The argument for capping interest rates at 10% is fourfold:

1) Moral and civic prohibitions against usury stretch back deep into our religious and national history. Our prophets and founding fathers made the clear case long before us that usury is patently wrong, against God, and against our national interest. From the time of Hammurabi to the Carter administration, usury was illegal. Modern practices of usury are an aberrant blip in history.

2) Our people are hurting because of crushing debt loads exacerbated by exorbitant interest rates – in the form of high credit card premiums, payday loans, banking and check-cashing fees, sub-prime mortgages, rapid-refund tax return schemes, car-title scams, and other practices that seek to generate income off of financial misfortune.

3) The elimination of usury laws in America from 1978-1980 ushered in an era of deregulation that allowed financial markets to run wild, accelerating the present economic crisis.

4) The elimination of usury laws helped shift the investment of American capital and talent away from manufacturing and material innovation and into an unproductive financial sector based on trading paper rather than producing long-term wealth. That shift has damaged other sectors of the economy, decimated America’s labor force and weakened America’s position in the world.

What we need now more than thousands of pages of new regulations, or the sour faces of executives forced to reduce their eight-figure salaries to a mere seven, is a 10% cap on interest rates. Why 10%? Because 10% is enough. Ten percent puts proportion and equity into the relationship between the lender and the borrower. Ten percent restores our capacity to form right relationships.

For more information, read the Metro IAF background paper and the Metro IAF white paper.