NCL urges FCC to protect consumers, preserve jobs in Verizon-SpectrumCo review – National Consumers League

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August 7, 2012

The Honorable Julius M. Genachowski
Chairman
Federal Communications Commission
445 Twelfth Street, SW
Washington, DC 20530

Re: Applications of Cellco Partnership d/b/a Verizon Wireless, SpectrumCo LLC, and Cox TMI Wireless, LLC, WT Docket No. 12-4.

Dear Chairman Genachowski:

On behalf of the National Consumers League[1] (NCL), the nation’s pioneering consumer and worker advocacy organization, I am writing to you to express our deep concerns regarding certain provisions of the above-referenced Verizon-SpectrumCo transaction. In particular, we believe that the proposed Joint Marketing Agreement (JMA) raises serious competition concerns that, if left unaddressed, will likely lead to higher prices, fewer choices and less innovation for consumers in the residential broadband market. In addition, we are concerned that the JMA will lead to fewer jobs being created due to reduced investment in Verizon’s FiOS network. It is therefore imperative that the Commission not grant the applications absent certain public interest safeguards.

NCL shares the concerns expressed by numerous public interest commenters regarding the impact of the JMA on consumers.[2] Millions of Americans lack robust choices in the residential broadband market. For the great majority of consumers, there are only two viable options when it comes to their home broadband provider – the local cable company or the local telecommunications company. The proposed JMA would remove any incentive Verizon may have to continue to expand its FiOS footprint, relegating millions of consumers to a poor choice between cable and increasingly outdated DSL for their home broadband service. Conversely, absent a competitive threat from Verizon, cable companies in potential FiOS territories will have less incentive to improve their service quality and keep prices affordable for consumers.

We are also concerned that reduced investment in the FiOS network will lead to a reduction in job growth. Specifically, we would urge the Commission to consider a recent analysis by economist Helene Jorgensen, which found that nearly 72,000 additional jobs would be created if Verizon were to expand its FiOS network to 95% of its wireline footprint.[3] At a time of high unemployment, a top priority of the Commission should be finding ways to increase, not reduce, the investment necessary to support the creation of good jobs.

Given these concerns, NCL supports the merger conditions proposed by the Communications Workers of America and the International Brotherhood of Electrical Workers, including:

  • Requiring Verizon to continue to offer its FiOS residential broadband service and expand this service to 95% of the residences in its in-region territory;
  • Requiring Verizon to increase its FiOS deployment to rural, low-income and underserved areas with verifiable timetables and penalties for non-compliance;
  • Prohibiting Applicants from cross-marketing their services within the Verizon footprint.[4]

NCL strongly believes that the merger as proposed does not serve the public interest. The Commission should impose strict conditions that will preserve affordable access to residential broadband service, protect competition, encourage innovation and promote job creation.

Sincerely,

John D. Breyault

Vice President of Public Policy, Telecommunications and Fraud
National Consumers League
1701 K Street, NW
Suite 1200
Washington, DC 20006
202.207.2819

[1] NCL, founded in 1899, is the nation’s pioneering consumer organization.  Our non-profit mission is to protect and promote social and economic justice for consumers and workers in the United States and abroad.  For more information, visit https://nclnet.org.

[2] See, e.g., Consumers Union. Letter to Chairman Genachowski et al. at 2-4 (filed March 26, 2012).

[3] See Communications Workers of America. “CWA Study: Verizon Wireless Cable Deal Is Job Killer,” Press Release.  July 10, 2012.  Online: https://www.cwa-union.org/news/entry/cwa_study_verizon_wireless_cable_deal_is_job_killer/#.UCGTwcie7Os

[4] See Reply Comments of the Communications Workers of America and International Brotherhood of Electrical Workers. WT Docket 12-4 at 29-30 (filed March 26, 2012).

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About the National Consumers League 
The National Consumers League, founded in 1899, 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. For more information, visit www.nclnet.org.

Child labor advocates come together for three days of sharing and strategy – National Consumers League

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

The world’s child labor advocacy community does not gather together very often, but it did just that Sunday, July 28 through Monday, July 30, here in Washington for an international conference on agricultural child labor. More than 60 percent of the 215 million child laborers globally work in farms and fields–if you’re trying to solve the puzzle that child labor presents, agricultural child labor is the biggest piece of that puzzle and should not be ignored. Children who work in agriculture are exposed to pesticides and hazardous equipment like machetes. If you’ve ever seen a seven- or eight-year-old opening a cocoa pod with a machete, you know what kinds of dangers children are exposed to on farms internationally.

The Global March Against Child Labor, a world-wide network of civil society groups, teacher unions, and trade unions, organized the conference with logistical support from the Child Labor Coalition (CLC)–co-chaired by NCL and the American Federation of Teachers–and CLC members, especially the Solidarity Center and the International Labor Rights Forum. About 150 representatives from 40 different countries attended all or part of the three-day event, about half of those were from developing countries like Ghana, the Ivory Coast, and the Philippines with endemic child labor problems.

