What an inspiring 2012! Together, we exposed and stopped false MPG claims by automakers, shamed health insurance companies into lowering outrageous rate hikes and moved closer to the day when technology companies can’t collect and sell our private information online and on our phones without consent. This year we’ll continue these fights, and more.

Big things are going to happen in 2013, and we’re glad you’re here with us to see them through. We’ll be asking in the coming days your thoughts on what Consumer Watchdog’s priorities should be in 2013.

For now, here are some of our pledges for this year. We will:

• Turn up the heat on health insurance companies to stop unjustified rate hikes for families like Karyn Mor’s, who has seen her premiums jump over $800 a month in just two years. Californians will have a chance to vote at the next general election on the ballot initiative to require companies to publicly justify and get their rates approved.
• Win our three-year campaign to give consumers the right to say “Do Not Track Me” online. The more companies collect information about what we read, search for and buy online, the more they abuse that knowledge – as privacy project director John M. Simpson discusses in this news story about companies that change prices based on your browsing habits.
• Expose oil companies’ continued Enron-like manipulation of gas prices, which brought gasoline to $5.00 a gallon on the West Coast this summer. When gas prices spiked in May and August, oil refiners blamed reduced capacity because of outages and maintenance. But new evidence in November suggested that refineries were running as usual. Consumer Watchdog has called for a criminal investigation, joined by 7 US Senators, into whether oil companies faked the supply shortage.
• Protect patients from the kind of dangerous medicine practiced by doctors like Dr. Carlos Estiandan, who the LA Times exposed as a reckless over-prescriber of narcotics. Eight of Estiandan’s patients died of overdoses or related causes while the Medical Board of California dragged its feet on a 4-year investigation before finally pulling his prescription pad. It’s time the Medical Board got serious about disciplining bad doctors.
• Save California consumers hundreds of millions more on their auto and homeowners insurance premiums. Since 2002, our challenges to excessive rate hikes have saved policyholders over $2.2 billion.
• Prosecute our suits filed on behalf of drivers to hold car companies accountable for their fuel economy promises. Louis Bird bought a Hyundai Elantra that advertised 40 MPG, but the car never came close to that promise. A Consumer Watchdog complaint led to an EPA audit finding the company’s MPG claims were false, and to the first-ever multi-vehicle recall of MPG window stickers. The state and federal cases on behalf of owners of the Hyundai Elantra and three other models are heading to court.

What do you think of our resolutions? At Consumer Watchdog we know that when public opinion is on our side, we can make big things happen. So be on the lookout for our survey next week, and let us know your opinion on what our priorities should be in 2013.

Your ideas, actions and complaints were behind some of our biggest consumer protection victories. We need your input again to make this year as big as the last.

Happy New Year!

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Posted by Carmen Balber, Executive Director of Consumer Watchdog.

If you’re a fan of the Godfather, you have to love any book that says all you have to know about managing a crisis you already learned from Vito Corleone.

We don’t recommend many books, but Masters of Disaster is the perfect playbook for how to respond when you’re under enemy fire and armed with little more than a cannoli.

The team that advised President Clinton, celebrities and corporate titans have broken down the commandments of crisis management, whether you accidentally hit “reply all” to an embarrassing email, or are fending off a real crisis in your life or business. You can get their hard knuckle advice and funny real life stories at bookstores or online at BarnesAndNoble.com.

Penned by fixers Chris Lehane and Mark Fabiani, and filmmaker Bill Guttentag, Masters of Disaster is a vital and fun read full of back-room tales for those who want to learn from America’s greatest corporate and political scandals. You’ll understand the big mistakes made by companies like Toyota and BP, politicians like Mitt Romney and celebrities like Roger Clemons and Tiger Woods.

The book argues for full and rapid transparency in a crisis: “If the mistake fits, be quick to admit.”

The masters also recommend the cool disciplined approach to crisis that made Michael Corleone the Godfather when he decided to kill the corrupt cop that shot his dad: “It’s not personal, Sonny. It’s strictly business.”

America’s greatness, like its greatest historical failures, has come from the fact that public opinion can rule. Masters of Disaster shows those who face crisis can only survive by respecting public opinion and those who don’t will quickly fall.

