Free Market Groups Oppose Price-Control Fed Debit Card Rule

“The latest debacle is the looming Federal Reserve rule to fix prices on debit cards, which threatens the flow of credit to low-income Americans and promises higher fees on bank services for nearly everyone else.”

“But merchants need to beware of what they are asking for. Allowing the Obama administration to fix prices could come back to bite them when the next logical step, controlling the price of consumer goods, follows.”

“Without committee hearings by either chamber of Congress, [Senator Durbin] proposed (and in all likelihood the merchants had drafted) a price-capping arrangement for debit (but not credit) card interchange fees that had never been proposed or discussed in the extensive academic and industry literature on the subject.”

”Quite simply, the proposed regulations are price controls that will severely disadvantage consumers and card issuers. They are not good public policy. We urge Section 1075 be repealed, revised, or – at the very least – delayed.”

“Although regulators do perform their duties under a somewhat different set of circumstances than lawmakers, it is entirely appropriate for you and your colleagues to engage Congress and the Administration when you believe that certain laws could lead to untenable regulatory outcomes. For the sake of consumers, taxpayers, and the economy, we urge you to do so now.”

“The proposed Federal Reserve rule confirms our fears that this section amounts to a price control that will have serious unforeseen consequences, and the routing provisions abrogate contract that are serving consumers well. “

“The Federal Reserve Board has been told to implement the law, but the assumptions underlying this instruction and the terms of the delegation are so uncertain and ill-defined that the agency will find it impossible to act rationally unless it receives further instruction from Congress.”

"ATR urges all members to support the Tester amendment to delay implementation of interchange price controls. Failure to support this measure is a failure to stand up for free-markets and American consumers."

"60 Plus is alarmed that the fee caps will shift the cost of debit card processing to consumers, and seniors will lose services such as free checking and debit card rewards that are frequently redeemed as airline miles used for trips to visit grandchildren."

"Roll call votes on Sen. Tester’s amendment will be significantly weighted in our annual Rating of Congress and a 'YES' vote will be considered the pro-taxpayer position."