From ABA:
Senate Fails to Defend Community Banks; Critical Interchange Amendment Defeated
The Senate today failed to approve an ABA-backed amendment that would have stopped, studied and fixed the Federal Reserve’s harmful debit interchange rule. The amendment required 60 votes to pass but fell short in a 54-45 vote.
Months of aggressive grassroots lobbying by ABA and state association bankers resulted in more than 250,000 letters from bankers to members of Congress and countless phone calls and meetings in recent months. But ultimately these extraordinary grassroots efforts could not overcome a massive misinformation campaign by big-box retailers and efforts by Senate Majority Whip Richard Durbin (D-Ill.) to preserve the price-control rule, which promises to deliver a $14 billion windfall to retailers.
The amendment to the Economic Development Revitalization Act of 2011 -- offered by Sens. Jon Tester (D-Mont.) and Bob Corker (R-Tenn.), along with Sens. Kay Hagan (D-N.C.), Michael Crapo (R-Idaho), Michael Bennet (D-Colo.), Roy Blunt (R-Mo.), Tom Carper (D-Del.), Jon Kyl (R-Ariz.) and Chris Coons (D-Del.) -- was a modified version of the ABA-backed S. 575. Changes had been made in a bid to attract the votes needed to ensure the legislation’s passage.
While the changes and bankers’ grassroots lobbying helped persuade a majority of senators to vote for the amendment, the 60-vote “supermajority” needed to clear the measure proved to be an impossible hurdle to overcome.
“The Senate has essentially said that it is fair for one industry to reap what another has sown, and American consumers will now have to pay more for basic banking services, while big-box retailers go off and count their unjustified profits,” ABA President and CEO Frank Keating said in a statement on the disappointing vote. “It is simply unconscionable that the Senate would not act to protect community banks from [the rule’s] destructive effect.”
Keating said ABA would continue to push hard for relief from the “ill-conceived law,” adding that the Fed, which must soon finalize its rule, has the power to mitigate the rule’s disastrous consequences. “We urge the Fed to take all necessary action to do so,” said Keating.
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