Drama unfolds at egg recall hearing – National Consumers League

By Sally Greenberg, NCL Executive Director

One of the great things about living in Washington, DC is that you can witness the drama of politics up close and personal and for free. On Wednesday I went down to the House of Representatives to attend the oversight and investigations hearing on the 500 million egg recall that took place over this past summer. The drama was to be the apology offered by Jack DeCoster and his son Peter, who run the million+ hen facility that sent the millions of eggs contaminated with Salmonella Enteritidis (SE) into the stream of commerce. More than 1,600 (1,608 to be exact) reported cases were identified.

For me the drama was less the questions put to the DeCosters. I thought it was far more powerful – and scary – to hear from two women, one 30 years old, the other over 70, who had eaten food contaminated with the SE pathogen. Each time I hear stories about what the most virulent foodborne pathogens do to victims I’m always stunned. It’s not the overnight upset stomach or throwing up/diarrhea that most of have experienced from a bout of food poisoning. Each of these women would likely have died had it not been for medical intervention. They described high fevers, severe dehydration, emergency room admissions, and days spent with IVs in their veins, unable to function or get out of bed. The older woman testified that she had permanently lost her old vitality and enjoyment of life . . . and eating had become a scary experience.

Both had conditions that compromised their immune systems, making them particularly vulnerable. The 30-year-old mother of two had consumed a custard pie made with uncooked eggs. The older victim consumed something like a crab cake with a sauce that she guessed harbored the pathogen.

The DeCosters – father and son – owners of the huge facility that produced the effected eggs – argued that they had done all they could to keep the plant running well. Sounds reasonable except for the fact that Committee investigators had photos of 8-foot-high piles of manure, maggots, hundreds of live and dead flies, buildings oozing liquid manure, rodents, holes in the floor where mice entered the plant, and piles of dead chickens. The DeCosters really couldn’t explain the discrepancy – the elder DeCoster, who former Labor Secretary Robert Reich called “a rotten egg” in a recent blog because of his many violations of the law – said “we were small and then we got big and that’s where we got into trouble.” Congressman Henry Waxman (D-CA), who chairs the full committee, challenged the DeCoster’s statement that the plant is well run: “that’s not what the record indicates” naming all of the above violations – and suggesting they needed to fire their quality control manager.

Finally, the FDA’s second-in-command, Dr. Josh Sharfstein, gave compelling testimony about the new rules for egg regulation that have just gone into effect allowing the FDA to set stronger standards for egg production, while also stressing the importance of passing the food safety bill that is being held up by Senator Tom Coburn (R-OK) in the Senate because it will give the FDA mandatory recall powers (which they lack today). Two other dramatic moments took place: ranking member Michael Burgess (R-TX) and Subcommittee Chairman Bart Stupak (D-MI) nearly came to blows over procedural issues, with Burgess constantly complaining he wasn’t given his allotted time to speak, and Stupak eventually turning off his microphone.

And the moment the DeCosters sat down to testify, a small group of protesters arose from their seats, holding up a banner and chanting that factory farming egg production is corrupt and should be stopped. They were escorted out of the hearing room by Capital Police.

You can understand why I talked about the drama of politics. On a serious note, if anyone wonders why we need improved food safety rules, the harrowing stories of these two women – victims of a virulent salmonella strain – should provide the answer. Now if we could just get Senator Coburn to lift his hold on the bill.

As American as apple…picking! – National Consumers League

By Courtney Brein, Linda Golodner Food Safety and Nutrition Fellow

The pools have closed, the school year has begun, and the weather has started to change: apple season is here! In some parts of the country, orchards have already opened for “pick your own” apples, and in the coming weeks, the season will swing into full force, lasting through October.

Apples taste best when freshly picked from the tree, and when you’ve picked them yourself. For a fun fall outing with family or friends, find a local orchard and head over to wander through the trees and pick a few bushels. To prevent your apples from bruising, place them gently in the basket, rather than tossing them in.

Low in calories, high in fiber, and full of antioxidants, apples make the perfect snack. To extend their shelf life post-picking, store your apples in a cool place and refrain from washing them until you want to use them.

Happy picking!

High school dropout rate hitting close to home – National Consumers League

By Sally Greenberg, NCL Executive Director

At a recent meeting in downtown Washington, I heard an expert on teenage high school dropout prevention talk about new strategies for keeping kids in school or luring them back after they’ve dropped out. The expert told us that in some of the worst schools – “dropout factories” (schools where 60 percent or more of children graduate) most common in high poverty rural areas and inner cities – as many as 70 percent of the students drop out.

