Guest Post; Lindsey Pasieka – Consumer Rights Investigator
Donald Trump seems to be waging a war against American workers and consumers, and he doesn’t even realize it. A pro-business billionaire mogul, Trump falls under a popular delusion that what is good for business is good for the people. He believes that cutting out “red tape” and “useless” regulations will benefit everyone, but I wonder if he ever thinks about why those regulations exist in the first place. I’ll give you a hint: it’s not because anyone just LOVES paperwork.
When I look at the Trump Presidency thus far, I realize I could go on and on about his legal decisions and why they put the
consumer at risk. But neither I, nor you, have enough time for that. So let’s stick to a few prime examples. The first two you’ve likely heard about: the repeal of the Dodd-Frank Act and the Class Action Fairness Act of 2017. Each has received significant media attention from both sides of the aisle. But a third which you may have missed was H.J. Res 83, a motion to repeal an OSHA law from the Obama administration, which addressed an employer’s obligation to keep records of employee illnesses and injuries. Though opposed by unions and employee protection projects, the repeal did go through.
More of that later. Let’s start with the repeal of the Dodd-Frank Act. From a financial standpoint, the key aim of the Dodd-Frank act was to prevent an economic crisis like that of 2008 from ever happening again. It did so by issuing regulations to stop banks from becoming “too big to fail,” meaning they won’t need to be bailed out by our government in order to save the economy. Additionally, Dodd-Frank allows for the restructuring or liquidation of weak banks, or those who deal in “risky” investments. To Trump followers, that sounds like a red-tape nightmare. To anyone hurt by the 2008 crash, it is an essential safety net for our country.
The second key point of the Dodd-Frank Act, however, directly interacts with consumer rights. It established the Consumer Financial Protection Bureau, tasked with, you guessed it, protecting the consumer from harmful business practices. These included the popular practice of giving brokers higher commissions for signing mortgages with higher interest rates and fees. The Bureau also requires brokers for both mortgages and other speculative lenders, including credit card companies and automobile lenders, to provide easy-to-read forms for consumers. This makes it harder for these companies to hide anti-consumer provisions in loads of paperwork that only a well-versed lawyer could understand. Further, when these companies do cross the line and harm consumers, the Bureau can step in and take legal action on behalf of consumers who’ve been abused or mislead by financial institutions.
Not only does the repeal of this act play into banks’ desires to make risky bets on the market, it also strips the requirement for brokers to put their clients needs ahead of their own. As if that weren’t enough, the repeal practically castrates the Consumer Financial Protection Bureau’s ability to act on behalf of the consumer. For a man so critical of Hillary Clinton’s relationship with Wall Street, Mr. Trump seems to have found a comfortable seat next to the bronze bull.
Another favorite litigation of the Trump Administration is the Fairness in Class Action Litigation Act of 2017. Don’t be mislead by the name– it is an oxymoron at best. Again, the idea behind this little piece of law was to reduce regulations and save valuable time for businesses. How does it do that? By making class action lawsuits incredibly difficult to file.
Class action lawsuits are meant to provide reparations to individuals who have been abused or mislead by companies. Often, individual suits wouldn’t be cost-effective, so individuals who have been injured, discriminated against, or otherwise abused can band together to create a single lawsuit to highlight an issue. Here’s a great example as to why these lawsuits are essential:
Johnson & Johnson has been a household name for decades and is one of the most trusted brands for families. Mothers use the products on both their babies and on themselves as a feminine hygiene product. But did you know that the company is currently being pursued in multiple lawsuits for their use of talcum powder? Doctors have discovered a link between talcum powder, which was for many years used in J&J’s baby powder, and ovarian cancer. Again, why does this legal action matter? Because when initially shown the link between their product and talcum powder, Johnson & Johnson refused to remove the ingredient from baby powder, and they still have talc in some of their products today.
Class action suits against J&J will do more than just help pay for medical costs for women who’ve been diagnosed with ovarian cancer caused by talcum powder. The cost of losing these suits is hoped to encourage the company, and other companies that use talcum powder, to remove the harmful ingredient from their product lines. Doing so would help prevent future injuries and ensure safer products for future generations.
Trump’s “Fairness” law has 2 crushing aspects. First, it necessitates that those banding together to create a class must have proof of the “same type and scope of injury.” So, if one woman was affected by talc via self-application and another had been using it on her infant daughter who later developed ovarian cancer, neither would be able to seek justice by banding together. Second, the bill creates shaky ground for lawyers by issuing criteria for their fees which could endanger them receiving remuneration at all. The risk for taking on these lawsuits would greatly increase, thereby dissuading many law professionals from approaching them. For businesses, this is a godsend; less lawsuits means less money put into lawyers and less time spent away from production and marketing efforts. For consumers, it is yet another gag order that stops we the people from speaking out against harmful business practices.
Now, back to that lesser known little action of the administration, H.J. Res 83. Sounds like a snappy name, right? Not very attention grabbing, which just helps to keep it out of the spotlight. So let’s illuminate the decision. H.J. Res 83 repeals the “Volks Rule,” issued by OSHA last December under the care of former President Obama. The Volks rule stipulated that employers were required to keep a record of employee illnesses and injuries for up to 5 years. Previous legislation had only required 6 months of record keeping, making it difficult for companies to be prosecuted after the 6 month mark. Are you seeing the pattern here? Another rule that increases “red tape,” evil paperwork that companies don’t really need to be bothering with, according to Trump.
Let’s look at a little story– I’ll even make one up on the spot. It’s 2015, and you’ve been working for a construction company since the 80’s. You wake up one day feeling sick, go to the doctor, and are diagnosed with mesothelioma. Knowing that this rare cancer is connected to the asbestos you’ve been breathing in at your workplace, you rightly report it. A year later, your buddy gets diagnosed with the same illness. Two years after that, a younger man who started a few years after you falls ill as well. Now, if your employer is only required to keep 6 months of records, it’s going to be that much harder to prove that your illnesses were all connected to the company.
Need a different analogy? Think about this one: a faulty, old machine causes an onsite injury. It gets reported, and the company chooses to repair the old machine rather than paying more to replace it. In less than a year, the machine breaks again and injures a mother of two who now has to go on disability long-term. Without the records to tie the two events together, how can you claim company negligence for not replacing a machine that was clearly on its way out? Well, good for your employer then. Less money for them to payout, and hey, maybe they should just patch up the machine again. It’s easy to see why employee protection advocates oppose the new ruling.
My point is this: less paperwork means less hassle. We can all agree on that. But it also means less protection. Records make people accountable for their actions, a truth you acknowledge every time you sign a contract. In law, written records are the pinnacle of evidence– the more proof you have on paper, the stronger your argument.
Yes, less regulations will make it easier for businesses to profit. But if that profit comes at the cost of both workers’ and consumers’ safety, is it worth it? Maybe it is to the people on the top like Trump and his swamp. But for you and me? I’d take the hassle any day.