When President Carter held his week-long Camp David summit conference, consumer leaders in general - and Ralph Nader in particular - were conspicuous by their absence. It has been 13 years since General Motors Corp. made Nader a household word by having him followed to discover what made him run. In that time, the consumer movement and the consumer's consciousness of his or her rights have grown at a tremendous pace. Corporate awareness and responses to consumer complaints also have been increasing.
And, inevitably, the question has been asked whether the consumer movement, having raised everyone's awareness, has outlived its usefulness. Some even argue that it has done a good bit of damage. Has it served its purpose, and should it now fade away?
In this wide-ranging interview with Washington Post staff writers Larry Kramer and John M. Berry, Nader discusses the present state of the consumer movement, where it is headed, and what the Carter administration has done for and to the movement.
QUESTION: How do you think consumers generally have been treated by the Carter administration?
ANSWER: I think consumers in this country have been very badly treated by the Carter administration. Carter has done more to raise prices to consumers in essential areas such as energy and less to oppose monopolistic pricing practices in other areas than his predecessors. His predecessors never dared to do what he is doing. Where he said he wanted to become the leading consumer champion of any president, he may well be viewed in his first term as the president who has done more damage to the consumer interest than any recent president.
In the area of energy, they have decided that the price of domestic oil and natural gas should be allowed to reach world cartel levels instead of being under federal price controls.
Consumers have been mistreated in the area of the automobile, where the (safety and emissions) standards have come virtually to a stop, extending a similar lack of action in the Nixon-Ford administrations. Only one standard has been issued under the Carter administration, the passive restraints standard. And even that standard was extended to 1982-84 motor vehicles, an unprecedented four-to six-year lead time.
The prosecutions of economic crimes by the Justice Department and by referrals from other departments have been minimal, even though President Carter campaigned on going after "big-shot crooks," as he called them.
There is also a very inadequate legislative program by the Carter administration in the consumer area. True, they have come out on paper for the consumer advocacy agency, for standing to sue for reimbursement costs and for consumer class actions suits, but they have done virtually nothing in these areas....
And finally, although Carter has appointed some fairly good regulators, he has allowed his economists in the White House and the Schultze group (Charles Schultze, chairman of the Council of Economic Advisers) to chill the regulators, harass them and basically undercut their position to a point where almost all of those agencies are engaged in holding actions rather than in expanding the scope of consumer protection in the health, safety and economic areas.
Q: Have you changed your tactics, particularly in view of these difficulties you say you have had with the Carter administration?
A: With the increasingly apparent failure of our elected representatives to represent people who pay all the bills in this country, we've got to regroup.
The people who pay all the bills have got to learn the lesson that, unless they further organize, further develop instruments of action - initiative referendums, recalls, consumer co-ops, class action suits - they're going to, as a group in our population be more mistreated from year to year....
Q: How do you go about regrouping?
A: Since there is very little hope that the president is going to champion consumer interests, consumer groups, I think, are pushing more toward reorganizing themselves. I know we're expanding our Congress Watch local chapters and we are pushing for consumer cooperative expansion in health, housing, food, auto repair and other areas with the advent of the National Consumer Cooperative Bank.
We are trying to interest people in the states and state legislature in adopting a kind of checkoff on utility billing envelopes which would simply be a notification to consumers that they could join, for, say, $5 a year, their own statewide consumer group, with a full-time staff to expert organizers, lawyers and economists to represent their interests before all three branches of government as they relate to electric, telephone and gas companies.
Also, it looks like there has to be more consumer pressure on Congress to get through some of these long-delayed bills such as consumer class action reform, and to overturn some of the Burger Court opinions making class actions prohibitively expensive for consumers to bring in federal courts....
Q: Who is the so-called consumer that you represent? And when you say you are working in the "public interest," just who's public interest is that?
A: In some cases, that can be pretty black and white. Most consumers don't like lemon cars to be corrected when they are faulty. They don't like to be cheated in their insurance policies because of jargon and obscure provisions in the policy such as cancer insurance policies.
In the more difficult issues, it's a matter of judgment. How much a group really represents the consumer is determined by a track record....
If you are dealing with a very sophisticated issue with a lot of shades of gray, then you'd have to look at it and make your own judgment. But we are looking at so many issues of black and white, like the Love Canal situation, that just common sense and common observation would make you conclude that a particular issue is pro-consumer.
Q: Some administration officials argue that a given industry may have a limited amount of money to spend and that it should be allowed to meet a standard in the least expensive way possible. What's wrong with that?
A: What's wrong with it, first of all, is that it's arbitrarily trading off lives and health for dollars. Second, industry has not made the case that it needs this kind of relief. Look at the Conference Board's annual data, which shows something like $10.5 billion of investment in pollution control by industry. That's subject to depreciation and special investment tax breaks that bring it down to probably less than $5 billion. That's not a serious burden when you consider that the goals are goals of a civilized society.
This spending also creates jobs. I mean people who manufacture scrubbers are gainfully employed. For some bizarre reason, we consider expenditures for health as unproductive in this country. Expenditures for armaments and cigarettes are productive. Expenditures for corporate bonuses and incentives, yachts and hunting lodges are, but not health and safety.
Q: But expenditures for most pollution control don't provide people with goods that they want to buy. Society may be better off in an economic sense, with reduced costs of treating illness or postponing earlier deaths, but in the immediate period, you're spending money on providing benefits that people aren't used to buying. If they don't reduce other demands, doesn't that add to inflation?
