Republicans Turn on Trump

President Trump’s bold 10% credit card interest rate cap proposal faces swift rejection from his own Republican leaders, risking market chaos and credit shortages for American families.

Story Snapshot

Trump announced a one-year 10% cap on January 9, 2026, via Truth Social, blaming Biden-era policies for 20% average rates ripping off consumers.
GOP leaders like Speaker Mike Johnson, Sen. John Thune, and Sen. Thom Tillis immediately distanced themselves, citing risks to credit access.
Dow Jones plunged nearly 400 points on January 13 amid market fears of reduced lending and economic distortion.
Experts warn the cap could hurt high-risk borrowers most, pushing them to costlier alternatives despite short-term relief intentions.

Trump’s Announcement Targets High Rates

President Donald Trump posted on Truth Social on January 9, 2026, proposing a temporary one-year cap on credit card interest rates at 10%, effective January 20. He targeted average rates around 20%, which burden 216 million American cardholders. Trump blamed the prior Biden administration for allowing consumers to get ripped off by predatory lenders. This move echoes his 2024 campaign promises and aims to deliver quick relief from post-pandemic inflation pressures. The tight deadline ties to his White House return anniversary.

GOP Leadership Pushes Back Hard

House Speaker Mike Johnson downplayed the idea as from Trump’s “ideas guy” persona, urging no overreaction without congressional input. Senate Majority Leader John Thune distanced himself, refusing to advocate the cap. Sen. Thom Tillis declared himself totally against it, warning of severe risks to credit availability for everyday Americans. An anonymous House Republican labeled it horrible policy. This opposition highlights tensions within the party despite Trump’s presidency and control of Congress.

Credit card issuers and banks oppose the plan, arguing it would devastate families and small businesses by slashing credit access. They predict tighter underwriting standards and account closures for higher-risk customers. Industry groups emphasize that rates reflect real risks, operating costs, and economic realities left unaddressed by Biden’s fiscal mismanagement.

Market Reaction Signals Economic Risks

The Dow Jones dropped nearly 400 points on January 13, 2026, as investors reacted to fears of credit market contraction. Financial stocks tumbled on expectations of forced rate cuts or lending pullbacks. Experts like economist Gregg note the cap distorts risk pricing, potentially closing accounts for low-income and unstable-income families. Short-term relief on existing debts might occur voluntarily, but long-term effects include higher fees and shifts to unregulated, pricier lenders.

Expert Warnings and Bipartisan Precedents

Analyses from finance experts highlight well-intentioned but harmful consequences. The Consumer Finance Monitor stresses that caps limit proper risk assessment, preferring voluntary tools like promotions. A 2025 bipartisan Senate bill by Sens. Bernie Sanders and Josh Hawley proposed a similar temporary cap but stalled in committee. Elizabeth Warren, a longtime cap advocate, spoke with Trump but skepticism remains. No federal mandatory cap has ever passed due to market distortion concerns.

Implementation remains unclear without legislation; executive action via the CFPB faces legal hurdles, especially as Trump’s administration targets the agency for dismantling. Political pressure might yield voluntary reductions, but GOP resistance and industry power suggest limited progress. This strains Trump-GOP unity at a time when conservatives demand free-market solutions over government interventions.