Regional and Party Voting Record in 1985 Reveals Partisan, Differences Key in Both Houses Regional Splits on Consumer Issues SENATE 1985 Region/Party Average Fifty-four members of Congress have 2. Partisan differences continue to narrow subsidies more frequently than did other ALL DEMOCRATS 71 been named "Consumer Heroes" in in the House. In contrast to the Senate, Republicans. These votes on price supports ALL REPUBLICANS 25 recognition of their strong pro-consumer the difference between House Democrats contributed to the modest decline in the East—Dems 88 voting records in 1985. and Republicans continued to narrow. average for House Democrats, and to the West—Dems 73 The heroes—seven senators and 47 rep- House Democrats averaged 67 percent, Re- modest improvement in House Republicans' Midwest—Dems 70 resentatives—were cited in CFA's 1985 Con- publicans 34 percent, the narrowest gap average. South—Dems 54 gressional Voting Record. Ratings were since 1981. Four House Republicans are 3. Democrats from outside the South are East—GOP 53 based on 15 key votes in the Senate and listed as Consumer Heroes with records the bedrock of consumer support. Analysis Midwest—GOP 24 12 votes in the House. of over 90 percent. Three of them, Reps. of a combination of partisan and regional West—GOP 17 South—GOP 10 CFA Legislative Representative Alan Fox Silvio Conte (Mass.), Christopher Smith voting patterns reveals even sharper distinc- HOUSE said the voting record indicated "a return (N.J.), and Claudine Schneider (R.I.), received tions in both Houses. Democrats from re- 1985 to strong partisan divisions on consumer 100 percent ratings, an unprecedented gions other than the South supported con- Region/Party Average issues in the Senate." Senate Democrats aver- occurrence. sumers over 70 percent of the time in both ALL .DEMOCRATS 67 ALL REPUBLICANS aged 71 percent support for consumer posi- The nature of House votes did not change Houses, with Eastern Senate Democrats 34 tions, while Republicans averaged 25 per- significantly between 1984 and 1985, with scoring a phenomenal 88 percent. While East—Dems 79 West—Dems 74 cent. This 46-point gap more than tripled one exception: Two of the twelve House these Democrats constitute only 33 per- Midwest—Dems 73 the 14-point gap recorded in 1984. In the votes concerned price supports in the Farm cent of the membership of the Senate and East—GOP 57 House, partisan divisions remained roughly Bill for sugar and tobacco. Some farm state 39 percent of all House members, they South—Dems 50 the same in 1985 as in 1984, with Demo- Democrats, fearful of losing support for cast over 55 percent of all pro-consumer Midwest—GOP 34 crats averaging 67 percent and Republi- other farm programs, supported these sub- votes cast by all members in each House. South—GOP 23 cans 34 percent. sidies. Urban and suburban Republicans, 4. Southern Democrats and Eastern Repub- West—GOP 22 Fox noted that regional differences were largely from the Northeast, opposed the licans provide the swing votes. Eastern Repub- still significant on consumer issues. "Both licans and Southern Democrats are the Houses can be thought of as divided into average scores ranging between 50 per- three rough groups: Democrats from out- Senate Heroes scoring 100 percent are: cent and 57 percent. On most close issues, side the South, who are solidly pro-con- Howard Metzenbaum (D-OH1 Paul S. Sarbanes (D-MO) these 25 senators and 125 representatives sumer; Republicans from outside the North- Senate Heroes scoring 93 percent are: will generally decide the outcome. Republi- east, who usually oppose consumer posi- cans from other regions, particularly in Thomas F. Eagleton (D-MO) Edward M. Kennedy (D-MA) John F. Kerry (D-MA) tions; and Southern Democrats and North- Frank Lautenberg (D-NJ) Daniel P. Moynihan (D-NY) the Senate, seldom supported consumers' eastern Republicans, both of which groups interests in 1985. vote with consumers about half the time. Heroes in the Hosue who scored 100 percent are: 5. Individual senator's scores changed dra- "Obviously, Southern Democrats and Silvio D. Conte (R-MA) James J. Florio (D-NJ) Barney Frank (D-MA) matically between 1984 and 1985. A look Northeastern Republicans are the key swing Sam Gejdenson (D-CT) Edward J. Markey (D-MA) Bruce A. Morrison (D-CT) at individual scores reveals some dramatic votes on important consumer issues," Fox Peter W. Rodino, Jr. (D-NJ) Claudine Schneider (R-RI) Patricia Schroeder (D-CO changes in just one year. Nearly half of concluded. Christopher Smith (R-NJ) Stephen J. Solarz (D-NY) Gerry E. Studds (D-MA) the 93 senators who served in both years Robert Tbrricelli (D-NJ) Henry A. Waxman (D-CA Ted Weiss (D-NY) In addition to the Consumer Heroes, six either improved or worsened their con- senators and 27 representatives were named House Heroes with 92 percent scores are: sumer voting record by 20 points or more. Consumer Zeroes for their poor records. Frank Annunzio (D-IL) Michael D. Barnes (D-MD) Jim Bates (D-CA) These shifts are largely attributable to the The record's key findings include: Anthony C. Beilenson (D-CA) Mario Biaggi (D-NY) Barbara Boxer (D-CA) change in the nature of the most important 1. Sharp partisan differences in the Senate George E. Brown, Jr. (D-CA) Cardiss Colllins (D-IL) John Conyers, Jr. (D-MI) votes, as noted above. Senate Democratic support for consumer Ronald V. Dellums (D-CA) Brian J. Donnelly (D-MA) Bernard J. Dwyer (D-NJ) Twenty Democrats and three Republicans issues reached its highest point ever, 71 Lane Evans (D-IL) Robert Garcia (D-NY) Frank J. Guarini (D-NJ) improved their records by 20 or more Dennis M. Hertel (D-MI) percent. A promising trend of increased Marcy Kaptur (D-OH) Barbara B. Kennelly (D-CT) points. In contrast, 19 Republicans and one William Lehman (D-FL) Mel Levine (D-CA) Joseph M. McDade (R-PA) GOP pro-consumer voting in recent years Democrat dropped by 20 points or more. Matthew F. McHugh (D-NY) Barbara A. Mikulski (D-MD) Parren J. Mitchell (D-MD) evaporated, as Republican scores averaged Jim Moody (D-WI) Henry J. Nowak (D-NY) James H. Scheuer (D-NY) At the extremes were: Sen. Gary Hart (D- only 25 percent, fifteen points below the Lawrence J. Smith (D-FL) Fortney (Pete) Stark (D-CA) Bruce F. Vento (D-MN) Colo.), whose 1984 record of 33 percent, 1984 average. The 46-point gap between Howard Wolpe (D-MI) Sidney R. Yates (D-IL) caused in part by absences during his presi- Democrats and Republicans is the largest dential campaign, improved to 87 percent The following Senate Zeroes failed to in the fifteen years CFA has analyzed voting in 1985; and Sen. Larry Pressler (R-S.D.) vote for consumers even once. in Congress, and is more than triple the who fell from 58 percent in 1984 to 0 1984 gap of 14 percent. James A. McClure (R-ID) Mitch McConneU (R-KY) Larry Pressler (R-SD) percent in 1985. In the House, individual This pattern is consistent with findings Steven D. Symms (R-ID) Strom Thurmond (R-SC) Malcolm Wallop (R-WY) changes were generally less dramatic, with by Congressional Quarterly and other Four House members also recorded no pro-consumer votes: only 62 members recording 20-point observers that 1985 was a year of deep John E. Grotberg (R-IL) Marvin Leafh (D-TX) Charles W. Stenholm (D-TX) changes. partisan divisions in Congress. The pattern Michael L. Strang (R-CO) 6. Senate Democratic freshmen made a is particularly clear on consumer issues difference. The five Democrats who were Also named Consumer Zeroes are the following in the Senate because of the nature of first elected to the Senate in 1984 were representatives with 8 percent ratings: the most controversial votes. In 1984, the solidly pro-consumer, voting for consumer key votes included a number of issues on Herbert H. Bateman (R-VA) Carroll A. Campbell (R-SC) William W Cobey, Jr. (R-NC) interests 80 percent of the time. Their ef- Larry Combest (R-TX) which barriers to competition or direct sub- William E. Dannemeyer (R-CA) Bill Emerson (R-MO) fect is even more impressive when com- Thomas F. Hartnett (R-SC) Earl Hutto (D-FL) lorn Loeffler (R-TX) sidies to business were at stake. On these pared to the 50 percent average compiled Ron Marlenee (R-MT) Alfred A. McCandless (R-CA) J. Alex McMillan (R-NC) issues, a coalition of "neo-liberal" Demo- David S. Monson (R-UT) G. V. Montgomery (D-MS) John T. Myers (R-IN) by their predecessors in 1984. On one issue crats and "free-market" Republicans sup- Pat Roberts (R-KS) Harold Rogers (R-KY) Eldon Rudd (R-AZ) tabulated in the voting record, the mainte- ported pro-competitive or anti-subsidy posi- Dan Schaefer (R-CO) Joe Skeen (R-NM) Robert F. Smith (R-OR) nance of auto fuel-efficiency standards, the tions. In 1985, only one Senate vote of Gene Snyder (R-KY) Bob Stump (R-AZ) freshman Democrats provided the deciding fifteen involved such issues. margin for a 48-46 consumer victory.