A: Well, let's assume that these pollution-control expenditures are expensive, though that remains to be seen.... It's basically one involuntary expenditure versus another. Hospital bills are what I call involuntary expenditures. Either you pay the doctor when you get sick, or you pay for the company or the government to make you not sick. The question is which one do you want. If you took a poll, most prople would say they want to pay extra for pollution control and they wouldn't say they want to pay for health cost increases.
Q: Doesn't the spending by industry still mean that other investment or consumption is reduced, particularly if industry is not allowed to meet the standards in the most efficient way possible?
A: I don't think it automatically means other decreased investment, in the sense of a loss. For example, if the auto companies are spending more on auto safety, pollution control and fuel efficiency, they're spending less on style. Style is enormously costly. Is it a loss that we don't have tail fins curling up one year and down the next? That's why you always have to deal with qualitative assessments when you're dealing with quantitative determinations. As long as the only thing going was style, fine. But they can always use another strategy of competition, better warranties, efficiency, more trunk space. Style was really quite frivolous.That's why it was so costless to push (pollution control and safety standards) on the industry. They were spending billions on style, you know, kind of cosmetic values. All right, let them spend billions on stuff that really matters.
Q: What about noise standards for textile machinery? It is expensive to modify the machinery to meet the noise standards, but quite inexpensive to put earmuffs on workers in those areas. Why do people who want this kind of protection for workers generally insist on what amounts to a generally more expensive passive system? Are they afraid the people won't bother to put the earmuffs on and so the standards won't be met?
A: One reason is the passive system has proven to be more durable and effective than relying on human behavior every hour of every day. Instead of earmuffs, use the example of having people put a mask on so they won't breathe some substance. People may have asthma or a cold when they are working in a plant eight hours a day, and wearing such a mask may not be acceptable.
As for compliance costs to industry, the thing that astonishes me is how people who are opposed to our view-points on these issues automatically accept the cost figures given out by industry. I think the whole argument of cost benefit can start and stop with a demand which will never be responded to, that industry document its cost estimates. We have seen the most outrageous inflation over the years of estimates which then are shown to have no credence.
The airbag is the latest example. It has ranged from $100 to $800 in cost in the estimates supplied by the auto companies. But unless they give us the suppliers' bids and how they calculated the costs, like whether or not they amortize them over one year or 10 years, we shouldn't even begin to give these costs credibility. The auto companies and other industries know that their best weapon against regulation is to get a vastly exaggreated cost figure accepted by the decision makers or by public opinion.
Q: The Carter administration regulatory reform people say they are trying to build a valid data base for regulatory agencies that would enable them to make more intelligent decisions about costs and benefits. What indications do you have that they may help solve some of those problems?
A: None. On one case after another, (former Council on Wage and Price Stability Chairman Barry) Bosworth's people took the cost estimate as supplied by industry. Any economist worth his salt would know that a cost estimate is just a figure and would therefore ask for the background. I would want to see supplier invoices and other figures. I would want to see the extent to which frivolous expenditures have been cut and the amount that can be saved with things like investment tax credits.
Q: It has been said, particularly by your critics but also by some supporters, that you have spread yourself too thin, that you are trying to work too many issues at once and thus diminishing your impact in all. Some say, for example, that while the majority of people would be with you on a narrow consumer issue, many would not go down the road with you on the nuclear issue. How do you answer those criticisms?
A: Well, I think one of the functions of leadership in any area is to be able to spot hazards and needless costs ahead of time. When I started going against nuclear, less than 10 percent of the people were against nuclear. Now, depending on the polls you read, that number ranges from 40 to 60 percent.
It's just that I had an opportunity to get information years ago that many people in this country have not had an opportunity to see. Now they are getting it.
Otherwise, I'm always spread too thin. But, first of all, we have more people. It's just like if the Washington Post had two reporters, it couldn't do as much as if it had 100. So, we have more people, and we are into more things. Second, we could concentrate on one or two things, spending everything we have on health, or energy. But our approach is to try to open up areas so that an increased consciousness leads to more people coming in little by little. By opening up the food area in the late '60's, we brought in somebody called Mike Jacobson to work with us. Now he has set up his Center for Science in the Public Interest and has spread into the whole food area.
Q: Who is the consumers' candidate for president in 1980?
A: Well, Jimmy Carter's greatest advantage is that most of his competitors will be even less sensitive to consumers. John Connelly is clearly the oil industry's candidate; if he's elected president, they might as well put an offshore drilling rig on the White House lawn. Ronald Reagan, or course, has never had any sympathy with consumer rights or interests. He is a corporatist through and through. It's the same with George Bush.
Jerry Brown is very much like Carter. He too has appointed pro-consumer regulators, but he too has found ways to restrict them in terms of what they are doing. Teddy Kennedy would be more pro-consumer if only because he's not as susceptible to being intimidated by corporate luster and corporate blackmail, and because he would have more influence.
The problem is that the candidates for the presidency come from a pool of 635 people; governors and members of Congress. So the whole point of the consumer and citizen movement is to generate new leadership that doesn't have to come up the sleazy political party ladder. CAPTION: Picture, Ralph Nader: Consumer movement has to regroup. By Gerald Martineau - The Washington Post