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59 UCLA L. Rev. 1292 (2011-2012)
Credit Card Act II: Expanding Credit Card Reform by Targeting Behavioral Biases

handle is hein.journals/uclalr59 and id is 1306 raw text is: Credit CARD Act II: Expanding Credit Card
Reform by Targeting Behavioral Biases
Jonathan Slowik
Three years ago, the U.S. Congress passed the Credit CARD Act of 2009. This
ambitious piece of consumer protection legislation sought to relieve consumer debt
burdens by targeting credit card industry abuses and providing new disclosures. Congress
acknowledged that the legislation would not help individuals who borrow irresponsibly
on their credit cards, implicitly assuming that it could not encourage more provident
decisionmaking. This assumption was a mistake. Human decisionmakers are susceptible
to behavioral biases-predictable deviations from perfect rationality. This Comment
discusses how these biases encourage consumers to take on excessive credit card debt
and calls for Congress to consider how legislation can counteract behavioral biases in
the credit card context. It concludes by discussing several possible reforms in three
main categories-making costs of credit card use more salient, equipping credit cards with
commitment devices, and prohibiting practices that encourage consumer overconfidence.
Jonathan Slowik is a Managing Editor of UCLA Law Review, volume 59, and J.D.
Candidate, 2012, at UCLA School of Law
I would like to thank Russell Korobkin, whose input and guidance throughout this project
were invaluable. I am also indebted to the talented staff of the UCLA Law Review and
to Jonah Lehrer, whose book How We Decide inspired my research into these issues. This
Comment would not have been possible without Karen, who assists everything I do.

59 UCLA L. REV. 1292(2012)

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