CONSUMER FEDERATION OF AMERICA Page 2 April 1986 • CFAnews House Passes Bill Limiting Check Holds

The House of Representatives, in its The fight for expedited funds availability first item of business in the second legislation now shifts to the Senate Banking session of the 99th Congress, has Committee, chaired by Sen. Jake Garn passed a bill strictly limiting the length (R-Utah). of time banks and other depository insti- "The battle in the Senate will be much tutions may hold deposited checks. But over tougher!' CFA Legislative Representative Alan Strong consumer objections, the I louse also' Fox predicted. "We will need redoubled adopted an amendment to the bill that efforts by all the groups that worked in may give financial institutions broad leeway the House to pass this bill." to ignore the law. Fox said an effort will begin immediately As expected, H.R. 2443, sponsored by to urge Sen. Garn to schedule action on House Banking Committee Chairman Fer- funds availability legislation. "All supporters nand J. St (let-main (D-R.U, passed over- of this bill should write Senator Garn ask- whelmingly, 282-tt. Opponents attempted ing him to speedily move legislation similar to weaken the bill in the guise of "flexi- to the bill that passed the House. We are bility" and "lighting fraud." .Alter six hours also asking organizations and individuals of debate and some unusual parliamentary in states represented by members of the maneuvering, one such amendment was Senate Banking Committee to ask their adopted, 156-146. senators to support strong legislation and That amendment aside, the bill would to encourage early consideration of the bill." mandate sweeping changes in many banks' Along with Garn, members of the Senate treatment of customers' deposits. Immedi- Banking Committee are Republicans John ately after the law lakes effect, next day Heinz (Perm.), William Armstrong (Colo.), availability would be required for: Alfonse D'Amato (N.Y.), Slade Gorton (Wash.), • Checks under $100 Mack Mattingly (Ga.), Chic Hecht (Nev.) and • Most checks drawn on the bank in Phil Gramm (Tex.); and Democrats William which they are deposited not apply in the first 30 days after a new if an institution "reasonably believes" that Proxmire (Wis.), Alan Cranston (Calif.), • U.S., state and local government checks account is opened, and would only apply the writer of the check is, or is about Donald Reigle (Mich.), Paul Sarbanes (Md.), • Cashier's checks, certified checks and to the first $5,000 deposited in an account to, become bankrupt, or that "a situation Christopher Dodd (Conn.), Alan Dixon (111.) teller's checks. in any day. Banks could also place holds involving fraud or kiting exists." and Jim Sasser (Term.). Other install! and some local, but out-of- on depositors with histories of wilting bad It is unclear whether this later language state, checks would have to be available checks. The Federal Reserve Board was modifies and explains the more general on the third business day after deposit. granted authority to suspend hold limits "collectability" language, or if it constitutes A year after the law goes into effect, this in specified emergency conditions. Sup- a separate set of reasons a bank may use CFA period would be reduced by one day. Other porters of a strong bill, including CFA, to refuse to provide funds in the time period out-of-slate checks could be held no longer argued that these specific exceptions made specified. It also remains unclear whether Elects than six business days and would be avail- sweeping exceptions, such as those pro- a requirement in the second half of the able on the seventh day. posed by Rep. Shumway, unnecessary. amendment requiring notice to a consumer Within three years after passage, after The full effect of the amendment is uncer- that a check has been held applies to the Officers adoption of rules by the Federal Reserve tain, however, because procedural difficul- entire amendment, or only to the second Board, next-day availability would be re- ties required its backers, led by Rep. Norman half of the amendment. Jean Ann Fox from the Virginia Citi- quired on all in-state and local out-of'-state Shumway (R-Calif.) to graft two overlapping, zens Consumer Council was re- cheeks. Other out-of-state checks would have but not identical, amendments together. Widespread Support elected president of CFA at the federa- to be available no later than the fourth The resulting amendment begins by al- H.R. 2443 was backed by a wide variety tion's annual meeting in February. Fox, who day after deposit. lowing depository institutions to ignore of organizations, ranging from the Rural formerly headed the Pennsylvania Citizens The