DURHAM -- The average debt for nearly half of Americans with credit-card balances rose from about $5,600 in 2004 to $7,300 in 2007, according to the latest figures from the Federal Reserve.
With the average rates estimated between 12 and 15 percent, that means millions of consumers are paying $1,000 a year in credit-card interest alone.
Religious people of many spiritual stripes agree that's a big problem, and they'll unite in Charlotte today and in London next month to try to do something about it.
N.C. United Power is part of an international campaign to cap interest rates at 10 percent in deference to historic usury laws that grew out of Christian, Jewish and Muslim scriptures. The campaign comes at a time when credit card companies are being scrutinized by Congress and the Federal Reserve.
The Credit Card Accountability, Responsibility and Disclosure Act passed by Congress this year offered new protections for consumers, and the Federal Reserve is proposing new rules as well. But a legislative effort to cap interest rates at 15 percent did not succeed.
Religious congregations and community groups from across North Carolina will rally in front of the headquarters of Bank of America and Wells Fargo this morning to demand a meeting with bank executives to negotiate an "agenda for economic relief."
"In the Jewish tradition, we are not commanded simply to provide charity but to pursue justice," Rabbi Leah Berkowitz of Durham's Judea Reform Congregation told about 150 people at an interfaith service at Mount Level Missionary Baptist Church last week.
Joining her at the altar was Jahar Asad, associate imam at W.D. Mohammed Islamic Center.
"We believe 10 percent is more than enough," said Asad, "way more than enough."
N.C. United Power, a member of the activist Industrial Areas Foundation, kicked off the anti-usury campaign in Durham in July. It delivered copies of a theological statement against high-interest loans to SunTrust and Mechanics & Farmers Bank, and the Generations, Self-Help and Latino Community credit unions. Simultaneous demonstrations occurred in New York, London, Chicago, Boston and Washington, D.C.
SunTrust issued a statement in response, saying interest rates depend on how much the bank pays to borrow money and how great a risk a particular borrower poses.
"We operate in a highly competitive marketplace," said SunTrust spokeswoman Kelly Paul, "and prices tend to find their natural level without artificial controls that ignore those factors."
But the Rev. Mikael Broadway, an associate pastor at Mount Level and theologian at Shaw University Divinity School, preached at the interfaith service last week that a free market sometimes puts poor debtors in a perpetual state of poverty.
"Many of our bad choices have put us in the place we're in," Broadway said. "This is not the kind of economic system intended for the world that God loves."
Preaching from Deuteronomy 15 in the Hebrew Scriptures, Broadway said the biblical "bailout plan" benefits the poor, not big banks, with debts forgiven every seven years and land returned to its original owners or their heirs every 50 years.
The 10-percent cap harkens to the biblical concept of tithing, where believers are to give 10 percent of their income for church or charity.
"If the Lord requires 10 percent of us to support the community, why should anyone else desire more?" asked the Rev. Lawrence Womack, associate priest at St. Martin's Episcopal Church in Charlotte, at the campaign kick-off.
Jesse Blocher, a doctoral student in finance at UNC-Chapel Hill, has worked with Durham CAN in the past on improving school facilities but said he can't support the usury campaign.
"We as the church would better spend our time trying to help people get out of debt rather than trying to take on Bank of America," he said.
Mount Level is offering financial counseling as part of the campaign, but Broadway said the main purpose is to influence banks and legislators.
Blocher said banks won't lend unless they can make a profit above what they charge each other in interest. A cap on interest rates would simply price higher-risk borrowers, who tend to be poor, out of the credit-card market, he said.
