VANCOUVER, Wash. – “I’ve been in business a long time, yet I’ve never seen so much disinformation, distortion and outright nonsense as the big banks spewed about a reform that has actually saved consumers and Main Street retailers $40 billion,” wrote Don Rhoads, president of The Convenience Group, in an op-ed published yesterday in The Hill. Below is an excerpt of his piece.

“Fortunately, Congress saw through the banks’ smokescreen and, in one of its most significant actions this year, resisted the big banks’ pleas to let them throttle competition. … [Swipe fees] became many merchants’ second-largest operating cost, after only labor. For convenience store operators like me, it got to the point that the banks often took more out of my business in profits than I did.

“Congress decided to do something about this glaring inequity for debit card fees in 2010, and passed a law giving banks an incentive to compete. It also required retailers have a choice of at least two competitive networks to process their transactions. Before, the banks had been trying to squash these competitors.

“The law only affected debit cards, not credit cards; created a modest amount of competition; and still let banks that refused to compete on price mark up their fees an astonishing 500%, according to Federal Reserve figures. Yet the banks couldn’t stand having to compete in a business that had previously worked like a form of collusion. …The banks blew so much smoke that they got some members of the House Financial Services Committee to try to repeal debit reform as part of the Choice Act, a bill to repeal much of the Dodd-Frank financial-regulation law.

“But when Congress counted votes, they found the bill would never pass the House with repeal of debit reform in it. So they dropped it. It was a huge victory for Main Street merchants, consumers, the economy (since retailing is such a huge component of economic activity) and, finally, for the free markets that made us the largest economy in the world. …

“Debit reform has let my chain of a dozen convenience stores in Washington state pass tens of thousands of dollars’ worth of savings on to customers by holding down the price of the gas and soft drinks and snacks we sell.

“Imagine how much more we would all benefit if every card transaction was free of banks’ price-fixing. In fact, it would look like the rest of our free-market economy. It’s high time that it did.”