This issue touches the National Consumers League’s issues in several ways. First, it was the mission of Florence Kelley, our first leader, to get kids out of sweatshops, factories, steel mills, and mines and into school. Dropping out flies in the face of those fundamental goals. Secondly, NCL has a teenage financial literacy and consumer education program for teens called LifeSmarts, but most of our youngsters compete through their schools. As a result, kids who drop out have little chance of being able to benefit from all of the wonderful and practical education that LifeSmarts provides.

Finally, NCL is working hard to pass legislation that will provide rights and protections to farmworker kids. These children suffer much higher than average dropout rates. Their families travel from farm to farm, often in different states, picking crops; understandably these youngsters have a hard time staying in one school and graduating with their peers. The dropout rates for farmworker kids are perilously high. We need to have strategies to keep those kids engaged, learning, and graduating from high school.

In Minneapolis, the school system has launched the “We Want You Back” campaign, in which volunteers go door-to-door. In the Little Earth community in Minneapolis, largely American Indian, the graduation rate is a shocking 22 percent. The Minneapolis campaign is modeled on a Houston, Texas drive that has successfully brought 50-100 dropouts back to schools – which can include online courses, independent study or actual schools – each year. Dropouts need to feel wanted and valued and see a pathway to their degrees. According to one volunteer, “it’s news to people that we care.”

We at NCL support campaigns to keep kids in school and bring back into the fold those who’ve dropped out. These young people deserve all the support we can give them, and when they succeed, we can only believe they will be better informed and wiser consumers and citizens.

NCL to Congress: get tough on gold ‘investments’ with H.R. 6149 – National Consumers League

September 23, 2010

Contact: 202-835-3323, media@nclnet.org

Washington, DC—The National Consumers League, the nation’s oldest nonprofit consumer organization, has offered its support for H.R. 6149, the “Coin and Precious Metal Disclosure Act,” which the consumer watchdog says would do much to give consumers an accurate picture of the risks associated with buying gold and precious coins. Consumers may consider gold and precious coins to be an effective investment hedge against inflation.  However, recent investigations by federal, state and local enforcement agencies suggest that some gold dealers may be leveraging recessionary fears to steer consumers into buying gold and precious coins at inflated prices.

In a letter to Rep. Bobby L. Rush (D-Ill.), Chairman of the U.S. House of Representatives Subcommittee on Commerce, Trade, and Consumer Protection for the Committee on Energy and Commerce, NCL Executive Director Sally Greenberg conveyed the nonprofit organization’s concerns about the proliferation of gold coins being marketed to consumers as investments, particularly in the midst of a difficult economy.  The subcommittee is holding a hearing today to discuss the proposed legislation and potentially deceptive practices in the gold and precious coins marketplace.

“Purchasing gold may be a useful way for consumers to diversify their investment portfolios. However, we are disturbed by reports of gold dealers pressuring customers to purchase collectible coins at prices inflated far beyond market value,” wrote Greenberg. “Further, it concerns us that salespeople working for a prominent gold dealer were found by the Securities Division of the Secretary of State of Missouri to be offering financial advice to consumers without being licensed as investment advisors.”

H.R. 6149 will address these concerns by requiring disclosure of relevant fees and the purchase price, melt value, and resale value of coins and metal bullion. NCL believes that these disclosures will help consumers more effectively evaluate gold investment opportunities and applauds Congressman Weiner for introducing this bill and convening a hearing on the matter.


About the National Consumers League

Founded in 1899, the National Consumers League is America’s pioneer consumer organization. Its mission is to protect and promote social and economic justice for consumers and workers in the United States and abroad. NCL is a private, nonprofit membership organization. For more information, visit www.nclnet.org.

‘Strike’ one up for the ‘Little Guy’: company abandons plans to cut salaries and benefits at Mott’s plant – National Consumers League

By Reid Maki, Director of Social Responsibility and Fair Labor Standards

After a four-month strike, 300-plus workers at the Mott’s applesauce plant in Williamson, New York, have won their battle and have avoided pay and benefit cuts the conglomerate that owns the plant was trying to cram down their throats despite earning huge profits last year.

In addition to Mott’s, Dr Pepper, and Snapple, Dr Pepper Snapple Group makes Sunkist soda, 7UP, A&W, Canada Dry, Crush, Squirt, Hawaiian Punch, Penafiel, Clamato, Schweppes, and Venom Energy.

