Consumerism Bounces Back in US
FROM SHOPPING MALLS TO WALL STREET
CONSUMERISM - largely forgotten during the pro-business, merger-oriented days of the Reagan years - is back. In the past few weeks, several events have signaled heightened attention to the interests of consumers. Congress has held hearings into abuses by credit reporting agencies; a blue-ribbon panel has issued a major report calling for new reforms for the stock market; a major consumer organization has issued a widely-publicized criticism of credit-life insurance; and a new nonprofit group has started up a national campaign to identify ``environmentally-safe'' consumer products.Skip to next paragraph
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Such issues, say consumer advocates, are clear indication of renewed political and public tolerance for consumerism.
``You can feel it taking place almost everywhere, whether on the college campus, among the public at large, in the types of letters being received by corporate presidents, and by the greater interest in the environment,'' says Alice Tepper Marlin, executive director of the Council on Economic Priorities. The Council, a leading consumer organization, publishes ``Shopping For A Better World,'' a guide to socially responsible corporations. In just the past two years over 700,000 copies of the guide have been sold or made available to consumers, Ms. Marlin says.
Today's consumerism, Marlin says, is far less confrontational and narrowly-focused than was the super-charged consumer activism of the '60s and '70s. It seeks to work with, rather than conflict with, corporate America, she says.
During the '60s and '70s, the White House, whether under Democrats such as Presidents Kennedy, Johnson, and Carter, or under Republicans such as Nixon and Ford, seemed eager to embrace legislative goals linked to consumer issues, such as support for clean air, or pension and financial-services reform.
And beyond the White House, quasi-independent agencies such as the Occupational Safety and Health Administration, the Federal Communications Commission, and the Federal Trade Commission became known for their activism.
Among recent signs of consumer activism on the upswing:
Credit watchdogs: Some congressmen, including Matthew Rinaldo (R) of New Jersey, are seeking greater federal oversight of agencies reporting on personal credit histories. According to Congressman Rinaldo, while credit reporting agencies reap substantial profits, they have shown little interest in protecting privacy. Moreover, records of credit reporting agencies have been found to contain inaccuracies. Several bills have been introduced to upgrade the 20-year-old Fair Credit Reporting Act.
Credit-Life Insurance: According to Stephen Brobeck, executive director of the Consumer Federation of America, credit-life insurance is the nation's ``worst insurance ripoff,'' with consumers paying out proportionately large amounts of money to obtain little actual insurance benefits. The CFA, in tandem with the National Insurance Consumer Organization, has just issued a devastating new study of credit-life insurance.
Consumers, says Mr. Brobeck, are overcharged nearly $1 billion annually on credit-life.
Wall Street Reform: A prestigious blue chip committee headed by Roger Smith, chairman of General Motors Corporation, last week called for a government-required halt in stock trading during periods of volatility for up to a full day - to help restore investor confidence. Still, the committee, put together by the New York Stock Exchange after the market downturn in October 1989, did not advocate major curbs on program trading.
Nighttime trading: Last week the NYSE announced that it was planning to start up nighttime trading in 1991, to boost competition with overseas exchanges.
Ecologically-safe products: Last week, the Green Seal group, a new nonprofit labeling organization headed up by Denis Hayes, organizer of Earth Day 1990, announced that it will start to certify products that are considered environmentally ``friendly.'' A green seal will be affixed to such products as a guide to consumers who wish to buy responsibly.