Consumer Federation of America (CFA)

ESTABLISHED: November 1967
EMPLOYEES: 20 (1997)
MEMBERS: 240 organizations representing 50 million individuals (1997)
PAC: Consumer Federation of America Political Action Committee

Contact Information:
ADDRESS: 1424 16th St. NW, Ste. 604 Washington, DC 20036
PHONE: (202) 387-6121
FAX: (202) 265-7989
EXECUTIVE DIRECTOR: Stephen C. Brobeck

WHAT IS ITS MISSION?

According to the mission statement of the Consumer Federation of America (CFA), the umbrella organization "works to ensure that all consumers, but particularly those who are least able to speak out for themselves, are not ignored by the system." Over the years the organization's goals have shifted in response to consumer needs and abuses. During the late 1960s and early 1970s the CFA was concerned with truth-in-lending and truth-in-packaging issues. By the 1980s many of its efforts were targeted at "big business," especially fighting inflation in the areas of food and energy. More recently, the CFA has been involved in matters concerning the purchase of new and used cars, as well as making sure consumer abuses do not occur on the Internet. But while its specific involvement has changed with the times, its overall mission remains: serving as a watchdog for the U.S. consumer.

HOW IS IT STRUCTURED?

Composed of representatives from over 240 consumer groups and agencies with allied interests, the CFA is governed by a board of directors elected by organization members. The board has the authority to elect officers and other board members and to determine the consumer policies of the organization. The entire membership debates and adopts policy resolutions at CFA annual meetings, which are held in conjunction with a consumer assembly. Policy committees oversee specific issues, including energy, food, health, product safety, communications, antitrust, the disabled, finances, low income, insurance, transportation, and the environment.

Since the board of directors meets only once a year at the convention, it delegates most of its authority to an elected 10-member executive committee which includes a president, secretary-treasurer, and eight vice presidents representing both national and grassroots organization members. That board, in turn, delegates certain responsibilities to the executive director, who is hired for an indeterminate period, and the CFA staff. Since its creation the CFA has had four executive directors, each appointed after the voluntary departure of his or her predecessor.

Member participation and control has been one of the greatest strengths of the CFA, helping to ensure that policies reflect a broad, grassroots consensus and providing the organization with credibility. Nevertheless, the CFA board extends a great deal of administrative discretion to the executive director, including the hiring of personnel, recommending annual legislative and regulatory priorities, and interpreting policy resolutions.

The CFA seeks to strengthen the consumer movement by building bridges between pro-consumer organizations. Staff members coordinate ongoing communication among hundreds of consumer and community organizations around the country. In addition to working with small groups of both member and non-member organizations on issues before Congress and regulatory agencies, the CFA operates the Coalition for Consumer Health and Safety. This unique alliance of 37 consumer, health, and insurer groups has defined goals and proposed solutions to problems in the areas of motor vehicle safety, home and product safety, indoor air quality, food safety and nutrition, cigarette and alcohol consumption, and AIDS. The coalition works to implement its agenda through legislative, regulatory, and public education initiatives.

PRIMARY FUNCTIONS

From its inception, the CFA has dedicated itself to representing the interest of U.S. consumers and ensuring them a voice in policy decisions that affect their daily lives. The size and diversity of its membership enables the CFA to represent virtually all consumers on a wide variety of issues. But its special interest always has been advocating on behalf of those with the greatest needs: children, the poor and near poor, and the elderly living on fixed incomes. Before Congress, the courts, and federal regulatory agencies the CFA has pushed for equitable ways to stabilize the U.S. economy and protect consumers by ensuring that the marketplace promotes competition, product safety, protection against fraud and abuse, quality healthcare, and pollution regulations. It has supported deregulation only in economic sectors where meaningful competition exists, such as in the telecommunications industry.

The CFA is first and foremost an advocacy organization, working to advance pro-consumer policy on a variety of issues. Its staff works with Congress and regulators to promote policies beneficial to consumers, oppose harmful policies, and engage debate on all issues in which consumers have a stake. It is also an educational organization intent on providing information on consumer issues to the public and the media, as well as to policymakers and other public interest advocates, by means of reports, books, news releases, newsletters, and press conferences. Finally, the CFA is dedicated to supporting national, state, and local organizations committed to the goals of consumer advocacy and protection. Member organizations include grassroots consumer groups, senior citizen organizations, labor unions, and cooperatives.

To achieve its goals and remain effective, the CFA also provides comments and information to Congress, federal agencies, and the courts; conducts surveys on consumer concerns; monitors legislation; lobbies; provides information to the media; and forms coalitions with other local, state and national consumer organizations.