Senator Harkin (Iowa-D), the congressional champion who has led a many-year crusade to reduce child labor, opened the conference with a speech that urged attendees to work to remove the “worst forms of child labor”—the types of child labor that harm physical, mental, or moral well-being of a child worker. After the speech, the senator stayed for the rest of the morning to soak up as much of the conference as he could. For the advocacy community, it was a powerful statement of support and concern.

Kailash Satyarthi, founder and leader of the Global March and a Nobel Prize nominee, expressed frustration at the slow progress in eliminating the worst forms of child labor. He reminded attendees that the 2016 deadline to eliminate worst forms of child labor set by the international community is fast approaching and we still do not have a strategic child labor elimination plan for each country. Satyarthi also demanded that multinational corporations stop hiding behind modest corporate social responsibility initiatives and seriously confront the huge child labor problems in their supply chains.

CLC member and filmmaker Len Morris of Media Voices for Children agreed, telling conference participants that the corporate sectors responsible for many child laborers— cocoa, cotton, and tobacco—could eliminate child labor from their supply chains in a year or two if they really wanted to. Money and resources, said Morris, are the key. Companies simply must be willing to commit enough financial resources to adequately confront these difficult problems.

The conference featured a number of leaders in the fight to keep kids in school and out of exploitative child labor, including Constance Thomas of the International Labor Organization’s International Program on the Elimination of Child Labor, Fred van Leeuwen of Education International, Geronimo Venegas, president of the IUF Agricultural Trade Group, Mauro Vieria, Ambassador of Brazil, Tim Ryan of the Solidarity Center, and many others working on the front lines of child labor remediation.

The difficulties of eradicating child labor proved a steady theme for conference participants. U.S. presenters Norma Flores Lopez of the Children in the Fields Campaign and  Zama Coursen-Neff of Human Rights Watch noted the very disappointing withdrawal of occupational child safety rules  for agriculture by the Department of Labor and the White House in April. One child labor advocate who works on agricultural child labor issues in West Africa was stunned to learn that the U.S. has its own problem with child labor in agriculture and was having similar difficulties reducing its dependence on child workers.

The conference featured several workshops that allowed participants to strategize about remediation efforts. A conference framework document identified several factors needed to eliminate child labor in agriculture:

  • a conducive legislative environment and policy framework;
  • protection of child rights; universal free quality basic public education;
  • decent employment and decent wages and work for adult workers [so children do not have to work];
  • food security, the right to food and sustainable rural livelihoods;
    the rights of workers to organize and to bargain collectively in free, independent trade unions;
  •  the rights of farmers to form their own independent organizations;
  • gender equality, social inclusion and non-discrimination;
  • strong safety and health laws and their enforcement;
  •  adequately resourced and funded labor inspection.

The conference also allowed participants other opportunities for activism. Several of the Global March attendees picketed the White House with anti-child labor signs. And conference attendees also enjoyed some “down time” at a wonderful evening of music and child labor activism at a local Busboys and Poets restaurant. The event, organized by the CLC and ILRF, and cosponsored by the Global March and the CLC, featured talks by three farmworker youth who are interning for CLC members the Association of Farmworker Opportunity Programs (AFOP) and Farmworker Justice, as well as the U.S. Department of Agriculture. The interns spoke movingly about their experiences working in U.S. fields and the challenges posed by educationally by their constant migration. Norma Flores Lopez, the director of the Children in the Fields Campaign for AFOP and the Domestic Issues Committee chair for the CLC, related the interns experiences to her own working in the fields as a farmworker youth.

All in all, the weekend provided many opportunities for the advocacy community to come together from across the globe, all of us looking for effective strategies to reduce or eliminate child labor in our countries. Perhaps most important, the conference focused some much-needed attention to the problem of child labor in agriculture across the world.

Payday lending scams kicking consumers when they’re down – National Consumers League

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Payday loans are notoriously bad deals for consumers, providing short-term fixes to financial dilemmas at an extremely high cost. Con artists are finding ways of making them even worse.These days, fraudsters targeting consumers who are down on their luck and desperate for money are providing another reason for consumers to avoid the temptation of a payday loan. The growing popularity of online loans has attracted scam artists who are eager to prey on these vulnerable consumers.

In a typical payday loan scam, the victim, who may or may not have ever actually applied for or taken out a loan, receives a call or email demanding that they pay back an overdue debt. Because of porous information-sharing practices, consumer’s personal information often finds its way into the hands of fraudsters, making it easy for them to recite the consumer’s personal and confidential information.

