Credit card era changes shopping forever

Credit card era changes shopping forever By Bob Karolevitz This is credit card season.

Shoppers all over America are using funny money to finance their Christmas binges, and we go merrily on our way pretending that everything is paid for.

I'm no financial wizard, so I have to assume that the plastic economy is working for the merchants, the banks, advertising agencies and everybody else involved in the phenomenon which will celebrate its 50th anniversary next year.

Goodness knows it's working for millions of buyers who are gleefully hauling stuff out of stores, all because a guy named Frank X. McNamara had an idea back in 1949.

It seems he had finished a meal in a New York restaurant when he discovered that he had no cash. Red-faced, he called his wife who finally showed up to pay the bill so he wouldn't have to work it out washing dishes.

McNamara was no dummy. In thinking about the embarrassing incident, he came up with a scheme so that his restaurant predicament would never happen again. He called his idea Diners Club, and the credit card era began.

Four years later he sold out his idea for a couple hundred grand, at which time holders of the Diners Club Card could also charge things other than restaurant tabs. The concept began to catch on, but at first it was the merchant who paid for the sales gimmick with discounts to the card company.

In 1958 American Express got into the act, and so did Carte Blanche. Then came BankAmericard which eventually became Visa.

That's when the affiliated banks began to charge interest on unpaid balances, and a lucrative new fiscal industry evolved. The idea was proving so profitable that the Wells Fargo Bank and 77 others created what became known as MasterCard � and shopping hasn't been the same since.

The Big Three � American Express, Visa and MasterCard � eventually dominated the field, challenged only by Sears' Discover Card. Today, however, there are literally thousands of different cards available to eager consumers who are willing to put off till tomorrow what should have been paid for today.

You can buy through the Internet, and I guess you can even pay your taxes that way.

At one time a Californian was listed in the Guinness Book of Records for holding 1,381 different valid credit cards. I don't know who the champion is now.

Before Congress tightened the laws, unsolicited cards were sent to almost everybody, including pets and people long since dead. But today just about every mail carrier still brings applications from alumni associations, veterans groups and even charitable organizations for cards that offer low interest rates, no fees, high credit limits and a ticket to the good life. You're nobody, it seems unless you have a gold or platinum card.

I wouldn't be surprised if I got a chance to sign up for a new SantaCard issued by the Snow Bank at the North Pole.

But if it moves merchandise, who am I to question the system? A long time ago William Shakespeare wrote: "So far as my coin would stretch; and when it would not, I have used my credit." Shucks, he was way ahead of Frank X. McNamara.

Have a happy, plastic holiday!

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