Although their intentions may be the same—to protect consumers—CFA interactions with local and state organizations have not been without conflict. Especially in the organization's early years, CFA representatives at the national level frequently battled with grassroots representatives over control of the organization. Large trade unions and cooperatives felt that they should control the organization since they contributed the largest portion of income and were located in Washington, D.C.; grassroots groups believed that because of their character as consumer organizations, they were entitled to run the federation. A balance was struck by electing board members from both constituencies.

PROGRAMS

Each year the CFA sponsors the Consumer Assembly, a conference addressing consumer issues, needs, and priorities. The assembly provides a unique forum for leading consumer advocates and leaders representing labor, senior citizen, and rural interests to meet and exchange views and information with government, academic, and industry representatives. More than 500 typically attend.

The CFA also sponsors a full schedule of single-issue conferences each year. At these conferences, consumer advocates and representatives of government and industry discuss emerging issues in such areas as telecommunications, financial services, indoor air quality, electric utilities, energy, and marketing. CFA's annual Awards Dinner honors members of government, the media, and public interest organizations with distinguished records in advancing the cause of the U.S. consumer.

BUDGET INFORMATION

Under the leadership of Stephen Brobeck, the CFA has increased its annual income from about $200,000 in 1980 to $2 million in 1997. A reserve fund has been built up to more than $600,000, and membership services have been expanded. Most notably, a state and local grants fund was created. The increased funds were the result of a more diversified financial base. Instead of relying simply on membership dues to run the federation, the CFA began to publish and sell consumer-oriented books and pamphlets, as well as host and charge for workshops and conferences on various issues, such as energy and financial services. These and other projects were funded by a diverse group of institutions, including government agencies, publishers, corporations, trade associations, and CFA members.

HISTORY

The CFA was organized by reform-minded Washington, D.C.-based advocates during the mid-1960s, a time of turbulent change and social protest. Most of these advocates, drawn from organizations established earlier in the century such as the Consumers Union, industrial labor unions, and rural electric cooperatives, thought the time was ripe for new consumer protections and agencies.

In 1964 representatives of several of these groups began meeting informally and planning ways to advance consumer legislation; a year later they organized a national consumer forum. Held for the first time in April of 1966, this consumer assembly was co-sponsored by 30 national organizations representing workers, small farmers, consumer cooperatives, and women, as well as individual consumers. At this meeting White House Consumer Adviser Esther Peterson urged the creation of a federation of state and local groups to press for consumer legislation.

Later in 1966, after a lengthy debate, participants decided that the federation should include not only consumer advocacy and education organizations but also cooperatives, trade unions, and other supporting nonprofit groups. By the next assembly, held in November 1967, the foundation for the organization had been laid, a charter and bylaws prepared, and temporary officers selected.

1968–1973: The Angevine Years

During the federation's first annual meeting, held in April, 1968, 56 charter members elected officers and directors and appointed activist Erma Angevine, a professor of English at the University of Kansas and a member of several cooperatives, as the CFA's first executive director. Angevine's greatest challenge was building the organization from scratch, with minimal funds contributed by members. She also mediated ongoing tension between grassroots consumer organizations and the trade unions and cooperatives which represented about three-quarters of the federation's membership. This disagreement over representation culminated in the establishment of an offshoot of eight state consumer groups that was called the Conference on Consumer Organizations (COCO).

In addition to building the federation and dealing with internal turmoil, Angevine was expected to take the lead on numerous issues. During her tenure, she involved the CFA in dozens of congressional issues, developing position papers and fact sheets, mobilizing CFA members, and communicating with members of Congress and their staffers. Working closely with other consumer advocates, cooperative and union lobbyists, and a supportive group of Democratic congressional leaders, she helped ensure the passage of key consumer legislation involving truth in lending and truth in packaging.

1973–1980: The Foreman/O'Reilly Years

Angevine's successor, Carol Foreman Tucker, who served as executive director from 1973 to 1977, also faced many challenges in helping the federation grow and evolve. The daughter and granddaughter of Arkansas politicians, Tucker had worked on Capitol Hill, in the executive branch, and at a community-level Planned Parenthood office.

After Tucker left the CFA due to her appointment as assistant secretary in the U.S. Department of Agriculture in 1977, legislative director Kathleen O'Reilly took over the top spot, where she served until 1980. Before joining the CFA in 1975, O'Reilly had practiced law in the District of Columbia, where her corporate and insurance-industry defense litigation work included drafting the first federal no-fault auto insurance legislation. At the CFA, O'Reilly would become known for forceful consumer advocacy. She organized numerous coalitions, testified more than 200 times before congressional and state legislative bodies, and frequently was interviewed by national media. O'Reilly led a successful congressional effort to reduce sugar price supports and to expand protections against credit discrimination.

