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Opinion: Government price caps?! That’s not Missouri Values

The first year of Democrats controlling Congress and the White House has already proven to be an unmitigated disaster for American workers. The Biden administration’s “tax and spend” policies are hurting the economy, and unfortunately, its allies in the U.S. Senate are seeking to deploy new regulations that would further hit Americans in their pocketbooks.

Tim Jones

​While Democrats try to project “pro-worker” images, their policies hurt workers the most. We are seeing congressional Democrats tout Green New Deal policies even as Americans cope with gas prices that are a dollar per gallon higher than they were a year ago. Here in Missouri, rising costs for housing are leaving many Missourians bracing for higher property tax bills.

​This month, the Bureau of Labor Statistics announced that consumer prices rose 5.4 percent over the past year. This growing inflation bubble serves as a new regressive tax on the American workforce, wiping out any gains Americans might have recently seen in their paychecks.

​In this environment, you would think United States senators — let alone self-declared “progressive” senators — would be pushing policies that would help American families. Instead, some are doing the opposite.

​Senator Dick Durbin (D-IL), along with progressives like Senator Bernie Sanders (I-VT), are looking to enact what could be one of the largest and costliest regulatory burdens in American history. They are seeking to impose new regulations on credit cards that would make it harder for Americans to access banking and financial services and would ultimately take money out of people’s pocketbooks.

​Durbin and his allies want to expand government price controls to credit cards, strictly limiting the money that banks need to ensure security and financial inclusion in the digital marketplace. When this money disappears, a lot of benefits to consumers will as well.

​American consumers receive between $40-$50 billion annually from credit rewards. For the average consumer, that’s nearly $170 per year that can be used to help pay for groceries and other necessities. But those rewards will likely be closer to zero if Durbin has his way.

​Banks will also have to limit their credit exposure, and that will have consequences for consumers and their favorite stores. When a credit card transaction is fraudulent, it is the bank that winds up absorbing the loss. But with a significantly smaller financial cushion, banks will begin charging more for credit cards and eliminating the ‘no fee’ credit cards upon which many families rely.

​If consumers do not believe this will happen, they should know that it has all happened before. In 2010, Senator Durbin introduced and passed an amendment that imposed similar restrictions on debit card transactions. Since then, these debit card regulations have hurt consumers, not banks.

​After Durbin successfully imposed these regulations, a Federal Reserve study found the availability of free checking accounts at the banks targeted by Durbin’s amendment declined by 35 percent. A separate Boston University study found that the regulations cost low-income consumers roughly $160 per year, and the number of Americans without a bank account grew by nearly a million.

​Not content with these outcomes, Durbin and his far-left allies now have their eyes trained on Americans’ credit cards. Fortunately, the 50/50 split in the U.S. Senate makes every vote critical, and Missouri has two strong consumer-minded, conservative senators in both Roy Blunt and Josh Hawley. Hopefully, they will do the right thing for American families and workers and oppose any expansion of Durbin’s already ruinous policies. Under these Democratic proposals, every dollar Missourians earn will be at risk to the never-ending regulatory burdens of Washington, D.C., political progressives.