THE MOVEMENT IN THE 1990s: IMPLICATIONS FOR RESEARCH

Stephen Brobeck, Consumer Federation of America

The topic, the future of the consumer movement, is Coverage of the movement's dominant figure, Ralph not an easy one to address. There are so many var- Nader, paralleled that of the movement as a whole. iables which interact in such complex Here also the headlines revealed the content of ways that we cannot be certain what will happen. news articles. In the New York Times, in 1966, I have been reminded of this difficulty in pre­ "Car Safety Crusader: "; in 1979, paring a bibliography on the consumer movement. "Nad er Expanding Consumer Efforts" ; and in 1982, This literature is littered with the corpses of "A Subdued Nader Works to Organize ." In articles that ventured predictions which have not Business Week, in 1969, "Crusader Widens Range of been fulfilled. One report by two highly re­ His Ire" : in 1972, "Ralph Nader Becomes an Organi­ garded researchers, for example, argued that during zation"; and in 1979, "A Fading Ralph Nader Re­ the last 25 years of this century, writes His Strategy. " would disappear. I myself became more careful about making predictions after giving a speech, Public opinion surveys also s uggest a loss of featured in a 1981 Associated Press wire story, public support and influence. In the early 1970s, that s uggested it was highly unlikely the infla­ Gallup found that Nader was one of the ten most tion rate would return to single digits in the widely admired Americans. By 19 76, when Lou Harris near future. So why do we continue to try to conducted his first consumerism survey, he learned speculate about the future? There are many rea­ that Nader ' s support had declined but was still sons. Perhaps one is that there is so little strong. Yet by 1982, in his second survey, Harris . discovered that this support had declined signif­ icantly: Fewer than 40% of respondents regarded What is more useful in helping us understand Nader highly. the future of the consumer movement than making bold predictions, however, is identifying the key An even more important gauge of the consumer move­ variables that will shape this future and examin­ ment ' s influence is success in achieving its most ing how they have interacted in the past. That important policy objectives. In the 1970s, for can give us a better understanding of the range national groups and for Nader the most important of outcomes and those mos t likely to occur. prio~ity was persuading Congress to pass legisla­ tion establishing an independent consumer protec­ From my experience in and research on the consumer tion agency. They fail ed. In the 19 80s, for movement, it seems that two sets of variables are Nader and his network of organizations, the most important. One is the condition of the movement, important goal was to establis h, at national and especially its level of resources and its willing­ state levels, citizen groups funded by check-off ness to address pressing consumer concerns. The mechanisms. Only a few bonanide organizations of second set includes external conditions, particu­ this type were ever set up, all citizen utility larly general economic conditions and support, boards (CUBs). But when in 1986 the Supreme Court opposition, or apathy from political leaders, restricted the access of the CUBs to utility mail­ business, and the public. ings, they lost most of their funding and clout.

To what extent do these factors help us understand This decline in influence can be explained in changes in national consumer groups -- that part terms of the condition of the consumer movement of the consumer movement about which the most is and external conditions over which it had l i ttle known -- over the past 15 years? Research by control. Much has been made of the loss, to the Herrmann and Warland, by Mayer, and by Smith and Carter administration, of several of the movement ' s Bloom have documented the declining influence of most effective leaders. And there i s no question the consumer movement in the late 1970s and earl y that the departures of Carol Tucker Foreman from 1980s. This decline can be seen in press cover­ the Consumer Federation and from age. As Smith and Bloom have shown, between the Congress Watch weakened both organizations . Yet, early 1970s and early 80s, there was declining many talented and energetic leaders remained -­ coverage of the movement in the New York Times . Kathleen O' Reilly at CFA, Mark Silbergeld at As I have discovered in my own research, this Consumers Union, Sid Wolfe at Health Research Group, coverage reported the rise and fall of consumer Alan Morrison at the Litigation Group, Mike Jacob­ movement influence in Was hington. Headlines of son of the Center for Science in the Public Interest, major newspaper articles t ell the story. In the Clarence Ditlow of the , and New York Times, in 1969 a headline read, "Consu­ Nader himself, t o mention only a few. With the mer Indigna t ion"; in 197 2, "New Groups are Serv­ most supportive President and Congress in nearly ing as Watchdogs for Consumers"; in 1976 , "Public a decad e, and their former colleagues, especially Affairs Groups, Now on the Outside, Expect Access" ; , holding important leadership in 1978, "Consumer Leaders, i n Reappraisal, Seek positions, why did they not accomplish more? New Consumer Initiatives"; and in 1983, "The Con­ sumer Movement: Whatever Happened." One critical factor is that their goals were not strongly supported by most consumers. What cons~ers

