable housing strategies at every level of government and a home renovation pilot to help families preserve the home that they already own. The House and Senate now agree, or now agree, we look forward to this legislation being signed into law, adding to other successful reforms from Congress, such as opportunity zones and low income housing tax credits. We know the twenty-first century Road to Housing Act will have the same meaningful impact but as we all know there is more work to be done. We know it will take time to build more homes, but we also need to ensure that communities don't adopt short-sighted quick fix things to address affordability. In my home state of California, we have seen policies that do more harm than good. While solutions like rent control may be popular, the on the ground results only water down personal property rights, discourage more development, and push mom and pop housing providers from the market. Property ownership works best when property rights are strong. That's what allows consumers to build and protect equity, the foundation of long-term wealth. While rent control may be seen as a way to protect tenants, in practice it limits housing opportunities and makes them more expensive. This is why it's critical that the federal government take the lead in meaningful lasting solutions. Realtors look forward to working with Congress on additional reforms and policies, such as More Homes on the Market Act, a bipartisan bill that would double the capital gains exclusion threshold on a primary residence for first time for the first time in nearly thirty years, while adjusting the caps to reflect future inflation. Just like people who are locked into their homes at lower interest rates, seniors are often locked in because of home equity penalty, the home equity penalty. This legislation expands existing housing stock and gives seniors the opportunity to tap equity that they have counted on for retirement. In turn, move-up buyers can then buy homes, thus freeing up houses for first-time home buyers. Additionally, policy solutions, additional policy solutions are included in my written testimony. We know there is no silver bullet that will quickly fix the supply and affordability crisis but the solutions this committee has championed will help the housing market for decades to come. Thank you Chairman Scott and Ranking Member Warren. I look forward to your questions.

Thank you, sir. Uh, next we'll hear from Doctor Morgan, President of the Century Foundation, you are now recognized.

Chairman Scott and Ranking Member Warren, thank you for inviting me to testify before as a public policy think tank dedicated to improving the lives of all americans the century foundation has been acutely focused on how rising costs are affecting working families while president trump is calling affordability a hoax or a fake word and confessing that he does not think about americans financial situations families are dealing every single day with the cost of living crisis that donald trump promised he would fix from his first days in office president trump has gone back on his campaign promises layering one price hike on top of another. Starting on so-called Liberation Day last April, the Trump administration set off a series of tariffs that have cost American consumers an average of about seventeen hundred dollars, increasing prices on a wide variety of must-have items, from groceries, clothing and school supplies, to building materials and electronics. The Trump administration and Republicans in Congress then pushed through massive tax cuts for the wealthiest Americans, paid for by increasing the cost of health care, higher education, energy and food for ordinary families. While the wealthiest Americans got a boost, those tax cuts for the ultra-rich cost the lowest income families about twelve hundred dollars a year. In fact, any benefits the average families may have seen from Trump's tax plan were completely wiped out by war with Iran that is keeping gas prices at nearly four dollars per gallon and has cost families an estimated one hundred billion dollars to date. On the Trump administration's watch, some of the biggest expenses for ordinary families have become even less affordable. New car prices hit record highs, health insurance premiums have spiked, home prices rose again this last year, and rent and mortgage payments both remain alarmingly high. And prices are only one side of the equation on affordability, wages are the other. Since returning to office, the president has directly cut the wages for home health workers and farm workers, wreaked havoc on the agencies responsible for insuring that workers can exercise their rights, And in twenty twenty five, ushered in the worst year of job growth since twenty twenty. The cumulative impact of these policies has been disastrous for working families. Our research shows that half of Americans report skimping on health care services or taking on debt to deal with their rising health care costs. Half have had to tap into savings to meet their day-to-day expenses. In one survey, one in three respondents reported that they had, they or someone in their household has skipped meals to save money in the past year. Americans are increasingly forced to use debt to make ends meet, but high-cost loans are pushing families further over the edge. Outstanding credit card balances stand at around one point two five trillion dollars, with delinquency rates of more than thirteen percent, the highest level since the great recession. Student loan delinquencies have also shot up under the Trump administration from nearly zero to about twenty five percent. Auto debt has exploded, bankruptcy filings increased almost twelve percent between twenty, twenty five, twenty six home foreclosure filings are up twenty six percent from the last year, and are the highest they've been since twenty twenty. This mountain of debt adds a new dimension to the affordability crisis. Driving down the prices of individual goods and services won't fully alleviate the pain that families are feeling or the drag it places on the economy. Lower gas prices next week don't mean all that much when you're still paying off your pr your price of the pump from the last week. or last month's groceries at a twenty four percent interest rate. Not everyone is losing in the Trump economy, however. The Trump administration has engaged in a relentless, corrupt agenda of self-enrichment, deregulation, corporate pardons, and sweetheart deals for the wealthy and the well-connected. Some of the beneficiaries are represented here in this room, like the banks that continue to derive excess profits from overdraft and credit card late fees that cost consumers fifteen billion dollars a year. This committee has the power to advance legislation that would help help save Americans billions of dollars. I applaud you all for starting with housing, an area of critical need. And I saw this morning that Senator Warren and Senator Moreno are working to save social security as well. But with a hundred and ten million Americans unable to pay off their credit card balances each month, and banks tucking massive profits into historically high interest rates, there is much more to be done. The affordability crisis is not a hoax. it's a back-breaking reality for the vast majority of Americans. This committee must take action to address it. And I look forward to your questions. Thank you.

