But, Instead of cracking down on companies that treat their customers poorly, why doesn't the government just offer a credit card of its own? After all, government regulation may help, but it's unlikely to solve the problems of the credit industry—namely, spiraling interest rates coupled with rising defaults. Obama likes to talk about constructive alternatives. Why not offer an O-card? With his face on it?

Why not help out individual consumers by setting up a government issue credit card.  I am on Social Security Disability and there are times when I cannot even pay the deductible of $2.50 for my medications and I have to go without for a week and suffer tremendous pain, just because i am poor and disabled. I also had a $500 deductible on my medical at one time and could not make any type of payments on those medical bills and now my credit is even worse then it was before I came disabled.  I have had a bankruptcy too.  The government could be a big help to the poor, who cannot even get credit cards for $200.  Any credit would help me out.  I always run out medications, naturopathic drugs, or my car breaks down and then I have to walk 2 miles one way or a mile the other way, just to get to nearest bus line.  I need a knee replacement so I cannot do that.  YOU TALK ABOUT A STIMULUS PACKAGE.  Help the poor, small business, middle America, and really stimulate economy with money that rolls over every time it is repaid.  97% of micro-loans and well as pay day loans are paid back.  I think this could really help the economy.   

 The idea isn't crazy. In Germany and France and Iceland and India, state-owned banks issue credit cards. One difference between those lenders and private banks is that interest rates are lower, since profit isn't the state's chief goal. (Europeans also have a different relationship with credit cards, using them to make routine payments rather than rack up debt.) Government-issued credit cards could also help consumers avoid those small but numerous charges that add up over time, from ATM fees to annual fees to interchange fees.

Nor does the notion freak out economists. "It's not something I'd be sitting here and saying" in normal circumstances, says Tahira K. Hira, a professor of finance at Iowa State University. "But some of the rates are so astronomically high, it's becoming impossible to manage for individuals." Phillip Uhlmann of Tufts University says, "I think a government system might offer a cleaner type of business, more easily understood by consumers."

Wait, what are we saying? Surely we don't want the government lending directly to individuals. That way lies socialism.

Maybe so, but we're already there. Think of all the different things the state finances. It backs home mortgages through quasi-government-owned Fannie Mae and Freddie Mac. It offers student loans through its direct-loan program, providing billions of dollars to help kids pay for college. Uncle Sam will even chip in to help you buy a car—it gave auto financier GMAC a $5 billion bailout last December.

If we're already backing loans for the three biggest life expenses—homes, college, and cars—what's missing? Consumer and business credit. Consumer spending accounts for almost 70 percent of GDP. The average American household carries $8,700 in credit card debt. And just as the financial crisis swallowed the housing market, it seems to be eyeing the credit card industry. Purchases are way down. Credit card companies are slashing credit limits.