EFCA Gets Unfair Bad Rap in Washington Times – National Consumers League

Last week, the Washington Times ran an editorial by Senator Jim DeMint, a Republican Senator from South Carolina and chairman of the Republican Steering Committee, that contained misleading criticism of the Employee Free Choice Act (EFCA), a piece of legislation that would rightly restore the freedom of American workers to express their interest in unionizing.

NCL’s Reid Maki had a strong rebuttal for the Washington Times in a letter that ran today: “The senator portrayed EFCA as an attempt to undermine a worker’s ability to vote by secret ballot, but the truth is that corporations often use their vast economic might to undermine workers’ attempts to unionize with coercion and manipulative campaigns.”

As NCL and its labor allies know far too well, corporations often have the upper hand when it comes to the balance between workers’ interests and company policies. Unscrupulous companies are able to tip the scales in their favor by threatening to close factories, move overseas, or fire “problem” workers when the workforce shows an interest in unionizing.

It’s time for workers to regain their right to free speech, and that’s why NCL, which has a long history of supporting workers’ rights, supports the EFCA.

Amidst Economic Collapse, Corporate Abuses Shocking and Shameful – National Consumers League

By Sally Greenberg, National Consumers League

While the financial markets’ implosion takes its toll on working Americans in the form of job cuts and lost wages and benefits, a series of events over the past two weeks has me shaking my head in disbelief. In September, the Federal Reserve Board extended an $85 million “bridge loan” to American International Group or AIG, the insurance behemoth, because it was considered “too big to fail.” This week, at a House of Representatives hearing, we learned that AIG’s 70 “top performers” (hard to imagine how you can have “top performers” in a company that needs an $85 billion bail-out, followed by a $37.8 billion infusion) – yes, a week after the bail-out – were sent on a junket to a California resort, where they managed to ring up $440,000 for rooms, meals, and spa fees. (Even White House press secretary Dana Perino described the AIG junket as “pretty despicable.”)

AIG also disclosed at the Congressional hearing that its financial products manager, whose reckless investments contributed to the company’s collapse, is receiving $1 million a month in consulting fees. And the AIG former chief executive who ran the company for the three years leading up to its demise is receiving a $5 million performance bonus! You can’t make this stuff up. A performance bonus to a man whose company now needs multibillions in federal assistance? How did we get to this place where $40 million dollars to one person in salary and benefits is no long considered outrageous? Why does one person need $40 million?

After AIG’s revelations about junkets and outsize pay packages for executives who failed miserably at their jobs, the New York Times last week reported that the Federal Reserve Board will provide an additional $37.8 billion to AIG to help it deal with a rapidly dwindling supply of cash. It wasn’t until this morning’s news that New York Attorney General Andrew Cuomo demanded that AIG reign in corporate excesses (like multimillion severance packages to outgoing execs and junkets for top brass) that any official has put his or her foot down in the midst of the AIG bailout. AIG says it will comply with Cuomo’s demands – at last!

Where is the accountability? Where’s the outrage? It is no wonder that the hubris and arrogance of these corporate executives – whose incompetence led us to this situation – goes unchecked. Our regulatory authorities appear to be providing loans and other assistance with no strings attached.

You or I might expect AIG executives to be contrite, coming hat in hand to the House of Representatives, asking for forgiveness for their profligacy. Wrong. Robert Willumstad, CEO of AIG from 2005-8, said this: “Looking back on my time as CEO, I don’t believe AIG could have done anything different.”

My question is if the average working American’s dollars are being used to bail out poorly managed companies whose top execs grabbed millions, shouldn’t we expect some accountability? A system that bails out companies like AIG – whose CEO earns $40 million in one year and pays $1 million a month to a consultant who helped drive the company into the ground – is rotten to the core and badly in need of reform.

