Standard liberal procedure, blame others for THEIR own failed policies.
Posted on 10/03/2011 10:04:02 AM PDT by SeekAndFind
Hold on to your wallet: The Durbin Amendment goes into effect Saturday. The once-obscure amendment to the Dodd-Frank financial-reform bill limits “interchange fees,” which banks charge to merchants for providing the service that allows stores to accept debit-card payments. The fees were cut by some 80 percent, which makes it less profitable for banks to offer debit-card services. So the banks have done the natural thing and begun to transfer the fee from merchants to their customers, with Bank of America announcing a new $5-per-month fee for debit-card users.
Naturally, the amendment’s author, Sen. Dick Durbin (D., Ill.) is in a rage, complaining that the banks are “sticking it” to consumers. He ought not be surprised: What is happening is precisely what was predicted by industry experts and by the banks themselves. Running a debit-card network costs money, and banks are not going to do it for free or suffer reduced profits gladly. As is usually the case, what we have here is one special-interest lobby (retailers) using its political clout to prevail over a marketplace rival (the banks) to secure for itself a bigger piece of the action. Mr. Durbin, being a senator and a Democrat, cannot resist the urge to stick his nose into controversies better left to the marketplace. Not coincidentally, one of the nation’s largest retailers, Walgreens, is located in his state, and the firm’s CEO lobbied hard for the new federal price controls on debit-card fees.
The new fees are a textbook example of the unintended consequences of regulation — unintended, yes, but not unforeseeable.
Indeed, they were almost universally foreseen. In the Michigan state legislature — hardly a hotbed of free-market fundamentalism — a resolution calling for abandoning the Durbin amendment was passed unanimously by both houses. Sen. Darwin Booher, who sponsored the Michigan resolution, said at the time: “I sponsored this resolution to send a strong message to Congress: Stop any rules from being adopted that would harm our community banks, credit unions, and the millions of Michigan consumers that use them. As currently proposed, the rules would force credit unions and community banks to absorb the costs of fraud and data security. That would result in less credit available for job providers, increased fees, and the ending of popular services like free checking.”
Free checking accounts were the first casualty, with almost every major bank in the country restricting that popular option to larger accounts and imposing new fees on customers who keep lower balances. Again, Bank of America was the first mover, a position it was impelled to take in no small part by the fact that the new regulation forced it to suffer a $10 billion writedown of future earnings. “I’ve seen more regulation in last 30 months than in last 30 years,” Robert Hammer, a banking expert, told the Associated Press. “The bottom line for banks is shifting enormously, swiftly and deeply, and they’re not going to sit by twiddling their thumbs. They’re going to change.” Unintended, not unforeseeable.
Dodd-Frank is a bad piece of legislation, and the Durbin Amendment may not even be the worst part of it. But when Americans start seeing those $5 monthly fees on their bank statements (and if you get a paper bank statement, expect a fee for that, too), we should thank Senator Durbin, who did it all to save us money.
How Dodd and Frank are not in prison is beyond me.
Sweet....
So they would rather process checks than do it electronically? It would seem that doing the money transfers would be cheaper for them.
Dodd Frank is just as dangerous to the health of the country as Obamacare. The candidates need to start pointing this out and talk about it’s repeal.
Dick Durbin, Obama and the Dems are not going to sit idly by and allow B of A to beat them up in a PR war with the “Durbin Fee”. You might as well call something the Democrat Wallet Emptying Program. They won’t let this stand.
Some additional regulatory pain is now headed B of A’s way. And you can take that to the bank.
I am required by Republic Bank to have a checking account with them in order for them to hold my mortgage. That also requires 7 transactions a month through the account.
This checking account requires 2 debit cards. It charges me $1 per card if the card is not used at least once each six months.
If they start charging me $5 a month for the debit cards I don’t want or use, I’m going to be pretty mad.
Now I don’t have a problem with the account requirement. RB has good terms on the mortgage and in return they want some business from me. I will add that RB hasn’t sold the mortgage and the agreement does state that if they were to do so, the checking account requirement is void.
The $5 monthly charge applies only if you USE the debit card in any one month.....that is my understanding, but please double check this.
This reminds of the mole in that funny golf movie Caddyshack where the critter is whacked in one hole and just pops up in another hole.
Since each and every Senator (and staff member for that matter) think they are infinitely smarter than anyine else in America, we see stoooopid stuff like this that produce unintended consequences. They need to stop screwing with the system, which screws us, and allows others to screw us. The only ones not being screwed are the people that continually screw us. Barney Frank likes sticking things up our...... Don’t know Dick Turban’s motivation other than acting stupidly and getting wee-weed up.
I just called Republic and was told that at present they have no plans for a debit card fee. I was also told that I could cancel both of the cards if I wished, so I misunderstood that when I got the account. I think I will cancel one of the cards and hold on to one for the time being, in case my needs change.
Then I read the bio of former New york city Police Commisioner Benard Kerik, a Republican. One of the highest decorated cops in NYPD history. Doing four years in jail for tax evasion on ONE tax return and because contracters doing work on his place were mob connected. Whoa, the mob involved in construction? That must be a first! I better do background checks on that roofer I hired. Oh yes; And *gasp* he employed a maid who was an illegal!
Standard liberal procedure, blame others for THEIR own failed policies.
RE: Speaking of jail, why isn’t Charles Rangel in jail?
He was officially CENSURED by the House... Isn’t that punishment enough ? /sarc
Frankendodd the banking monster, twin brother of Frankenstein.
I used to beg my parents “Please don’t censure me! I can take anything but censure!”
I would think that Bank Debit Cards are used by a lot of folks who have low salaries/wages. These are the folks who probably have a hard time getting a regular Credit Card.
So along comes DEMOCRAT DURBIN who sticks it to the poor folks by forcing the banks to reduce their charges against the retailer and put a fee against the card holder instead.
Way to go Democrats. Can we help you find other ways to stick it to your base?
I would think that Bank Debit Cards are used by a lot of folks who have low salaries/wages. These are the folks who probably have a hard time getting a regular Credit Card.
So along comes DEMOCRAT DURBIN who sticks it to the poor folks by forcing the banks to reduce their charges against the retailer and put a fee against the card holder instead.
Way to go Democrats. Can we help you find other ways to stick it to your base?
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