The Financial Reform Bill, which promises to be a political gift that keeps on giving to Republicans, has dropped its first neatly wrapped present at the doorstep of whichever GOP candidate wants to open it – a new income limitation on struggling banks that has forced them to begin charging customers for using their debit cards.
As anyone with a three-year-old knows – except President Obama and Sen. Richard Durbin (D-Ill.), his closest Senate ally – taking something away from people is a lot worse than not giving it to them in the first place.
People just love to use the debit cards for free, but the Financial
Wrecking Ball Reform Bill the Democrats passed and Obama signed now limits the fees banks can charge businesses when the debit cards are used in their stores. So they’ll be passing their new costs onto consumers by charging for use of debit cards and trying to steer consumers into using credit cards, which are more profitable – and which BTW promote less responsible spending and more borrowing, which is supposedly what government is trying to limit.
Bank of America was the first to jump today, announcing it will charge a $5 monthly fee for the privilege of using debit cards.
This is the kind of thing that will make people very angry.
Sure, the banks screwed up with all those easy mortgage loans, behavior of course facilitated and even prompted by the Community Reinvestment Act and Fannie Mae and Freddie Mac, all causes especially dear to Democrats.
But what are we supposed to do now, with banks struggling, punish them for their mistakes? Talk about shooting yourself in the foot. Who’s going to give you a loan, grandma? Her money was in her home, which now isn’t worth more than one of her blueberry pies.
The Dems’ response to their mistake is to blame the victim. Said Durbin, author of the offending provision, which was reportedly inserted in the bill at the request of big retailers who hate paying the banks.
After years of raking in excess profits off an unfair and anticompetitive interchange system, Bank of America is trying to find new ways to pad their profits by sticking it to its customers. It’s overt, unfair, and I hope their customers have the final say.
But Republicans have a real opportunity here to frame the problem as a result of the regulatory orgy that has occurred under Obama. They have the upper hand: Consumers are inclined to see this as just another unpleasant feature of the Obama economy