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Thursday, August 27, 2009

Credit Card Reform Act Kills No Jobs Yet

...Rounds Preaches Fear Instead of Forming Plan B

The Credit CARD Act of 2009, passed by Congress back in May, took effect seven days ago. The giant sucking sound you don't hear is jobs draining out of the Sioux Falls metro-usurial area. Anyone at Premier Bankcard sending out résumés yet? Anyone?

Governor Mike Rounds insisted that the law would kill thousands of South Dakota jobs. Governor Rounds' needle is still stuck in that groove. He argues that limits on fees on low-limit cards will drive the industry to increase fees on transactions. Another commentator echoes my own mild fear that we credit-card deadbeats may lose our bonus points and rebates. Governor Rounds thus predicts that credit card companies will lose customers and thus fire up to 3,000 good South Dakotans.

It is perhaps noteworthy that Governor Rounds was previously citing 5,000 as the number of jobs we could lose. Keep rounding down, Mike....

But 5,000, 3,000, whatever the number, I actually think 3,000 fewer South Dakotans profiting from usury would be an improvement in our quality of life. And if those job losses do ever happen, maybe the state can help those people transition to a more honest, satisfying work that actually produces something useful: growing industrial hemp!


  1. CAH:

    I certainly wouldn't feel bad about losing rewards and such. Recognize that those of us that pay off our balances every month and simply use it for convenience and fraud protection really don't provide any revenue for the credit card companies. When we receive rewards someone must be paying for them and of course it's the people who are caught in the credit trap that pay for our rewards. It's basically a tax on the poor who can't afford their bills to give rewards to those who can pay their bills.

    Super, super regressive process...

  2. I'm with you, Tony. I like my rebate check, but as I acknowledged back when the bill passed, we don't really deserve those freebies and can't complain if the credit card companies take them away (paying bills on time is the default moral position, not exceptional behavior deserving reward). Worse, we're making that money on the backs of the subprime borrowers that the credit card companies rope into bad deals with predatory lending.


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