Jamie Dimon says U.S. should impose Trump credit card rate cap in Vermont, Massachusetts

JPMorgan Chase CEO Jamie Dimon on Wednesday advocated for a test of President Donald Trump’s proposed 10% cap on credit card interest rates in two U.S. states: Vermont and Massachusetts.

Dimon, speaking on a panel at the World Economic Forum at Davos, Switzerland, addressed a question about Trump’s order for banks to voluntarily limit their interest rates for a year. The president had called for the lower rates to take effect Tuesday.

Several large credit card lenders contacted by CNBC on Tuesday said they had made no changes to their interest rates, but they all declined to be identified as defying Trump’s proposal.

“It would be an economic disaster,” Dimon said Wednesday. “In the worst case, you’d have a drastic reduction of the credit card business” for 80% of Americans, he said.

In earnings conference calls last week and behind the scenes, banks have pushed back against Trump’s order this month to voluntarily forgo billions of dollars in revenue.

Their main argument, that price controls will result in lenders canceling accounts for many card customers, has resonated with several Republican lawmakers, including House Speaker Mike Johnson. Most banking analysts believe that Trump would need legislation to enact a nationwide cap on card rates.

Dimon then said he had a “great idea” to help quell disagreement over the proposed card cap, suggesting that the U.S. government impose the pricing controls on Americans in just two states.

Vermont and Massachusetts are the home states of Sens. Bernie Sanders and Elizabeth Warren, respectively, both of whom support a bill capping card rates at 10% for five years. Dimon didn’t mention the lawmakers by name Wednesday.

The U.S. government “should force all the banks to do it in two states, Vermont and Massachusetts, and see what happens,” Dimon said, drawing laughter from the audience.

Dimon said “the left” and people who argue for price controls “will learn a real lesson, and the people crying the most won’t be the credit card companies,” he said.

“It’ll be the restaurants, the retailers, the travel companies, the schools, the municipalities, because people miss their water payments,” he said. “It would be something else to watch.”

The office of Sanders didn’t immediately return calls for comment.

Warren had a response which read, in part: “It’s January 21, and unsurprisingly, there is no self-imposed interest rate cap on credit cards by the big banks,” Warren said. “But Jamie Dimon and the world’s richest people did fly their private jets to a ski resort in Switzerland to complain about how bipartisan action to cap credit card interest rates would destroy life as we know it… It’s time to pass a law and get this done.”

Dimon added that JPMorgan was planning on giving the Trump administration its analysis on what would happen under a national credit card rate cap.

“I think it’s wrong for the government to get involved extensively in pricing of stuff, but I got to deal with the world I got,” Dimon said.

— CNBC’s Stephanie Dhue contributed to this story.