MLK Day tribute – National Consumers League

This week marks our nation’s annual celebration of Martin Luther King Jr. day. As we honor a truly great American icon we keep in mind two parallel and pertinent events that are occurring in America. One is the increasing awareness of the epidemic of police killings of black men (and black women too, though not as frequently). “The Root” enumerates 20 unarmed African Americans and the stories surrounding their killings by police.

The killing of Tamir Rice, is particularly troubling. Tamir, 12, was killed by a Cleveland cop as he waved a toy gun around in a park – this very officer had been fired from a suburban Cleveland police force for being too impulsive and lacking in good judgment. The Cleveland police department hired him without doing a background check.

As protests have sprung up across the country, with proclamations like “Black Lives Matter,” surely King would have led the marchers across America to protest these terrible killings and seek solutions.

The second event revolves around the movie “Selma.” The film, currently in theaters and directed by a black woman, stars a black actor and focuses on MLK’s campaign for voting rights in America.

While the reviews are positive, neither the director – an African American woman – nor the actor who vividly portrays Dr. King’s struggle to achieve the right to vote for African Americans – have received an Oscar nomination.

In the movie, King’s political skills are in sharp relief: he refused to be cowed by President Lyndon Johnson. He led his followers through a phalanx of dangerously racist cops and locals wielding nightsticks nail studded clubs, whips and guns. These scenes are depicted so graphically I could hardly watch.

The tense phone conversations between King and LBJ have viewers on pins and needles. LBJ capitulates and eventually passes the Voting Rights Act, because he has to. He accuses King of reckless opportunism, but the civil rights leader triumphs because he makes the case that without voting rights, blacks are denied power to throw out white office holders who deny them the right to vote, the right to march, the right to be free of harassment and discrimination.  Martin Luther King, a disciple of Mahatma Gandhi, wins the day,

There’s something else – something troubling – being played out on another totally different stage: neither the African American female director nor the actor playing King were nominated for Academy Awards.

So how important is an Oscar nomination anyway? Very important, and for a variety of reasons. Over the weekend CNN featured two men debating whether the Academy was racist. The white commentator said no, absolutely not, The Help and 12 Years A Slave, the first about black maids in the South as the civil rights movement unfolded and the latter, about a free black man in the 1850s kidnapped and sold into slavery, both won major awards in the last few years . The African American commentator laughed. “I thought you were kidding. The Academy is only comfortable acknowledging black actors playing servants or slaves. But in a film like Selma, black actors and directors don’t get any recognition.”

The director of “Selma,” Ava DuVernay, is a black woman who for years sought studio backing to make the movie. And, as David Carr wrote in the New York Times this week, “No club in the United States — over the last several years, the academy has been around 93 percent white, 76 percent male and an average of 63 years old — is in more need of new blood than Hollywood.”

Carr further argues for the importance of Oscar recognition. He says the Oscars, “convey recognition at the highest level of a craft that is seen by millions.”

These two seemingly vastly different issues are not so different after all. They are both focused on the value of African American life in America and African American contributions, social, political, and cultural. Yes, we have an African American president and that is a milestone, but America still suffers from the ugly legacy of slavery and I fear that we continue to minimize the value of African American life and African American achievement in America.

2015 is a historic year  – it marks the 50th anniversary of both the Selma marches and the Voting Rights Act. We could recognize these events by acknowledging the risk black men face every day at the hands of the police – and that police officers have a hard job – and supporting campaigns like “Black Lives Matter.” We need also to recognize the talent and achievement of black directors, actors and producers at the Oscars. Martin Luther King would have been very proud, I think, of Selma, and especially its directors, actors, and producers. Happy MLK celebration to all.

Chicago conference explores Multi-Level Marketing in minority communities – National Consumers League

This week, I participated in a town meeting held at a local Methodist church on Damen Street, in the heart of Chicago’s Hispanic community.  I was invited by the League of United Latin American Citizens (LULAC) to discuss frauds and pyramid schemes that prey on members of minority communities. 

NCL has a longstanding history of opposition to pyramid schemes and other fraudulent business opportunities. We are the only consumer group with a Fraud Center. In 2009, we published a guide to help consumers distinguish between legitimate sales opportunities (Multi-Level Marketing) and pyramid schemes, with the support of the Direct Selling Association, the industry group that represents MLMs.   

