The evolution of consumer reporting
Trudy Lieberman writes in the latest Columbia Journalism Review how consumer reporting has evolved from advocating on behalf of consumers to providing advice on how to spend money.
Lieberman writes, “Some reporters still do aggressive consumer reporting. Last year, Christopher Neiger, a freelancer writing for AOL Autos, showed how lenders got away with charging exorbitant rates for car-title loans, which provide borrowers with a little quick cash secured by the title of a car that’s already paid for. Neiger noted that such lenders must disclose the interest rates in terms of the annual percentage rate, but they often just disclose a monthly rate. He warned borrowers that if they see a monthly rate of 25 percent, it is equivalent to a whopping 300 percent APR. How could lenders get away with this? We need more stories like Neiger’s that delve into the reasons why the truth-in-lending law has been weakened so much that APRs don’t mean much any more.
“Truly educating the public seems a pretty remote goal for journalism when consumerism reigns. There’s no consumer movement to make news; there are no leaders to be newsmakers, and few local government agencies left dedicated solely to the consumer cause. Heads of regulatory agencies rarely are invited to appear on the Sunday morning news shows, as they once were. There are only advocacy groups, including what remains of the old Nader organization, that get quoted here and there but have little clout.
“Consumerism, fostered by the press through consumer advice stories, has helped lead people to focus on ‘me’ instead of ‘we’—the notion that a lot of little guys are in the same boat. Lenders have reinforced that sensibility, when, for example, they argue before Congress that their practices are necessary so that good credit risks don’t pay for bad ones. But if your neighbors default and you don’t, what happens to your property values on a street of empty houses? The mindset of ‘me’ makes it difficult to see solutions in terms of ‘we,’ or a collective frame that might benefit everyone.”
Read more here.
