Today’s links The credit card fee victory is a defeat: Small cartels beat large industries every time. Hey look at this: Delights to delectate. This day in history: 2004, 2009, 2014, 2019, 2023 Upcoming appearances: Where to find me. Latest books: You keep readin’ em, I’ll keep writin’ ’em. Upcoming books: Like I said, I’ll keep writin’ ’em. Colophon: All the rest. The credit card fee victory is a defeat (permalink) The headline was pure David and Goliath: America’s small businesses had finally triumphed in their 20-year litigation campaign against Visa and Mastercard over price-gouging on fees, and V/MC were going to cough up $30B as reparations: https://edition.cnn.com/2024/03/26/economy/visa-mastercard-swipe-fee-settlement/index.html But if you actually delve into that settlement, the victory gets very hollow indeed. Here’s the figure that didn’t make the headline: as a part of this settlement, the sky-high fees merchants pay to process your credit-card transaction are going up by 25%: https://www.creditslips.org/creditslips/2024/03/the-proposed-credit-card-interchange-settlement.html The payments system is a hellish complex, rotten cartel, dominated by a handful of firms who have raised their already-high fees by 40% since the start of covid: https://prospect.org/power/2023-02-07-small-business-credit-card-fees/ These companies who take 2-5% out of virtually every dollar exchange in the American company are wildly profitable, but their aggregate profits are still much lower than the profits of all the merchants they prey upon. More: the combined market capitalization of every company that accepts credit-cards is orders of magnitude larger than the payment processing companies. If we’re just talking about sheer economic muscle, the “Goliath” here is…Pluralistic: The credit card fee victory is a defeat (28 Mar 2024)