New Muscle for Consumers
A dull letter with exciting possibilities for consumers was delivered privately a few days ago by the General Accounting Office (GAO) to the Federal Trade Commission — the agency that is supposed to protect consumers and fight monopolies. The GAO, a Congressional watchdog over federal expenditures, advised the FTC that it had the authority to pay certain expenses of participants in its proceedings who cannot afford to bear these costs.
This opinion clears the way for the FTC and other regulatory agencies to adopt a policy of facilitating citizen initiatives or intervention in the consumer, health and safety issues which have all too often been decided in favor of business lobbyists. Although the GAO letter advised the FTC that an intervening citizen’s witness fees and costs, transcript charges and traveling expenses may be reimbursed by the Commission, the real importance of the opinion is to clear away legal hurdles for the Commission to exercise even broader “administrative discretion.” Presumably, this discretion could extend to providing legal services similar to what is now provided by the state for poor people facing court trials.
Federal regulatory agencies make decisions affecting electric, telephone and energy prices, consumer frauds and deception, and defects and other hazards of consumer products from autos to food. But their mystifying procedures are known largely to those special interests who can hire specialized lawyers and pay the costs to negotiate the legal labyrinths. In practice, this has meant over the years that only those who are well‑heeled could afford to fight for their interests. Consequently, corporations have had the field pretty much to themselves and it, indeed, has been a field day.
What led to the GAO opinion is a good illustration of the need for abolishing this pocket-book test for citizens to participate and advance their rights. About two years ago, a group of George Washington University law students, as part of their law course, petitioned the FTC to intervene in a case involving an alleged deceptive Firestone tire advertisement. The Commission was about to issue its usual “cease and desist” order, colloquially known as a “go and sin no more” edict, against Firestone.
The students’ intervention, allowed by the FTC in a pioneering decision, asked that a corrective advertising order be issued so that deceived consumers would be informed of the deception by the company itself. The reason for their request was that it would be just for consumers and be a strong deterrent against any further deception in advertising.
As they carried forward their case, the students asked the Commission to reimburse expenses, such as witness fees, because they had no money to do so themselves. It was at this point that the FTC passed the buck to the GAO and asked for a legal opinion. For some 15 months, the GAO was urged to decide the matter one way or the other by various members of Congress. Fortunately, it came out in favor of the average citizen.
Now two questions should be asked: Will the FTC issue guidelines which comprehensively open its doors to those without resources who wish to secure justice, or will it confine the GAO opinion to the Firestone case? And, secondly, how will other agencies, such as the Federal Power Commission, the Interstate Commerce Commission, the Atomic Energy Commission, the Food and Drug Administration, react? Will they ignore the door opened by the GAO or will they help launch a major abolition of the financial obstacles that make most Americans less equal than a privileged few?
It is in the interest of all citizens to make sure that the answers are not left entirely to the bureaucrats.