Sunday, March 27, 2011

Interchange Under Attack

In general, I'm not concerned about the GOP's efforts to roll back financial reform. House Republicans can pass all the bills they want; they're not going to get a vote in the Senate.

However, the one aspect of financial reform that I think could legitimately be rolled back is interchange (a.k.a., the Durbin amendment), which is unfortunate, because I still haven't heard a single legitimate argument against it. The problem is that the Durbin amendment has a ridiculously powerful coalition lined up against it — the community banks, credit unions, and, apparently, the teachers' unions. And yes, the big commercial banks too, although (a) it's the community banks who are driving the anti-Durbin movement, and who could put it over the top, and (b) the big banks' power in Congress is wildly, absurdly overrated anyway. As Barney Frank said recently regarding the fight over rolling back the Durbin amendment: "The lobbying power doesn't come from the big banks. The community banks beat the big banks." Of course, the opposition from JPMorgan/Wells Fargo/BofA is certainly still a factor — mostly what they can bring is a certain professionalization to the lobbying effort.

The community banks and credit unions are so powerful because they're in every member's district, they usually give to politicians' campaigns, and they tend to be very involved in local society. Those are the kinds of traits that command a Congressman's attention. And right now, the community banks, credit unions, and big commercial banks are screaming to their Congressmen and Senators about interchange. These kinds of measures need to gather a bit of momentum in Congress to have a chance, and I definitely get the sense that the momentum for rolling back the Durbin amendment is building.

On March 15, Sen. Jon Tester (D-MT) introduced the "Debit Interchange Fee Study Act of 2011," which delays the implementation of the interchange rules until July 21, 2012, expressly voids the Fed's proposed interchange rules, and directs the Fed, OCC, FDIC, and the National Credit Union Administration (NCUA) to conduct a study on a parade of horribles that might result from an interchange fee cap. It's a decidedly unsubtle message ("do NOT do through with this!"), and one that regulators aren't likely to ignore. For all intents and purposes, it would kill the Durbin amendment. Tester's amendment is also co-sponsored by 6 Democrats and 7 Republicans, giving it the all-important "bipartisan" label. (At the very least, it guarantees that the Washington Post editorial page will support the bill.)

On the other side of the fight, the main interest group supporting the Durbin amendment — namely, the merchants — is, I fear, too loosely organized, or simply not powerful enough, to win this kind of low-profile battle. A couple of merchant groups are already attacking Tester for his bill, but (a) it's too early in the electoral cycle for the attack ads to have much of an effect, and (b) Tester's in for a bitter re-election fight no matter what, so the fact that someone is running attack ads isn't likely to scare him.

The primary obstacle to rolling back the Durbin amendment is, I suppose not surprinsgly, Sen. Durbin himself. Durbin is the second-ranking member of the Senate, so he's got significant clout, especially among Democrats. Will Durbin be able to prevent Tester's bill from coming up for a vote until July 21, the date that Dodd-Frank requires the interchange rules to take effect? Maybe. He likely won't get any help in committee though, since the Chairman of the Senate Banking Committee is now Tim Johnson, who's from a very bank-friendly state (South Dakota), and is sometimes referred to as "the Senator from Citibank." Not surprisingly, Johnson voted against the Durbin amendment the first time around.

Durbin has promised that he'll make sure Tester's bill will need 60 votes to pass, and I think he'll be able probably be able to keep that promise. Whether Durbin can win that vote is another matter, because, again, he's battling a ridiculously powerful coalition in the community banks, credit unions, teachers' unions, and the big commercial banks. I've been tracking this issue pretty closely, and while my gut sense is that Durbin will be able to hold the line with wavering Democrats, I'm not particularly confident about that.


Tom Lindmark said...

I've never been able to shake the feeling that the entire interchange debate is simply a rent seeking exercise on behalf of two big interest groups -- banks v retailers.

If the end result is a win for the retailers, they keep the spoils and the banks replace their lost revenue via fees on other services.

A win for the banks is preservation of the status quo.

As a consumer, the status quo seems like a more preferable outcome. At least I don't have the potential of being tapped to make up for the banks' losses.

Anonymous said...

Sandrew, you Cheap wow goldmight be proper, the most significant levels of collateral simply dropped owing right after downgrades, as a result your bailout was only needed following AIG bought reduced (even though some C/Ps for example Goldman had been do security regardless of whether AIG endedBuy rs gold up being Double a or higher, even though probably certainly not with Ccc)

GM MDI said...

When shopping for an OBD II scanner, remember that they are normally interchangeable and valuable in diverse sorts of cars. Nonetheless autoboss v30, there are some scanners that can not be appropriate for particular varieties of automobiles. Just be certain which you possess the ones that you call for so you might not have any issue.

Unknown said...

yemek tarifleri
ekol hoca
android market
twitter aç


Theirs always someone or thing under attack.