At Consumer Watchdog, we create a lot of crisis for big corporations and politicians when they stray from the path. If more of them heeded this book’s advice, there would be a lot fewer scandals and more pro-consumer companies.

Go to your mattress with a copy of Masters of Disaster and enjoy the book.

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Posted by Jamie Court, author of The Progressive’s Guide to Raising Hell and President of Consumer Watchdog, a nonpartisan, nonprofit organization dedicated to providing an effective voice for taxpayers and consumers in an era when special interests dominate public discourse, government and politics. Visit us on Facebook and Twitter.

Reporters largely missed the point of a Commonwealth Fund study released this week, that looked at consumer savings under Obamacare’s 80-20 rule, the rule making insurance companies spend at least 80% of your premiums on health care, not overhead.

The authors started with a fact we already knew — that health insurance companies had to pay $1.1 billion in rebates for missing the MLR requirement in 2011 — and that big shiny number distracted the news media. But the authors zeroed in on a much more important fact. Insurance companies successfully reduced administrative costs by $1.184 billion in 2011, but they used those savings to increase profits instead of passing them on to consumers.

Clearly the 80-20 rule isn’t working to contain profits and hold down premiums, especially in states that don’t have tough regulation of insurance premiums.

California Insurance Commissioner Dave Jones launched an audit this week of the state’s largest health insurers to determine if consumers paid too much when insurers were actually saving money and boosting profits. The Commonwealth study found that in California, insurance companies increased profits for individual plans by $88 per member or about $90 million, even though administrative costs went down and every major insurance company imposed rate increases.

These results are more evidence that states need the ability to say no to rate manipulation. Otherwise, insurance companies will keep premiums artificially high to make sure profit numbers stay high too. As we warned HHS Secretary Sebelius more than two years ago:

“In the same way that a Hollywood agent who gets a 20 percent cut of an actor’s salary has an incentive to seek the highest salary, insurers will have incentive to increase health care costs and raise premiums so that their 15 percent or 20 percent cut is a larger dollar amount.”

As Jones said when announcing the audit:

“I have long pushed for the authority to reject excessive health insurance rate increases and this study provides further evidence of why this change in the law is long overdue in California. Health insurers and HMOs continue to impose double-digit premium increases each year and are making larger profits when selling to individuals and families even during these tough economic times.”

Californians will finally have the chance to stop them, by voting at the next ballot on an initiative measure to require health insurance companies to publicly justify rate increases and get approval before they take effect. Learn more at justifyrates.org

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Posted by Carmen Balber, Washington DC Director for Consumer Watchdog and Consumer Watchdog Campaign

Wednesday, the California Fair Political Practices Commission takes up the question of whether political bloggers should have to disclose who pays them to blog in political campaigns. Sacramento’s consultant establishment, both on the left and the right, has been hiding behind free speech protections to propagandize and cut the legs out from under credentialed authorities on behalf of any interest group.

Because voters increasingly rely on information online, paid blogger-based attacks that masquerade as real journalism are one of the biggest rackets in Sacramento.

Journalists get fired for lying. Tax-exempt nonprofit groups can have their tax status revoked if they lie and propagandize. They are subject to disclosure requirements by the IRS, the state Fair Political Practices Commission and the U.S. attorney general. Political bloggers, on the other hand, can get paid to blog lies and are accountable to no one.

How does the paid-blogger racket work? A consumer group like mine finds itself in the crosshairs of a powerful industry. For example, this summer we qualified a ballot measure to regulate health, home and auto insurance rates that will be on the 2014 ballot. This fall, we successfully defeated Proposition 33, the $17.5 million campaign by one insurance company billionaire to deregulate auto insurance.

We were outspent 70 to 1 on the Prop. 33 fight, but we had a strong online voice and large lists of supporters. Our enemies know that our credibility as a consumer group is our main asset. So suddenly a new group was created to “watch” Consumer Watchdog by a Democratic Sacramento political blogger and consultant, Steve Maviglio.

He misstated facts about our funding on his blog and on his new website, made an expensive online video that showed a fake picture of our founder’s house to claim it was a mansion, and took out advertising on Google, YouTube and elsewhere around the Web. He claimed no one paid him for any of that work or advertising, but that he simply had a grudge. Remarkably, the day after the election, when voters rejected Prop. 33, the Google ads were no longer running.

