| I feel sorry for Sen. Ben Nelson. Last week, he was run through the online gauntlet over some confusing statements to the Omaha World-Herald that revealed he'd never used an ATM machine and may not have the firmest grasp of technological lingo.
Nelson's statements were in response to questions about an amendment to the Wall Street reform bill proposed by Iowa Senator Tom Harkin that would have limited the fees that could be charged for using an ATM. Harkin's amendment never even received a vote in the Senate. Still, Nelson's statements were used to portray him as out-of-touch and generally unconcerned with protecting consumers.
That's sad because, on an amendment that was actually brought to a vote - Illinois Senator Dick Durbin's - Nelson had just stood up against the big banks, casting an important vote requiring that debit card fees be reasonable while ending some of the anti-competitive payment restrictions imposed on retailers by credit card companies and financial institutions.
Ben Nelson supported the Durbin amendment, which was adopted 64 - 33. Nine Democratic Senators did not vote for the amendment - most of them with ties to large financial institutions doing business in their states. Sen. Mike Johanns didn't even need that excuse. Like many of his fellow Republicans, Johanns sided with the big banks as a matter of principle.
Out of nowhere, Nebraska's Republican State Treasurer, Shane Osborn, has now thrust himself into this debate as well. He wrote a letter opposing the Durbin amendment that got picked up by Bloomberg News:
A U.S. Senate proposal to limit debit-card "swipe" fees could increase costs to taxpayers and harm citizens who receive benefits on prepaid cards, according to Nebraska Treasurer Shane Osborn.
Lowering the fees paid by merchants may discourage banks from issuing the cards that governments use to disburse money to senior citizens and needy families, Osborn wrote in a letter to lawmakers yesterday. The measure, part of the financial overhaul bill, directs the Federal Reserve to ensure that debit-card swipe fees, or interchange, are "reasonable and proportional" to the cost of processing transactions.
"A regulated debit interchange rate would decrease or eliminate the ability of financial institutions to offer these cost-effective programs to the public sector," Osborn wrote. "Financial institutions issuing these cards may raise fees on cardholders or states to recoup lost revenue."
The letter contains a passage almost identical to one on the website of Visa Inc., which opposes the legislation.
When specifically asked about his letter's lifting language from Visa, Osborn told Bloomberg:
"We've researched significantly to try and go out and get information on what's going on as this thing changes, so we use all types of resources."
Sounds like Visa needed an elected official to defend their right to impose UNREASONABLE fees on debit card transactions, and our own Shane Osborn was the best they could come up with. That's not surprising considering the weakness of their claim that this amendment is going to hurt taxpayers and cost states money - which shouldn't be the case if competition between banks actually works.
Of course, they don't want to compete on both ends of a financial transaction - not when they're currently able to pass on all of their costs to small businesses and retailers. Who could blame the banks and credit card companies for defending a system gamed so heavily in their favor. At the same time, who could excuse Shane Osborn doing their bidding and passing their words off as his own - especially in his capacity as Nebraska's State Treasurer.
With all of this, Nelson is the guy who takes the hits from the press - and even from many progressives. I'm guilty of it myself, understanding that's a large part of why we don't do any better than electing Osborn, Johanns, and their like. |
