New Credit Card Policy Seeks to Punish Big Corporations

As Republicans gear up for the 2024 elections, President JoeBiden's economic policies, also known as "Bidenomics," will serve as a crucial part of the GOP efforts to defeat president.  Once again, the United States has revved up efforts that push policies that encourage ESG-like elements.

Republicans continue to believe that President Trump's (R) economic policies led to economic prosperity not seen in ages during the late 2010s.  Now that the Biden Administration has endorsed policies that could not have a sharper contrast (ESG, DEI) the programs are now being targeted as the source of many economic troubles seen as of lately.

Democrats however, are only doubling down on economic efforts to intercede in the economy, or, "pick losers and winners," as critics may say.  US Sen. Dick Durbin (D-IL) is now pushing the "Credit Card Competition Act."  The legislation is described as targeting credit card companies, like Mastercard, in the name of leveling the playing field.

For instance, from July 2021 to June 2022, credit card companies and banks collected more than $288 million from merchants just on the sales tax portion alone.

In February, State Senator Travis Hutson (R-FL) filed SB 564, Interchange Fees on Taxes Bill to keep the credit card companies and banks from charging a hidden fee on state-mandated taxes.  The measure is now making its way to the House Floor and has one more stop in the Senate.

The proposed legislation would prohibit processors (credit card companies) from charging fees on the sales tax portion of a sale – something that the state mandates that merchants collect and remit. This bill would only allow credit card companies and banks to only charge a swipe fee on the subtotal of the transaction.

Durbin's legislation however, seems to carve out large credit card companies (American Express and Discover) by punishing them, and make room for smaller companies.  This legislation is only one of many attempts that the United States has seen from the Biden Administration to create a tangible effect on economic outcomes.