I'm not a socialist, although my Political Compass score says I think like one. I'm not even anti-capitalist - in fact I am a capitalist by profession.
I drove to town today, so I got to listen to the radio (no reception at my house). I usually leave around 2PM so I can catch Fresh Air, and today Terry Gross was interviewing Bob Sullivan, author of a new book called Gotcha Capitalism (audio link). It's about all of the little extra "hidden fees found in many phone, cable, credit card and other bills."
These things have been driving me nuts for years, but I never quite caught the trend until I heard the program today.
Sullivan was talking about things like ATM fees, all of the extra lines on your cell phone or long distance bill ("access fee", "gross profits tax" - all the stuff that starts to add up), your ISP, cable TV and especially credit cards. In short, all of the ways large corporations are adding small fees to squeeze an extra few bucks out of their customers. It really hit home, since I've just gone through a few of those with credit cards.
My "favorites" lately are all from Bank of America (BoA) - easily the greediest, slimiest corporation I've ever dealt with. I use credit cards for short term financing for my business - I have bank credit lines at good rates, but it's hard to beat 0% financing. The best cards (and highest limits) I had were with MBNA. I know a lot of people didn't like MBNA, especially their campaign donation practices, but my experience with them was excellent (on credit cards - dealing with their international banking department was .. um .. amusing, to say the least).
Of course BoA bought out MBNA a while back, and began to make changes. With MBNA, 0% cash advances were charged a cash advance fee - 3% of the amount, but $75 maximum. Since a draw for us could be $20,000 to $30,000, that $75 maximum was a lot better than $600 to $900. BoA started sending me changes in terms that dropped the maximum, which makes "0%" a lot less attractive.
But the new terms don't go into effect until this March, so a few months ago I made a big draw. When the first bill came, there was an interest charge on it. It was only a few bucks, but it was supposed to be 0%, so I called BoA (always a joy - rudeness is part of their operators' job descriptions). The loan was at 0%, but the cash advance fee was being charged interest at 18%. For a few bucks, I didn't get too upset - just kind of shook my head at the cheapness of one of the largest banks in the country. Which, of course, is what BoA wants me to do.
But my most recent bill (with the loan fully paid off) was more interesting. I get at least one set of covenience checks per week per account from BoA. On the most recent bill there's a charge for $35 for a "Rewards Program Fee".
Thinking they had signed me up for one of those programs where you get points you can redeem for a Bass-o-matic or Ronco Turnip Twaddler or equally useless merchandise, I called to complain about the charge. "What's a 'Rewards Program Fee'?", I asked. "I didn't sign up for that."
"Oh," said the unfriendly BoA employee. "We send you special interest rate offers periodically - it's in your latest card agreement."
"Lemme get this straight - you're charging me $35 for all of the junk mail you send me every week?"
"Yes".
She emphasized it was permitted by the agreement, but would remove the charge "this time". I'll check in a day or two to see if she really does - I've had BoA employees tell me in the past that they were issuing credits that required at least 2 or 3 more calls to materialize.
This is a business credit card. I pay all my credit cards online for no extra charge, usually at the last minute, because our cash flow is hard to manage. This supposedly convenient, business-oriented card is the only one I can't pay online. BoA can't do it. But I can pay it by phone - $10 charge for using the service.
Bank of America has scaled such new and original heights charging extra fees that the label "Gotcha Capitalism", as in the book title, is inadequate. "Scam capitalism" is more like it when someone is charging you to send you junk mail.
I love hearing the creativity that goes into these criminal (morally, if not legally) and useless fees. One of the best was on the program today - AT&T actually did research and implemented mailings designed so people would throw them away without reading them. Then they could change terms in ways that any reasonable person would refuse if they actually read and understood them.
What little fees are showing up on your bills?