In an editorial yesterday, Timothy Muris was incorrectly identified. He is director of the Federal Trade Commission's Bureau of Consumer Protection.
THE LATEST analysis from the FTC Bureau of Competition director, Timothy Muris, reminds us of the Walt Disney comic book character, Gyro Gearloose. Surely you remember: he was the giant goose, with glasses about to fall off his nose and vest askew, who was always inventing some new and utterly useless gadget. He was the Disney version of a classic American figure of fun -- the absent-minded inventor, the impractical intellectual.
In the Gyro Gearloose tradition, Mr. Muris produces exotic theories that seem to make perfect sense until you start thinking how they would work in the real world. His latest project is to cut the heart out of the FTC rule requiring advertisers to substantiate claims in their commercials. For the past 10 years, companies have had to conduct detailed scientific tests to prove any verifiable claims. Now, Mr. Muris argues, they should be allowed to run their ads any time they have a "reasonable basis" for their claims, and do the tests later or not at all. Mr. Muris argues that the present rule prevents some claims that could be useful to consumers but that can't be verified by scientific testing, and adds, "If you make it hard for false claims to be made, you also make it easier for true claims to be stopped." Anyway, false claims need not be attacked "when consumers are not likely to be injured." Let consumers, in the exercise of their free choice, decide which claims should be heeded.
All of this may make sense in Mr. Muris' theoretical Gyro Gearloose world. But how will his proposal work in fact? Who decides whether there is a "reasonable basis" for a claim? In the first instance, the advertiser; only years later, if at all, would the FTC step into the picture. And what's "reasonable" anyway? Even conscientious advertisers are likely to resolve any doubts in their own favor. Why not save the cost and bother of scientific tests? Yes, theoretically, the costs of scientific tests add to the costs of products -- but usually in a microscopic way imperceptible to the ordinary consumer.
Interestingly, the impetus for this proposal does not come from the advertising industry, even though it has complained for some years about the FTC rule. "The program has worked well and has helped bolster the believability of advertising," says the executive vice president of the American Association of Advertising Agencies. "I don't subscribe to the view that a lie is okay if nobody is hurt," says the president of the American Advertising Federation. Advertisers see value in the FTC rule because government here does something for them that they and the free market cannot do for themselves: it guarantees their credibility. The nation generally has a stake in the integrity of commercial discourse above the levels that the operation of the free market can be expected to produce. Practical people understand that. Gyro Gearloose types evidently do not.