Consumer Federation of California

California
consumers are under assault every day from big business interests with
an endless amount of money, lobbyists, and political connections. Their
purpose is simple: maximize profits at our expense.

The Consumer Federation of California is an active force at the Capitol
— standing up in the face of corporate opposition — fighting to
protect our rights in the marketplace. Check out the following list of
our legislative priorities for 2007, and let us know which are most
important to you by taking our survey.

Now onto our descriptions of 5 of the key issue areas we are considering for the coming year:

Governor’s Health Insurance Proposal: How Will It Affect You?

Governor Schwarzenegger has stated that he will make health insurance reform a major priority in the new year.

While he has not yet revealed his proposal, we suspect that
he may put much of the burden on the uninsured, by requiring
Californians to purchase health insurance. This proposal became law
this year in Massachusetts. It’s a bad deal. It doesn’t protect against
insurer waste or excessive profits, and it forces low-income uninsured
people to purchase high deductible plans that simply don’t cover most
medical expenses.

The Consumer Federation of California believes that health
care is a right, not a privilege. We want to make affordable,
high-quality health care available to ALL Californians. This year the
Consumer Federation supported a bill that would have created universal
health insurance for all Californians, but the bill was vetoed by the
governor.

We will fight to make sure that any new health care proposal helps you
and other Californians, and that it doesn’t wind up costing you a
bundle or enriching HMOs and insurance companies while reducing the
quality of your health care.

Your Right to Cancel a Cell Phone Contract

This year the Consumer Federation sponsored a bill to allow you
to cancel a new cell phone contract within 30 days. We had this right
until the Public Utilities Commission repealed it early in 2006.
This simple proposal would mean you would not have to pay hundreds of
dollars to get out of a cell phone contract that does not really meet
your needs or that was sold to you under false pretenses. That would
include things like the cell phone not actually having coverage in your
area, or being billed for extra services that were never made clear
when you signed up for the contract.

We also supported legislation that would have required phone companies
that advertise a product in a language other than English to print a
contract in the same language used to peddle the product. This would
let limited-English consumers read a contract and make sure that they
are not victims of ‘bait and switch’ sales tactics.

We also supported
legislation to prevent a phone company from forcing a customer to pay a
phone bill run up by a thief who gets his hands on a lost or stolen
cell phone.
The giant cell phone companies fought tooth and nail against these
bills and they died in the legislature or were vetoed by Governor
Schwarzenegger.

The Consumer Federation will try once again in the new year to win
passage of these common-sense laws. We are building a strong coalition
with community, senior and consumer allies, and — with your support —
we will not give up the fight until we win.

Political Reform: Take the ‘For Sale’ Sign Off the State Capitol

California consumers lost an important fight last month when voters
defeated Proposition 89, the California Clean Money and Fair Elections
Initiative. Amidst an opposition campaign filled with distortions,
voters turned down an opportunity to do away with the campaign
contributions and influence peddling of oil companies, banks, insurance
companies, phone companies, drug companies and other special interests
‘- all of which prevents important consumer protection legislation from
passing in Sacramento and through statewide initiatives.

The tobacco companies just spent at least $57 million to defeat
Proposition 86, the tobacco tax initiative, and the oil companies spent
more than $94 million to defeat Proposition 87, the alternative energy
initiative. And Governor Schwarzenegger has raised more than $100
million in campaign contributions since he was first elected in 2003,
setting a new record.

The Consumer Federation will keep fighting for real reforms in 2007,
such as banning fundraising by state legislators while the legislature
is adopting the state’s budget. Governor Schwarzenegger backed this
plan when he first ran for governor, and it’s time we put his pledge to
the test.
We are also working with other organizations to address the obscene
amounts of money spent on congressional campaigns.

Protecting Your Personal Privacy

The Consumer Federation of California led the three-year fight that won
the nation’s strongest financial privacy law. But as technology
advances, and as news of government snooping and corporate scandals,
such as Hewlett Packard’s acquisition of reporters’ and board members’
private phone call records reveal, safeguarding our privacy requires
never-ending vigilance.
In 2006, CFC helped win two major privacy victories.

We’ve outlawed the
purchase or sale of your personal telephone calling records without
consent of the telephone subscriber. The other new law prohibits a
retailer from printing more than the last five digits of your credit
card account number on your receipt.
We also worked hard for legislation placing limits on the government
embedding radio frequency identification tags (RFIDs) in drivers’
licenses and ID cards. RFIDs have some legitimate uses, but unless
strictly regulated, they can provide anyone -‘ including a hacker —
too much of our personal information.

The governor vetoed this privacy
bill.
The Consumer Federation will continue to spearhead the protection of
our privacy. Our principle is a simple one: Ask My Permission First
before buying or selling our private information. And take extra care
to make sure our private details are not vulnerable to identity thieves.
In 2007 we will continue to aggressively protect the privacy rights of
all Californians from unreasonable intrusions from big business, common
criminals and government snoops!

Defending Californians Against Predatory Lenders

Low-income consumers have a huge disadvantage when it comes to
obtaining credit. Denied conventional loans, their only avenue for a
mortgage or auto loan is in the ‘sub-prime’ credit market.

Predatory
lending at exorbitant rates keeps may Californians in perpetual and
growing debt. Minority consumers and young adults, new to the
workforce, are often victims of predatory lenders.
Some Californians who live from paycheck to paycheck have little choice
but to get a loan as an advance against their next payday. These loans
must be paid back with interest in a couple of weeks.

As one loan is
rolled over into the next and the next, the rate on a small payday loan
can legally exceed 300% annual interest.
Predatory automobile lending is also an epidemic of abuse. Auto
dealer-originated loans frequently include big hidden dealer mark-ups.
What seems like a good sale price on an automobile is often an
illusion.

The buyer ends up paying hundreds or thousands of dollars in
unnecessary interest, which the dealer pockets, above and beyond the
interest rate the dealer got from the bank.
CFC has campaigned to cap interest rates on dealer-financed car loans
and payday loans, and to expose mortgage lenders who steer customers
from minority neighborhoods to exorbitant sub-prime loans.

We plan to keep working to curb the abuses of predatory lenders, and
expand opportunities for credit-worthy lower’income consumers to obtain
financing on terms that don’t push them further into debt.