Thank you, ma'am. We'll now hear from Miss Lindsay Johnson, the Community Bankers Association.

Thank you. Chairman Scott, Ranking Member Warren, and members of the committee, thank you for the opportunity to testify. My name is Lindsay Johnson. I'm President and CEO of Consumer Bankers Association, the nation's only trade association exclusively focused on retail lending. For as long as there's been an American economy, banks have helped families and small businesses build within it. That work often begins with something simple, safeguarding a paycheck. And it grows from there. Banks take deposits and put them to work in communities, helping consumers establish credit, finance an education, buy a car, purchase a home, or start or expand a small business. For millions and millions of Americans, a credit card or a small loan can take a family from credit invisibility to financial opportunity. The same is true for small businesses. Many begin with a founder's personal credit card, grow into a small business loan, mature into an enterprise that takes payments, manages cash flow, hires employees, and serves their communities. At every stage, banks are alongside them. But the true measure of a bank is not just what it does in good times. It's what it provides when life doesn't go according to plan. When a paycheck and a bill don't line up, When a car breaks down or when hours are cut, bank products can be the bridge between a difficult month and a genuine crisis. A credit card, an overdraft service, a home equity line of credit can help a family absorb a shock, stay current, and keep moving forward. Banks also provide another layer of support for consumers that they may not see. Fraud prevention, payment security, and technology that makes modern commerce possible. Banks do well when their consumers, small businesses, and their communities do well. Today's economy and consumers are remarkably resilient. But affordability is a real concern for many families as essentials like housing, health care, food and transportation, what we refer to in our written testimony as a four horsemen of affordability, continue to pressure household budgets. As costs have risen, families, particularly those at the bottom of the K shaped economy, feel it more acutely. Consider the median household making around sixty eight thousand dollars after taxes. or roughly fifty seven hundred bucks a month. Essentials like housing, vehicles, health care comprise around two thirds of their budget, and if you add child care in there it consumes around seventy five percent of the budget, before utilities, gasoline, retirement savings, and other reoccurring costs. By year's end, this household has a net savings of around five hundred and forty dollars or roughly forty five dollars a month. It's an incredibly thin margin where a single unexpected expense can upend a family budget. And seventy five percent of Americans experience at least one expense shock a year on average that expense shock is around five thousand dollars for consumers like this low cost financial products from main street banks can help manage and smooth out those unexpected expenses conversely credit cards and other products and services that uh serve as shock absorbers comprise a very small amount of the consumer's budget as credit card interest accounted for roughly one percent on average of the household budget in twenty twenty four for example an overdraft and other fees are even less Congress, this committee, and the administration deserve credit for advancing solutions focused on core sources of affordability challenges including pending bank capital rules that are gonna enhance banks' abilities to lend bipartisan work on housing, expansion and supply and support for small business lending. CBA also appreciates a focus on fraud and scams, a fast-growing threat costing Americans billions every single year. Combating it requires stronger coordination, accountability, law enforcement engagement, and more engagement across technology, telecom, and non-bank marketplaces. As policymakers consider additional so- solutions, it is so critical to preserve the financial tools that help families manage those unexpected expenses. Quick fixes like credit card rate caps may seem appealing, but they simply reduce access to credit and they make it harder for consumers who meet need it most to access that credit and instead pushes them to less regulated alternatives. A better approach, detailed in my written testimony, is to address affordability affordability challenges at their source, while maintaining responsible access to credit. Banks cannot serve solve structural affordability and income challenges alone. But we can, and do, help families manage through it, ensuring access to essential credit and liquidity in a competitive and sustainable way. The last six years have presented some of the most unprecedented challenges to the economy and consumers in modern history. Yet, Bank's role to support consumers and small businesses during this time, led to much greater resiliency for families, for business, for businesses, for communities and the broader economy, as banks were the driving force in the fastest post-pandemic recovery in modern history. Banks will continue to serve as foundational partners in American life, and will support stability and help families achieve their own American dream. Thank you again, and I welcome your questions.

