Why Do Teacher’s Unions Care About Interchange Regulation?
Mike Konczal and Kevin Drum both examine the question of the National Education Association siding with the banks on the debit card interchange issue and find that their minds are unchanged. They both attribute the NEA’s opposition to the new regulations to the fact that there are some teacher-run credit unions whose interests may be imperiled by regulation:
So this argument should be viewed in light of the credit union argument. Firms with less than $10 billion in assets will not be covered by the interchange amendment, though credit unions don’t believe this will be the case in practice. Felix Salmon took a look at the arguments for credit unions last June and found them wanting, Adam Levitin did an overview of interchange and Credit Unions and the Durbin amendment in December 2010 and found that while it is complicated, competition from the market is likely to follow-through on two-tier pricing, benefitting credit unions.
So the argument here is that the unions are acting on behalf of their own interests as credit union operators, and being disingenuous when they talk about harm to consumers. But on top of that, they’re also mistaken about their interests as credit union operators! Maybe that’s right…