If you’re a right-leaning reader or a fan of the current presidential administration, you probably won’t make it past the headline of this story. And if you do, it will only be for the purposes of scrolling down to leave an angry comment at the end of the article.
But if by chance you made it this far, please remember last week’s column on how the Trump administration could help consumers. And also, that there are at least two sides to every story ― especially this one.
You don’t have to look far for evidence that the Trump administration will harm consumers. From its pledge to deregulate American businesses to its actions to dismantle the Consumer Financial Protection Bureau, to its clumsy attempt to eviscerate the Patient Protection and Affordable Care Act, it’s hard to know where to begin a column like this.
Perhaps here: Even the administration’s most full-throated cheerleaders would have some trouble making the case that Trump has been good for consumers. Take the promise of deregulation lowering prices, discussed at length last week.
“I have yet to see an example of consumer prices going down and market competition increasing after deregulation of a U.S. industry,” says Prabir Chetia, head of business research and advisory for Aranca Research, a global research, analytics and advisory firm.
That might come eventually. If taxes on airline tickets are lowered, or “burdensome” regulations are lifted, those savings could be passed along to consumers. Or not. It’s difficult to say, since consumers hold far more pricing power than one or two regulations in the airline industry ― but we’ll have to wait and see.
“Consumers may win with lower prices in the near term as a result of deregulation because businesses can improve margins and pass the savings along to shoppers,” says Jonas Sickler, marketing director for ConsumerSafety.org. “But, in the long run, I see the potential for consumers to take a hit from degrading safety standards on everything from food to products.”
Sickler makes a valid point. Regulations exist to protect consumers, not companies. And if consumers feel safer, they’re more likely to trust a brand and spend more money. So the argument about less regulation being better for everyone doesn’t necessarily hold true.
“When consumers feel at risk,” he adds, “everyone loses.”
But that isn’t the only way the Trump administration has hurt consumers. Last week, I discussed some of the less obvious ways the government’s “laissez faire” approach to regulation had changed how consumers feel about the government and business, and how that change is good.
But in other ways, Trump is hurting us. Badly.
Consumers are assuming the worst ― even when they shouldn’t.
Too many consumers are telling me that they believe companies are out to get them. And while that may be true for some companies, it certainly isn’t true for all of them. The shift in the balance of power, with companies now holding the upper hand when it comes to regulation, is worrisome to consumers. It’s manifesting itself as a deep distrust of corporations. Problem is, there are lots of companies that still do right by their customers. Helping you find them ― well, that’s what I do.
Consumers think the government is actively working against their interests.
It’s one thing to be skeptical, but quite another to be paranoid. Unfortunately, many consumers say they believe, based on the current appointees to federal agencies and actions taken by the federal government, that the administration is out to get ‘em. While it may be true at a higher level ― that the political appointees think consumers are there to be fleeced by the free market ― it isn’t universally true. I personally know people at the regulator level who care about consumers and want to protect them. The Trump administration has a word for these resisters: Deep Staters.
Consumers believe they can’t win.
That is perhaps the worst fallacy of all. Many consumers are telling me the deck is so perfectly stacked against them that they can’t win. Companies hire the best lawyers, their contracts favor them, and now so do the very people who are supposed to protect us. This morale problem is pervasive. Evidence of it can be seen in almost every consumer complaint we receive, and I try hard every day to counter that misconception with words and deeds. Consumers can win. Pay no heed to the thoughtless tweets and the rhetoric carelessly tossed out in impromptu press conferences ― the truth is, consumers may be more powerful than they realize.
Trump is bad for consumers, not necessarily in what he’s doing now, but in how he’s affecting the morale and psychology of the American customer. Too much paranoia and a can’t-win attitude will only serve the profit goals of the big corporations that love the “anything goes” economy this administration has promised them.
We can’t let that happen.