What The TX Governor Isn’t Telling Us
CU SWRO editorial published by the Fort Worth Star Telegram
and the Austin American Statesman on 06/16/03
by Reggie James, Consumers Union’s Southwest Office
Are you better off today as a consumer than you were on January 14? That, you may recall, was the day our legislature began one of its more fractious sessions in recent memory.
In 1999 and 2001, many of us gave the Legislature’s efforts on consumer initiatives mixed reviews. Consumers gained ground in some areas but took significant steps back in others. In educational parlance, the legislature’s pro-consumer efforts rated between a “C” and a “C+.”
We can’t be as benevolent in 2003. It was, to borrow the word from a recent editorial — ugly. Generally, the session marked the triumph of raw economic and political power to the exclusion of logic and good public policy. The legislature’s efforts this year merit no better than a ‘D’ in advancing the consumer interest.
The biggest winners? The insurance industry lobby, by a landslide. After declaring homeowners insurance one of the session’s two emergency items, lawmakers retreated with nothing of substance for consumers, short of PR talk. The truth of the matter is you and I will not see our rates rolled back to reasonable levels, insurance companies will still be able to unfairly use credit scores against us, and insurers will have an easy time asking for and receiving further rate increases.
The other emergency item — medical malpractice — was mishandled from the start. The legislative leadership used the medical malpractice bill as a Trojan horse to carry other tort reform measures that lacked public support. You and I are the losers here because we will have a much tougher time keeping the manufacturers of defective products and dangerous drugs accountable. The caps imposed by the legislature will boost insurance company profits but have minimal to no impact on the rising cost of malpractice insurance, nor will they curb malpractice.
If, like 60 percent of Texans, you get healthcare coverage through your work, life just got a little tougher for you. Key benefits that took the legislature more than two decades to require for employer-provided healthcare plans have been wiped out. Among these are coverage for contraceptives and chemical dependency treatment.
The legislature had its hands in your pocketbook, too. Along with higher fines for traffic tickets and deregulated university tuition, lawmakers gave big loan companies another way to increase your debt. One bill, for example, allows finance companies to add a range of low-value, high cost products (like club memberships, security plans, etc) to loans — typically several thousand-dollar loans made at interest rates that can top 30 percent.
The governor and legislative leadership made a big deal about balancing the budget with no new taxes, which will in the end impose severe hardships on the less fortunate in need of critical state services. The “no new taxes” pledge also distracted consumers from the fact that the legislature held consumer purses and wallets open to a host of new business and government fees and charges.
If you own a manufactured home, look out. Lawmakers passed a bill widening the ability of retailers to sell consumers manufactured homes through high-cost personal loans, rather than conventional home loans.
The “mixed bag” award of the session goes to a bill that creates a time consuming, confusing and expensive administrative inspection process for consumers complaining of a home defect. The bill is laced with procedural technicalities that may trip up unwary homeowners; but does contain a few provisions that offer genuine benefits to homeowners. One of them, for example, would allow consumers to challenge an arbitration award if the arbitrator showed a manifest disregard for state law.
This is not to say that there weren’t outright bright spots along the way, however few. Among the brightest is a bill providing a response to the problem of identity theft in Texas. It puts in place key changes that will help limit identity theft as well as provide relief to victims.
Also, a newly created office of patient protection will represent the interests of consumers before boards regulating healthcare professionals, including the Texas Board of Medical Examiners. The office will represent the interests of consumers before these boards and will act as a liaison to patient complainants.
Consumer groups also pushed back an attempt to defer a review of the state’s new deregulated electric market beyond 2005. Additionally, local phone companies won’t be able to pass to us a tax they are required to pay to maintain an infrastructure fund dedicated to technology in our schools and other public places.
Generally, however, consumers lost ground in practically every area. So don’t buy for a minute Governor Perry’s recent claim that the legislature’s accomplishments this year were nothing short of epic. Perhaps he meant tragic. Let’s hope he understands the difference.