The National Consumers League believes in regulation and legislation that will contain such outsize executive pay packages. Our friends abroad – in Europe and Australia – are generous with their corporate leadership but don’t begin to approach the absurd and indefensible salaries American companies pay ours – regardless of whether they succeed.

With unemployment rates higher than they have been in many years, it’s unconscionable to pay someone who has nearly destroyed a company a $1 million retainer. With more than 2 million homeowners likely facing disclosure, and states and cities across the country cutting benefits to our neediest citizens, if American consumers are going to bail out banks and insurance companies, we have a right to expect accountability, including an end to the excesses of the past.

Fraudulent Text Messages? Just Delete ’em! – National Consumers League

By John Breyault

When faced with spam text messages — also known as SMiShing – just delete the messages. That was the advice we gave to Nashville’s CBS Newschannel 5 in a story that ran on the issue earlier this week.  Click here to watch the full video.

While the estimated 1.5 billion spam text messages that will be sent in 2008 represent only a small fraction of the total amount of spam consumers receive, the problem is growing. Since 2006, the number of spam text messages sent has nearly doubled, likely driven by dramatic growth in text messaging use by American consumers. Even though most mobile phone consumers will receive very much, if any, text messaging spam, the cost of getting even a few is not insignificant. Given that U.S. consumers pay for text messages sent and received, combined with rising pay-as-you-go text messaging fees (currently at 20¢ per message on most carriers), the real costs of such spam can quickly add up.

The easiest way to avoid becoming a victim of SMiShing scams is to simply delete the messages. Do not call the number listed in the text message or surf to the Web address provided. You will likely be asked to provide sensitive financial information (bank or credit card account numbers) which the scammers will then use to defraud you. In particular, SMiShing scams seem to be targeting credit union, so be especially wary if you are one of their customers and receive these text messages. Other ways to cut down on SMiShing is to avoid listing cell phone numbers online (such as in online social networking site profiles), since scammers frequently use sophisticated harvesting software to comb the Internet for such numbers. If the problem is especially severe, cell phone carriers can block all SMS text messages to a consumer’s handset, though this will also block legitimate messages.

Consumers who suspect they’ve been a victim of SMiShing fraud should contact their financial institution and cell phone provider immediately. Also consider reporting the fraud to NCL’s Fraud Center, so that we can alert the FTC and federal and state law enforcement authorities.

Happy Birthday to Us – National Consumers League

The Savvy Consumer Blog is celebrating our first year of fun in the blogosphere! Launched just about a year ago, in October 2007, we’ve been hard at work bringing news and nuggets to consumers around the globe. We’ve covered issues ranging from the importance of reading your bills, to swimming pool safety, things to think about when buying a home, avoiding fake check scams, advice for teens searching for jobs, and more!

And what a crazy year it’s been! With headlines about the foreclosure crisis and a scary economy, concerns about imports, lead, and toy safety, child labor abuses, and other hot consumer news, we’ve sure been busy! We’ve had a lot of fun doing it, and we want to hear from you! Tell us your consumer stories, and tell us what you think of ours.

Here’s to another year of fun and education at the Savvy Consumer blog!

Child Labor An American Issue, House Subcommittee Discovers – National Consumers League

by Reid Maki, Coordinator of NCL’s Child Labor Coalition

Americans tend to think that child labor is something that happens in poor, third world countries, but there’s plenty to worry about in our own back yard, according to the witnesses at a congressional hearing late last month before the House Education and Labor Committee’s Subcommittee on Workforce Protections.

National Consumers League Executive Director Sally Greenberg, who also serves as co-chair of the Child Labor Coalition, told the subcommittee that DOL needs more resources to enforce child labor laws. “Every 10 days in America, a young person is killed at work. Every day, more than 100 young workers under the age of 19 are seriously injured or become ill from their jobs,” she said, adding that the number of DOL child labor investigations “has declined drastically”—the number of investigations fell by nearly half from 2004 to 2006. “The number of child labor investigations conducted in 2006—1,344—was the lowest in the last ten years for which we have data, and may be lowest in many decades.”