Maviglio was joined in his online assault by a couple of Republican consultants and bloggers. None would disclose who, if anyone, paid them. A California Watch story noted an attack by “Republican consultant Rob Stutzman, who is working with an opposition research firm but wouldn’t say who is paying for the effort.” Republican blogger Jon Fleischman wrote an attack blog without bothering to check the facts, then forwarded it to our founder saying: “Thinking about you this holiday season. Happy Hanukah.” Very journalistic.

Who regulates Maviglio, Stutzman and Fleischman, or requires that they disclose their funding? That is the subject of the FPPC deliberations.

Not surprisingly, Maviglio and Fleischman are the most vociferous opponents of any changes to the status quo.

What should be done?

• Political bloggers should be required to comport themselves with the ethics of journalists if they are claiming First Amendment protection. Bloggers on political issues in California should be required to disclose financial conflicts of interest or face sanctions by the FPPC and public prosecution. “Paid for” political disclosures are cumbersome for bloggers and websites but requiring simple disclosure of payments made by entities involved in political issues in the context of content is no more than we ask of journalists.
• Legal loopholes allow monied interests to pay unlimited amounts to bloggers for attacks on their opponents. These payments are never disclosed so long as the bloggers don’t expressively advocate how to vote on the ballot measure. Bloggers should be required to disclose such payments.
• Advertising on a blogger’s website paid for by an interest group with a dog in a political fight should be disclosed. This is one way to compensate someone voicing an opinion without disclosing it.

The good news about the new media is that anyone can create their own media outlet. The bad news is that without regulation it will be harder than ever to decipher whose opinions and voices we are hearing online.

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Jamie Court is President of Consumer Watchdog and a director of the Consumer Watchdog Campaign

Originally published in the San Francisco Chronicle on November 14, 2012

Karl Rove, Hyundai and Elizabeth Warren Can Go In “The Dog House” With Consumer Watchdog’s New Free App That Lets iPhone Users Create Meme-Like Images

Leading Consumer Group Offers Alerts, News & Expression In 5-Star Rated App

Consumer Watchdog’s new five-star rated app gives iPhone and iPad users a way to complain, stay informed and be engaged on the top consumer issues of the day. A popular feature, the “Consumer Watchdog Dog House,” allows consumers to take a photo with their phone and satirize or applaud a politician, company or product and share it with their networks.

“Consumer Watchdog Mobile is a great new way to express your thoughts on the election. Think Super PACs poisoned the election? Now you can take a picture with your phone and put them in an actual Dog House. Win a ballot initiative fight for marriage equality? Announce it to everyone you know with the Dog House Daily Times,” said Carmen Balber, Washington DC Director for Consumer Watchdog.

The free Consumer Watchdog Mobile application can be downloaded from the Apple App Store or by clicking this link

Consumer Watchdog Mobile features:

1) Live updates of Blogs, News, Videos and Podcasts – Stay up-to-date on breaking consumer protection news and ongoing Consumer Watchdog campaigns.

2) Real-time Consumer Complaints – Report problems and complaints as they occur, and view others that match your own.

3) Mobile Action Center – With weekly Consumer Watchdog actions, contact a member of Congress or email a corporate CEO on the go.

4) Consumer Watchdog Dog House – Satirize a politician, company or faulty product and share it on social media. Nine meme-like templates let you literally put a politician in the Dog House, set corporate executives’ “pants on fire” or point out a lobbyist who’s swimming in cash.  

Sacramento loves to hate Consumer Watchdog, because we expose the dirty deeds politicians do for corporations, confront regulators who are asleep at the switch, and don’t believe you have to go along with big corporations to get along.  We also take on the rich and powerful in the initiative process on behalf of consumers, which the legislature and lobbyists consider a slap in the face.

Whenever we have a big fight with the insurance industry, most of which we have won, some PR flack materializes as the voice of Sacramento’s hatred. There was a Republican operative in the Schwarzenegger years, before that a  soon-to-become Blue Shield executive, and now a former chief mouthpiece for two disgraced California Democratic politicians, who recently took to Capitol Weekly’s pages with venom for all things Consumer Watchdog.

