Center for Legal & Responsible Commerce

Legislative Files

    We are out to prove that democracy can still work and that balanced legislation can still get enacted. We do not pay for our legislation. We do not wine and dine legislators or their staff.  We do provide them with balanced legislation to either sponsor or vote for.  As our name suggests, we support both consumer rights and efficient commerce, and there is no conflict between the two goals.  We have two constituencies that make our lobbying power significant, consumers and legitimate businesses.  Both are injured directly and indirectly by fraud and other deceptive business practices. Further, both groups need and demand meaningful legal protection.

    Unfortunately, neither group is protected by their current advocates. "Consumer advocates" advocate for more government regulation of companies.  One need only look at the insurance industry to see the worthlessness of government regulation.  When "consumer advocates" cannot achieve their goals in the legislature, they go to court and hope to regulate, or at least get wealthy, by judicial fiat.* Businesses are no better off, because the Chamber of Commerce and other business oriented/funded groups are seeking to close the courts to everyone via unconscionable, and often one-sided arbitration agreements. Not only does this harm commerce (because people are less likely to buy less products and services from less established companies if there is no chance of legal recourse), but it prevents businesses who are injured from seeking recourse.

Our Goals for the 115th Congress Include:

Reforming the Federal Arbitration Act
    Currently consumers are being sent mandatory binding arbitration agreements that limit the ability of consumers to protect their rights in a neutral forum.  An overburdened judge, when presented with a mandatory binding arbitration clause, will often without looking to determine if the clause is valid, stay the proceeding and send it to arbitration. Besides there being limited opportunity for review of an arbitration decision, arbitration is usually very expensive (even compared to litigation), usually prevents class actions (making it impossible to vindicate consumer rights and enforce consumer protection laws) and unfairly favors repeat players (the defendant corporation which has the power to select the arbitration forum). While the National Arbitration Forum (which has renamed itself FORUM) has suspended hearing many disputes involving individual consumers, the fact that there are other arbitration firms that have not ceased hearing consumer disputes, along with the fact that the NAF had to be sued by the attorney general of its home state before deciding to stop hearing these actions, shows the need for reform. Congress needs to stop tinkering with the edges of the Federal Arbitration Act for favored groups, and fix the act for everyone.

Reforming the Employee Retirement Income Security Act
    The United States' economy was very different when ERISA was enacted in 1974.  The vast majority of people worked for mid to large size companies and health insurance was just beginning become a necessity.  In 1974, the terms HMO, PPO, POS, etc... were unfamiliar. You went to the doctor, you or the insurer paid for the services rendered, and that was it.  In these much simpler times, insurance was straightforward, and Congress had a compelling interest in having businesses provide their employees with health coverage.  While the government still has a compelling interest in employers providing health coverage, ERISA is out of date, but ERISA is making it difficult for the self-employed and small businesses to get affordable health coverage and is driving up costs and pitting employee against employer in large corporations.  We need to update ERISA (or even start from scratch) to reflect modern economic realities, and to ensure that employees, employers and health care providers are being served by the healthcare financing system.  We need laws that promote private sector competition between insurers and ensure that insurers do not continue to make windfall profits at everyone else's expense. However, the last thing we need is a healthcare and/or health insurance system designed and managed by Washington (i.e., Washington setting policy benefits, premiums, deductibles, coverage decisions, insurer profits, and executive compensation).

Repeal McCarran-Ferguson
    The antitrust exemption for insurance companies should be eliminated.  It is this exemption that has allowed insurers to use coercive economic pressure on healthcare providers, and has resulted in cost shifting from the insured to the uninsured.  With some healthcare plans, the coverage is so limited that the plan amounts to nothing more than the purchasing of a right to the network price.  In the automobile insurance sector, McCarran-Ferguson has been used to drive down repair shop prices and unreasonably limit a claimants choice as to where they get their vehicle repaired.
     We supported S.618 in the 110th Congress because it was a bill that focused on fixing the problems with the insurance industry.