Despite her political savvy, O'Reilly found herself battling the Carter administration, which, surprisingly for a Democratic administration, seemed to support big business as it organized against consumer initiatives. To encourage the election of a more consumer-friendly Congress, the organization established its political action committee, which endorsed, but did not give financial contributions to, congressional candidates. One of the CFA's top priorities during the Carter presidency of the 1970s was fighting inflation, especially in the areas of food and energy.

The 1980s and Beyond: The Brobeck Years

After O'Reilly's departure to run for Congress, she was replaced by Stephen Brobeck, a social history professor at Case Western Reserve University who had served on the CFA board and executive committee. He became executive director just prior to the election of Ronald Reagan as president. During Reagan's first term, CFA consumer advocates remained almost continuously on the defensive, trying to protect agencies such as the Federal Trade Commission's Bureau of Competition and the Consumer Product Safety Commission from elimination and defending existing consumer protections, such as state ceilings on interest rates, which were under attack.

During the Bush administration, antipathy to consumer efforts lessened; the Clinton administration that followed would be even more supportive, although consumer advocates were unprepared for the overwhelming Republican victory in the 1994 elections. In addition to building the federation's financial base, Brobeck spearheaded efforts to create new organizations such as the Advocates for Auto and Highway Safety, advocacy groups like the Coalition against Insurance Fraud, the Coalition for Consumer Health and Safety, and the Consumer Literacy Consortium, and created the CFA's Tele-Consumer Hotline.

During the 1980s and 1990s the CFA staff established annual single-focus conferences on energy, utilities, and financial services, prepared a half-dozen books and more than a dozen pamphlets, established toll-free hot lines on telephone services and radon, and conducted consumer literacy tests that served as the basis for a new organization, the Consumer Literacy Consortium, which developed and disseminated money-saving tips. These and other projects were funded by a diverse group of institutions including government agencies, publishers, corporations, trade associations, and CFA members.

CURRENT POLITICAL ISSUES

Shifting consumer concerns have always dictated the focus of the CFA. Over the years the organization has followed such concerns as they have arisen; however, it has also raised public awareness regarding problems the average consumer might not be aware of, such as the dangers of formaldehyde, a substance used in furniture, home-building materials, and carpet manufacturing that is suspected of causing allergies and respiratory problems. One of the federation's most recent targets for reform has been the practice of "lemon laundering": dealers' misrepresentation to buyers of the condition of used vehicles.

Case Study: Defective Vehicles

In 1996 the CFA, along with the National Association of Consumer Agency Administrators, co-petitioned the Federal Trade Commission (FTC) to take steps to curb lemon laundering. Deeply concerned about the continuing problems encountered by consumers in connection with used car-sales and repairs, the CFA conducted surveys of consumer protection agencies concerning consumer complaints. In any given recent year, automobiles—both new and used car-sales and repairs—have been the product consumers complain about most. In listing the top five most frequent categories of complaints received, the survey found that autos comprised three of the four most frequent responses, with "used car sales" topping the list.

CFA representatives told the FTC that auto manufacturers' claims that vehicles are repaired before being marketed should be viewed with skepticism. Often problems are intermittent and may only become apparent under specific road conditions that are not duplicated when the vehicle is tested on the road or in the laboratory. Examples of problems include failure to start in certain climatic conditions, or stalling when there are changes in temperature or altitude. If vehicles with flaws are repurchased and resold to subsequent buyers who lack warranty protection, the vehicles may remain unfixed indefinitely. The CFA called for disclosure, title branding, and public registry of all vehicles repurchased by auto manufacturers and their agents or dealers.

CFA representatives also pointed to the false intentions of many car dealers who claim they will take back a lemon but then refuse to do so when pressed by the buyer or fail to inform customers that a vehicle has a history of known defects or was previously salvaged or rebuilt. Although 37 states and the District of Columbia require this kind of disclosure to buyers, law enforcement records show that manufacturers commonly fail to make such a disclosure, according to the CFA. While state disclosure laws vary in effectiveness, the main problem cited by consumer advocates is noncompliance. The CFA supports federal action to enforce disclosure of vehicle origin and condition as long as such laws do not preempt stronger state statutes.