Last night’s town meeting began when I walked through a wall of pro-Herbalife demonstrators, who waited outside for an hour on a very cold Chicago night, wearing t-shirts bearing the words “Yo Soy Herbalife.” Inside we started the evening with prayers, the Pledge of Alliance, and the Star Spangled Banner.

Brent Wilkes, executive director of LULAC, opened the forum by describing the problem of Hispanics falling victim to fraud. He discussed notarios, who pose as lawyers—as well as actual lawyers, who promise to help clients obtain legal status, but then take large sums of money, lie to them, and do no work on their behalf.

It was this work fighting fraud perpetrated against Hispanics that led to his interest in pyramid schemes and phony business scams. He described meeting with officials at the Federal Trade Commission (FTC) about Herbalife, a company with $3.2 billion in revenues that has aggressively pursued Hispanics to distribute their products. Indeed, 60-83 percent of Herbalife distributors are Latino. The chances of making any money at all—after expenses—as a distributor of Herbalife are tiny, estimated at less than one percent, according to the company’s own filings with the Securities and Exchange Commission.

My part of the evening’s agenda focused on what consumers should ask to avoid falling victim to pyramid schemes that are posing as legitimate MLMs.

I noted that NCL wrote to the FTC in March of 2013, asking the agency to sort out the truth. Herbalife claims it’s a legitimate business, hedge fund manager and Herbalife critic Bill Ackman and Pershing Square argue that it’s an illegal pyramid scheme. NCL asked the FTC to use its resources to clear the company’s name if these allegations aren’t true or to determine that the allegations against Herbalife are accurate and take steps to put a stop to illegal practices. The FTC agreed to investigate, but alas, the wheels of bureaucracy grind slowly and we have yet to hear the results of their probe.

The most powerful part of the evening for me—and I think for everyone in the room—were the voices of the community telling their stories. At least five people described paying lawyers and notarios their last dollar to get a husband or wife into the U.S. or to get them papers, only to find out they’d been duped by an unscrupulous actor. Many people spoke about investing thousands of dollars in Herbalife, their life savings, and having nothing to show for it. Several said they were encouraged to buy more and more products they couldn’t sell, to attend conferences, and to exaggerate Herbalife’s ability to treat cancer, diabetes, or high blood pressure in order to make sales. They also spoke of being ashamed to come forward until now.

We hope that the FTC’s investigation will lead to a reexamination of practices that may be widespread throughout MLM industry. For example, our review of the income disclosure statements of several other MLM’s showed that the vast majority of MLM participants have little profit to show for the large amounts of time and money they are often asked to devote to these businesses.

Data aside, it is the personal stories I heard last night that reinforced for me how important NCL’s work is. No one there last night could avoid feeling the pain flowing from these individuals. Single fathers, out-of-work carpenters, and struggling musicians all shared their Herbalife woes.

My life’s work is fighting fraud and championing consumer protection. The stories I heard in Chicago last night galvanized me to stand with these communities and to demand that regulators and bar associations crack down on the illegal, criminal practices that steal money from the poor. Depriving those who only want to pursue the American Dream of their opportunities and hopes is intolerable. What last night told me is that I—and NCL—must redouble our efforts to protect the most vulnerable of our citizens.  

An end to secret settlements could save lives – National Consumers League

en, corporations are able to settle lawsuits brought against them in secret, paying off litigants and hushing up the hazards that lurk in their products. Consumers deserve more transparency and accountability from these corporations. USA Today editorialized last week on this very problem, focusing on a product I’d never heard discussed in this debate, ironically a rifle. 

 

In 2000, a nine-year-old Montana boy, Gus Barber, on a family hunting trip, was killed when his mother released the safety on a Remington 700 rifle to unload it and the gun discharged. Gus’ father later discovered that the company knew they had a safety problem for decades and never changed the design, admitted the problem, or recalled the rifles. By the time Gus was shot, more than 100 people had been injured and two-dozen killed. All these cases were buried through secret settlements, with judges sealing these confidential settlements, thus depriving the public from knowing about this deadly hazard.

The practice of sealing health and safety hazards, many of them deadly is unconscionable and dangerous. NCL and our fellow safety advocates have supported legislation introduced over the years in Congress to stop this practice, requiring judges to reject requests from plaintiff and defense lawyers to enter into secret settlements where dangerous products remain in the marketplace.

