As [MENTION=13066]pinniped[/MENTION] said, card charges to merchants (e.g. "3%," and some pay 4-5%) are hard on small merchants (especially) for whom all or a large majority of sales are by credit card. Look at it this way: that's 3% right of the top of revenue. If the business is running on a 10% profit margin -- that is to say competitive position in which the business operates -- that 3% is 23% of the gross profit (i.e. 13%) before the credit card fees are paid.

If the business is comfortable operating at a 10% profit margin, per its competitive environment, where would that 3% go if it weren't charged to the merchant? It could be to lower prices, for a competitive advantage. Or it could be to paying employees a living wage, or hiring more employees. Or a combination of those three things, and whatever the choice those all are things that (across all businesses) make life better for everyone in our society.

Maybe you see where I'm going with this. The Credit Card Competition Act is a compromise that partly solves the credit card dilemma. Really, the legislation that's needed would require all fees and other costs of using a credit card to be charged to the card holder on the monthly bill, and prohibit putting those charges on the merchant. The merchant would then pay only for hardware and software for registering sales.

Airline loyalty programs would still exist, but would be more like they were originally. Miles would accrue from butts in seats or spend on air fares. Seems fair to me, all the way around.