It’s somewhat flattering to have a stalker, since it’s reserved for only the most successful public interest groups. It means that the insurance industry, Silicon Valley and the other corporations we fight and beat are very worried about us.

The big difference between journalists and political bloggers is that a journalist gets fired for lying and a political blogger can get paid to do it.

Political bloggers like CW’s latest official stalker Steve Maviglio don’t disclose how much they are paid or who pays them, nor do they live by journalistic standards. That makes them the perfect hit-men-for hire by crooked corporations and politicians who want to attack the credibility of their critics with phony facts and outrageous allegations.

Recently, the chair of the Fair Political Practices Commission proposed new rules to require political bloggers to disclose the source of their funding when engaging in political campaigns.   The rules were temporarily beaten back by Sacramento’s PR lobby including Maviglio, the former communications chief for Assembly Speaker Fabian Nunez and Governor Gray Davis, both driven from Sacramento in scandalous firestorms that Maviglio mismanaged. Only in Sacramento do the PR hacks responsible for politicians’ falls from grace become putative pundits.

Maviglio’s recent blog/oped in Sacramento’s Capitol Weekly erroneously attacking our nonprofit Consumer Watchdog came within days of a remarkably similar op-ed attack on us in the Union Tribune by a Republican consultant Jeffrey Barker, former Schwarzenegger communications deputy.  (Despite Maviglio’s crazy claim that Consumer Watchdog reserves its criticism for Latino Democrats, Consumer Watchdog was one of the toughest critics of Schwarzenegger’s pay to play politics.)

Why the well-orchestrated attacks on Consumer Watchdog now?

There’s no force the insurance industry fears more.

Our sister organization Consumer Watchdog Campaign has turned in 800,000 signatures for a ballot measure to require health insurance companies to justify rate changes and get permission from the insurance commissioner before raising rates.  Maviglio and his compadre Barker falsely stated we didn’t collect enough signatures to qualify for the ballot.  In fact, county election officials are counting all the signatures now and have to report back to the Secretary of State by August 23.

We are also fighting Prop 33, a venal scam paid for by Mercury Insurance company’s billionaire founder to deregulate auto insurance and unfairly penalize drivers with perfect driving records.  Voters rejected the nearly identical Prop 17 in 2010 after we led the effort against it, notwithstanding the $16 million spent by the insurance company. But insurance companies rarely take no for an answer.

Our consumer group is the insurance industry’s chief watchdog. Since 2003 we have stopped over $2.2 billion in unreasonable proposed rate hikes by property casualty insurance companies.

Insurance companies would love to escape our scrutiny and return to the good old days of highway robbery; hence Maviglio’s critiques of Consumer Watchdog and the intervener program. Fact: The cost of the experts, attorneys and advocates to save $2.3 billion (all paid for by insurance companies that failed to raise rates) was about $5.7 million over the decade. That’s 25 cents paid to experts for every $100 saved, the most effective regulatory process for consumers in American history. State records show, despite Maviglio’s ridiculous claims, that Prop 103’s author and Consumer Watchdog founder Harvey Rosenfield made less than $25,000 each year during the last ten years from intervener fees.

Who else but the companies and their bought and paid for politicians would fund Maviglio’s online advertising and blogging?  Maviglio refuses to disclose his company’s client list.

By contrast, Consumer Watchdog discloses all of our donors and income to the Internal Revenue Service and the Attorney General of California. We have an independent board of directors, a consistent charitable mission to protect consumers that hasn’t changed in two decades, and our tax returns are public documents.

Our advocacy affiliate, Consumer Watchdog Campaign, publicly discloses all campaign contributions for ballot measure and political activity on the Secretary of State’s website. Maviglio falsely charges that Consumer Watchdog Campaign concealed the identity of donors to the health insurance rate regulation ballot initiative. In fact, every one of the campaign donors are disclosed on the Secretary of State’s website.  And the contributions coming directly from Consumer Watchdog are clearly disclosed on these state finance reports as “non-donor” funds; money that Consumer Watchdog earned, rather than raised from others.  These dollars were principally obtained from successful litigation against telecommunications, insurance, and hi-tech companies that we beat in court after they ripped off consumers.  Our legal cases and their public interest outcomes are a matter of public record – protecting consumers in important ways.

Ironically the money the political mudslingers accuse Consumer Watchdog of hiding may have come from the very corporations that are funding Maviglio and Barker. But of course we won’t know. Unlike nonprofits and political committees, they are accountable to no one and have to disclose nothing.

The real flaw with Maviglio’s attacks is his failure to recognize the irrefutable record of insurance reform Prop 103, authored by Rosenfield.  The Consumer Federation of America reported in 2008 that drivers have saved $62 billion on their auto insurance bills due to the law’s regulation. California has the fourth most competitive state for auto insurance.  It’s a model that works because of the elected insurance commissioner’s post, also created by Prop 103, and the effective intervention system. And that’s why it should be extended to health insurance under our new ballot measure.

We are willing to debate the merits, policies and politics anywhere any time.   But Maviglio could care less about consumers or ethics. A great example is his effort recently to have a Democratic official in Sacramento sanctioned for filing an ethics complaint against Maviglio’s client Sacramento Mayor Kevin Johnson.  Maviglio claims an ethics complaint is an attack, when in fact it is a matter of public honor and responsibility.

The failure to have perspective and proportion about propriety and ethics has haunted Maviglio and his prominent clients. He is no doubt angry that Consumer Watchdog has called them out and focused pubic opinion on their breaches of the public trust.

When Governor Gray Davis took money from energy companies that were pillaging the state, and refused to use his eminent domain powers to seize power plants that were later shown to be manipulating electricity prices, we raised questions. When Davis wanted the legislature to force ratepayers to bail out the utility companies, we worked with Senate leaders and stopped him.  Davis and Maviglio’s failure to understand the public’s anger with him led to Davis’s recall.

Meanwhile, as Davis’s deputy, Maviglio was privy to insider information on what was going on in the industry and himself traded in energy stock of a company, Calpine, that got massive state contracts. He was properly chastised by us and in the court of public opinion. Five other Davis aides resigned in the insider trading scandal that ensued, but Maviglio refused.

When Assembly Speaker Fabian Nunez flew around the world living high on his campaign contributors’ credit cards, then ran away from a television news reporter’s questions in Los Angeles, he became the poster child for Sacramento corruption.  Maviglio’s mismanagement of the scandal led not only to Nunez’s fall from political grace but the failure of a term limits extension initiative championed by Nunez. Opponents featured footage of the Maviglio-inflamed scandal.

Maviglio’s career under the Capitol Dome also suffered from an ethical lapse that we called out.   The high frequency of Maviglio’s private political blogging during the work day while he was communications deputy for the Assembly Speaker Fabian Nunez led us to file an ethics complaint questioning whether Maviglio was using a government computer and state time for private political activity.  After a formal investigation, we received a letter from the Assembly Rules committee that stated: “Following a review of the facts produced from this investigation, appropriate action has been taken to ensure there is compliance with Assembly policies.” Not long after, Mavigilio went to work for Johnson’s Mayoral campaign and turned to private clients.

Many of the fights Consumer Watchdog now finds itself in are extensions of old ones Maviglio is connected to. Our battle with Mercury Insurance over Prop 33’s insurance deregulation scheme is basically the same legislation Gray Davis signed as governor after taking big campaign contributions from Mercury Insurance. Consumer Watchdog invalidated that law in court as an illegal amendment to Prop 103. Nunez jet-setting included a high-price World Cup fundraiser patronized by Blue Cross, shortly after legislation to regulate health insurance premiums failed on his Assembly’s floor.

Insurance deregulators and the politicians in their pockets will always find Steve Maviglios to speak for them. It’s high time that the same strict regulation that applies to nonprofits, political committees and politicians apply to political bloggers too.

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Jamie Court is the president of Consumer Watchdog, author of The Progressive’s Guide To Raising Hell, and a leader of StopProp33.org.

Originally posted on August 6, 2012 at CapitolWeekly.net

The largely peaceful revolution in Cairo and Americans’ celebration of it raises the question:

What would it take to mount a peaceful revolution in America against the Wall Street and corporate powerhouses that have turned the government against the best interests of our people?”

The largely peaceful revolution in Cairo and Americans’ celebration of it raises the question:

What would it take to mount a peaceful revolution in America against the Wall Street and corporate powerhouses that have turned the government against the best interests of our people?”

