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Adverse effects of CARD Act's limits on freedom of contract

In the 1970's, the age of adulthood was generally moved from 21 to 18, permitting 18-year-olds to vote, serve on juries, and contract for themselves. There was a bit of a rollback in the 1980s regarding the sale of alcohol, but the biggest change came in 2009 with the CARD Act, Congress's intrusive "We know better than the market" bill regulating credit cards and forbidding those under 21 from obtaining one. Public Citizen's CLP Blog discovers what those of us on the right have known for a while: nanny-statism, by eliminating mutually beneficial voluntary transactions, has adverse consequences for society. The CARD Act does not just insult the dignity of 20-year-olds by infantilizing them, but hurts the rest of us by limiting the ability of 18-, 19-, and 20-year-olds from fully participating in society. As Andrew Schwartz points out, entrepreneurs like Bill Gates and Mark Zuckerberg got their start before the age of 21 with the help of credit-cards to finance their eventual multi-billion-dollar ventures. The next Mark Zuckerberg will need a lot more help from his parents, and may instead have to choose to run up $100,000 in debt at NYU getting a sociology degree.

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Rafael Mangual
Project Manager,
Legal Policy

Manhattan Institute


Published by the Manhattan Institute

The Manhattan Insitute's Center for Legal Policy.