Protect consumers too
Congress and government regulatory agencies now have a special responsibility to protect the American public against legislative bills and rate-hike requests that could drive up the price of a score of goods and services.Skip to next paragraph
Subscribe Today to the Monitor
Certainly, price increases should be granted where they are absolutely necessary to ensure the well-being of a utility or business and to provide a fair rate of return to investors. But regulatory officials should be wary of hikes that weigh heavily on consumers - and thus work against economic recovery in general.
Proposals now in the planning stage would substantially boost - or keep at high levels - prices for long-distance telephone services, postage stamps, milk, and electric heating costs, among other items.
What gives special urgency to a need for an even-handed approach from regulatory agencies at this time is the decline in the political clout of the consumer lobby since its zenith in the late 1960s and early 1970s. The decline stems from several factors, including the rise of other public-interest concerns such as environmentalism and the nuclear-freeze movement; the recession, which reduced the power of workers vis-a-vis management; and the election of conservative, business-oriented administrations in Washington and elsewhere.
Consider just three examples where potential price increases could collide with the larger public interest:
* Milk. Consumer groups, livestock interests, and the White House tried but failed to stop the House from passing legislation last week that will have the federal government pay dairy farmers not to produce milk. The Senate has passed a similar bill. Both were backed by the dairy lobby. The White House reckons that the measure could cost consumers an additional $1.8 billion for dairy products in 1984.
President Reagan should veto the measure. The issue is not public stinginess toward dairy farmers - or the farming community as a whole. Americans have been very supportive: Overall, federal farm programs now cost taxpayers over $50 billion a year. Surely farmers realize that such lavish support involves trade-offs, such as keeping food costs steady at the supermarket counter.
* Long-distance telephone access charges. The US Justice Department and American Telephone & Telegraph Company are seeking to have residential phone users pay special access charges for long-distance phone service beginning next Jan. 1. The charges, in effect a surtax, would hit elderly and low income persons particularly hard. There must be a fairer way to prorate phone costs among residential and business users.
* Postage hikes. The US Postal Service, which posted total profits of well over $1 billion for the past two years, wants to boost the cost of mailing a letter from 20 cents to 23 cents. How long will it be before the 25-cent stamp appears? The Postal Rate Commission should consider the potential damage to the Postal Service's competitiveness, as well as the cost to the public.
Countless other proposals now before regulators would cost consumers sharply more in the marketplace. In a number of states, proposals would substantially increase electricity rates. Precisely because the consumer lobby is now at a relatively low ebb, regulators and Congress have a special responsibility to keep an eye out for the general public. At risk for bureaucrats is a firing up again of the easily aroused consumer forces.