A Washington Post columnist weighs in with an interesting look at credit card economics and the role of credit card companies in the consumer economy. Plenty of people have noticed rebate programs seem to be getting more lucrative, as card companies will increasingly rebate up to 5 percent of a purchase to the card holder. Merchants might appear to pay the brunt of this, but in reality it's consumers, the columnist argues.

He points to a study by the Federal Reserve Bank of Boston that found "households with annual incomes of less than $20,000 pay an extra $21 a year in higher retail prices as a result of merchants' credit card fees, while households with incomes of $150,000 benefit by $750."

According to the columnist, the reason is simple. "Poorer people tend to do more of their business in cash and don't qualify for many high-reward cards."

The industry argues that credit card use "has made the payments process less costly and more efficient, particularly once those clunky mechanical systems were replaced with easy swipes of the card," according to the Post. "But those efficiencies were pretty much realized a decade ago, when most retailers adopted the latest technology. It's hard to see how there could have been enough additional efficiencies since then to justify the big jump in typical merchant fees since 2005."

This is not necessarily a new issue. The Justice Department filed an antitrust suit against Visa, Mastercard and American Express in October, but the remedy, which allowed for more information to flow from merchants to consumers about fees, did not go far enough for some.

For more:
- here's the article

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