337 want most from advocates is protection against were turned over to anti-regulation administrators specific marketplace threats such as rising bank who halted or slowed rule-making, reduced enforce­ fees and utility rates, unsafe cars and children' s ment activity, and supported substantial cutbacks products, and fraudulent television and home in funding. In the 1980s, for example, repair services . In the 19 70s, what national ad­ tfie. budget of the Consumer Product Safety Com­ vocates focused most attention on was the estab­ mission in constant dollars declined by 50%. More­ lishment of a new federal agency to help ensure over, the administration rarely backed consumer that other federal agencies considered consumer movement initiatives in Congress. interests in their decisions . In part because of growing skepticism about the effectiveness of the Of course, during the Carter administration, the federal government, which ironically was fed by ardor of Congress for consumer reforms had cooled earlier reports of Nader Raiders, there was little considerably, as has been documented by Pertschuk. enthusiasm for this agency outside Washington. Congressional leaders increasingly began to Members of the Cleveland consumer group I was realize that, when consumer advocates pursued coordinating could not have cared less. What goals not strongly supported by the public, they national cons umer l eader s forgot is that the were paper tigers. Without public outrage, or public backs only the creation of new government at least widespread irritation, and related press agencies, such as local protection officesor the criticism, senators and representatives had little National. Highway Traffic Safety Administration, to fear from the threats of advocates. It was wh~ch offer promise of preventing or solving this growing realization that led to diminishing their own individual problems. Congressional support for a agency. Despite a Democratic administration and A second important factor is the funding problems Congress, there were even fewer major consumer experienced by national groups in the late 1970s bills passed than during the previous eight years and early 80s. In 1982, Consumers Union had a of Republican Presidencies. serious, and well-publicized, financial crisis. It was forced not only to cut back support for Beyond its lack of enthusiasm for a consumer pro­ its three advocacy offices, but also to reduce tection agency, the public was growing increas­ contributions to other organizations such as the ingly preoccupied with financial and job security Consumer Federation of America and Center for and more accepting of the conservative and Auto Safety. At CFA, this reduced support slowed corporate arguments that consumer regulations recovery from an earlier crisis in 1979 and 80 carried unacceptable price tags. Without strong when organizational revenues had fallen to $200,000 public support, consumer advocates were unable to annually and cashflow problems occurred regularly. counter the great influence of a business commun­ The same year, , which was supposed ity that had united against the consumer protec­ to raise funds for other Nader-related organiza­ tion agency bill. After defeating this proposal, tions, reported net revenues of under $1000. the same coal ition mobilized against the aggres­ sive advocacy of the Pertschuk-led Federal Trade There is no question that inexperienced or inat­ Conmission and persuaded Congress to severely tentive management had something to do with these curb its activism. funding problems. Yet, these difficulties largely r eflected the condition of the economy Nader's nadir was probably in 1986, when the and other external factors. Most important was Supreme Court restricted his check-off mechanism the stagflation of the late 1970s and recession of and he experienced several per sonal crises. 1981 and 82. Rising prices increased the costs Nevertheless, in this period, national groups of, and the recession depressed revenues from, were strengthening themselves institutionally Consumers Union solicitationsf or subscriptions and finding greater support in Congress. One and Public Citizen solicitations for contributions. indication of Congressional receptivity was the The latter probably also declined because of the increasing number of times committees asked con­ growing public perception t hat national advocates, sumer advocates to give testimony. Even clearer especially Nader, were pursuing their own agenda, evidence was Congressional passage of consumer not that of most consumers . Also, the Reagan initiatives such as consumer banking reforms, Administration virtually eliminated all federal appliance efficiency standards, and prohibitions grants and contracts to consumer groups. Organ­ against physician sel f-dealing. More widely izations as diverse as the CollDJlunity Nutrition reported by the press was the passage in 1988 of Institute, which was funded principally by the radical insurance reforms by California voters . Community Services Administration; National PIRG Their approval of Proposition 103, fiercely and ACORN, which received VISTA grants and volun­ opposed by the insurance industry, signified that te~rs, and National ConstmlersLeague and Consumer consumers still looked to Nader for leadership Federation of America, which depended somewhat when their welfare was threatened. on U.S. Office of grants and contracts, lost important resources. Even if press coverage of the consumer movement was not much more extensive than earlier in the The oppositio. • of the Reagan administration to decade, stories were more likely to recognize the objectives of consumer advocates , us ually Nader' s influence and that of the movement. In federal intervention of some sort, threatened 1989, Business Week, Fortune, and the New York more than just funding source~. Agencies such as Times all ran laudatory stories on Nader and other the Consumer Product Safety CollDilission and National advocates. These articles were titled, respective­ Highway Traffic Safety Administration that advo­ ly, "The Second Coming of Ralph Nader," "The cates had worked so patiently to create and fund Resurrection of Ralph Nader," and "Nader, After

