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October 29, 2011

Boycott Bank of America

Matt Taibbi makes the case that removing our money from Bank of America is one concrete action that we can take to show our disgust with the banking industry. Targeting one of the worst culprits is a better strategy because we cannot boycott the entire industry. If we can shake one of the main institutions, it will cause other banks to fear if they will be the next to have a bull's-eye painted on them

I used to feel the same way about earlier boycotts of gas companies to protest gouging practices. General boycotts will fail because people eventually need gas. It would be better to pick a particular gas company and boycott only them because such an action can be continued indefinitely. After the BP oil spill, if people stopped buying only BP gas, that would have forced them to take the public outcry more seriously.

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Comments

there's a big difference between bank boycotts and gas boycotts: in the case of banks, many many people have the alternative of banking with a local bank or a credit union. you usually get better terms than the large banks will give, particularly at credit unions, which are member-owned nonprofits. the cost is the inconvenience: it's more of a hassle to withdraw and deposit money from a local bank or credit union, particularly when you're travelling. but people who are motivated enough can overcome the inconvenience.

Posted by Uri on October 29, 2011 02:36 PM

This is an absolutely brilliant idea. It will put the Private Sector and the Government on notice, that they cannot act with impunity and not have to face grave consequences. My only hope is that some experts are consulted to ensure that no catastrophic result will ensue. I have seen nasty unintended consequences result from perfectly justifiable actions.

Posted by Manik on October 29, 2011 09:11 PM

When it comes to comparing banks to credit unions, we should not only examine their relationships with consumers, but also with merchants. As far as the latter is concerned, a strong argument can be made that in the post-Durbin world banks, big and small, are now much more merchant-friendly than credit unions.

See, credit unions were exempted from the Durbin Amendment and as a result the fees they charge retailers accepting their debit cards are now much higher (83%, to be exact) than what banks charge. http://blog.unibulmerchantservices.com/credit-unions-muscle-in-on-big-bank-territory

So we should not be losing sight of the issue that got the whole thing started – the size of the debit interchange fees. It seems to me that the issue is a very simple one. If a fee charged by one bank to a merchant is considered too high, it should also be considered too high if any other bank, or a credit union, charges it to that retailer. I just can't see it any other way and I can guarantee you that merchants see it exactly the way I do.

Posted by Jay Gould on November 2, 2011 06:29 PM