WASHINGTON — Lawmakers on both sides of the aisle pressed executives from Visa and Mastercard on the cost of so-called swipe fees to small businesses and consumers.
Notably, Republican lawmakers — who will have full control of the White House and Congress for the next two years — signaled openness to
The legislation is
The lawmakers
"I don't know exactly where I'm going to come out, but you're having a hard time convincing me that the fees here are set to the advantage of the consumer," said Sen. Lindsey Graham, R-S.C., the current ranking member of the Senate Judiciary Committee, who will likely serve as the panel's chairman next year.
The bill, Sheedy said in his opening statement, "is not only unnecessary, but also potentially deeply harmful to the competitiveness and innovation that drive this country's payments industry."
Sen. Roger Marshall, R-Kan., who cosponsors the legislation alongside Senate Judiciary chair Sen. Dick Durbin, D-Ill., was added to the witness list the morning of the hearing to push for the legislation. He swiped at the Senate Banking Committee, currently led by Sen. Sherrod Brown, D-Ohio, for not picking up the issue.
"We repeatedly asked — in fact, begged — the Banking Committee to hold a hearing, and they haven't answered our request," Marshall said. "I'll let you all decide why."
He struck a populist tone in his remarks, a growing sentiment among the Republicans who were elected to Congress this past cycle.
"Capitalism without competition leads to unchecked greed, the exploitation of hard-working Americans and the erosion of opportunity," Marshall said.
Several other Republicans said that they would be open to the idea of passing either this bill or a similar one.
"If we had to vote on this bill today, I don't know how I would vote," said Sen. John Kennedy, R-La.
Kennedy sought to distinguish the legislation, which he said could promote competition, from European card regulation, which he said he was against.
"You need to sit down and work this out," Kennedy said. "Because if you don't, Congress is going to do something. And Visa and Mastercard, when we get done with you, you could end up looking like either the Post Office or the Dallas Cowboys."
Even lawmakers like Sen. Thom Tillis, R-N.C., who is traditionally friendly toward the banking industry, emphasized the need to revisit swipes. But he added that this specific legislation would not be the best way to remedy the situation.
"We have a problem here," Tillis said. "You've got a Congress and a half to solve this problem, in my estimation.
"Get in a room and solve it," he said.
Banking groups lobbied against the bill ahead of the hearing. The American Bankers Association, America's Credit Unions, Bank Policy Institute, Consumer Bankers Association, Electronic Payments Coalition, Independent Community Bankers of America, Mid-Size Bank Coalition of America, and National Bankers Association said in a letter to the committee that the panel should have included a representative from the banking industry.
"We also want to share our deep disappointment with the committee's decision to schedule a lame duck hearing promoting this misguided legislation without hearing testimony from a community bank or credit union," the groups said. "If the Committee's goal is to educate lawmakers and the public, these financial institutions could detail the real harm CCCA will bring to the customers and communities they serve."
The Electronic Payments Coalition had similar complaints about the witness list.
"This is a one-sided hearing that ignores the small business who oppose new mandates on our payment systems; the impact these mandates will have on community banks and credit unions' ability to serve their communities; and the multitudes of independent reports showing the Durbin-Marshall Bill would be a windfall for the largest corporate mega-stores without any guarantee of lower prices for American families," said Nicklaus Simpson, a managing director of the group, in a statement.
Douglas Kantor, general counsel at the National Association of Convenience Stores, testified at the hearing that the bill would "introduce market competition where there is none today."
"The harm done to merchants, consumers and the U.S. economy due to the anticompetitive actions of the card industry is far too large and should end," Kantor said.