333 Eight Years, Is Back on the Inside." The same advocates, Congress passed legislation requiring year, Changing Times printed a feature article additional disclosures from banking institutions on the consumer movement that answered the ques­ about the terms of credit card and home equity tion, whatever happened to the consumer movement? loans and is soon likely to approve new truth in with a report on the movement's growing strength savings requirements. and advocacy. Also, advocates have found that the Bush adminis­ The condition of the consumer movement and cer­ tration is more willing to consider intervening tain external conditions explain most of the move­ in private markets than were Reagan regulators. ment's resurgence. Forced to focus more attention Recently the secretary of Health and Human Ser­ on management and fundraising than on advocacy, vices announced that the Food and Drug Administra­ in the early 1980s national consumer leaders cut tion would be developing rules for nutritional costs within their organizations and developed claims made by food advertisers; the head of new revenue sources. Consumers Union sold their the National Highway Traffic Safety Administration fulfillment division, which housed nearly one­ declared his intention to seek side-impact crash third of the organization' s employees, laid off standards; and the chairperson of the Federal other staffers, and reduced the paper quality and Trade: Commission indicated her agency would length of . They also organized investigate products making environmental claims. highly successful campaigns to raise funds for their advocacy offices and for a new building. The deregulation of several industries also CFA moved up 14th Street to a low-rent neighbor­ increased the influence of advocates in these hood and began to generate tens of thousands of areas. Although activists complain about growing dollars from the sale of publications and confer­ consumer confusion and discrimination against the ence registrations. Public Citizen turned its poor resulting from deregulation of banking and direct mail operation over to professional fund­ telephone industries, this deregulation has not raisers and enjoyed increased s uccess selling only presented them with new iss ues , but has also publications. given them more political leverage. By increasing competition within the financial services and The financial reports of the three organizations telecommunications areas, deregulation has pro­ reflected these cost-cutting and income-producing vided advocates with opportunities to bargain with measures. In the 1980s, Consumers Union's annual competing industries who wish to increase the revenues increased nearly 100% in current dollars. credibility of their policy proposals. In 1988, More importantly, it began generating multi­ consumer lobbyists.persuaded bankers to accept million dollar surpluses, a portion of which it consumer protections in Senate legislation in used to fund state and local groups, through the return for support of expanded bank powers, which Consumer Federation, and Third World consumerism. were opposed by insurers and investment firms. At CFA's budget increased from $200,000 to more than present, the Consumer Federation and the American $800,000 in current dollars, and its reserve fund Association of Retired Persons are allied with from nothing to over $300,000 . Although Public cable companies, newspaper publishers, and long Citizen experienced growing pains in 1986Land 87, distance carriers to try to block expanded powers in 1988 and 89 the sal e of a new book on pills for Bell companies. Yet, CFA is also leading netted the organization over $2 million. In the consumer efforts to r eregulate the cable industry. same period, single-issue organizations such as Center for Science in the Public Interest and While the consumer movement is stronger institu­ Center for Auto Safety were also growing stronger tionally, more powerful in Congress, and more financially. credible with the public than it was a decade ago, it stil l does not have the public and policymaker More effective management and entrepreneurship support that it enjoyed two decades ago. But than in the 1970s were not the only reasons, this is the fate of nearly all social movements, however, for the improving financial condition of especially those that have been s uccessful . The most consumer groups. Slow but steady economic initial enthusiasm of activists and the public growth after 1982, which benefitted mainly the cannot be sustained. As a compensation, however, financial supporters of the movement, contributed consumers are better able to protect themselves substantially to increasing Consumer Reports sub­ today than in 1970. Most importantly, they are scriptions, Public Citizen contributions, and more aware of themselves as consumers with sales of books and other products by many organ­ interests that are separate from those of sellers izations. and with rights that are enforceable in their dealings with these vendors. Economic improvement, particularly the decline of the unemployment rate, heightened consumer inter­ To summarize, the influence of the consumer est in consumpbion-related issues . Consumer movement has reflected both its own condition, advocates were responsive to these growing con­ particularly funding levels and its willingness cerns. Rather than try to serve consumers r eheated to address specific consumer concerns, and policy proposals from the 1970s , advocates pre­ external conditions such as the condition of s ented them with a new menu of reforms. Several the economy and support or opposition from entr ees appealed to reawakened consumer appetites. policymakers, business , and the public. I would Most popular were proposals for auto insurance argue that it is principally these factors that rate reductions. Also appealing were measures to will shape the development of the consumer provide consumers with additional information movement in the corning decade. about a whole array of products. Encouraged by

