Caveat Emptor

In my inbox this morning was a newsletter or what have you from Overstock.com. I thought about it and, in addition to deleting it, unsubscribed from their mailing list. Was I sure, asked the screen? I would no longer get news of sales and other deals. Positive. I don't need anything at the moment, so even a fantastic sale will just cost me more money and suck more time. I had to do a lot of shopping for the house (well, some had to, some wanted to, and I'll admit-- some impulse), but now I pretty much have everything I need but a few things, and I don't need my inbox clogged with news of sales on stuff I don't need.

I unsubscribed and went to the next newsletter in my inbox, which let me know what Liz Pulliam Weston had to say this week. Fittingly, it was all about consumerism:

Tips and tricks may indeed save you money and make you feel like a smarter consumer. But they haven't done much to address the growing anti-consumer attitude of many businesses, which seem to be competing with each other to come up with new ways to soak their customers.

She goes on to explain why being a sloppy consumer-- and it's hard not to become one-- is unAmerican:

Now, you may think of yourself as pretty savvy, a consumer "sophisticate" in economists' terms, as opposed to a "myope," who doesn't know the score and constantly gets taken in deals.

The problem, as MSNBC Red Tape columnist Bob Sullivan points out in his book "Gotcha Capitalism," is that nobody gets to stay a sophisticate. No matter how hard you try to educate yourself, unethical businesses are always one step ahead of you. Everybody gets slammed sooner or later.

"The credit card company turns a dial," said Sullivan, "and a sophisticate becomes a myope overnight."

In the system we have now, cheaters prosper. Companies that are honest about their prices lose out to those willing to lie about the true costs of what they sell. Sullivan recently found a great example in Valentine's Day flowers, where consumers using two of the top florist Web sites wound up paying 50% to 100% more than the advertised price because of hidden fees. The third site, which seemed to have the highest price, actually had the best deal.

This isn't just bad for the consumer. It's bad for capitalism. Instead of the most efficient companies winning, the biggest liars are.

It's true. This is what I experienced with, for example, Verizon (before they started f*ing with me about my actual service, i.e. back when all I was trying to get them to do was transfer it to a new address without their trying to tack on added services I would never use). It was exhausting. At that point (before the move), I still had the stamina (and lady balls) to fight them, but months later I would have been at the point of 'f* it and do whatever you need to do so I can get off the phone and on with my life.'

Not just with utilities, but with all sorts of things I had to buy with the house--goods and services--I saw a lot of 'bait and switch.' It became especially evident because as a new homeowner, I became of a consumer of services to a completely new extent (and I'm sure more is yet to come). I'd never before consumed, in the full sense of the word (i.e. hired, etc.), maid service, a plumber, or an electrician. It didn't take long to develop great appreciation for the people who actually did their job well.

Take the cleaning service. Now, I partly blame myself, but this woman came highly recommended by my realtor, and I'd had great experiences at that point with people highly recommended by my friends. Afterward I thought, is she for real? How does she get repeat customers? I mean, I'm human, and although part of me feels that if my bosses have to come back to me and actually ask me to do things that I should have known to do, I have failed. My job isn't just to do my job; it's to be one step ahead so that they don't have to think about the things I could be doing. Now, things slip from time to time, but what would be truly unacceptable is if I neglected to do a series of things that were a standard part of my job and, when they came back to me with a clear list of those things, I then completed the first task and didn't bother with the rest. Who DOES that?? Apparently, people do.

But I digress. Ms. Weston then talks about mortgages. [Aside: I also recommend the section on mortgages in "Nudge," which comes to similar conclusion-- the system is just too complicated for most people to be able to navigate it. Thankfully, I did get a really great lender--through the recommendation of a friend and by not choosing any of those recommended by any of the realtors I'd worked with.] Anyway, Ms. Weston:

The way we handle mortgages in this country is far too complicated and fraught with hidden conflicts of interest for a borrower to ever be sure he or she has gotten the best possible deal.

A savvy, cautious borrower who did plenty of research might have avoided the toxic mortgages that are blowing up in lenders' faces. But she could still be slapped with unexpected fees at closing, since no one has been enforcing the laws about good faith estimates. Because her lender officer or mortgage broker had financial incentives to steer her into a more expensive loan, she may have wound up with a higher interest rate than she deserved.

The fix:

I don't propose we resort to a nanny state, where every detail of every consumer transaction is regulated. Every rule seems to become a weapon used to bludgeon the ignorant or unlucky.

But I do propose that consumers have a right to a fair shake. Regulators need to have the will to enforce existing laws that protect consumers and the tools to really punish companies that deceive.

And you, the consumer, need to stop accepting the idea that you're a sheep for the shearing. You know the difference between fair play and foul play; so do regulators and so do businesses. Make them show it.

A separate column on MSN talks about how utilities have started charging fees for the luxury of paying your bill. Indeed, I went to pay my water bill the other day-- recall that this is the same company that turned off my water for "non-payment" and kept it off for three days (and on the third, claimed to have turned it on when they hadn't) because they couldn't be bothered to call me when the meter that they had to read to transfer the service to my name was piled over in the previous resident's trash. Instead, they kept it in her name... and turned off my water when she didn't pay the bill. But I digress. There was a fee for paying the bill online. There was even a fee for paying over the phone through an automated system. I had to actually send a check, and I hate doing that. It just makes me fume.

Rick Jurgens of the National Consumer Law Center aptly sums up the system: "We all have a common interest in demanding and hoping that there will be a minimum standard set for customer service. . . . Instead, we have this death-race spiral to the bottom."