This guest post was contributed by Lawrence B. Glickman, who teaches history at the University of South Carolina. He put the fight for the Consumer Financial Protection Agency in historical perspective in his previous post on this blog.
A recent ad taken out by the “The Center for Consumer Freedom” marks the latest assault by business lobbyists and conservatives on the idea of consumer protection. This organization’s motto — Promoting Personal Freedom and Protecting Consumer Choice — defines consumer freedom as “the right of adults and parents to choose how they live their lives, what they eat and drink, how they manage their finances, and how they enjoy themselves.”
Like other critics of consumer protection, this organization (“supported by over 100 companies,” according to its website) speaks in the name of freedom and depicts consumer protection as an assault not only on the liberty but on the intelligence of ordinary people. The ad begins with the following rhetorical question, “Are you too stupid…to make good personal decisions about foods and beverages”? Arguing against the “campaign to demonize soda” the advertisement blasts “food cops and politicians” for “attacking food and soda choices they don’t like.” Another of their ads warns about “Big Brother” in the “Big Apple” because New York City is considering taxes on junk foods and sugar-laden sodas. [The group's print ads can be seen here.]
A nearly identical line of criticism is currently being deployed against President Obama’s proposed Consumer Financial Protection Agency. Richard Shelby, the Republican Senator from Alabama, finds the proposal “disturbing and somewhat offensive” because it relies on the “concept of the intellectually deficient consumer.” Jeb Hensarling, a Congressman from Texas, worries that “un-elected bureaucrats” might “decide if we can have a credit card.” Scott Garrett, his fellow Republican colleague from New Jersey, is worried about the “Orwellian, government-bureaucrat-knows-best mentality” evinced by the proposal.
Opponents of consumer protection have long spoken in the name of individual liberty. They have done so by misconstruing the nature of human agency and freedom in the modern world.
At least as far back as the Progressive era, many Americans noted that industrial society–in which consumers did not produce their own food and drink and often lived far from such sites of production–called for federal regulation and protection to insure that the food we bought was safe. This was the essence of the landmark 1906 Pure Food and Drugs Act and it was the meaning of presidential candidate Woodrow Wilson’s statement in 1912 that “freedom today is something more than being let alone. The program of a government of freedom must in these days be positive, not negative merely.” Wilson and other progressives–-including members of the Republican Party, such as Theodore Roosevelt–-recognized that extending freedom in the twentieth century required a federal government capable of regulating business. In Wilson’s view, federal regulation of the sort provided by the 1906 Pure Food law did not substantially restrict the freedom of individual Americans. It instead instilled confidence that the market for food and drugs would be stripped of poisonous and dangerous goods.
The freedom that is restricted by consumer protection laws is the freedom of businesses to sell dangerous or even poisonous goods. By preserving confidence in the marketplace, such regulations allow consumers the freedom to make choices, and therefore esteem the intelligence of the American people.
Of course, regulation can become excessive and Americans need to balance individual autonomy with federal protection. (So too can federal assistance go in the other direction: one of the reasons businesses ply Americans with unhealthy food is that subsidies to agribusiness make possible the cheap production of high fructose corn syrup. Thus, these defenders of the free market ignore the inconvenient fact that the playing field is not truly level.) The claims of business lobbyists that common sense regulation amounts to incipient totalitarianism, however, demonstrate their unwillingness to accept what has become over the last century a fundamental part of the social contract, and which makes tangible true freedom of choice.
By Lawrence Glickman