Patrick Collison AMA on r/neoliberal

>It reminds me in some ways of net neutrality: yes, fast lanes and slow lanes have real downsides. But there's vast capex required to build the infrastructure we need. How should that be paid for?

Defending credit card fees by criticizing net-neutrality. I guess at least he’s being interviewed in the right subreddit...

Their Reddit banner links to two articles

https://miltonfriedman.hoover.org/friedman_images/Collection...

https://olivermhartwich.files.wordpress.com/2015/02/neoliber...

I guess with the aim of describing why they chose to use the word.

That's not what it means here. The label was rehabilitated by Sam Bowman back in 2016:

https://medium.com/@s8mb/im-a-neoliberal-maybe-you-are-too-b...

Basically used here to describe a politics which is fond of market-based policies but supportive of redistribution when it is necessary for positive outcomes.

It is very peculiar.

Whether it is an attempt to "reclaim" the word or not, that subreddit's usage of "neoliberal" bears little relation it's usage as defined in books such as David Harvey's 'A Brief History of Neoliberalism', where it is most commonly associated with privatization, financialisation, tax cuts, the retrenchment of social welfare and rapid growth in inequality.

Critically, the neoliberal state is not 'smaller', it just prefers deficit spending to tax and prefers to funnel money to private enterprises and the military-industrial complex rather than spend it on it's citizens.

In contrast, /r/neoliberal seems to use the word to mean some sort of libertarianism-lite?

> These steep fees also fund (a) vast extension of consumer credit, (b) massive card distribution programs, and (c) the downsides of a generally frictionless payment method (occasional fraud losses), all of which together yields higher spending for merchants.

This is a bit disingenuous. He makes it sound like these fees are the primary income for card companies, but that's not the case. Interchange and merchant fees represent a minority of revenue for card companies[1] - about 26%. The bulk of actual revenue comes from cash advances, fees charged to the customer (both annual and penalty fees), interest on balances, and ancillary products like insurance.

Here's the rub: if the US regulated credit card fees like they do debit cards (via the Durbin amendment) Visa would still be profitable - they happily operate and makes money in countries where credit card fees are capped by law, like Australia. They wouldn't be as profitable, sure. Neither would Stripe.

[1]: https://www.fool.com/credit-cards/2017/04/13/this-is-how-cre...