Thank you very much, each member of the Committee will have an opportunity to ask questions of any of the witnesses for up to five minutes, and then we'll uh move on. I'll start. You know, w- one of the things I said during my opening comments was that because of the working family's tax cut bill, ninety-seven percent of Americans saw their taxes go down, and the focus of those tax decreases were on people making less than two hundred thousand dollars a year. One hundred percent of Democrats voted against the tax cuts for ninety-seven percent of Americans. Five trillion dollars is just a mind numbing amount. But two hundred and fifty dollars a month is something I can understand. Giving Americans two hundred and fifty additional dollars because of our working family's tax cut bill that showed up in tax returns, an increase on average of eleven percent, is just another way the Republican majority is working on behalf of the American people making two thousand twenty-six the year of affordability, working in the right direction. I'd also add to that comparisons matter. The contrast between the Biden administration years, where the average family was losing more than a thousand dollars of purchasing power a month, And inflation got as high as nine percent. And oh, by the way, don't forget gas prices, June of two thousand twenty two, four dollars and eighty eight cents a gallon on average. On top of all of that, one of the most oppressive regulatory environments in modern history, brought to us by the by the Biden administration. digging out of that hole has taken time without any question. And when I think about the regulatory burden put on top of the average person in this country, I think about the uh regulatory options like Basel-three, an initiative coming to the table that fortunately and thankfully, we were able to dodge that really devastating bullet to the American people. Now, most people may not be as familiar Lindsey Johnson, as as you are with the Basel three provision. Let's talk about that for a few minutes because my understanding is the more money you park on the sidelines, the fewer dollars you have for first time homebuyers, starting a small business, purchasing a car, and yet on top of that one regulatory option, another one through the CFPB, spying on businesses, Looking for ways to bring more owners' pain into the lives of just working class small business folks, trying to make their ends meet. That regulatory pressure on top of the economic uncertainty created an instability that I'm not sure that we fully appreciate or or have absorbed completely. Thoughts, Miss Johnson?

well i'll start with your uh the conversation around basel and just capital proposals and regulatory burden generally you know your your comment is right we have to get that balance between safety and soundness and allowing a bank to be a bank and wanting to a bank to compete with all the other non-banks in the atmosphere more competition means more safe product options and what we saw before under the basel three proposal that was released in twenty twenty three was something outstripped even international standard. It would have made US banks far less competitive, push banks outside of the outside of certain lending segments, and mortgage, you know, banks are already uh a much smaller portion of that market than they were before. The more we can get that competition in the marketplace, the lower cost uh cost will actually lower because competition that's what it's that's what it's there for. So that's one example and then I would say on this CIPB look the cfpb we need a cfpb that's credible and durable and stable we need a cfpb that does a true cost benefit analysis a rigorous cost benefit analysis to understand how the rules that it's writing are actually gonna impact consumers and oftentimes whether it's credit card late fee or overdraft they simply overlooked it consumers were gonna lose access to these products by their own admission on credit card late fees seventy four percent of people were gonna see their costs go up And that small portion of people who are frequent late payers were, you know, would would uh see some benefit, but they didn't take into account that their credit score was gonna be hurt long term, driving their costs up. We've gotta do a better job of having an honest conversation that's apolitical at these agencies so that we can really drive cost savings to consumers.