With fewer than 750 labor investigators for the entire nation, DOL is conducting so little enforcement the department has become a “paper tiger,” said Greenberg.

Norma Flores, a former child farm worker, testified about her early years in America’s fields harvesting fruits and vegetables. She and her sisters began working long hours when they turned 12 “during our summers and any other school breaks we had,” Flores told subcommittee members. “Full-time work weeks now meant 70 hours— including weekends—for weeks at a time with no days off,” she explained.

Advocates estimate that 400,000 children help their impoverished migrant and seasonal farmworker families in the fields each year. Exemptions to U.S. labor law allow the youth to work at younger ages in agriculture than they could in any other industry.

“One of the most terrifying moments of my life was when an airplane accidently sprayed pesticides over the field my family and I were working in,” Flores recalled. The farm contractor told the panicked family to move to a different field and keep working, she said.

David Strauss, the executive director of the Association of Farmworker Opportunity Programs, told Subcommittee Chair Lynn Woolsey (D.-Calif.) that federal law offers working children like Norma few protections. Strauss explained that the law’s only requirement is that the teen agricultural workers “not work during school hours when school is in session. That is virtually the only restriction in federal law, along with a prohibition against hazardous employment for children 15 and younger.”

“A 12-year-old kid can work 12 or more hours a day during the summer, on weekends, or during the school year as long as those hours are outside of school time,” Strauss added. “I have spoken with teenage children of migrant families who worked after school until midnight during a heavy harvest.”

Strauss noted that kids pay a heavy toll for their hard work. They often leave their homes and schools to begin seasonal work before the end of the school year, and they sometimes return after the school year has already begun. Falling behind, they quickly become discouraged and, according to estimates, as many as two out of three drop out of school.

“Without a diploma, without good job skills, they often end up continuing the cycle of poverty their parents hoped they could break,” said Strauss.

Strauss reminded subcommittee members that legislation by Rep. Louise Roybal-Allard—The Children’s Act for Responsible Employment— would address the issue of agricultural child labor and level the playing field so that child farmworkers are treated like other children. The legislation would keep kids under 14 out of the fields unless they are working on their own family’s farm (in which case they would be exempt). Kids 14 and 15 would only be allowed to work in the fields if the Secretary of Labor determined that the work is safe.

Alexander Passantino, the acting administrator of the Wage and Hour Division who represented DOL, claimed investigators always look for child labor even when they are investigated other labor violations.

NCL’s Greenberg made several recommendations, including asking Congress to double the number of labor inspectors. She urged passage of the CARE Act to protect children working in agriculture, and she called on DOL to revise the “hazardous orders” to prohibit teens from working in dangerous agricultural jobs. Greenberg asked DOL to conduct targeted child labor investigations of agriculture and meatpacking, two industries with high injury rates.

Fast Food Chain’s Decision to Post Calories Great News for Consumers – National Consumers League

By Sally Greenberg, NCL Executive Director

Last week, consumers of fast food got some great news: YUM! Brands announced that it will post calorie counts on menu boards at KFC, Pizza Hut, Taco Bell, and Long John Silver’s – all chains that it owns. About 4,000 of Yum’s company-owned stores will begin to post calories on menu boards now, and the company says all of its 20,000 stores will do so by Jan. 1, 2011, if not sooner.

Why is this great news for consumers? Because consumers want to know what’s in their food, including calories. For years, health advocates concerned about our obesity epidemic, including the National Consumers League, have been wrestling with the food industry – including sit-down restaurants and fast food outlets – to get them to post calories in a prominent place: on menus customers receive when they sit down for a meal or on the board you read when you order a burger and fries. YUM!’s getting out in front on this issue will put pressure on others in the industry to do the same.

Even Michael Jacobsen, the take-no-prisoners director of the organization Center for Science in the Public Interest, known in many circles as the “food police,” had this comment: “I never thought I’d say this, but I salute Colonel Sanders!

