Today’s output from Blogistan Polytechnic Institute’s state-of-the-art HEMMED (High-Energy Meta Mojo Elucidation Detector) machine is a little bit of this and a little bit of that because it is not quite fully geared up from vacation brain.

First, an update to a HEMMED In story from June 22nd about bank fees.

It turns out that many small businesses were delighted that FinReg, the re-regulation bill (now being held up – literally – by Senate republicans, Blue Dogs and purists) is going to give them a break from Debit Card Swipe Fees.

These fees are the charges that the credit card vendors invoke each time a Debit Card is swiped to pay for something. It turns out that the small business owner is NOT ALLOWED to have any rules about the use of these cards like minimum charges or even discounts for paying with cash. (Pausing while you stop to consider that the credit card companies are dictating a business decision that has no connection to their product or service). So someone could buy a Diet Coke at a restaurant, swipe their Debit Card and make the business owner incur a 2% or 3% charge.

A recent article in my local paper discussed these fees:

…according to the Wisconsin Restaurant Association, [swipe fees] have risen 300 percent since 2001. The group also reports that credit card companies, along with their issuing banks and credit unions, collected some $48 billion in swipe fees last year.
By some estimates, swipe fees are the largest component of the various fees that merchants pay for the privilege of accepting credit cards. It hits smaller businesses harder, since giant retailers like Walmart or Walgreens can typically absorb the costs due to their larger sales volume.

This long-brewing unhappiness over swipe fees has now found its way into the sweeping financial reform bill working its way slowly through Congress. New rules included in the 1,500-page measure would put limits on debit card fees and allow merchants to offer discounts for customers paying with cash, something specifically prohibited in most agreements between merchants and credit card companies.
Merchants could set a $10 minimum for transactions, for example, something they technically can’t do now without penalty from card networks. These provisions, reform advocates say, will enable small businesses to bring their interchange costs under control and pass the savings on to consumers.

Not surprisingly, banks do not like this. From that same article:

Eric Skrum, a spokesman for the Wisconsin Bankers Association, [says] debit card fees had nothing to do with causing the financial crisis. “This provision has no business being in a financial regulatory reform package.
But Doug Kantor, a Washington, D.C. attorney with the Merchants Payments Coalition, says that swipe fees definitely belong in the bill and are part of helping Main Street get back on its feet. “What it’s going to do is help local business,” he says. “In some cases, these fees are the second biggest expense after rent.”

So the bottom line from the banksters is that even if something will help small businesses, if it is NOT the exact cause of this recession it cannot be including in legislation designed to reform the Financial Industry. Pardon me while I shed a tear for the banksters over the unfairness of this.

Okay done…tears shed…hope you didn’t get any on you.

I promised This and That but I think that This is enough so I am going to save That for another day.

Happy Thursday to everyone! And fist bumps.

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