I don't see any value to unnecessary transaction fees. In particular:

> These fees enable consumers to potentially spend more than what they have.

Where's the money coming from? You can't spend out of thin air...

Let's say I offer to provide an automated payment system in exchange for 0.1% transaction fees, which is an equitable exchange. My inclination is to then raise the transaction fees, but when the fees become burdensome I jeopardize my business. So I both raise the fees to 2-3%, and introduce rewards cards to justify the raise. The problem is that not everyone is eligible, or willing, or able to qualify for rewards cards. So I've mollified the consumers that matter while managing to rip off the disadvantaged.

Rewards cards can be seen as loyalty programs for merchants, but only merchants who command dominant market positions. I think franchises are particularly bad because the link between owner and brand is hidden. A small franchise (ie print/ship stores) cannot differentiate itself. A large franchise (ie gas stations) is essentially a monopoly which does not benefit from loyalty. That's why you have so many small retailers offering discounts for cash payments.

Now as a merchant stuck covering transaction fees, my incentive is to increase loyalty. This means increased rewards through steeper discounts on higher prices, but this is a network effect that only benefits businesses with a large customer base. Just as with disadvantaged consumers, retailers with smaller customer bases simply cannot compete. Large businesses with higher prices can also negotiate better agreements with payment networks.

What we have here is are two rent-seeking trends and a hidden network of rewards agreements that obfuscate market signals for the consumer. If you are banking on rewards to buy something otherwise outside of your means, chances are that blood money was unwittingly liberated from someone less fortunate.

So yes, control of payment rails is crucial and is responsible so many large-scale social trends.