Consumers shouldn’t have to fight to learn basic nutritional information about the food they are eating. Ever tried to find out what the calorie count is of a burger at a fast food outlet? It’s like going on a treasure hunt. The staff has to search around behind the counter for the information. If you’re lucky, they will locate a sheet that lists the calories. Often times they can’t find it. Several years ago I lived in Australia. Every fast food item has a wrapper that lists the calories and other nutritional information for whatever you’re eating. I wondered why we couldn’t do that here.

The National Consumers League agrees with Michael Jacobsen of CSPI: McDonald’s, Starbucks, Applebee’s, and other major chains should follow YUM!’s example. YUM! is also backing legislation that would require restaurants to list calories on menus and menu boards. Good for them!

YUM! is ahead of the pack in taking a voluntary approach to what’s becoming mandatory in some places around the country. Gov. Arnold Schwarzenegger just signed into law a bill that requires chains in California with 20 or more locations to post calorie information on menu items by Jan. 1, 2011. A stricter form of nutrition labeling went into effect in New York City last July.

So this is the trend, and it’s good for consumers. No, not every consumer cares about caloric information in the food they eating. But plenty do, and they should have easy access to that information. YUM! Brand’s announcement last week is good news for consumers and, we can only hope, a harbinger of things to come in the fast food industry.

Meet the Honorable Richard Blumenthal – National Consumers League

Since 1991, Connecticut Attorney General Richard Blumenthal has been defending consumers’ interests for an unprecedented five terms in office. Blumenthal’s aggressive law enforcement for consumer protection, environmental stewardship, labor rights and personal privacy, has helped reshape the role of state attorneys general nationwide, has recovered hundreds of millions of dollars for Connecticut taxpayers and consumers each year — AND has earned him one of two 2008 Trumpeter Awards from the National Consumers League.

Like fellow recipient Barbara Ehrenreich, Richard Blumenthal is being honored with NCL’s highest award for his career-long dedication to guarding the interests of consumers and workers against harm. Blumenthal lead the national fight against Big Tobacco to stop deceptive marketing aimed at children and for reforms in the health insurance industry to ensure coverage and lower costs.

He has worked relentlessly to eradicate corruption in state government, make state contracting accountable, fair, honest and transparent, and to battle unfair utility rate charges, air pollution causing acid rain and other environmental wrongdoing, and scams and frauds victimizing consumers.

We will proudly present Blumenthal with the Trumpeter Award tonight in Washington, DC, before everybody tunes in to the first VP Debate. Check back soon for photos from the event!

Seniors, don’t be an easy target – National Consumers League

October 1, 2008

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

Washington, DC- Con artists use many tricks to gain the trust of their victims, and many of them are experts at what they do, warns the National Consumers League. Many have perfected their pitch to successfully target seniors, a vulnerable group of consumers, many of whom may live on fixed incomes or have more free time to consider alluring pitches. This month, NCL is offering older consumers (and their loved ones) advice on how to weed through a fraudulent offer and avoid being duped in its “2008 Consumer Calendar Tips: Do We Have Tips for You!”

The nation’s oldest consumer advocacy organization, NCL works to educate people about how to make wise decisions in today’s marketplace. Each month, NCL’s Web site, www.nclnet.org, will feature the calendar and tips for the month. Covering a range of subjects from medication safety, to avoiding scams, the tips are sponsored by major companies, government agencies, and organizations. The October tips about scams against seniors were sponsored by the Direct Selling Association. This month’s tips feature four common scams that target seniors:

  • Bogus Sweepstakes and Lotteries
  • Phony Charities
  • Pyramid Schemes
  • Home Improvement Fraud

The print version of the calendar was distributed to consumers free of charge through agencies and organizations around the country. There are no printed copies of the calendar remaining.

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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.