In America, the corporation is king and the abuses of corporate power are the subject of our people’s greatest grievances.

The 2008 election was supposed to settle the score with Wall Street and the corporate elite that have ransomed, ransacked and run over the average American. The change never came, and it’s even less likely in 2012.

At Consumer Watchdog we build populist revolutions one spark at a time where the public has spoken but the rich and powerful won’t listen. While our work cannot compare to the heroism of the Egyptian people, we are inspired by their example.

The revolution in Cairo showed the power of online platforms like Twitter and Facebook to authentically air outrage and connect change makers. In Washington, DC, Consumer Watchdog is fighting to protect individuals’ freedom online, which is being threatened in the name of greater profit, by some of the very corporate innovators that created these platforms.

On Friday, the “Do Not Track Me Online” revolution began with the introduction of legislation by Congressional Rep. Jackie Speier (HR 654) to force corporations to respect our right to keep personal information and online habits private. You can weigh in with your Congressional Representative to pass the legislation here.

Our freedom to be revolutionaries in America depends on how well we can maintain the online commons as free, open, and in the service of the individual, and our privacy needs, rather than the corporation and its commercial needs.  This is an American battlefield that begins with online privacy, the right not to tracked online, extends to net neutrality and evolves to the greater notion that online technology should be in the service of individuals not corporate robots (in spirit of the teaching of Jaron Lanier’s You Are Not A Gadget.

If there is a nonpartisan street revolt brewing in America today it is against the staggering health insurance premium increases that insurance companies are foisting on Americans.  I was in the streets against Blue Shield’s 59% rate hike two weeks ago with angry patients and the California Nurses Association. Blue Shield actually agreed to delay the hike when we showed up.

Consistent premium hikes and the pending mandatory health insurance law to take effect in 2014 are bound to continue a growing rebellion.

Health insurance companies like Blue Shield and Anthem Blue Cross thumb their noses at our democracy daily.  They hijacked health reform to give themselves a guaranteed market, even as they fight daily to erode the consumer protections in the new federal law. Consumer Watchdog is working with regulators to force the health insurance companies to live by the new rules and with California legislators for “Do Not Gouge Me” legislation — giving government the right to stop unnecessary premium hikes. (You can weigh in for AB 52, if you have not already, here. )

Ultimately, the 24 states with ballot initiative processes will be a vehicle to get the people what Congress will not deliver – a public insurance alternative to the private market. Consumer Watchdog is already drafting such a ballot measure for California.

What happens after a revolt is as important as the uprising itself. Insurance companies like Mercury Insurance, Allstate and Farmers have been fighting for two decades against the ballot box revolution of insurance reform Proposition 103. Consumer Watchdog’s lawyers fight back daily to protect and further that voter revolt, which has saved motorists $62 billion on their auto insurance, and to show that even the biggest and most powerful companies have to respect the people’s will.

Revolutions in America today take place in the corporate suites, not the streets.  CEOs are generally the ones deposed, not presidents, which is the first clue to who really holds the power in our nation… But if a governmental revolution were to come, how would it unfold?

Bob Herbert in his New York Times column Saturday artfully makes the case  of the price we have paid for the sins of Wall Street and self-serving interest of those at the very top of the economy.  America will never be the same, nor will our schools, parks, colleges, social programs and deficit, without a major re-rewrite of how our government works to divorce it from the state of corporate capture that is its numbing existence.

Elections are not tools of revolutions in America anymore. What will it take to get Americans in the streets?  

Higher prices for everything coming with growing inflation, higher unemployment,  no jobs for our youth, the closing down of public services and public assistance?

The powerful in America have too much to lose and usually buckle when they smell the whiff of a revolution. That’s why it’s worth putting that smell in the air and in the streets again when the moment calls for it.

Dramatic changes in ideas and practices are the results of long, hard marches toward freedom and accountability. We need to start marching together in America again.

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Posted by Jamie Court, author of The Progressive’s Guide to Raising Hell and President of Consumer Watchdog, a nonpartisan, nonprofit organization dedicated to providing an effective voice for taxpayers and consumers in an era when special interests dominate public discourse, government and politics. Visit us on Facebook and Twitter.