339 I had originally intended to discuss consumer to say that all groups are strong -- some are not. issues of the 1990s. Although pr edictions about Yet, as I have ar gued elsewhere, one of the great these are also speculative, I could have at l east s trengths of the movement is its institutional informed you what issues CFA and other national diversity, entrepreneurial orientation, friendly consumer groups plan to work on in the next tnternal competition, and willingness to cooperate couple years. I would have identified three to achieve collDDon objectives. dynamic forces in our society -- technology, deregulation, and the environment. I would have Lastly, my analysis has r eported data that has associated increasing concerns about privacy, not been cited in earlier research. Information product safety, and rising health care costs with on the financial condition, politics, and pr ess the implementation of new technologies; consumer coverage of the consumer movement may be useful confusion , ~is cr imination against the least to future studies of the subject. Most sources affluent, and i ncreasing concerns about physical of this information will be listed with annota­ and financial safety and soundness with economic tions in a bibliography I am completing that is deregulation; and domestic resource depl etion, to be published by G. K. Hall this fal l. pollution, and global warming with the environ­ ment . Unfortunately, this discussion takes time, Given this deadli ne and others, I have not had so I can only refer you t o my article, publis hed time to refine this analysis as much as I would in the fall 1989 i ssue of Mobius, that examines have liked. But I hope that its data and many of these issues. hypotheses are helpful to those of you r esearching the consumer movement. Let me conclude by discussing some implications of my earlier analysis for research on the con­ In closing, I would challenge you to build on the sumer movement. This interpretation is generally solid foundation of research on the movement laid consistent with explanation of the rise and fall by Mayer, Herrmann, Friedman, and others . I see of consumerism in terms of underlying social two especially important research needs. To conditions and political entrepreneurship. elaborate and tes t the generalizations of earlier However, unlike other analyses, it s tresses the r esearch, we need more empirical studies -­ influence of economic conditi ons on political monographs on individual organizations, biographies and financial support for the movement . Like of consumers leaders such as Esther Peterson and Mayer ' s s uperb study of the consumer movement, Rhoda Karpatkin, and case studies of the making my analysis suggests that the failure of national of consumer policies, which focus on both groups in the 1970s ref1ected in part their "rad­ national and grassroots organizations. We also ical" emphasis on r edistribution of power, a goal need additional research on the social and that Nader pursued throughout the 1980s , and economic impacts of these policies . Even taken parentheticall y, can be linked historically t o together, the biased analyses of advocates and both the cooperative and New Left movements. I their opponents at the American Enterprise would s uggest;, however, that Mayer ' s r eformis t s Institute and Heritage Foundation rarely reveal are a diverse group that includes both conserva­ the actual effects of consumer regulations. We tives and liberals . Conservative reformists stress need more studies like those of Dardis and her improvements in the efficiency of markets through Maryland colleagues on the costs and benefits increased information . They are most comfortable of product safety regulations. As importantly, advocating improved consumer education, expanded we need good research on the impacts of consumer product-testing , and evaluation of consumer regulations r elated to new technologies, services, and required disclosures. Liberal deregulation, and the environment . And like reformists, on the other hand, are more concerned Mayer, we must consider the distributional about exploitation and discrimination, especially impacts of these interventions. This is an against the poor, that invariably are found ambitious research agenda. But it is one that in capitalist economies. Accordingly, they you are well-qualified to undertake. I wish emphasize government interventions to prevent and you well and promise to help in any way I can. redress fraud, and to ameliorate structural dis­ crimination in free markets. Specifically, they address pricing of insurance , banking, telephone, and energy services where the poor are often forced to pay higher prices (or costs) than are other cons umer s . Their solutions involve govern­ ment s ubsidies or government intervent ions where ther e is minimal disruption of markets . While many advocacy groups support both conservative and liberal consumer reforms, there is a continuum here on which organizations can be placed -­ perhaps with Washington Checkbook at one end and the National ConslDDer Law Center at the other.

My analysis also argues, unlike earlier research, that the consumer movement has experienced a revival recently. Public and political sup port for movement goals has increased, though not to earlier levels, and national groups have never been better funded or more stable. This is not

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