New survey reveals consumers wary of prescription switches – National Consumers League

October 1, 2008

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

WASHINGTON, DC — According to a new survey released by the National Consumers League

(NCL) today, nearly three-quarters of prescription drug users would be very concerned if a drug they were prescribed was switched to another drug designed to treat the same condition without their doctor’s knowledge. Even with their doctor’s knowledge, one in five surveyed are concerned about the practice, known as therapeutic substitution, the dispensing of an alternative to a prescribed medication that is not chemically or generically equivalent but is in the same therapeutic class and is used to treat the same condition.

“Consumers are justifiably concerned about the practice of therapeutic substitution, how it’s done, and who’s involved,” said Sally Greenberg, National Consumers League (NCL) Executive Director. “For some conditions and treatments, it may make good financial or medical sense to swap out one prescription for another. But, as consumers reported in our survey, it’s essential for them to be a part of this process, to know their doctor is aware and supportive of the switch, and to feel confident that their health and treatment – not financial incentives – are top priority.”

In an era of skyrocketing health care costs, insurance companies may turn to the practice of substituting similar (but chemically different), less-expensive drugs, from the same class.

Advocates are concerned primarily about the practice when it occurs without the patient’s knowledge, or without discussion and consent of their physician. However, opinions fall on either side of the debate, with physician groups expressing concern over patient safety, and pharmacist groups being more supportive of the practice as a cost-savings measure and a way to optimize patient care.  In some cases, the substitution can be beneficial or inconsequential, but in others – especially in treatment of epilepsy, mental health, and cardiovascular problems – it can be less effective or pose dangers, especially if done without the knowledge of the consumer or prescribing physician.

“Without transparency, therapeutic substitution could introduce efficacy or safety issues, including unknown drug interactions and potentially serious health consequences. It may evoke confusion or fear on the part of patients already feeling frustrated by a failing health care system,” said Greenberg.

The online survey of 1,387 adults aged 18 and older who have filled a prescription in the past year, which was conducted by Harris Interactive® for the NCL between August 25 and September 2 of this year, revealed that most consumers are not aware first-hand of therapeutic substitution, but they have objections and concerns about how and when a prescription drug should be swapped for another.

NCL released the survey today and announced a public education campaign to educate consumers about the practice of therapeutic substitution at its Web site, www.nclnet.org. New resources help explain the practice and empower consumers to ask the questions necessary to feel comfortable and in control of their health care. For an executive summary and full copy of the survey, click here.  The survey also polled a sample of statin users to test the awareness of patients taking medications that might be impacted by therapeutic substitutions.  The views of this group largely mirrored those of the general population.

Survey Highlights

Consumers concerned about therapeutic substitutions that don’t involve doctor

  • Overall, prescription drug (Rx) users would be very concerned if a drug they were taking was switched to another drug in the same class without their doctor’s knowledge or consent.
  • Nearly three-quarters (70 percent) would be very or extremely concerned if their prescription or had been changed without their doctor’s knowledge and consent for a different medication meant to treat the same condition. And 77 percent strongly oppose the practice without the consent of the prescribing doctor or patient.

Consumers’ experiences with therapeutic substitution less than satisfactory

Of those who reported experiencing therapeutic substitution for themselves or a family member, 33 percent say that they (or their family member) did not have their doctor consulted before the substitution occurred, and two-thirds (66 percent) say that they/their family members were not consulted about the switch. Nearly half (47 percent) were dissatisfied (or their family was) with how the process occurred and report that this substitution did not result in lower pocket costs. Only a third (34 percent) felt that the substituted medication was just as effective as the original medication.

Consumers don’t know much about therapeutic substitution, but believe it happens frequently

  • 66 percent of Rx users surveyed have never heard of the practice of therapeutic substitution. 10 percent of Rx users report that they personally experienced therapeutic substitution of their medication in the past two years, and 9 percent said that a family member experienced it.
  • When respondents were given a description of therapeutic substitution (“replacing the prescribed drug with a chemically different drug (not just generic version of the branded prescribed drug)”), the vast majority of Rx users said they believe therapeutic substitution is occurring at least sometimes in the U.S. (84 percent), without informing the patient (68 percent) or the prescribing physician (59 percent).

