Cosmo's Anger, While Entertaining, Is Often Misdirected
by Joran Elias
21 October 2009
Cosmo apparently doesn’t know much about credit/debit cards. Namely that everything he purchases from a merchant that accepts credit/debit cards costs as much as 3% more than it should.
(Yes, you read that right. Merchants often raise all their prices by 1-3% to cover the fees they pay to provide the optional convenience of credit/debit purchases. If you buy everything in cash, you’re still subsidizing other people’s use of credit/debit cards.)
Your government is trying to save you money, Cosmo.
Thank them.
Oct 21, 03:22 PM
I’m well aware of this.
Ignoring the fact that all my credit purchase discount my price 1%-5% depending on item, location purchased, and card used, having a ready-made record of everything I purchase is worth the expense.
Then there’s the convenience of not worrying about losing cash, making change, breaking bills (especially for tipping), getting robbed, buying more checks, envelopes, writing out an archaic meatspace address…
Let’s consider a $25 parking ticket. The stamp alone (44 cents) is close to 2%. Then you need to factor in that the city has to buy mailable tickets, has to pay someone to work a mail room and deliver the tickets, has to pay people to properly read the tickets, mark them as paid, ensure the check clears, file them, process the payments, and a host of other crap that a computer should have done for them, instantly.
Hell, the immediate, guaranteed payment from a credit card company should alone be worth the 3% markup, especially in this time of economic trouble.
Oct 21, 06:46 PM
Ok.
First, I totally agree that credit/debit cards can be super convenient. Indeed, I’ve been known to use them on occasion. (Interestingly, I’ve seen some compelling data that suggests that credit/debit pretty much always loses to cash wrt to transaction time. Cards are slower than you think.)
Second, your local government isn’t a business. They don’t sell parking tickets. The money they get from tickets is probably an important source of revenue for them and their ability to raise ticket amounts is quite limited. So they are maximizing the amount of $ they take in that can be turned around and spent on other stuff.
Third, attempts to make tickets easier to pay is somewhat contrary to the point of their entire existence. Part of their purpose is to serve as a disincentive for people to park illegally. Why should they sacrifice 3% of their ticket revenue to make it more convenient for you to park illegally?
Fourth, I guess we just have very different pre-conceptions about the costs involved here. I believe rather strongly that people of our generation tend to wildly underestimate the costs of computerizing some process. And the things you list don’t seem to me like they’d be all that expensive, and many of those tasks can be performed by people who the city had to hire anyway to staff offices that have to be staffed for other reasons. I could totally be wrong about this (I mean, we’re both pretty much talking out of our asses trying to estimate the relative costs of mail-in vs. electronic payment of parking tickets) but then, so could you.
Finally, it’s pretty sad that the only way I can get a comment on a post here is by baiting you, Cosmo. ;) So thanks for the comment! Now I know someone’s reading.