How consumerism hurts consumers

By Liz Pulliam Weston

For much of my adult life, I've written advice to help consumers get better deals, spot hidden fees, avoid tricky terms and generally navigate "the system."

By doing so, I've inadvertently helped the system turn against you.

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.

Need some examples? Just round up your monthly bills and you're likely to see plenty, including:

• Fees masquerading as taxes on your cell phone bill.

• Punitive bounced-check charges pretending to be "courtesy overdrafts" in your bank statement.

• A cable bill that bears no resemblance to the deal you were promised.

• A bewildering array of fees and interest rates, most of which are sharply higher than they were even a year ago, on your credit card statement.

Or look at the receipts from your last vacation. Chances are what you actually paid for airfare, a car rental and lodging was substantially more than you were originally quoted, thanks to things such as fuel surcharges, checked baggage fees, insurance coverage and (my personal favorite) "resort fees." Is that morning newspaper and stuffy fitness room really worth $15 a night?

Life wasn't always like this, and it doesn't have to stay this way.

Why cheaters prosper

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.

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"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.

• Talk back: Do you think the cards are stacked against consumers?

Unfortunately, we've gotten so used to not getting what we pay for, or paying far more than we expected for what we actually got, that it's come to seem normal. Not right, but normal.

How we created a loophole industry

Meanwhile, laws protecting consumers have been gutted or rendered irrelevant by the somnolent agencies charged with enforcing them.

Trudy Lieberman, a contributing editor to the Columbia Journalism Review, summed up the change in attitude toward consumer protection this way:

"The consumer movement that rose in the 1960s pushed for laws and regulations to protect buyers from the excesses of the marketplace," she wrote in a short piece for the September issue. "The press aided both its creation and its demise, then helped to replace it with consumerism, which serves the individual shopper but not systemic reform that might benefit everyone."

Continued: Industries that have gone amok

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