SHARED PAIN DEPARTMENT

At the risk of stating the obvious, the recession (if that's what we are still calling it) has hit hard. But there is a not-so-obvious pressure on retailers: interchange fees -- the fees credit card companies charge retailers every time someone uses a credit card at their store.

You may think the fees you pay your credit card company are a cash cow for them. They don't compare to the $48 billion in interchange fees the credit card companies charged merchants in 2008. At Overstock.com, we paid over $14.5 million in interchange fees in 2008.

Credit card companies routinely agree to increase interchange fees without any justification or transparency. Not only that, but when somebody commits credit card fraud, they push the cost to the retailer -- despite one of the stated reasons for the huge interchange fees being to guarantee that retailers get paid. But there is no guarantee; retailers lose these sales dollars because if there is one credo the credit card companies live by it is this -- if they can take money from us, they will.

So why do retailers like Overstock.com put up with this abuse? There is no choice. Retailers are powerless to negotiate with the cabal of credit card companies. And credit cards are a basic, necessary utility for retailers -- especially for an Internet retailer.

Ultimately, it is consumers who pay the $48 billion to the credit card companies in interchange fees, as retailers pass them along in the price of products.

Perhaps worst of all, these huge interchange fees create an incentive for banks to issue as many credit cards as possible -- often ignoring the risk that a consumer may not be creditworthy or able to pay. By the time a consumer digs himself into a credit hole (maybe years down the road), the credit card company has already collected thousands of dollars of interchange fees on the card. Have you ever wondered why it is so easy for anyone (sometimes even small children and family pets) to get preapproved credit card offers? Interchange fees are one reason.

It drives retailers out of business, takes money out of consumers' pockets and creates a credit crisis: The interchange fee is a fee only a banker could love.