Consumers are open to therapeutic substitution, but certain factors determine their comfort level

  • Rx users are most likely to consider switching to a different medication if their physician felt that the two were interchangeable (57 percent).
  • A letter from the insurer may not put consumers at ease, but it would evoke communication: only 19 percent of Rx users say they would consider switching to a different medication meant to treat the same disease if their insurance company sent a letter recommending this change, but receiving such a letter would inspire 71 percent of Rx users to have a conversation with their doctor about a less expensive alternative drug.
  • Nearly a third (31 percent) of Rx users say they would consider switching medications if their pharmacist called to discuss an alternative medication.
  • 68 percent of Rx users would oppose insurance companies offering incentives to physicians for switching patients to lower cost alternatives
  • 73 percent of Rx users would oppose insurance companies offering incentives to pharmacists to switch patients to lower cost alternatives

About the Survey

NCL commissioned this survey with an unrestricted educational grant from Pfizer.

This Consumers’ Views on Therapeutic Substitution Survey was conducted online within the United States by Harris Interactive on behalf of the National Consumers League between August 25 and September 2, 2008 among 1035 US prescription drug users aged 18 and older who have filled a prescription in the past year, and an oversample of 352 US statin users aged 18 and older who are currently on a statin medication. No estimates of theoretical sampling error can be calculated; a full methodology is available.

Complete survey results, fact sheets for consumers, and other resources are available at www.nclnet.org.

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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.

About Harris Interactive®

Harris Interactive is a global leader in custom market research. With a long and rich history in multimodal research, powered by our science and technology, we assist clients in achieving business results. Harris Interactive serves clients globally through our North American, European and Asian offices and a network of independent market research firms. For more information, please visitwww.harrisinteractive.com.

Meet John Breyault – National Consumers League

by John Breyault, NCL VP, Public Policy Telecommunications and Fraud

Hello to you all, fellow Savvy Consumer Blog readers! I’m the “new guy” here at the National Consumers League. At NCL, I’ll be coordinating the League’s policy activities and managing the National Consumers League’s Fraud Center and the Alliance Against Fraud coalition in my position as Vice President of Public Policy, Telecommunications, and Fraud.

While I’m new to the position, I have been a fan of NCL for many years through my work as Research Director of the non-profit Telecommunications Research and Action Center (TRAC). In my five years at TRAC, I educated and advocated on behalf of residential and small business consumers of communications services. As such, I became well-versed in all things related to telecom and broadband policy, where I developed an intense love-hate relationship with the minutiae of tariff sheets, ex parte filings, and – yes – even EULA’s.

Concurrent with my role at TRAC, I was also Director, Research at Amplify Public Affairs where I helped launch one of the public affairs industry’s first blogger relations practices (which should serve me well with this blog!). I also designed and implemented issue campaigns using online social networks such as MySpace and Facebook and even virtual worlds like Second Life.

I’m very excited to be joining the League at this important moment in its history. With a new Administration set to take office, the next few months will be a critical time to help shape the future of consumer-friendly policies in Washington. The old saying “you never get a second chance to make a first impression” holds true in policy work as well. Relationships with the new occupants of the White House will be forged. New Members of Congress and agency officials will need to be educated to make sure that the 111th Congress keeps the interests of consumers in mind. In short, the next few months are full of possibilities for the League and I’m proud to have this opportunity be a part of it.

Going forward, I’m looking forward to keeping up a regular posting schedule to keep everyone up to date on the League’s policy activities here in Washington. I’ll also be discussing some of the important consumer news that never seems to make it into the newspapers and evening news. Please do feel free to post comments or drop me a line directly at johnb@nclnet.org.