Public Impact

The impact of lemon laundering on the public is clear. With the price of a new vehicle equalling as much as it once cost to purchase a modest home, many people have resorted to purchasing used cars and trucks as a way to economize. In addition, according to the CFA, more than 52,000 people are stuck with "lemons" each year. The organization contends that the problem of defective automobiles is not only a consumer issue but a safety issue as well. People driving unsafe vehicles endanger many lives, including their own.

FUTURE DIRECTIONS

The CFA and the Center for Media Education (CME) have launched a joint campaign to ensure that the "information superhighway" is built in an efficient and fair manner, filing comments with the Federal Communication Commission and the Department of Justice. "The rhetoric of the information superhighway paints beautiful images of a free-flowing information teletopia, but the reality can degenerate into anti-social, anti-consumer, and anti-competitive programming, pricing, and marketing practices. We intend to prevent that," director of research Dr. Mark Cooper noted in a CME report. The purpose of the campaign is two-fold: to ensure that telephone ratepayers do not bear an unfair share of the burden of the massive build-out of the phone network to provide video and advanced information services, and to ensure that consumers have access to a broad range of programming.

GROUP RESOURCES

All queries or requests for literature or reports should be made to the CFA information center by writing Consumer Federation of America, 1424 16th St. NW, Ste. 604, Washington, DC; or by calling (202) 387-6121. Information concerning specific consumer issues can be obtained by contacting the following CFA-related organizations: Advocates for Auto and Highway Safety at (202) 366-0123; Coalition against Consumer Fraud at (202) 393-7330; Tele-Consumer Hotline at (202) 347-7208 or 1-800-332-1124; and Coalition for Consumer Protection and Quality in Health Care Reform at (202) 789-3606.

GROUP PUBLICATIONS

The CFA's legislative staff conducts original research as a foundation for advocacy work. Often this research becomes the basis for new consumer legislation, and research results are frequently published in report form and made available to the public for a small fee. To obtain a list of available reports contact the CFA at 1424 16th St. NW, Ste. 604, Washington, DC 20036, or call (202) 387-6121.

The CFA publishes several book-length consumer guides, among them How to Fly, The Bank Book, The Childwise Catalog, and The Product Safety Book. Other consumer information is available in informational pamphlets obtained through a written request accompanied by a self-addressed envelope. Available topics include consumer credit options, indoor air quality, store brands, and dangers associated with formaldehyde.

CFA's most notable book is The Encyclopedia of the Consumer Movement, published in 1997 and edited by Stephen Brobeck and professors Robert N. Mayer and Robert O. Herrmann. The nearly 700-page book is the first comprehensive reference guide to the consumer movement in the United States and worldwide. Its 198 entries cover general topics, special consumer populations, consumer movement activities, consumer organizations, consumer leaders, product protections, and consumer movements.

The organization also publishes three newsletters. CFAnews keeps readers up-to-date on organization advocacy efforts, conferences, and publications, is issued eight times a year, and is available by subscription. The Consumer Health and Safety Update, providing up-to-date coverage of legislative and regulatory actions regarding home products, auto safety, cigarette and alcohol consumption, food safety, AIDS, and more is issued four times per year to members of the Consumer Coalition for Health and Safety. Indoor Air News, also published quarterly, provides legislative and regulatory information related specifically to air pollution. For an annual contribution of $225 individuals can join CFA's Newsletter and Information Service, a comprehensive package of consumer news that includes three newsletters; CFA policy resolutions; CFA testimony before Congress, regulatory agencies, and executive departments (an average of 40 documents); special legislative alerts on issues of concern to consumers; a congressional voting record, including detailed analysis of votes on key consumer issues; pamphlets on consumer topics; and dozens of news releases on events impacting consumers. For more information, contact the CFA at its central address.

BIBLIOGRAPHY

"Airline Ticket Prices." Consumer Reports, July 1997.

Fillion, Roger. "FCC to Propose New Cable Programming." Reuters News Service, 17 December 1997.

Hall, Jessica. "U.S. Telecommunications Consolidation to Intensify." Reuters News Service, 14 December 1997.

"Holiday Excesses Leave Many Americans in Need of Budget." Business Wire. 29 December 1997.

Lawsky, David. "Many Used Car Dealers Violate Federal Regulations." Reuters News Service, 3 December 1997.

Shanoff, Carolyn. "FTC Reminds Consumers: Know the Rules and Use the Tools During National Consumer Protection Week." Credit World, January/February 1999.

Smith, Frances B. "Bank Mergers: Boon or Bane for Consumers?" Consumers' Research Magazine, August 1998.

Szekely, Peter. "Group: Bank Tactics Raise Credit-Card Scare." Reuters News Service, 17 December 1997.