Friday, March 26, 2010

A Great Week for America's Consumers

by Thomas Hinton

Three important events took place this week which will reshape the lives of millions of Americans and, perhaps, give hope to a billion Chinese.

1. Healthcare Reform. It’s been nearly a week since President Obama signed the historic Healthcare Reform legislation and the sky has yet to collapse on us. From all the hysteria and political rhetoric hurled by opponents to this mega-legislation, I was concerned the world would end as the president signed the new law. It didn't.

The healthcare debate is a keen example of what happens when politicians place the needs of special interests ahead of their constituents. They lose focus of their obligation to represent Americans and make absurd claims that have no basis. In the process, they lose credibility. This is what happened last week to the entire Republican congressional delegation when not one Republican in the House or Senate supported the passage of this monumental healthcare reform legislation. Of course, as consumers began to realize the benefits of the healthcare legislation, some Republicans will blatantly lie and claim they supported it. But, the average consumer knows better. Consumers will remember those elected representatives who had the courage to vote "yes" and, hopefully, reward the party of “Can Do” on Election Day.

Now, millions of Americans, who have been victimized by the unscrupulous and greed-driven health insurance industry, will have the opportunity to obtain affordable healthcare insurance and not go bankrupt if they become seriously ill.

While the new legislation is far from perfect, it’s a good start. Consumers have finally been heard after more than 60 years of repressive practices by the self-serving healthcare insurance industry. As the new legislation takes shape, the abuse of middle-class Americans by medical piranhas and health insurance companies will gradually end. This is good news for all Americans -- even those who vigorously opposed the healthcare reform bill. For, they shall also reap its benefits.

College Funding: Another positive benefit of the healthcare legislation is the financial-aid portion of the bill that shifts student loans from private lenders such as Sallie Mae and banks to the federal government. This will save $61 billion over the next 10 years, according to the Congressional Budget Office, and make more money available to struggling middle-class families who are trying to find ways to pay for college. Also, the bill will eliminate outsourcing of loan-servicing jobs to foreign countries by requiring all student-aid workers to be in the United States. Once again, Democrats in Congress are entitled to all the credit for helping middle-class Americans deal with the mounting cost of college. Not one Republican supported this legislation to help middle-class families afford college. What in the world were they thinking? Are the Republicans that far out of touch with middle-class Americans? I guess so.

2. Google Stands-up to China. Integrity matters. Finally, there’s an American company that has told the Chinese communist government where to go! Thank you, Google for putting ethics, integrity and freedom of speech ahead of profits by sending a strong message to the Chinese communist bullies that you aren’t going to play by their repressive rules. Now that Google has cracked the Great Firewall of China, it’s time for other companies to support the Google Revolution by telling the Chinese government they cannot censor ideas, rewrite historical events like Tienanmen Square, control births or suppress free speech.

Let’s not forget how quickly the Berlin Wall came down after President Reagan rallied world opposition during his speech in Berlin and challenged Russia to "tear down this wall." American companies and their global partners should rally round Google and send a united message to the Chinese extremists that free-thinking people are not going to play their crooked game. Imagine the potential market under a reformed China! Imagine how much business can be had if the handcuffs of freedom are removed from the Chinese people. They, too, deserve a chance to enjoy the basic freedoms of speech, thought, dissent and democracy.

While Google has taken the first step in this economic war against the Chinese oppressors, American consumers can support this effort by boycotting Chinese goods for 30 days. If just half of America’s consumers refused to buy anything made in China (which is a lot of stuff) for 30 days, it would send a strong message to the Chinese government’s repressive leaders and fuel the fires of freedom for a billion people. This means companies like Wal-Mart would have to put ethics and human rights ahead of profits. Unfortunately, I'm not holding my breath because greed runs deep in corporate America.

