The answer is no, they won’t. Is there anything on this planet more stupid and ignorant than liberals? I doubt it. Seriously. Ever notice that every single time these morons try to solve a problem, they end up making it worse, and in the end hurting those they’re “compassionately” trying to help? Me too.

Take, for instance, the Dodd/Frank act (I personally don’t want anything to do with any act that Barney Frank is involved in, but I digress), which included an amendment from Little Dick Durbin™, which was meant to keep all those mean and e-v-v-v-v-v-il banks from making too much profit at the expense of “the little guy” (I guess that’s you and I), by the capping the transaction fees that those mean and evil banks can charge retailers for accepting our debit and credit cards.

These debit/credit card fees are how I make a living, and have since 1986, so I do know what I’m talking about.

What this act was intended to do, was, in the end, save middle and lower income Americans money, by forcing those mean and evil banks to lower their fees. The (warning: oxymoron alert) libs’ thinking was that these lower fees would eventually trickle down to you and I by lowering the cost of what we buy, since the retailers would obviously pass on some of these savings to the unwashed masses (again, you and I).

Don’t you all feel warm and fuzzy knowing that these all-caring, compassionate libs are looking out for you? Me neither.

In the end (which is usually where those who these clowns try to help usually get it), it will end up costing us more money, and the banks will end up making more money. So it’s just another misguided liberal attempt meant to help us that will harm us. But that’s okay, since it’s their intentions that matter, not their results, which were obviously predictable.

In a nutshell, here’s how Visa/Mastercard processing works. Visa and Mastercard issue the cards to their member banks. They charge each bank a fee, which is called the interchange rate, every time their card is used by the bank’s customers. Then the issuing bank charges the merchant accepting the card a small fee called a discount rate to accept it. The total of these fees is usually less than two cents on the dollar, but with millions of transactions each day, it’s billions of dollars each year.

Forbes Magazine had a great article on this very subject, and how you and I end up getting screwed. Again, don’t you love all those caring, compassionate liberals?

Bank of America’s New $5 Debit Card Fee? Blame Dodd-Frank

The inevitable happened today. Bank of America said it will start charging customers a $5 monthly fee on debit card purchases.

Where’s this coming from? Well, anyone paying attention to the Durbin Amendment (which came out of the Dodd-Frank Act) as it was moving through Congress would have seen this fee coming. The Durbin Amendment essentially limits the amount of money banks collect from merchants, like Target for instance, each time you use your debit card there.

Back in June I said that that while placing a cap on those debit card fees might be great news for retailers it would be bad news for customers. Why? Because now that the Durbin Amendment goes into effect October 1 banks will have less money coming into their pockets from the retailers. Where do you think they are going to make up for that lost revenue? You got it–me and you.
Read: Cap On Debit Swipe Fees Will Hurt Consumers

That’s exactly what BofA is doing today with that $5 fee. It’s making up for lost revenue. A report from RBC Capital Markets estimated that banks will take an 80% hit to the fees they once collected from retailers. For a bank like JPMorgan Chase, which RBC says generated $537 million in fees from retailers in the 1Q 2011, that translates into a quarterly revenue loss of $430 million.

As much as I want to hate BofA (disclosure: I’m BofA customer by way of Fleet) for charging me $60 a year so I can deposit my scrappy journalist’s salary I can’t blame it for making the decision to do so.

BofA and every other major bank is simply making up for lost revenue that it would otherwise lose because of a new regulation stemming from Dodd-Frank.

Now, I’m no financial-regulations hater but nothing about the Durbin Amendment is good news for the consumers Dodd-Frank was trying to protect. I’d be singing a different tune if Senator Dick Durbin pushed for the cap on swipe fees for the sake of consumers but let’s face it–the Durbin amendment benefits no one except for retailers. It is completely infuriating (and probably shouldn’t be surprising) that one of the few rules to go into effect from the Dodd–Frank Wall Street Reform and Consumer Protection Act has nothing to do with protecting consumers.
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