According to the  New York Times, Dr Pepper Snapple Group–despite profits of over a half billion dollars in 2009–tried to slash workers’ wages $1.50 an hour because it felt that the facility’s pay was too high for the area, which is economically depressed after years of layoffs from firms like Kodak and Xerox.

“It used to be that corporations…moaned about how bad they were doing when they demanded givebacks. Now they don’t bother. ‘We’re doing great, we admit it…but we want more, more, more,’” said one observer.

In addition to the wage cut, the company wanted to eliminate pensions for future workers, freeze pensions for current workers, decrease its contributions to the 401 K plan, and increase employee contributions toward health care premiums and co-pays.

Hopefully, the workers’ “victory,” extensive media coverage it garnered, and the strong support the workers received from New York’s congressional delegation (29 members of which asked the company to return to the negotiating table) will serve as a signal to corporations that they should think twice before they cut workers’ wages and benefits while they are generating huge profits.

To add insult to injury, Larry Young, the CEO of Dr Pepper Snapple Group, made $6.5 million last year, and he’s averaged nearly 30 percent raises for each of the last three years. By contrast, veteran plant workers earned less than $40,000 a year without overtime.

It’s a sad comment on the current state of labor relations that a contract for level pay is considered a victory. We think the Mott’s workers deserved a raise and a share of the parent company’s success. At least the company’s arrogant and insulting attempt to drive down wages was beaten back.

As Congress addresses egg recall, groups call on industry to phase out cages – National Consumers League

September 22, 2010

Contact: 202-835-3323, media@nclnet.org

Washington,DC — Hours before a Congressional hearing on the largest egg recall in U.S. history, the National Consumers League, the nation’s oldest consumer organization, and The Humane Society of the United States, the nation’s largest animal protection organization, joined forces to call on the egg industry to phase out the cage confinement of laying hens in order to reduce food safety risks and animal cruelty. The half-billion egg recall is the latest in a series of reminders that how we treat animals can have significant food safety and public health implications.

“It is the very system of cramming birds into cages – in warehouses on operations that may confine more than a million animals – that exacerbates the spread of infectious diseases like Salmonella,” said HSUS president and CEO Wayne Pacelle. “The industry must phase out these hazardous and merciless cages.”

Even before the recall, the FDA estimated that 142,000 Americans are sickened by Salmonella-tainted eggs every year. The elderly, infants, pregnant women, and those with impaired immune are especially vulnerable to developing severe—even life-threatening—complications.

The egg industry has unfairly placed the blame on consumers, but given the potential for cross-contamination and the fact that many common egg cooking methods are insufficient to eliminate the threat, it is incumbent on industry to reduce Salmonella risk on the farm. An abundance of evidence suggests this can be accomplished by phasing out cage confinement, which carries greater risks due to the enormous flock sizes, the propensity for rodent and fly infestations, and an inability to adequately disinfect the cage equipment between flocks.

“Consumers don’t want to buy products from companies that abuse their workers, mistreat their animals, or pollute the environment, and they certainly don’t want to buy food that contains pathogens that could make them or their families sick.” said NCL Executive Director Sally Greenberg. “The link between caging of birds and increased Salmonella makes this animal protection issue a food safety one as well. This large-scale egg recall comes from a company that appears to routinely violate the rights of workers, engage in cruel treatment of animals, and dispose improperly of waste; it’s no surprise to us that this same company would produce goods that are harmful to consumers.”

Numerous public opinion polls show that most Americans oppose this extreme confinement. California and Michigan have passed laws phasing out cages, and California is phasing out sale of cage eggs. Many major retailers, including Burger King, Subway, Quiznos, IHOP and Denny’s, are already using cage-free eggs.


About the National Consumers League

Founded in 1899, the National Consumers League is America’s pioneer consumer organization. Its mission is to protect and promote social and economic justice for consumers and workers in the United States and abroad. NCL is a private, nonprofit membership organization. For more information, visit www.nclnet.org.

About The Humane Society of the United States

The Humane Society of the United States is the nation’s largest animal protection organization—backed by 11 million Americans, or one of every 28. For more than a half-century, The HSUS has been fighting for the protection of all animals through advocacy, education, and hands-on programs. Celebrating animals and confronting cruelty—on the web at humanesociety.org.

