Durbin admitted that he offered the amendment after detailed discussions with a big retailer CEO. The bottom line is that, absent an explicit requirement that retailers pass along any related savings to consumers, the Durbin amendment will put billions of dollars into the pockets of Wal-Mart, big oil companies like BP and other big box retailers who depend on consumers and their credit cards for revenue.
While Durbin claims his amendment will help both small businesses and consumers, former Bush Administration press secretary, Dana Perino believes this amendment will hurt consumers. "Much of what you’ll find in the bill creates legitimate consumer protections. [But] Durbin’s amendment to the bill would do the opposite. Imagine you're planning your monthly budget -- you can take anywhere from 2 to 6 percent right off the top," said Perino.
"Retailers will be allowed to add a special charge to your bill if you decide to use your debit card…and given that option, don’t you think they’ll do that? Other consequences: you can kiss that no-fee checking account goodbye. Your rewards program? It probably won’t have much value if this amendment remains intact," she added.
If there are any doubters out there, all they need to do is study Australia's experience with Swipe Fees:
Swipe Fees legislation passed in Australia seven years ago. Retailers began tacking on extra fees for consumers paying with plastic. Far from benefiting from lower prices, Australian consumers found themselves paying more at the cash register than ever before. In the United States, a few years ago, gas stations charged drivers higher prices for gasoline if those drivers paid by credit card or debit card instead of cash.
While Americans watch the President and other politicians grandstanding and bashing big business, they are rewarding their villains with a huge windfall -- and soaking Americans at the same time.
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