Mike Konczal reports on a scrambled-together lobbying effort by the banks along with Visa and Mastercard to defeat the interchange-fee amendment in the financial reform bill.
Because here’s the funny part: You have to suddenly believe that all these firms are suddenly very concerned about consumers paying fees. Did you catch that? Visa and the major banks are worried that you may have to pay a fee!
Even better: “If interchange revenue were artificially limited by the government, the millions of consumers who use small financial institutions would be forced to turn to large, national banks for their debit cards — further consolidating the financial system.”
Actually no, it exempts small financial institutions with less than $10 billion from the reasonable debit fee requirement. But read that again: Citi, JP Morgan, and Bank of America are terrified about financial sector consolidation.
It’s called the CARD Alliance: Or Consumers Against Retail Discrimination. Which is as good a chance as any to get in a Naked Gun 2 1/2 joke:
PRESIDENT GEORGE H.W. BUSH: Now I’d like to call on my Chief of Staff, Mr. John Sununu, to introduce some special guests.
SUNUNU: Thank you. Mr. President, tonight I am extremely proud to welcome our guests from the nation’s energy suppliers.
First, representing the oil industry, head of the Society of Petroleum lndustry Leaders—better known as SPIL—Mr Terence Baggett.
From the coal industry, chairman of the Society for More Coal Energy, or SMoCE, Mr Donald Fenwick.
And from the nuclear industry, president of the Key Atomic Benefits Office Of Mankind — KABOOM — Mr Arthur Dunwell.
Consumers Against Retail Discrimination, huh? Well, I guess Jamie Dimon, Vikram Pandit & Co. et al are technically consumers.
But this astroturf makes the Brady Brunch backyard look like Augusta:
Let’s hope the press doesn’t fall for this one.
— Further Reading:
WSJ: Plastic Fees Under the Microscope. The paper keeps the spotlight on financial industry rent-seeking.
Spotty Coverage of the Financial Reform Amendments: Let’s just say the press has had better days.
NYT PINs Visa on Transaction Fees: How screwed up does an industry have to be for competition to increase prices?
Ryan Chittum is a former Wall Street Journal reporter, and deputy editor of The Audit, CJR’s business section. If you see notable business journalism, give him a heads-up at rc2538@columbia.edu. Follow him on Twitter at @ryanchittum.