2010 Trumpeter Award recipients announced – National Consumers League


The National Consumers League is pleased to announce that Surgeon General Vice Admiral Regina Benjamin, M.D., and “Compensation Czar” Kenneth Feinberg will receive this year’s Trumpeter Awards on Thursday, October 7 at 6:00 p.m. at the Capital Hilton in Washington, DC. Please join us as we honor these two distinguished advocates for their commitment to serving consumers nationwide. NCL will also honor Consumer Federation of America’s Jean Ann Fox, a lifelong consumer champion, with our Florence Kelley Consumer Leadership Award.

Support the Trumpeter Awards Dinner

NCL offers several giving levels, as well as individual tickets, for the Trumpeter Awards Dinner, which helps support NCL’s advocacy and education efforts year-round. To learn more about the benefits of each category, contact NCL’s Larry Bostian at (202) 207-2826.

  • Underwriter – $25,000
  • Consumers Circle – $15,000
  • Benefactor – $7,500
  • Patron – $5,000
  • Sponsor – $2,500
  • Friend – $1,500
  • Individual – $200

About the honorees

Kenneth Feinberg has been described as “America’s Solomon,” serving multiple Presidents and Congresses in taking on the very difficult task of distributing compensation funds to those who’ve lost loved ones or their livelihood. In trying times, from the September 11th Victim Compensation Fund to the tragic Virginia Tech shooting in 2007, where he administered the Hokie Spirit Memorial Fund for victims’ families, Feinberg has unfailingly gained the trust of the beneficiaries he has been called upon to serve. He has consistently demonstrated concern, patience, and a willingness to listen and learn from victims. Feinberg currently serves as the Special Master for TARP Executive Compensation and as administrator of the BP Deepwater Horizon Disaster Victim Compensation Unit.

As “America’s Doctor,” Vice Admiral Regina Benjamin, M.D., is the 18th Surgeon General of the United States, charged with the task of providing the public with the best scientific information available on how to improve their health. Benjamin oversees the operational command of 6,500 uniformed health officers who serve around the world to promote, protect and advance the health of the American people. Prior to becoming the surgeon general, Benjaminfounded and served as CEO of the Bayou La Batre Rural Health Clinic in Alabama. She served as former associate dean for rural health at the University of South Alabama’s College of Medicine and immediate past chair of the Federation of State Medical Boards of the United States. Dr. Benjamin received the 1998 Nelson Mandela Award from the Henry J. Kaiser Family Foundation for her work in the United States and abroad.

For additional information, or to learn about sponsorship opportunities, please contact NCL’s Larry Bostian at (202) 207-2826 or larryb@nclnet.org.

Community connections used to commit affinity fraud – National Consumers League

By John Breyault, Vice President of Public Policy, Telecommunications and Fraud

When consumers imagine a typical scam artist, a number of images may jump to mind. Nigerian princes, damsels-in-distress in Russia, and exiled dictator’s former wives’ son-in-law come to mind. What most consumers don’t immediately tend to think about is the man sitting in the pew next to them at church. They probably wouldn’t suspect their country club golf buddy. Or the neighbor who just hosted a block party. Or their tennis partner at the senior center.

Unfortunately for consumers, scam artists don’t adhere to any easy-to-distinguish profile. In fact, many scammers use the very same social connections they develop as part of a community to gain their victims’ trust. The central thread of these scams is that members of a particular community tend to trust other members of the community and thus don’t exercise the proper caution needed to spot and avoid a scam.

In recent years, enforcement agencies have investigated and prosecuted many of these scam artists. Unfortunately, by the time law enforcement catches up with the scam artists, there is often little money left to reimburse victims of these scams. Recent examples of Securities and Exchange Commission investigations of these scams include:

  • 190 victims of a Ponzi scheme targeting seniors members of Jehovah’s Witness congregations defrauded victims of more than $16 million.
  • $36 million in losses to a fraudulent investment scheme targeting members of a Korean-American community.
  • A Baptist minister running an investment scheme targeting African-American congregants defrauded victims of more than $3.5 million.

Consumers who are approached to commit funds to an investment opportunity should be sure to be wary of some of the classic signs of affinity fraud, including:

  • A refusal by investment operators to document promises in writing. Legitimate investment managers should be eager to provide documentation substantiating claims made in marketing materials or presentations.
  • Pressure to “buy now” to avoid a “can’t miss” opportunity. Fraudsters thrive on getting victims to suspend logical thought and surrender to emotion — particularly fear (of losing out on an opportunity).
  • An absence of credentials. Investment operators should be qualified to operate. Good places to check and see if someone is competent include FINRA’s BrokerCheck database, your local Better Business Bureau, and your state Attorney General.
  • Unusual similarities among investors. If an unusual number of the investors in a particular investment are from the same church, community group, or ethnic group, be sure to dig deeper into the fundamentals of the investment.