With my time that I have left with just only about thirty seconds, because I'm the chairman, so I can't tell time. The uh, Mr. Brown, you said that you have more solutions in your

Sure, uh, more homes on the market act, which, which is uh also a bipartisan bill before Congress, um, provides for doubling of capital gains, the capital gains exemption, from two fifty, and five hundred thousand dollars for married couple, to five hundred thousand for a single person, million dollars, for a married couple. That would free up, there are people on the sidelines right now, just waiting because they they either don't wanna pay the tax or can't afford to pay the tax. And so that would free up inventory. You don't have to put any shovels in the ground. There would be instant inventory into the marketplace where uh buyers would come in, buy that property, which would free up some housing also for first time homebuyers. So

Thank you.

and thank you for your work on that, by the way.

Well, I appreciate that.

Thank you.

Thank you.

Uh, thank you, Mister Chairman. You know, I'm really glad that we are holding a hearing about President Trump's affordability agenda, and I am glad that my Republican colleagues don't seem to agree with President Trump's claim last week that quote " affordability is a fake word made up by Democrats". In fact, I wanna ask our witnesses about that. So, raise your hand if you agree with the President that affordability is a hoax made up by Democrats. I'm giving you time here. OK. No hands up, and I assume that means none of you, Democrats or Republicans, agree with President Trump that the affordability crisis facing American families is a hoax. Uh, and that seems right to me. You know, President Trump's agenda has driven up costs so that families are putting more of everything from groceries to gas on their credit cards, Trump's own top economic advisor, Kevin Hassett, recently bragged that quote "credit card spending is through the roof". He's right. Over a hundred million Americans have credit card debt now, many of them putting groceries and gas on their credit cards just to be able to make it to the end of the month. And delinquencies are at the highest level since the crash of two thousand eight. So let's talk about affordability. In January, President Trump promised to cap credit card interest rates. He politely asked the biggest banks to put in place a one-year ten percent cap by January twentieth. Now, Miss Johnson, your organization represents some of the biggest banks in the country. We are more than five months past Trump's January twentieth deadline. Which banks have implemented the one-year ten percent cap on credit card interest rates that President Trump promised to deliver.

So, thank you for the question. There's a couple of things I'd love to say. One, banks offered zero percent APRs today.

I'm sorry.

They

I, I had a specific question. Donald Trump told the banks that they should lower their credit card interest rates to ten percent by January twentieth, He said that's what he would deliver for the American people, promised it to everyone in America. And I just want which banks have actually lowered their credit card interest rates to ten percent? Can you give me their names?

There are, there are definitely options that are low cost APR options.

I'm sorry, which banks have lowered their credit card interest rate to ten percent?

But the problem is if

Are there any that are at ten percent? Can you name one?

I, I can tell you that there are options today available,

Can you name one?

they don't have a cap. A eight percent that they will offer.

bank that has lowered its credit card interest rate as President Trump politely asked,

And no bank wants to cut off credit to people with below a interest rate.

has there been one? Has there been one?

Including avid consumers who say

Has there been one? One?

There are options in the marketplace for sure, but

So, not a single one has followed through on what President Trump told them to do. So, President Trump and the big banks, they don't provide the ten percent cap on credit cards, Miss Johnson, how much more have Americans paid in interest on credit cards than they would have paid if the cap the President promised had taken effect? What's the number?

So again, I wanna go back to the rate card.

What's the number?

The rate, so we have not done that calculation, Phil?

I'll bet you haven't done that calculation,

I do want, I do want to

but here's the thing I have.

I see. I'm sorry.

It's fifty-seven billion dollars. in credit card interest rate above ten percent that Americans have paid since January twentieth. By the way, if you just do the math, that's three hundred and sixty eight million dollars a day. Now, President Trump promised he was gonna make banks lower interest credit card interest rates for families by January fiftieth, uh, January twentieth. And so far, families have been paying three hundred and sixty eight million a day for Donald Trump's broken promise. Now, We know that families have less money to spend and are falling behind on their bills, thanks to Donald Trump's economic policies. Doctor Morgan, if you can tell me very briefly, how are people coping with these tighter finances?

I mean, families are really struggling. As I said earlier, you know, one in three are skipping meals, they're skipping medications that are prescribed by their doctors, they're skimping on health care services, and they're turning to debt. I think it's important to know that's a both and right we're seeing people both cut back on the things that they need to live their lives and also put their expenses on to high cost debt both credit cards buy now pay later paycheck advance loans

thank you you know president trump may love inflation but it's killing american families congress needs to work together to fix the president's failed economic agenda and to make life more affordable for all americans Thank you, Mister Chairman.