bill includes several exceptions to limits on holds if they have reason to "doubt Coalition to the National Urban League, Consumer Council, also serves on the board these time periods designed to reduce the collectability" of the check. It goes on and including most major consumer, senior of directors of Consumers Union. opportunities for fraud. The limits would to specify that the limits may be ignored citizen, labor and credit union organizations. Also re-elected for a one-year term were secretary-treasurer Ken Kovack of the United Steelworkers of America and eight vice-presidents: Ann Brown of the Ameri- CFA Welcomes New Staff cans for Democratic Action's Consumer Af- ^iCE^Vnevvs fairs Committee, Jake dayman of the National Council of Senior Citizens, Ellen CONSUMER FEDERATION OF AMERICA Haas of Public Voice, Bill Matson of the 1424 16th Street, N.W. Washington, D.C. 20036 Pennsylvania League for Consumer Protec- (202) 387*612] tion, Arnold Mayer of the United Food &. Commercial Workers Union, Alex Radin President: Jean Ann Eo,\ of the American Public Power Association, Executive Director: Stephen Brobeck Lee Richardson of the Maryland Citizens Legislative Director: Gene Kinvnelnmn Administrative Director: Eriku Uuuiberg Consumer Council, and Mark Silbergeld Legislative Representative: Alan l'n\ of Consumers Union. Energy Director: Murk Cooper Ten persons were elected to three-year Public Affairs Director: Jack Gillis terms on the board of directors: Bob Berg- Product Safety Director: Mary Ellen Eise Product Safety Coordinator: Edith Ernst land of the National Rural Electric Coopera- Conference Manager: Sheila Meade tive Association, Bill Holay ter of the Machin- Secretary: Lydia Rivera Grogan ists Union, Karl Hoyle of the Credit Union Secretary/Resciarcher: Lisa Goldstein Legislative Assistant: Dina Zarin National Association, Ruth Kobell of the Administrative Assistant: Miguel Carpio National Farmers Union, Stewart Kohl of the National Business Cooperative Associa- CFAnews Editor: DaWd R. Jones tion, Ken McEldowney of San Francisco Consumer Action, Sarah Newman of the CFAnews Is published 8 times .■ year. Annual subscription iali> is S2," per year. National Consumers League, Dermot Shea of the Association of Massachusetts Con- ©Copyright 1986 by Consumer Federation of America I i \ should be credited for all material All Rights Reserved sumers, Joe Tuchinsky of Michigan Citizens Design A typeset bj Design Consultant! Inc Lobby, and Bill Welsh of the American Fed- eration of State, County and Municipal 7lvo new staff members at CFA are Legislative Assistant Dina Zarin and CFAnews Editor David Employees. In addition, Robert Krughoff H. Jones. Zarin is a former legislative intern to Congressman Les Aspin (D-Wis.i. Her responsibilities of the Center for the Study of Services at CFA will include research on product safety and telephone rates. Jones is a freelance writer was elected for a one-year term. and editor specializing in public policy. He formerly edited the newsletter Ways & Means at Twenty-one other board members are the National Center for Policy Alternatives. currently serving three-year terms. April 1986 • CFAnews Page 3 New Product Liability Bill Criticized

In testimony before the Senate Commerce Group, and Public Citizen's Congress Watch Committee, CFA and three other na- noted that S. 1999 "would neither preserve tional consumer groups agreed with some tort law goals of adequate compensation of the underlying goals of a new product and product safety, nor insure swift dis- liability bill, but criticized specific provisions pute resolution." The groups warned that as ineffective and dangerous to consumers. when manufacturers were faced with large Committee Chairman John Danforth (R-Mo.) economic claims and believed it difficult has introduced S. 1999 in an effort to meet for plaintiffs to prove negligence, they would consumer objections to product liability simply refuse to pay claims system awards legislation that was defeated last year in for economic loss. committee. In addition, victims suffering substantial The Danforth bill would establish an ex- pain and impairment would have little in- pedited claims system with limited awards centive to file limited claims under the pro- for plaintiffs who meet a strict liability-type posed system. The new system also would test, as well as setting a negligence stan- "undermine current incentives to manufac- dard for product liability lawsuits. Persons ture safe products," the groups cautioned. injured by defective products could submit At the hearings, CFA Legislative Director claims for actual economic losses, such as Gene Kimmelman proposed an alternative medical expenses