3. Mortgage Relief is Coming. Finally, the third significant issue is meaningful mortgage relief. The Obama Administration has realized that its well-intentioned mortgage relief program introduced last year was worthless. Banks and other lenders got richer while under-water homeowners slipped further into debt because the mortgage bailout was a sham. Now, new rules designed to provide meaningful relief to homeowners and prevent foreclosures are being introduced and these new guidelines will force banks to forgive some debt and reassess the current market value of homes so that mortgage payments can be lowered.

This makes sense for everyone. While some mortgage holders and lenders will experience a loss on certain properties, neighborhoods will be preserved and families can stay in their homes. As the economy recovers, more people will find jobs and, in turn, be able to start making a reasonable mortgage payment.

All in all it was a great week for American consumers!

About the Author.
Thomas Hinton is president of the American Consumer Council, a non-profit consumer education organization with over 92,000 members in 45 states. He can be reached at:

Friday, March 5, 2010

Why Can''t Toyota Come Clean with Consumers?

Over the past few weeks, Toyota has been chastised harshly for mishandling its recall of 8 million vehicles and misrepresenting the facts to consumers and federal regulators. And, rightfully so.

At the same time, Toyota’s powerful public relations machine has been pumping out commercials and newspaper ads showing how dedicated its employees are and the positive financial impact Toyota has on U.S. communities where its manufacturing plants are located.

What’s happening here is a strategic ploy by Toyota to shift public opinion by touting its commitment to consumers and the company's good citizenship while distancing itself from the lawsuits and congressional hearings that are dominating the news. Frankly, this is a disturbing attempt by Toyota to dodge the central questions -- why are your vehicles malfunctioning and how long have you known about it?

Toyota's public relations strategy could have serious negative consequences if the auto company does not get to the root cause of its recall problems and come clean with consumers. To date, it appears the quick fix approach Toyota is using with regard to sudden, unintended acceleration and steering malfunctions isn’t working. More than 60 Toyota owners have filed complaints with federal officials in the past month stating ongoing problems with sudden acceleration despite their vehicles being “fixed” as part of the massive recall.

These post-recall complaints suggest Toyota doesn’t know what the root cause problem is, nor does Toyota have a meaningful solution to fix it. Perhaps this is why Toyota cannot come clean with American consumers? Furthermore, as the problem persist, Toyota's public relations strategy could backfire. Consumers are not stupid. They know Toyota is trying to soft-pedal the problem by showering us with touchy-feely commercials that are designed to boost consumer confidence in their flawed vehicles and restore integrity to Toyota’s tarnished image. What Toyota needs to understand is this situation could become another Enron if Toyota doesn't come clean with consumers and tell us the whole truth.

No one is suggesting Toyota has been corrupted from the top down. Rather, Toyota has a technology flaw that is causing some of its vehicles to lose control and injure or kill people. But, instead of coming forward and being candid with consumers, it appears that a handful of managers within Toyota's North American operation made serious mistakes in judgment by hiding the truth and failing to candidly discuss the problem. It is also possible that these same individuals kept evidence from federal regulators and lied to unsuspecting customers about the potential risks of driving certain vehicles. If these accusations are true, Toyota cannot tolerate such behavior. These people must be fired and, possibly, prosecuted. It runs against the grain of Toyota's values and culture of excellence.

With each passing day, more negative revelations are being uncovered about Toyota’s mis-management and how they either ignored or covered-up the truth on the sudden acceleration problems. This is a serious indictment against a once-proud company that has dropped the quality ball and placed profits and market share ahead of its customers’ safety and welfare.

Nobody wants to see Toyota fail despite its gross mishandling of the recall problem. After all, Toyota, Lexus and Scion dealerships employ more than 115,000 people. And, since 1991, Toyota has awarded more than $464 million to numerous organizations across the nation.For more than 50 years, Toyota has been a respected and honorable company in the United States.