Gus Barber’s case is so outrageous that Montana joined four other states in adopting an anti-secrecy statute that prohibits their state courts from concealing information about public hazards.

Things may finally be turning around on this issue. In a recent case in Missouri, federal judge Ortrie Smith refused to seal a case against Remington for safety issues. That’s a hopeful sign. If we could get a federal bill passed, every judge would be required to follow Judge Smith’s example and refuse to deprive citizens of critical safety information that could have saved nine-year-old Gus Barber’s life. 

Reflections on 2014 victories for consumers and workers – National Consumers League

As we wind down another year advocating for consumers and workers, it is inspiring to reflect on the two major victories we saw in 2014 for consumers and workers. NCL is America’s only advocacy group with a dual mission to protect both consumers and workers, and we are proud of our work advocating for these changes.

  

Increased minimum wages

Minimum wage increases are essential for helping get America’s low-income workers—and our economy—back on track.

As of Jan. 1, 2015, 29 states and Washington, DC will have minimum wages above the federal minimum wage. America’s lowest paid workers will see their meager hourly wages increase, and it’s not just happening in the states with the most liberal voters! Four states (Alaska, Arkansas, Nebraska, and South Dakota) approved minimum wage increases through ballot measures in the 2014 general election. In Illinois, voters approved an advisory measure.

NCL and our allies have been beating the drum for increased minimum wages, helping to build momentum in recent years that resulted in these real victories. We are hopeful that this trend will continue across the country to help improve the quality of life for millions of working families.

Health care accessibility advances

For consumers, access to health care under the Affordable Care Act (ACA) will improve the nation’s quality of life. Despite conservatives’ pledge to unwind and repeal the ACA, sign-ups have surged, representing a huge amount of pent-up demand for health care across America.

As of mid-December, total enrollment for 2015 plans in this year’s open-enrollment season is about 7.44 million. Experts are saying the surge was bigger than expected and that the Obama administration will exceed its target of having 9.1 million people enrolled in the ACA by the end of 2015.

NCL was a part of this movement—last year, we hosted events across the country to educate consumers about their options and helped them sign up for the exchanges.

All told, the National Center for Health Statistics says that 11.3 percent of Americans lack health insurance, compared with 14.4 percent in 2013. That is progress! More and more Americans, especially children, are insured today than ever before—a huge victory for consumers and for our nation’s health.

There are still many obstacles to overcome for our country’s working families. With your support, we will continue to fight for livable wages, access to healthcare, and so much more in 2015.  

The time to protect pregnant workers is now – National Consumers League

Sometimes I really hate what lawyers do to parse the plain language of the law. Last week was a case in point. I attended Supreme Court argument in the case of Peggy Young vs. UPS. Young challenged her treatment as a UPS worker expecting a baby and needing to go on light duty but the company refused to reassign her. The statute in question is the Pregnancy Discrimination Act of 1978 (PDA). 

As it happens, I worked on getting that bill passed as a Congressional staffer. In 1978, Congress rushed into action to overturn a blatantly absurd finding by the Supreme Court in a case called Gilbert vs. GE where the Court actually said that not making physical accommodation for pregnant women in the workplace while accommodating all sorts of other disabilities wasn’t sex discrimination under the 1964 Civil Rights Act but simply discrimination against pregnant people.

Ahem. Pregnant people are ALWAYS women so in fact the finding in Gilbert is in fact discrimination against women. So why were we back at the Supreme Court again last week 36 years later re-litigating this case?  The PDA is very simple. It says:

To amend Title VII of the Civil Rights Act of 1964 to prohibit sex discrimination on the basis of pregnancy.Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, that section 701 of the Civil Rights Act of 1964 is amended by adding at the end thereof the following new subsection:

“(k) The terms ‘because of sex’ or ‘on the basis of sex’ include, but are not limited to, because of or on the basis of pregnancy, childbirth, or related medical conditions; and women affected by pregnancy, childbirth, or related medical conditions shall be treated the same for all employment-related purposes, including receipt of benefits under fringe benefit programs, as other persons not so affected but similar in their ability or inability to work, and nothing in section 703(h) of this title shall be interpreted to permit otherwise.

In other words, pregnant women should be treated the same for all employment related persons as those with similar in their ability or non ability to work.

Peggy Young simply wanted light duty at UPS late into her pregnancy, as ordered by her doctor. UPS wouldn’t accommodate her. But men with other similar disabilities, including those with DUIs who couldn’t drive a truck, were accommodated. This doesn’t seem like rocket science. But the Supreme Court seemed to think interpreting the PDA was very complicated. What did each word mean and why was it there? As Lyle Denniston of SCOTUS Blog commented on the case: “ The Justices probed deeply into what that section’s words — and punctuation — convey, even to the point of trying to sort out whether a semi-colon made a difference.  There did not appear to be a consensus on the meaning.”  I mean really! There was a great deal of consensus in Congress when the PDA was enacted.

Peggy Young’s plight is not isolated. Appearing before Congress earlier this year, Armanda Legros testified that she was sent home by her manager at an armored truck company, indefinitely and without pay, when she was six and a half months pregnant and had to avoid heavy lifting. She also testified that a co-worker who injured his back on the job was granted the accommodation that she was denied. UPS claims that the comparisons are between those who are injured on the job and those injured outside of the workplace, in which case UPS claims it has no duty to accommodate them and pregnant women fall into that category. 

I can tell you that when Congress enacted the PDA, it was meant to cover exactly Peggy Young’s case – if men at UPS had disabilities that are accommodated, so should Young. I’m told by Supreme Court scholars pregnant women might lose this case. How sad. In fact, UPS has changed their employee practices to ensure that pregnant workers have a right to light duty when needed. But we have to go thru this slow tortuous process to protect pregnant women’s rights nevertheless.

NCL filed an amicus brief in support of Young, joining the ACLU and many other groups. Among the arguments in the brief is that when women are forced to leave the workplace because of pregnancy-related conditions, while other workers with similar limitations are provided light duty, women suffer the very discrimination that Congress sought to eradicate. They lose income, economic security, and benefits, including health insurance, often with devastating results.

I found that listening to the case – I was in the overflow room at the Court reserved for members of the Supreme Court bar –infuriating. Why are we still debating these basic rights for working women. I only hope that the Supreme Court will look at Congressional intent in passing this bill and finally, 36 years later, give Peggy Young and all pregnant women who work the kind of accommodation Congress intended them to have when it passed the PDA. That’s good for women and good for families.

Young Americans are saddled with debt – National Consumers League

It’s not surprising – but it is worrisome – that  young Americans aren’t saving. The generation under 35, known as millennials, have a savings rate of under 2%. They are burning through their assets and going into debt. The ramifications of this are myriad:No money to move out of parents’ house, no cushion if they want to switch jobs, no money for homeownership, not to mention no money for saving for a 401k or other retirement benefits.

But this has larger implications for our economy. “They are truly a vulnerable group. They don’t have assets to buffer themselves against shocks, and they have to manage debt,” said GWU economist Annamarie Lusardi.

Yes indeed, millennial student debt is a huge drag on these young people. In 1995 borrowers under 35 had a median student debt of $6100; now that number is almost three times that size – $17,200.

It’s no wonder that millennials don’t compare well to Generation X-ers in another category  – the median millennial has a net worth of $10,400; the median Gen-Xers has $18,200 net worth, according to the Federal Reserve.

This is a sleeper issue that is going to wreak havoc on the economy in years to come. We need to support legislation like that introduced by Senator Elizabeth Warren to let millennials reduce their student debt and get them out of from under this albatross and allow them to move out from the parents, save for a house and even for retirement. 

Banks too expensive for many low-income Americans – National Consumers League

Consumer advocates often lament the number of consumers who are “unbanked.” It’s true that having a bank account is a sign of stability and that having your money attached to a checking account and ATM card can help build credit and promote long term saving. But it appears that banking fees have driven millions of low income customers away; 25 million Americans are unbanked. Another 63 million are under-banked, which means they may have bank accounts but rely on some alternative financial services. These include check cashers, payday lenders, prepaid cards, and lending and saving circles instead of banks. 

I happened to see one of my relative’s Bank of America statements; this relative doesn’t earn much of an income. He opened a bank account with a $100 deposit and three months later there was only $25 left. He hadn’t spent any of money; the $75 went toward a $25 monthly fee to maintain the account. Thank god he didn’t bounce any checks; his account would have been wiped out.

Several years ago the New York Times Magazine, in a story about payday lenders, quoted a low-income customer who used Payday lenders because their fees were predictable. He said he couldn’t trust bank fees because he never knew what they would cost. He closed his bank account after bouncing two checks at $39 a pop.

This week’s New York Times featured an op-ed written by Lisa Servon, a profession of urban politics in New York who worked for a short period at Check Center a payday lender in Berkeley, CA. Her customers found that bank fees had increased 25 percent in one year, that only 39 percent of noninterest bearing checking accounts were free, down from 76 percent in 2009, and the average overdraft fee is $32.74, and low income people bounce checks because they have little or no financial cushion. Some of the payday lenders charge less for a money order than the post office. And Servon points out that bank overdraft charges could amount to 5,000 percent if viewed as a seven day loan. Servon concludes that the problem isn’t the unbanked. It’s the banks that have become too expensive.

Where’s enforcement of the Pregnancy Discrimination Act ? – National Consumers League

Early in my career, I worked as a staffer in the House of Representatives. During my time there, the Supreme Court ruled in Gilbert vs. General Electric and handed down a decision that was so absurd and insulting to women that Congress swiftly passed a bill to overturn the decision. The Court said in Gilbert that pregnant women didn’t have the right to be treated similarly to people with disabilities i.e., not forcing them to lift heavy objects or stand for hours. They rules that this was not sex discrimination but discrimination against pregnant people, and that’s not sex discrimination. Uh huh. Right. 

I worked on passage of the Pregnancy Discrimination Act, enacted in 1978, which prohibits discrimination against pregnant workers. Pregnancy has to be treated like any other disability and given proper accommodation. However, that hasn’t worked out very well for pregnant women. Thirty six years after the PDA, employers are flouting the Congressional intent of that legislation and the lower courts are letting them do it. 

Peggy Young vs. UPS will be heard by the Supreme Court December 3. Young asked UPS to excuse her from lifting heavy objects; they refused. She is one of many pregnant women whose employers won’t accommodate their need to reduce heavy duty and hours worked during pregnancy. 

Another victim is Angelica Valencia. She brought a case against her New York City employer – Fierman Produce Exchange – where she sorts potatoes –under the city’s Pregnant Workers Fairness Act. Valencia is 39 weeks along; she has a high-risk pregnancy and makes $8.70 an hour. Her husband drives a bus; she needs the job, but was told by her doctor not to work overtime. When she asked for accommodation, her company let her go because her “at-risk” pregnancy didn’t work with their need for someone who could keep up with the “fast pace”. Really? The woman’s having a baby, she has an at-risk pregnancy, and your company policies are so lacking in flexibility and humanity that you fire her. I hope she wins big against Fierman.

And on the national stage, we need once and for all to give pregnant workers the same accommodations that those with disabilities receive. It’s so sad that we have to revisit Gilbert all over again, but that’s the reality and low-income women are paying the price.   I’ll be at the Peggy Young argument in the Supreme Court and cheering her on.

Clinton’s “Hard Choices” a commitment to U.S. values when interacting with other nations – National Consumers League

In Hillary Clinton’s fascinating new memoir “Hard Choices” about her work as Secretary of State under President Obama, she devotes a section to the issue of what she calls a “more open trading system,” arguing that it has lifted “more people out of poverty in the last thirty five years than any comparable time in history.” She quickly adds, knowing that the labor movement has looked with dismay at so called “free trade agreements” that have shipped jobs overseas to places where the pay is a fraction of ours, that she is “determined to do everything [she can] do to help American businesses and workers seize more of the legitimate opportunities already available.”

I was glad to read from the woman who may be the first viable female candidate for President that she puts a priority on raising standards in foreign markets on key issues like labor rights and environmental protection. She also notes that, “For too long we’d seen companies closing factories and leaving the United States because they could do business more cheaply in foreign countries where they didn’t have to pay workers a living wage or abide by U.S. rules on pollution.” In response, she believes that “using diplomacy and trade negotiations to raise standards abroad could help change that calculus.”

