Archive: October, 2011
JP Morgan Chase gave up on a new $3-a-month fee after a test in Wisconsin and Georgia, and the Wall Street Journal says other banks seem to be backing off, too - perhaps even Bank of America, which started the current firestorm by announcing plans to impose a $5-a-month charge for debit-card use.
So did consumers "win"? It's a lot more complicated than that.
The Journal story says that in addition to Chase, at least four other banks - U.S. Bancorp, Citigroup Inc., PNC Financial Services Group Inc., and KeyCorp - have acknowledged similar moves, which the Journal and others frame as banks' backing down from following in Bank of America's footsteps. (I explained BoA's plan, and the ensuing firestorm, here and here.)
The Philadelphia utility will give five winners - one in each Philadelphia-area county - a free $400 energy audit, an autographed jersey from Eagles tight end Brent Celek, and an autographed football as part of a new "Peco Smart Ideas" promotion that kicks off Saturday in South Philly - not at the Linc but nearby at a Home Depot at 1651 South Columbus Blvd.
From 1 p.m. to 2 p.m., you can meet Celek, Troy Vincent, Mike Quick and Merrill Reese - Peco calls them its "Smart Ideas Go Green Team" - and learn about energy efficiency.
I'll get out front of the inevitable snarky comments - you know you're out there - with one from a colleague who jokes that "a typical Philly winner will keep the jersey and the ball and give the energy audit to his mother-in-law."
Credit where credit is due. After Consumer Reports announced a troubling dip in the projected reliability of Ford vehicles, based on its annual survey of owners, Ford Motor Co. CEO Alan Mulally addressed the issue forthrightly, and said the company was well along in its response - not via a PR blitz, but by fixing some genuine problems.
“We are incorporating the fixes now in the existing vehicles and will do that in all the new vehicles going forward,” Mulally told Fox Business Network’s Cheryl Casone yesterday during an interview focused on the company's quarterly results.
Consumer Reports said Ford sank from 10th to 20th place in expected reliability among 28 nameplates - a steep comedown for an automaker that just two years ago had been heralded by CR as "the only Detroit automaker with world-class reliability." The magazine blamed the fall on redesigns of three models - the Explorer, Fiesta and Focus - and on problems with new technologies, especially the new MyFord Touch infotainment system and a new "automated-manual transmission" in the Fiesta and Focus. (You can read my post here and our news story here; to see Consumer Reports' announcement of the annual survey results, click here.)
The Occupy Wall Street slogan, "We are the 99 percent," was partly a response to reports showing that recent economic growth has chiefly benefited those at the top of the income and wealth scales. Plenty of academic and think-tank research has demonstrated the trends, but a new report from the nonpartisan Congressional Budget Office should be a must-read for anyone with lingering doubts or those who just want to know more.
We can debate the causes of the growing disparity, and how society should respond. On the right, flat-tax proposals drawing plaudits in the Republican primaries reflect support for doing nothing at all - saying that's just the way the market works. Though they rarely argue their case equally forcefully, President Obama and most Democrats want to make the tax code a little more progressive, and to use some of the extra revenue to support investments in education, research, and infrastructure that should pay off for everybody in the long run.
But the CBO's report should lay to rest any doubts about what has happened since 1979, the year before President Ronald Reagan was elected and the country essentially turned to "trickle-down" economics, which was based on faith that benefits flowing from policies helping the rich - starting with a flatter tax code with decreased top rates - would trickle down to everybody else. As the CBO data show, the vast majority of gains since then have gone to the top 1 percent. From the CBO Director's Blog:
A year ago, Ford was riding high as the most-reliable U.S. automaker - 10th place overall among 28 major nameplates, including tough competition from Asian and European automakers as well as domestic brands. In fact, the big news last October from Consumer Reports' closely watched annual survey of brand reliability was that General Motors was doing better - just not quite up there with Ford.
The big news today from Detroit is a warning shot for Ford: It sunk from 10th to 20th place in Consumer Reports' rankings of the the projected reliability of 2012 models, based on surveys collected from owners of 1.3 million vehicles.
Chrysler, long an also-ran in CR's reliability survey, scored a coup this year: Its Jeep brand moved up seven spots to rank 13th in overall reliability, best among U.S. brands. Chrysler itself ranked 15, up 12 spots. (Click here to see all the results.)
The headlines last week trumpeted the latest finding on the cell-phone and cancer front. "Study sees no cancer link," our AP story announced. "Don't worry: Your device is probably safe."
The Danish study found no discrepancy in cancer rates among 360,000 people that appeared linked to cell-phone use. On the other hand, as this New York Times blog points out, the study had some methodological shortcomings, leaving its authors unwilling to rule out the possibility of "a small to moderate increase in risk of cancer among heavy users of cellphones for 10 to 15 years or longer." Tara Parker-Pope wrote:
The Danish study is important because it matches data from a national cancer registry with mobile phone contracts beginning in 1982, the year the phones were introduced in Denmark, until 1995. Because it used a computerized cohort that was tracked through registries and digitized subscriber data, it avoided the need to contact individuals and thus eliminated problems related to selection and recall bias common in other studies.
This video from South Florida's WSVN-TV tells the story of a truly mind-bending "wireless bill shock," which the FCC and the leading wireless carriers have agreed to address within the next year via voluntary warnings to customers who face excess charges for voice, texts, data, or international roaming.
Celina Aarons got a T-Mobile bill for about $201,000 - that's not a typo - after her brother, Shamir Aarons, took a two-week trip to Canada. He was billed for about 2,000 text messages, which sounds like a lot until you remember that texts are billed coming and going and that a recent Pew study found that 18- to 24-year-olds average about 110 texts per day. But the biggest problem was clearly T-Mobile's $10-a-megabyte rate for international data roaming, which led to charges of $1,800 or $2,500 for watching individual videos on his smartphone.
T-Mobile generously cut the bill to $2,500. And judging by the online comments when this story first hit the web, other consumers were shocked that anyone could build up a bill that large. They shouldn't be - not when data-roaming rates can run as high as $10 or $20 per megabyte, as the carrier in another data-roaming case charged this Bucks County businessman.
I'm often baffled at how deeply ideology has been allowed to intrude on something that was once relatively uncontroversial: basic consumer protection. Yet that's just where we are today, when a seemingly unbreakable phalanx of 44 Senate Republicans have vowed to block the nomination of anyone - yes, anyone - to be the director of the fledgling Consumer Financial Protection Bureau.
Led by Sen. Richard Shelby, an Alabama Republican who fought the bureau's creation, the over-our-dead-bodies response was initially aimed at the worry that President Obama would name Elizabeth Warren to head the agency she initially proposed. As I explained in a column last spring, Shelby broadened the attack by demanding that the new bureau be weakened before it even got off the ground. Even the American Banker has debunked Shelby's key lines of attack.
Still, Shelby and his allies have refused to give ground, and have so far blocked a confirmation vote on Obama's actual nominee, former Ohio attorney general Richard Cordray - a tactic that, perhaps not coincidentally, is also preventing the new bureau from writing rules to fulfill some of its duties.