and lost wages, to an approach featuring a streamlined tort alternative claims system funded by manu- system, with penalties for protracted, un- facturers. This system would require claim- necessary litigation. These could include S. 1999 "would neither preserve tort law goals of adequate compensation, nor insure swift dispute ants to prove that their loss was caused penalties if the final court award was either resolution," CFA Legislative Director Gene Kimmelman testifies. by an unreasonably dangerous product, but greater or less than the defendant's pre- not require them to demonstrate negligence trial settlement offer. For example, plain- Exposing the The long-term prospects for S. 1999 are or fault on the part of the manufacturer. tiffs refusing offers greater than or equal "Insurance Crisis" unclear and will depend, in part, on busi- Plaintiffs also could bypass this no-fault to final awards could be denied statutory ness reaction. At the hearings, the National system and sue for pain and suffering and court costs, pre-judgement interest or both. As insurance premiums rise and an in- Association of Manufacturers announced for punitive damages and economic loss. Kimmelman suggested that other ways creasing number of businesses and profes- its support for the legislation. Yet other In court, however, plaintiffs would be re- to streamline tort litigation might include sionals are denied coverage, pressure on businesses have expressed concern that a quired to establish negligence. requiring claims under $50,000 to be medi- Congress to pass product liability legisla- no-fault compensation system would dra- tion builds. Insurers claim they have been Bill Faulted ated; treating toxic exposure cases separate- matically increase the number of claims. ly; and penalizing for delay, for frivolous forced to hike premiums and limit coverage The principal objective of business groups In joint written testimony, CFA, Con- motions or defenses, and for destroying because of the escalation of product lia- is placing limits on product liability awards. sumers Union, U.S. Public Interest Research evidence. bility awards. They have been lobbying Congress in sup- Consumer groups respond that insurers port of caps (which S. 1999 would not have no data to support their claims. In- impose on court awards) and pressuring CPSC Addresses CFA Petition stead, they believe insurers are laying a state legislatures to impose similar limits. smokescreen to try to hide past mismanage- In response, 35 organizations, including ment. When interest rates were high, con- CFA, recently formed a coalition to oppose on Methylene Chloride sumer groups point out, property/casualty these industry efforts. The new Coalition companies wrote many high-risk policies In March the Consumer Product Safety Commission (CPSC) voted 4-1 to institute a for Consumer Justice will not only oppose to increase high-yielding investments using mandatory rule-making proceeding to determine whether the chemical methylene arbitrary caps on damages paid to victims; premium dollars. Now that interest rates chloride is a hazardous substance. CFA had petitioned the agency to immediately declare it will also seek to expose property/casualty have declined, insurers are seeking to com- the substance hazardous and to initiate proceedings to either ban or limit its use insurers for manufacturing a "phony crisis" in consumer products. pensate by terminating or hiking premiums to reduce victim compensation and divert on their riskiest policies. "It's unfortunate that the commission is dragging its feet on this extremely harmful attention from their past mismanagement. chemical," said Mary Ellen R. Fise, CFA product safety director. The rule-making pro- ceeding is estimated to take from two to four years. This proceeding will examine only whether the substance is hazardous; it will do nothing to limit high concentrations. Methylene chloride is a multipurpose solvent found in paint strippers, aerosal spray Storebrands Can Save paints and artificial spray snow. It has also been used in cosmetic hair sprays and in decaffeinated coffee. $30 Billion Annually FDA Proposes Limited Ban In a related action, the Food and Drug Administration (FDA) recently announced According to government surveys, prices a proposed ban of methylene chloride in hair spray. The agency is accepting comments of individual storebrands range from 2 per- on its use in decaffeinated coffee. cent to 77 percent lower than prices of The FDA has previously stated that it considers the risk the chemical poses in decaf- national brands. The potential savings for feinated coffee to be minimal and, therefore, it is unnecessary to ban this use. This each family varies because of differences position has sparked debate between the FDA and public-interest groups over whether in their storebrand purchases, willingness the agency is meeting the provisions of the Delaney Amendment, which requires substances to use neo-generics, and other factors. But causing cancer in man or animal to be banned. on average, households could save $300 Several studies have revealed the dangers the chemical poses. The federal National a year switching to storebrands. Toxicology Program has found methylene chloride to be an animal carcinogen. Other According to the pamphlet's author, CFA studies have showed it has neurotoxic effects. A CPSC staff analysis found the risk Executive Director Stephen Brobeck, "Store- posed by using paint strippers containing methylene chloride to be the highest ever brands typically offer superior value to calculated for a chemical in a consumer product. national brands because of lower costs. The CPSC also has directed its staff to work with industry and citizen groups to Storebrands usually cost less to develop, voluntarily address reducing consumer exposure to methylene chloride. A committee In a new pamphlet on storebrands, package, advertise, and distribute. Most of comprising CPSC staff and representatives of CFA, the National Paint and Coatings CFA asserts that shoppers can-save these savings are passed on to consumers Association, and the Halogenated Solvents Industry Alliance will begin to address label- $30 billion annually—an average of in lower prices." ing, product reformulation and consumer education. $300 per family—by switching from na- Brobeck also noted that "consumers often "While we are disappointed by the limited CPSC action, CFA believes that it is imperative tionally advertised brands to storebrands. view national brands as superior in quality that steps be taken to protect consumers from this harmful substance," said Fise. Storebrands (or housebrands) are prod- because they are heavily advertised. But "Hopefully, a combined effort by CPSC, consumer groups and industry can make ucts sold under a store's private label. "Top storebrands frequently offer satisfactory progress toward reducing consumer ignorance about this hazard and increasing the of the line" storebrands are usually some- quality at much lower prices." CFAs bottom- products' safety," she added. what lower in price than, but comparable line recommendation is: "Try a variety of Currently no products containing methylene chloride warn of the cancer risk; many in quality to, national brands. Neo-generic brands in order to find the least expensive products do not even state on the label that the product contains methylene chloride. storebrands are nearly always much lower one with satisfactory quality." "Additionally," Fise explained, "labels that merely state 'Use Adequate Ventilation' fail in price, but are more often lower in quali- The pamphlet is available by sending $.25 to communicate the precautions that should be taken—and the attendant harm resulting ty, though any differences are frequently and a self-addressed stamped envelope to from ignoring this direction." cosmetic. CFA. It is free to CFA members. Page 4 April 1986 • CFAnews ICC Admits Flaws in Railroad Rate-Making

Two years of concentrated efforts tion and the Procompetitive Rail Steering to convince Congress to amend Committee. the Staggers Rail Act of 1980 gained In addition to calling for changes in the dramatic momentum in hearings before revenue adequacy test, the pending legisla- the House and Senate in February and tion would modify the automatic rate ad- March. After battling with the consumer justment practices of the ICC. movement over its rate-making practices Calling the ICC's Rail Cost Adjustment and accounting procedures, the Interstate Factor a nightmare, the CFA energy direc- Commerce Commission finally admitted that tor pointed out in his testimony that "This one of the cornerstones of its regulatory month the operating expenses of virtually treatment of railroads is fatally flawed. every regulated service in this country are Appearing before the House Energy and going to decline noticeably because of the Commerce Committee on February 6, the dramatic decline in the cost of oil. The newly appointed chairwomen of the Inter- benefits of that decline in prices will be state Commerce Commission, Heather passed through to consumers virtually on Gradison, repeated the ICC's defense of a dollar-for-dollar basis because almost every its regulatory methods and procedures. Just regulatory body in the nation recognizes two weeks later, however, she did an about- that these are cost factors that should not face, stating before the Senate Commerce enter into the operating profits or losses Committee that "We agree that our exist- of the providers of service. ing standards and procedures for determin- "That will not happen to the tariffed rates ing revenue adequacy are not producing at the ICC. The ICC has decreed that rates a realistic picture of the financial condition will rise as cost do, but never fall if costs of the rail industry." happen to fall. Not only won't the ICC let CFA, which has focused its attention on rates fall, it has jacked up increases by the revenue adequacy test in two years refusing to adjust its cost index for produc- of research and lobbying, recently released tivity. Worse still, it refuses to recognize a report entitled, "The Consumer Move- CFA Energy Director Dr. Mark Cooper calls for passage of the Consumer Rail Equity Act. the right of consumers of rail service to ment versus The Interstate Commerce Com- complain when the cost factors are misesti- mission's Revenue Adequacy Test: The ICC's failure by the ICC is not the same as the consumers relief from the regulatory tyran- mated by the railroads," Cooper said. Admission of Failure and the Need for Con- correction of abuses. Consumers, who pay ny of the ICC and the abuse of market Cooper concluded his testimony by point- gressional Action." The report documented billions of dollars for the mistakes of the power by the railroads." ing out that "CFA member groups regu- the long struggle to force the ICC to admit ICC, do not need to wait for the ICC to Fueled by the ICC's startling flip-flop, the larly participate in regulatory proceedings its error. reinvent the wheel (and probably get it pending legislation gained almost two dozen at the state and federal level. All we are In testimony before the House Energy wrong again). Only the clear and sensible new co-sponsors in Congress and vigorous asking the Congress to do is to ensure and Commerce Committee on March 13, legislative guidance contained in the Con- support from several major national groups, an equitable set of rules applied by a CFA Energy Director Dr. Mark Cooper sumer Rail Equity Act [H.R. 4096, S. 477], such as the National Governors' Associa- reasonably impartial body and we will take warned Congress that "the admission of will give captive shippers and monopolized tion, the National Grain and Feed Associa- our chances on the process." Supreme Court BULK RATE U.S. POSTAGE Disallows Utility Bill PAID WASHINGTON, D.C. Enclosures •e PERMIT NO. 8772

On February 25, 1986 the Supreme Court dealt a serious, though not necessarily fatal, blow to state consumer activists working to establish citizen utility boards (CUBs) to represent consumers in rate hike hearings. In a 5-3 decision (with Justice Harry Blackmun abstaining), the court ruled that the California Public Utilities Commission could not compel utilities to include with their billing notices messages from the nonprofit consumer group Toward Utility Rate Normalization (TURN). In recent years utility bill enclosures have been used by state government-established CUBs to solicit memberships from ratepayers. Justices Lewis Powell, William Brennan, Sandra Day O'Connor, Thurgood Marshall (in a concurring opinion) and Chief Justice Warren Burger ruled that such enclosures violate the First Amendment rights of corporations by forcing them to disseminate messages with which they may disagree. TURN had argued that a utility's "extra space" in an envelope after bills and notices are included belongs to the ratepayers and should be made available to consumer activists. Interestingly, two of the most conservative justices (Byron White and William Rehnquist) joined Justice John Paul Stevens in dissenting from the decision. "It's difficult to tell what the ramifications of the decision are," said Tom Tobin of the U.S. Public Interest Research Group. "It's not clear whether CUBs can use utility enclosures in the future. We may have some room to maneuver to meet the objections the court raised." Tobin noted that CUBs, unlike TURN and other private groups, are established by state governments through legislation or administrative action. States therefore may define a "compelling state interest" in their creation. In any case, Tobin said, CUBs currently operating in Illinois, New York, Oregon, Wisconsin and San Diego, California will undoubtedly survive. Though the New York and Oregon CUBs have never gained access to cs billing envelopes, other CUBs have grown and prospered; the Illinois and Wisconsin CUBs each have more than 100,000 members. CUBs currently are analyzing the decision and preparing alternative fundraising strategies, such as direct mail, Tobin said.