SEVEN YEARS ago, the Federal Trade Commission began a study of the funeral business. Today, after a series of administrative procedings and congressional interventions too tangled to be recounted here, the FTC is scheduled to vote formally on a rule regulating--rather mildly regulating, in our view--the funeral industry. Why has the process taken so long? Because funeral home owners have lobbied their congressmen furiously against any regulation at all.
The regulation that the FTC will consider has three basic requirements. Funeral directors must provide customers with itemized price lists. They must not make misrepresentations, such as saying that state law requires embalming when in fact it does not. They cannot require customers to pay for unwanted or unrequested services, such as coffins for cremation. It should not cost a funeral home much to comply with these regulations, but if they are followed, it is likely that funerals will cost much less for consumers.
That is why some FTC commissioners and such organizations as the American Association of Retired Persons have been seeking such a regulation for seven years. They believe that people who must arrange for funerals are consumers particularly vulnerable to suggestion and particularly ignorant about costs and procedures. They believe that funeral homes seldom disclose information about less expensive services and do not provide itemized costs of services they do provide. Surveys have tended to support these views, and we think the case for regulation is strong.
What is to be said on the other side? Two leading appointees of FTC Chairman James C. Miller III have charged that the proposed rule is an example of federal overregulation and that the evidence the commission has collected does not provide a solid enough statistical basis for the rule. While we are inclined to agree that the FTC can overextend itself, we think the situation here and the lack of regulations in most states justify adoption of the rule. Those who call for more statistical evidence may be asking for a degree of scientific certainty that cannot be attained in these matters; FTC commissioners can be presumed to be people of some worldly experience and common sense, capable of making intelligent judgments on the basis of the kind of incomplete data on which almost all decision-makers act.
Another argument is that funeral home owners are almost always people with deep roots in their communities, and for that reason one can be reasonably sure they will not gouge consumers. We think the evidence casts this conclusion in doubt. But the minor premise is certainly right: funeral home owners are active enough in community affairs and sometimes in politics to have made a tremendous fight in Congress over the FTC's proposed rule. Accordingly, even if the FTC adopts the rule, it may be disapproved under the special procedure set up by Congress, which was prompted to do so by just this issue. This would be an unfortunate result for what is in fact a modest regulation, one which in accordance with free market principles simply makes available to consumers the information they need to make an informed choice in what are almost always difficult circumstances.