[Congressional Record (Bound Edition), Volume 155 (2009), Part 9]
[Senate]
[Page 12456]
[From the U.S. Government Publishing Office, www.gpo.gov]




                 CREDIT CARDHOLDERS' BILL OF RIGHTS ACT

  Mr. DURBIN. Mr. President, we are considering a bill which affects 
millions of Americans. It is about credit cards. We all have them. We 
all wonder each month, when we get a monthly statement, what in the 
world it means. I am a lawyer. I have been a legislator for a while. I 
couldn't even tell you what the back of my credit card statement says 
every month. But I know if you end up missing a payment, if you end up 
being late on a payment, the world can crash down on you, because I 
have gotten plenty of letters from people around my State and the 
country about some of the things that happen when it comes to these 
credit cards.
  I thank Senator Dodd and Senator Shelby. This is the first credit 
card reform legislation in how many years? Ever. That is a long time. 
It is overdue.
  All of us know how much they have become a part of our lives, and all 
of us know how vulnerable we are when interest rates go through the 
ceiling, when they end up saying: Because you are a day late on your 
payment, unfortunately, you have to pay a penalty. Then there is 
interest on the penalty. And did we tell you there is interest on the 
interest on the penalty. You think it will never end--$25, $50, $75.
  Senator Dodd, in this credit card reform legislation, does one of the 
most significant things for American consumers we have seen.
  I want to offer an amendment. Understand, if you go to your local 
restaurant in your hometown and have a meal and pay for it with a 
credit card, the owner of that restaurant has to pay part of your bill 
to the credit card company and the issuing bank. It is called an 
interchange fee. So the owner of the restaurant doesn't get the $20 
that you put on the counter. That owner may end up paying several 
percent of that $20 to the credit card company and to the bank.
  When we created the original law in this area back in 1981, we said: 
It is OK for people in restaurants and other places to say to their 
customers: We will give you a discount if you pay in cash or by check. 
That is the law; right? It makes sense. The person who owns the 
restaurant says: I am only going to charge you $18.75 instead of $20 
because you are paying in cash instead of with the credit card. That 
way I don't have to send part of your $20 back to that credit card 
company.
  That was the law, and it seemed to be a pretty good one. The credit 
card companies weren't happy with that. They didn't want people to get 
incentives not to use credit cards. They created new, legal entities 
for credit card companies that didn't quite fit into the 1981 
definition so that they wouldn't be covered by the possibility of a 
consumer discount. And then, for those bold companies like that 
hometown restaurant that decided they still wanted to offer a cash 
discount, they piled up the rules on them at the credit card companies 
and said: If you don't advertise in just the right way, we will fine 
you. I can tell my colleagues, gas stations are being fined $5,000 
because they offered a discount of $1 or $2 to a consumer.
  As a consequence, retail merchants came to us and said: Give us a 
break. If we are going to have a discount for cash or check, say so in 
the law so that we can offer this to the American consumer.
  The credit card companies hate it like the devil hates holy water. It 
is like old Senator Bumpers from Arkansas used to say: Like the devil 
hates holy water. They don't want to change.
  This bill will change a lot of things they don't like. Thank 
goodness. I hope the Members of the Senate will accept the amendment I 
am offering with Senator Bond of Missouri, a Republican, a bipartisan 
amendment that says: Merchants across America can offer a discount over 
credit cards for people who pay in cash, check, or with a debit card, 
which is the new checking account for many younger people.
  That discount is going to help that establishment to be able to say 
to folks: Well, we can give you a break here on the product you just 
bought or the meal you just bought; and say to the consumers across 
America who are struggling in this economy: Here is a way to save a few 
bucks. You can pay in cash, and you will not have to pay as much as you 
would on a credit card.
  I think that is a move in the right direction. I am glad retail 
merchants, large and small, all across America have rallied behind this 
amendment. Whether it is your gas station or a little shop in your 
hometown or the restaurant you go to, they will be able to say to you: 
If you pay in cash, check, or debit card, we can offer you discounts on 
your final bill. I think that is a good break for people across America 
that they can enjoy every single day if they want to, if that is the 
way they want to make the purchase. If they want to use the traditional 
credit card, that is up to them.
  So this goes back to the original law, knocks away all of the 
obstacles put in the path of this law by the credit card companies, and 
basically says, this gives retail merchants across America a way to 
offer a discount to American consumers.
  So I hope my colleagues on both sides of the aisle will join me on 
that amendment.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Wyoming.

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