These are exactly the concerns that consumer groups have expressed through the Trans Atlantic Consumer Dialogue about the trade negotiations between the European Union Countries and the U.S.. We want our safety, health, and environmental regulations strengthened – not watered down – through the negotiation process.

Clinton feels “particularly passionate about improving working conditions around the world” and that she had met workers, “many of them women and even children, who labored under atrocious conditions.” Her observation that the most “heartbreaking were victims of human trafficking and forced labor that amounts to modern-day slavery,” hit close to home given NCL’s history of working to eradicate child labor. She talks about a meeting with women workers coordinated by the Solidarity Center in Cambodia. The Solidarity Center is an active member of the Child Labor Coalition, which NCL coordinates. She talked about children forced to “tend fields, bake bricks, and beg in the street,” and the scourge of child trafficking for sex. She event mentions her appointment of Ambassador Luis CdeBaca to “ramp up our global anti-trafficking efforts,” which he has done with a passion. Indeed, CdeBaca spoke at a recent CLC meeting about his work.

Finally, I loved that Clinton gave inspiration to labor activists in Bangladesh by reflecting on our own U.S. labor history, noting “You go back to the 19th and early 20th century when labor unions were just getting started…we passed laws at the beginning of the 20th century against child labor, against too many hours for people to work, but that took time. It took time to develop a sense of political will to address those issues.”

Clinton has written an important book but it’s also a page-turner. I learned more about how the U.S. makes decisions about foreign policy from this one tome – at 600 pages it IS a tome – than from anything else I’ve read. But most satisfying for me was the acknowledgement she gives to keeping front and center some core U.S. values – workers’ rights, safety, and environmental protection concerns in our interactions with nations abroad.

 

 

Corinthian College is the first domino to fall in a misleading industry – National Consumers League

Its an odd thing to cheer when an institution collapses, but in the recent case of the for-profit Corinthian College – one of the country’s largest for-profit colleges – applauding what appears to be its downfall, is the right thing to do. NCL has applauded actions by the Department of Education and other federal entities to insist on transparent and accurate results reporting for these schools. 

The rise of the for-profit college industry, which largely recruits low income, military, and students of color falsely promise a solid education and good job prospects upon graduation when in reality, they have dismal records on both counts. For-profit colleges have been yet another example of industry engaging in predatory practices that target low-income Americans.

For profit colleges are dependent on students taking out hefty federal loans in order to pay the often sky-high tuition. Without federal loan programs, the vast majority of these colleges cannot survive. There are some exceptions – those students getting short term degrees to be a dental hygienist, medical technician, or other technical degrees may in fact get the training they need to get real jobs that pay decent wages upon graduation. But there are far more deceptive actors in this industry than good ones. When the federal government began tightening up requirements on for-profits getting, schools like Corinthian went into a financial tailspin.

Since January several states and the US Department of Education have been investigating Corinthian. NCL has long supported efforts by federal regulators to crack down on these schools.

Corinthian has 72,000 enrolled students and 12,000 employees. It has now agreed to shut down 100 campuses in the coming months. The school’s downfall came when it refused to provide DOE with data on how students were succeeding and admitted to the California attorney general Kamala Harris that it had falsified data on whether graduates were getting jobs, and had lied to investors as well. The company advertised rates suggesting that 100 percent of graduates were getting jobs when in fact not a single student had done so within the prescribed period of time.

The lawsuits say the school heavily recruited low-income single parents on the brink of poverty. In June federal officials put Corinthian on a 21 day delay for receiving federal aid. Corinthian said it would have to shut down because even a short-term delay in access to federal funds would result in its downfall.

Not surprisingly other for-profit colleges are lobbying heavily to weaken rules that allow them to get access to federal loan monies. These lobbying efforts should not succeed. While the Obama administration’s rules could be stronger, the current rules will help stop bad actors. Under the rules, for example, the program’s loan default rate could not exceed 30 percent – the for- profit colleges typically have a much larger default rate because the vast majority of students drop out or can’t find jobs after graduation and thus cannot repay their loans.

Most important to protecting low-income students lured to take out loans for worthless degrees, schools that lose eligibility for federal funds should have to pay back the loans and Pell grants themselves and not saddle students with this debt. Corinthian College, one of the biggest, is the first to fall, but others engaging in similar false and deceptive practices will go down as well, and that is for the best.