Trần Duy Thuận said...

Trần Duy Thuận Blog đang cần nhận gia công tại nhà. Ai có cần người nhận gia công tại nhà tphcm liên hệ mình nhé. Truy cập vào đặt vé máy bay giá rẻ vietjet để có thêm kinh nghiệm khi đi máy bay nhé.

Unknown said...

شات بنات مصر
شات بنات مصر
شات مصرى
شات مصرى
شات مصري
بنات مصر

شات مصر
شات مصرية

شات مصرى
شات بنات مصر
شات مصرى
بنات مصر
شات مصرى
شات بنات
شات مصر
شات مصرية

شات مصرية
شات مصريه

شات بنات مصر

Unknown said...

Jual obat herbal de nature asli untuk berbagai penyakit kelamin dan sebagainya
Obat Wasir Herbal
Obat Wasir Herbal Mujarab
Obat Wasir Herbal Ampuh
Obat Wasir Herbal Pada Pria
Obat Wasir Herbal Di Apotik
Cara Mengobati Wasir Stadium 4
Cara Mengobati Wasir Stadium 4 Tanpa Operasi
Cara Mengatasi Wasir Stadium 4
Cara Penyembuhan Wasir Stadium 4
Cara Mengobati Ambeien Stadium 4 Secara Alami
Cara Pengobatan Wasir Stadium 4
Cara Pengobatan Ambeien Stadium 4
Cara Mengobati Wasir Stadium 3 Dan 4
Cara Mengobati Wasir Stadium 3
Cara Mengobati Wasir Stadium 3 Secara Alami
Obat Wasir Herbal Apotik
Obat Wasir Herbal Untuk Ibu Hamil
Obat Wasir Herbal Terdaftar Bpom
Obat Wasir Herbal Untuk Ibu Menyusui
Obat Wasir Herbal Bandung
Cara Mengobati Wasir Stadium 3 Dan 4
Cara Mengatasi Wasir Stadium 3
Cara Mengobati Ambeien Stadium 3 Tanpa Operasi
Cara Menyembuhkan Wasir Stadium 3
Cara Mengatasi Ambeien Stadium 3
Cara Alami Mengobati Wasir Stadium 3
Cara Mengobati Ambeien Stadium 3 Secara Alami
Obat Wasir Herbal Manjur
Obat Wasir Herbal Semarang
Obat Wasir Herbalife
Obat Wasir Herbal Jogja
Obat Herbal Wasir Berdarah
Obat Herbal Wasir Dalam
Obat Herbal Wasir Akut
Obat Herbal Wasir Stadium 4
Obat Herbal Wasir Terpercaya
Obat Herbal Wasir Stadium 3
Obat Herbal Wasir Internal
Obat Wasir Herbal Alami

Buffalo Car Unlock said...

Wonderful blog! I found it while surfing around on Yahoo News. Do you have any suggestions on how to get listed in Yahoo News? I’ve been trying for a while.Buffalo Car Unlock

Judi Poker Online said...

This article is very nice and Helpful .. Update continued and success is always yes Gan

Poker Terpercaya
Agen Domino
Agen Domino Terpercaya
Judi Poker

mcq said...

خدمات تسليك المجاري شركة تسليك مجارى بالرياض نقدم اليكم افضل الخدمات علي الاطلاق حيث اننا نقوم بحل مشكلة
شركة تسليك مجاري بالرياض انسداد المجاري بافضل الطرق فنحن

Situs Judi Online said...

This article is very nice and Helpful .. Update continued and success is always yes Gan

Situs Judi Online

Agen Bola

Agen Casino Online

Togel Online

Agen Bola Terpercaya

Poker Online said...

This article is very nice and Helpful

Agen Poker Terpercaya

Poker Uang Asli

Cerita Dewasa

Nonton Film Semi Online

Bokep Indo

Cerita Sex Tante said...

Wonderful blog! I found it while surfing around on Jejakmalam story.

Cerita Dewasa

Cerita Sex Terbaru

Foto Seksi

Film Semi

Nonton Movie Online

Livecore Indonesia

Cerita Dewasa said...

Artikel Ini Sangat Bermanfaat ..

Cerita Sex
Cerita Dewasa
Cerita Hot

Bandar Poker Terpercaya said...

The article on this site is very interesting, thank you
Selamat datang di LENOVOPOKER™ Top 1 Judi Online
Promo Terbaru LENOVOPOKER :
- Bonus New Member Depo +20%
- Bonus All Member Next Depo +5%
- Bonus All Member Refferal 30%
- Bonus All Member Rollingan 0.5%
Contact : BBM : LENOVO88
WA : +6281375260652
Agen Domino 99
Bandar Poker
Agen Ceme
Bandar Ceme
Judi Poker Terpercaya