Could USA Today Find Any Economists Who Don't Think Bank Overdraft Fees Are Cool?

[Hannah Bell]

USA Today reports on the efforts by Sheila Bair, the head of the FDIC, to restrict bank overdraft fees. It then presents the views of economists who say that such restrictions would be a bad idea. Including the remarkable comment: "other analysts say that onerous restrictions could also make it harder for the troubled industry to recover."

Of course, if bank executives were raising money by robbing people at gunpoint it would be true that restricting these armed robberies "could also make it harder for the troubled industry to recover."

Restrictions on overdraft fees reduce the incentive for banks to use their brilliant minds to find deceptive ways to gouge consumers. If the government gives them free rein to tack on fees with little or no notification, then basic economic theory suggests that banks will devote considerable resources to this effort. This results in waste from the standpoint of the economy as a whole and a redistribution from bank customers to stockholders and top executives.

http://prospect.org/csnc/blogs/beat_the_press

[The_Casual_Observer]

1. The economists are all for spanking the little bad people who ran up debt

and kept this bogus bullshit economy (that they all vigorously promoted) going for 20 years longer than it should have.

[Ruby the Liberal]

2. The "troubled industry" could recover a lot quicker by

stopping the bajillion-dollar bonuses and golden parachutes of the Masters of the Universe who put us in this position in the first place.