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NBCC: The Durbin Amendment Will Yet Be Judged for Its Failures
In a disappointing turn of events, Congress has decided to strip out crucial language from the Financial CHOICE Act that would have righted a serious wrong done to consumers over the last seven years. Last month, the House Financial Services Committee voted to include language in the bill to repeal the disastrous Durbin amendment, and do away with price controls on debit interchange fees that have provided retailers $42 billion in profit since 2011. These same retailers promised to lower prices for their customers with the additional revenue, but those savings never materialized and in many cases prices have been increased. Tacked on to the enormous Dodd-Frank bill in the 11th hour, the Durbin amendment was full of empty promises that were never fulfilled. Continue Reading
NAFCU’s B. Dan Berger: Tell Congress it’s time for data-security standards for retailers
Every time there is a retailer data-security breach, credit unions step forward to make their members whole. A NAFCU survey found that its member credit unions paid an average of $226,000 each in costs associated with retailer data breaches in 2014. Meanwhile, large companies like Target might lose less than one-tenth of one percent of their annual sales due to a data-security breach; and if they want to recoup expenses, they can always raise prices. Credit unions, as not-for-profit, member-owned institutions, have no such remedy. It’s time to get a national data-security standard in place for retailers. And to do that, we need everyone in the industry – trades, credit unions and the more than 107 million credit union members nationwide – to raise their voices and make Congress take action. Continue Reading
CEI’s Iain Murray: House GOP Forgets History of Price Controls
In what American Commitment President Phil Kerpen called “a gutless sacrifice of principle,” last week the House GOP capitulated to relentless lobbying from big retail interests by stripping language repealing price controls on debit card use from the Financial CHOICE Act. This is not only wrong because the effect of the price controls has been to increase costs for those on the margins of the banking system – the underbanked – but because price controls are always harmful. They distort the normal working of supply and demand and generally benefit most those whom they were not intended to help in the first place. Thus, for example, the debit card price controls were purported to help small merchants, but in many cases they saw their costs go up, as they lost access to deep discounts they had before the price controls were introduced (the price ceiling actually became a floor.) Continue … Continue reading
Heritage’s Norbert Michel: Congress Should Repeal the Durbin Amendment Because It Is a Price Control
Business owners expect conservative members of Congress to protect them from the federal government. They particularly rely on conservatives for protection against government price controls. No self-respecting business owner wants the federal government telling him what price he can charge. Business owners – not federal bureaucrats – best understand what prices they need to charge to earn a living and to make their investments worthwhile. Continue Reading
CEI Criticizes House for Capitulation on Durbin Amendment Price Controls
CEI financial policy expert Iain Murray criticized the House for stripping out repeal of the Durbin amendment yesterday from the Financial CHOICE Act. The House Republicans’ capitulation on Durbin repeal is a slap in the face for lower-income Americans. All the evidence suggests the cap on debit card interchange fees resulted in a windfall for retailers who failed to pass on savings to consumers. In fact, many of those consumers were hit by higher bank fees as banks sought to replace the lost income stream from processing debit card transactions. The result has been a net loss of around $25 billion a year for American consumers, most of it born by low-income households. The House had a chance to right this wrong, and they blew it. Continue Reading
NTU Disappointed Durbin Amendment Repeal Pulled From CHOICE
NTU’s Executive Vice President, Brandon Arnold, responded to the repeal of the Durbin amendment: National Taxpayers Union is extremely disappointed by the decision to remove language from the Financial CHOICE Act that would have repealed price controls on debit card swipe fees. While its supporters claim that the Durbin Amendment is a pro-consumer measure, it has instead been little more than a government-imposed windfall for the retail industry. Continue Reading
Democracy Institute: Dick Durbin’s ‘Reverse Robin Hood’ Economics
Robin Hood took from the rich to give to the poor. A pivotal piece of legislation bearing the imprint of Democrat Richard Durbin suggests the Illinois senator, by contrast, is a fan of “reverse Robin Hood economics” — that is, taking from less fortunate consumers to boost the profit margins of the nation’s largest retail chains. Self-styled “progressives,” such as Durbin, always stress their compassion for the Average Joe, along with their antipathy toward private companies, who allegedly pay their employees as little as possible while charging their customers the highest prices possible. Most of these progressives, however, actually support terribly regressive economic policies, from high minimum wages to closed union shops to protectionist trade measures. Continue Reading
NAFCU: Economic Monitor finds support for CHOICE Act, Durbin repeal
NAFCU’s latest Economic & CU Monitor survey results, now available to member credit unions, show support among respondents for Congress’ move to implement the regulatory relief reforms found in the Financial CHOICE Act (H.R. 10), particularly the proposed repeal of the Durbin interchange amendment. H.R. 10 recently passed the House Financial Services Committee and awaits action by the House. Reports indicate that a vote on the bill could come as early as next month. Continue Reading
Rep. Budd: A Vote To Keep Durbin Amendment Violates Core Free-Market Principles
Representative Ted Budd (R-NC) spoke on the House floor on the importance of preserving the Durbin Amendment repeal in the Financial Choice Act. Two weeks ago, the Financial Choice Act passed the House Financial Services Committee with a full repeal of the Durbin Amendment included. Pro-price control groups are fighting to strip the provision through a procedural technique in the House Rules Committee, a closed-door process that, if successful, will not allow Congress to sidestep a public debate on the policy. Read Rep Budd’s full remarks below. Watch his speech here. Continue Reading
Heritage Action’s Sondra Clark: Dodd-Frank Has Crippled Our Economic Recovery
Have you noticed that free checking accounts are now nearly nonexistent, and locally owned stores are increasing the $5 minimum charge on debit cards? These are not the result of some financial conspiracy. They are a direct result of Dodd-Frank regulations. Continue Reading