Thank, thank you Mister Chairman. Look, I really appreciate the fact that the uh, Chairman and the ranking member have come together to have this discussion on where the costs are right now for American consumers. And I think it's really important that we talk about all of the impacts. I'd an- an- I noted that uh, there's always a desire to have your cake and eat it too. Sometimes that's not possible, particularly when we talk about how we go about financing activities in our daily lives. I'm just curious, um, um, Miss Johnson, um, you represent a lot of banks that issue a lot of credit.

Mm-hmm.

How many people today have credit cards in America?

Couple hundred, actually almost two hundred and eighty two million people have credit cards. I will say, yeah.

Two hundred and eighty two million people have credit cards today. Can you imagine not having credit and being able to survive in today's digital economy i i i'm just curious can you i mean we use them to get on an aircraft but we also use them to literally do digital shopping uh anything over the internet at all um telephones we pay for with a credit card in most cases um just thinking back about this thing here one of the greatest threats to a lot of people being able to survive on a day-to-day basis is they couldn't get credit. What would happen? Just I'm just curious. I I I think the president really wanted to find a way to try to suggest that he wanted the marketing side of things to be able to be incentivizing and to offer people low interest rates but a lot of credit card companies offer zero percent interest rates for short periods of time can you talk a little bit about what would happen if and I presume you've done the the work on it because you represent the banks that that really issue these cards, what would happen, what would be the impact if government were to step in and artificially say, you have to have an interest rate of ten percent less or less on credit cards. What what would happen to the number of people that would have availability of credit cards today?

So it's such an important question and it's the right question. Because ultimately it's the best way to make sure that someone only with an eight hundred credit score has access to credit.

You said what?

only people with an eight hundred credit score would have access to credit cards and credit cards.

So how many people have or how many people don't have an eight hundred credit score today out of those hundreds of millions of people that have credit cards?

It will restrict credit for around seventy five to eighty percent of the current market.

Seventy five to eighty percent of the uh I'm sorry but say that

We anticipate that that would be around a hundred and fifty million people.

seventy five to eighty percent of the current credit card holders

Yes.

And and how would that how would that happen? Would they simply lose them on day one or what would happen?

It would be fairly quick, it would be fairly immediate, because ultimately risk-based pricing allows uh issuers and there's four thousand plus issuers that compete for consumers' business, every single day to go out there and make sure that consumers have access to this necessary liquidity and source of credit in a very sustainable way. You can't do that for free. And part of this is making sure that we have plenty of options, and you mentioned the zero percent uh balance transfers, there were sixty billion in balance transfers last year uh in twenty twenty four alone. Uh, we are focused on making sure that consumers understand those different options, but to simply take away a source of of credit for consumers seems incredibly punitive.

You know, in in in in the nineteen eighties, uh, we had a tough time on the ag markets in South Dakota. um we had we had usury rates in place and because we had usury rates in place, there were banks that simply wouldn't loan to farmers anymore because well it was been a tough time, uh a lot of the guys were struggling and yet in order to put seed in the ground in the spring of that year, Bill Jenckler was governor at the time and uh he looked at it and he says, look I I don't care if it does cost a little more interest rates, we've gotta get these guys some credit so they can actually put put their crop in the ground. It's the reason why South Dakota at that time eliminated their usury rate. In doing so, banks charged more than what the the the traditional usury rate was, but we had farmers that survived because they could actually borrow the money. My concern with this whole discussion is that you say we've got over four thousand different banks that issue credit cards today. I'm just wondering, it seems to me that these folks that have got these great ideas about int about issuing ten percent credit rates Out of the four thousand, I'm sure one or two of them could do that today, but I'm just curious why we don't have some new start-ups by these folks that have got these great ideas. And they could issue ten percent, in fact they could go to eight percent, and they could get a lot of people coming in. I wonder how long they would actually be able to continue to offer that rate, based just upon the individuals that might not be able to uh qualify for a regular card, but would love to have that interest rate. Um, is there a reason why we don't have a lot of people offering that ten percent interest rate today?

It's just simply not sustainable. The worst thing we can do for a consumer is to extend them a product that they cannot uh afford to pay back. One of the things, and I do wanna just uh push back on a couple of the different comments, about the overall balances if I've got a a second, because

About ten seconds.

C- c- c- could you loan me thirty seconds?