The scam artist may threaten the consumer with immediate arrest if he or she does not pay right away. This is a clear giveaway that it’s a scam, but it also causes people to act irrationally out of fear. Scammers have been known to make dozens of such threatening phone calls to victims’ homes or places of work in order to extract funds. Victims are often accused of perpetrating check fraud, forgery or money laundering to scare them into paying up immediately, when in fact no money is owed.

Consumers shopping for an online payday loan should be aware that even legitimate-looking Web sites could in fact be fronts for scammers. Some “red flags” of a possible scam loan Web site include:

  • Requests to pay upfront before receiving a loan
  • Payment is requested via wire transfer
  • Payday loan Web sites that lack working phone numbers or mailing addresses
  • The payday lending company is based overseas
  • Loan packages that sounds “too good to be true”

Even legitimate payday loans, whether acquired online or in person, are already notorious for outrageously high interest rates. There costs are often hidden in fine print or outright lied about. The Federal Trade Commission recently sued several payday loan companies for “lying about interest rates, requiring borrowers to let the company take money out of their bank account automatically and threatened to sue borrowers or have them arrested for non-payment.”

Payday loans should be a last resort for cash-strapped consumers. They may solve financial issues in the short term, but paying it back will put you further into debt. For example, a recent survey of online payday lenders by the Consumer Federation of America found that the typical cost of a two-week $500 loan is $125, or a whopping 652 percent APR.

Rethinking retail – National Consumers League

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Lili Gecker, NCL public policy intern

You don’t have to be a shopping addict, and it doesn’t have to be the holiday season—we all buy and consume goods pretty regularly. Most of us are aware that Wal-Mart treats workers poorly, but which stores treat workers well and have low prices? Is this even possible? Today, there are nearly 15 million people working in the retail industry, which makes up about 10 percent of the U.S. labor force. According to the Bureau of Labor Statistics, cashiers and retail salespeople were the most common occupations in the entire economy in 2011, with 3.3 million and 4.3 million employees respectively, and representing nearly 6 percent of total U.S. employment.

Although many retail workers are well-educated (a study conducted by the Retail Action Project (RAP) found that about 70 percent of front-line retail workers in New York completed some college or a college degree), they are not well compensated. In 2011, the national median hourly wage in the retail sector was $10.88 an hour, lower than the national median of $16.57 for all workers. For the two largest occupations in retail, cashiers and salespeople, the median wage was $9.05 and $10.10. Retail workers often have little control and opportunities for advancement in their jobs. The same study by RAP found that only 17 percent of workers had a set schedule, and only 30 percent reported knowing their work schedule at least one week in advance. The fact that fewer than 5 percent of retail employees were members of unions in 2011 may play a role. These limit in worker control prove especially difficult for people who work other jobs, or who have other responsibilities, including those of a parent.

At a recent discussion on the retail industry hosted by the Aspen Institute Workforce Strategy Initiative, MIT professor Zeynep Ton explained the employer perspective: they view employees as a cost to be minimized. When seeking to maximize profits, they cannot always control sales, but they can cut payroll, and when under pressure employers feel they must cut employee hours. When employers cut labor, they see an immediate decrease in cost, but the benefits of stable labor are long-term. In fact, studies conducted by Ton found that if employers had more labor, they would make more money.

So why don’t businesses do this? Walmart claims that they cannot afford to treat their employees well and keep prices low. Kim Owens, former Vice-President of QuickTrip Corporation, disagrees. QuickTrip is a gas station convenient store located in 13 states and expanding, and the employer of 13,000 employees. With the belief that retail can be a career, most of QuickTrip’s employees have at least some college education and they promote from within. They invest in their employees from the beginning through one-on-one training for at least two weeks, and by providing a mentor. Starting salary for a night sales manager is $35,000 per year, and some employees who have worked as managers for over 20 years retire with $1 million. They offer benefits such as health insurance, bonuses, and a tuition reimbursement program. QuickTrip is good to its employees, and it benefits the company: they are one of the most successful in their industry.

Ton explained that it is not one change a business can make, but a series of operational decisions made by companies to invest in employees that allow everyone to succeed. Simply spending more time on training, or increasing worker benefits is a necessary start, but it is not enough. Americans can begin to transform our business practices through education. Businesses leaders must not view profit maximization as a narrow goal. They should put their employees, customers, and society before investors. Business educators must teach these important values in school: that companies should maximize shared values, not just their shareholder’s values.

In addition, we need policies that defend the rights of workers. Carrie Gleason of RAP asserts that the minimum wage is not a living wage, and it must be elevated and indexed to adjust for inflation. This may be a possibility, with the recent introduction of the Fair Minimum Wage Act of 2012. In addition, all workers, including part-time workers, need access to benefits such as health care and family and medical leave. When businesses have an incentive to act in a way that is most profitable, American workers need a strong government to protect their right to work to the best of their ability and earn fair compensation.