But, unless Toyota Motor Corporation’s president, Akio Toyoda, wants American consumers to change his name to “Mud,” he’d better take action and fire those executives who allowed this problem to become the company's worst nightmare. Mr. Toyoda should also direct his team to come clean with consumers. For starters, it would help to know the whole truth and whether or not Toyota really understands what’s causing its vehicles to go out of control. Until Toyota gives us all the facts, consumers are not going to trust this once-proud brand and buy its vehicles.

About the Author. Thomas Hinton is president of the American Consumer Council, a non-profit consumer education organization with over 92,000 members in 44 states. He can be reached at:

Wednesday, March 3, 2010

The Economy Remains Unsettled: Just Ask Consumers

Over the past two months, I’ve been invited to speak at several meetings and conferences to offer my insights on the economy and consumer sentiment. The truth is nobody has a crystal ball that can successfully forecast 2010 or the future. In fact, I’m more convinced than ever before that the so-called "experts," with very few exceptions, haven't the slightest clue what they’re talking about! It's mostly gibberish coming out of New York and Washington, D.C. And, the media is also clueless.

Think about it. One day the stock market is up and everyone predicts a bright future. The next day it’s down and the doomsayers come out of the woodwork. When an earthquake in Chile can not disrupt a country, but also causes a serious spike in prices at Chicago and St. Louis gas pumps, something is terribly wrong with our economy or the proverbial crystal ball economists are using to predict the future.

But, there are two things I know for certain that you can take to the bank. Actually, these days you’d be better off taking them to a credit union!

First, consumers are very uneasy about the economy because of slow job growth, rising foreclosures due to loan manipulation by unscrupulous lenders who are not really modifying troubled mortgage loans and the mounting cost of health insurance. Despite what Wall Street tells us, Americans are not buying the spin that our economy is rebounding; and, that’s why most consumers are sitting on their wallets and not making major purchases or planning expensive vacations to Europe and Asia. Frankly, very few consumers have any money to spare. It’s just that serious!

Secondly, consumers are not convinced our elected leaders know what the hell they’re doing in Washington or at their state capitals. Just look at the irony in California. Governor Gray Davis was recalled by voters for failing to control energy prices. But, over the past several years, Governor Arnold Schwarzenegger has created a bigger mess and saddled Californians with more debt than ever before! It’s beyond the point of absurdity. Our leaders are not only inept, but also beholden to special interests. Consumers have been left out in the cold.

Meanwhile, in Washington, although President Obama has ideas and charisma going for him, very little is getting done. Many consumers are beginning to question how and when the economy will be fixed. Or, will Mr. Obama and the cowardly Congress continue to throw billions of taxpayer dollars down an economic rat hole to reboot the economy? If so, most small businesses that could jumpstart an economic revival and lure consumers back into the marketplace, haven’t seen a penny of that $750 Billion stimulus money we keep hearing about. And, neither have most consumers. It appears most of that money has gone to big business, big banks and big political donors.

The final straw will happen in November. If things don’t improve quickly, voters will throw the bums out on Election Day. This applies to every elected official regardless of their party affiliation. Consumers are sick and tired of seeing Congress issue bailouts to poorly managed companies that turn around and reward themselves millions of dollars in bonuses for their incompetence. It makes no sense to most Americans.

And, big banks, which have tightened credit instead of making affordable low-interest loans to small businesses -- and continue to jack-up their credit card interest rates -- aren’t helping matters any. Frankly, consumers are disgusted with the whole lot of them!

Just as Toyota’s misguided management is learning how angry and volatile consumers can get when their Camrys and Corollas malfunction, so to will the politicians and Wall Street fat cats feel the wrath of consumers if the American economy doesn’t rebound soon.

My crystal ball tells me that Congress and big business are in serious trouble. They had better wake-up soon and realize that “we’re mad as hell and we aren’t going to take it anymore!” I predict another revolution is coming and this one will be waged with votes and boycotts by millions of angry, disgruntled consumers.

About the Author. Thomas Hinton is president of the American Consumer Council, a non-profit consumer education organization with over 90,000 members. He can be reached at: