Exactly 57 years ago, President John F. Kennedy made an impassioned pitch for stronger consumer rights.
“If consumers are offered inferior products, if prices are exorbitant, if drugs are unsafe or worthless, if the consumer is unable to choose on an informed basis, then his dollar is wasted, his health and safety may be threatened, and the national interest suffers.”
Kennedy offered these words of warning on March 15, 1962, a date now celebrated as World Consumer Rights Day. He then called on Congress to enact legislation to protect four fundamental consumer rights: the right to safety, the right to be informed, the right to choose and the right to be heard.
The address has become known as the “consumer bill of rights.” But Kennedy also discussed an equally important issue: how such rights would be enforced. After all, without enforcement, consumer rights are just empty promises.
Consumer rights flourish
The idea of consumer rights was nothing new in 1962.
As I describe in my research on the history of consumer credit regulation, the states took an early interest in protecting ordinary Americans against abuse by lenders and debt collectors, beginning in the earliest days of the republic. Most adopted usury laws limiting the price of credit in the colonial period, exemption laws shielding property from seizure by creditors in the 19th century and more tailored consumer credit regulations in the early and middle 20th century.
What was noteworthy about Kennedy’s address was not his push for more consumer rights, but rather his call for the federal government – “the highest spokesman for all the people” – to act on behalf of consumers instead of ceding the role of consumer protector to the states.
Congress heeded Kennedy’s call and passed a flurry of consumer legislation.
In the 1960s and ‘70s, it required lenders to clearly disclose loan terms through the Truth in Lending Act, mandated fair credit reporting and debt collection practices, created safety standards for cars and other consumer products, and banned discrimination in housing and consumer lending. More recently, in 2010, Congress created the Consumer Financial Protection Bureau and tasked the agency with guarding consumers against unfair, deceptive or abusive acts and practices in financial services.
The states also reinforced their decades-old consumer laws in the 1960s and ’70s by banning unfair and deceptive acts and practices under state “UDAP” laws.
Accordingly, consumer rights today are far more robust than they were when JFK gave his speech. To be sure, new business practices regularly require that existing laws be updated to address unanticipated threats.
But the biggest challenge today is not the need for new consumer rights. Rather, it is ensuring that existing rights are enforced.