These indicators do not automatically mean that an investment opportunity is a scam. Instead, if a particular investment triggers one or more of the above red flags, consumers should be sure to investigate and make sure that the investment is actually legitimate and not a scam.

For additional information on affinity scams, be sure to check out the SEC’s Affinity Fraud Investor Alert which details recent scams and gives consumers a good resource to start their due diligence.

Statement on appointment of Elizabeth Warren as CFPB interim director – National Consumers League

September 18, 2010

Contact: 202-835-3323, media@nclnet.org

Washington, DC—The National Consumers League applauds President Obama’s appointment of Elizabeth Warren as interim director of the Consumer Financial Protection Bureau (CFPB). The concept behind the CFPB was Warren’s. She is an outstanding consumer advocate who long ago recognized that consumers were being unfairly saddled with staggering fines and fees due to fine print in legal documents that few could understand. NCL supports Warren’s vow to do away with the “tricks and traps” in consumer contracts, to simplify these contracts, and to provide far greater transparency and protections for consumers.

American consumers are fortunate, indeed, to have someone of Elizabeth Warren’s stature, integrity, commitment and diplomatic skills at the helm of the CFPB. The National Consumers League is proud to join in support for this fine appointment from the Obama Administration.


About the National Consumers League

The National Consumers League, founded in 1899, is America’s pioneer consumer organization. Our mission is to protect and promote social and economic justice for consumers and workers in the United States and abroad. For more information, visit www.nclnet.org.

Obama appointment of Warren welcome – National Consumers League

By Sally Greenberg, NCL Executive Director
The National Consumers League issued a statement this weekend applauding President Obama’s appointment of Elizabeth Warren as interim director of the Consumer Financial Protection Bureau (CFPB). Warren’s name is all over this job; the concept behind the CFPB was Warren’s, and she’s been a vocal consumer advocate who long ago recognized that consumers were being unfairly saddled with staggering fines and fees due to fine print in legal documents that few could understand.

I remember hearing her speak at the Consumer Federation of America’s Financial Services conference two years ago, when she was advocating for the creation of a CFPB. Warren explained that just as there is a Consumer PRODUCT Safety Commission to protect against dangerous TVs or toasters, there ought to be a Consumer Financial Protection Agency to protect against dangerous financial products. Warren analogized further: just as consumers aren’t expected to look at the wiring diagram in the manual that comes with the TV or toaster to find the defect, nor should they be expected to read through 30+ pages of fine print to find the tricks and traps that await them when they sign credit card, mortgage, cell phone, or any other consumer contract. Her analogy was as compelling then as it is today, and Warren ultimately won the day with her arguments. Congress established the framework for the agency in the recently passed financial reform legislation, and Warren will be the first head, albeit an interim post for her.

New York Times consumer columnist Ron Lieber asked Warren what her priorities would be, and she thanked him for asking but said at this early stage, “I can’t say anything about anything.” So Lieber designed his own to-do list for Warren and I think it’s a good one.

  1. Student loan reporting to the student’s college or university.
  2. Requiring colleges to publish the rate of default disclosure on student loans, this is particularly needed for the many for-profit schools where students take out huge loans and end up with a degree that prove useless in finding a job and they default on their student loans but the for-profit schools keep the tuition money.
  3. Free unlimited access to credit scores.
  4. Requiring lenders, landlords, and employers to disclose which credit scores or reports they intend to check
  5. More 45-day warnings. Give consumers 45-day warnings before lowering their credit limit – right now, cards are required to warn before increasing your interest rate or annual fee or other charge under the new bill. Adding the warnings about lowering credit is something the new bureau could do.

I’m a big Elizabeth Warren fan – I sent her an email note over the summer as I was having dinner outside Boston with a group of women friends who had just unanimously agreed that the President should appoint her. She responded in kind that this was almost better than a presidential appointment. Warren may be blunt, but she’s also charming, and that will go a long way. American consumers are fortunate, indeed, to have someone of Elizabeth Warren’s stature, integrity, commitment and diplomatic skills at the helm of the CFPB.