If the legislature of South Dakota were to decree that rape isn’t a crime in South Dakota, you would be surprised.

If the Supreme Court were then to rule that the newly legalized rapists of South Dakota were free to rape the residents of every other state without the slightest threat of prosecution, you’d be beyond surprised. You’d be apoplectic.

That, basically, is what happened in 1978.

In the Marquette Bank Case the Supreme Court found that the high interest rates with which a bank raped its customers were not just legal in the home state. They were legal everywhere. It didn’t matter where the victims lived. The bank could rape them by mail.

In 1980 Citibank used this decision to make an end run around New York State’s usury laws. Citibank moved its credit card operations to South Dakota, which had no usury laws. Then they jacked up the interest rates. Nothing’s been the same since.

This Case Was Wrongly Decided. It’s safe to say, as rightwing judges discussing Roe v. Wade might put it, this case was wrongly decided. Of course states should have the power to protect their citizens from the rapacious behavior of out-of-state banks! And Democrats should get it back for them—by federal statute, if necessary. (We had national usury laws until after the Great Depression.)

Don’t Cry for America’s Banks. Banking is the country’s most profitable industry. Only pharmaceuticals come close. In 2004 over all industries, earnings as a percentage of revenues averaged 6.6%. Bank earnings totaled 18%. Credit cards alone earned banks $30 billion.

Borrowing has gone berserk. For the first time since 1933 America had a negative savings rate in 2005--that means we borrowed more than we made. Obscene interest rates didn’t slow us down. In fact, obscene rates probably spur borrowing, pushing banks to take risks on ever more desperate debtors.

This is a Classic Democratic Issue. Every victim of credit card loan sharking is a potential Democratic voter. And credit card loan sharking touches virtually everybody. Thirty-five million of us pay only the minimum due on credit card debt each month. That’s mostly interest.

Look at your MasterCard statement. Chances are you’re paying 18%, 20% interest—maybe as much as 26%. And if you’re as much as an hour late on a payment, there is no limit to how much the bank can increase your interest rate!

NOTE: This is not some vapid “truth in lending” law. The point isn’t to make banks tell you the truth about how they plan to rape you. The point is to stop them from raping you.