Things improved for consumers somewhat in 2013. With the economy slowly improving, more people are getting back to work. And after the slap-down Great Recession of 2008, government agencies are finally beginning hold those accountable for the epic economic disaster and adopt new rules to prevent such a catastrophe from happening again.
The following, in my opinion, are the top 10 stories for consumers in 2013:
1. Affordable Care Act.
It’s remarkable that 40 to 45 million uninsured Americans will be eligible to get health care insurance under the Affordable Care Act. While it’s an important public policy change and a step in the right direction, the law has many shortcomings. Unfortunately, a divided Congress isn’t able to realistically look at the law and offer positive fixes.
2. Website problems for signing up under the Affordable Care Act.
While it didn’t surprise me that consumers had difficulty signing up for health insurance when HealthCare.gov was launched, I was amazed at the extent of the problem and how poorly designed the system is. The huge undertaking, requiring coordination among three federal agencies, needed outstanding computer expertise. Unfortunately, the federal government’s procurement process failed and consumers are suffering needlessly in trying to take advantage of the new public policy on health care insurance.
3. Huge fines for banks for fraudulent practices.
First, huge fines were levied against banks who engaged in fraudulent mortgage practices after the Great Recession began: For example, 10 banks under enforcement action for faulty mortgage and foreclosure procedures reached an agreement with the Office of the Comptroller of the Currency and the Federal Reserve Board to pay more than $8.5 billion in cash payments and other assistance to help borrowers. Then, federal regulators finally went after banks for fraudulent activities leading up to the Great Recession. An example: JPMorgan Chase has agreed to pay $13 billion to settle federal and state charges related to the sale of residential mortgage-backed securities before to January 1, 2009. And, Chase also agreed to pay $4 billion for violations of federal and state securities laws for residential mortgage backed securities purchased by Fannie Mae and Freddie Mac.
While these government actions are good news for consumers, it was disappointing to read that former Wall Street chiefs are living in quiet luxury after the Great Recession and former securities regulators are now helping companies negotiate new mortgage rules while subprime lenders are back in business after the housing crash.
4. New rules to protect homeowners.
The Consumer Financial Protection Bureau is adopting new rules to protect homeowners as they purchase and maintain mortgages. Hopefully, this will protect consumers from the big banks in the future. Leading up to the Great Recession, banks and other mortgage servicers preyed on low-income homeowners, then when they couldn’t pay their mortgages, foreclosed on their mortgages using deceptive practices such as robo-signing.
5. Government actions on drug resistance pathogens.
After more than 35 years of debate, the U.S. Food and Drug Administration is finally taking a look at whether the antibacterial soaps that millions of Americans use daily are effective and safe. The agency only took action, asking the makers of the soaps to submit information in a year on whether their products are safe and are more effective than plain soap and water, due to a lawsuit filed by a consumer group. The FDA also recently announced a long-pending, voluntary plan to help phase out the use of antibiotics in animals that aren’t sick. Consumer groups argue the voluntary action does little to protect consumers.
Consumer groups and health officials have raised concerns that overuse of antibacterial products and antibiotics can lead to the increase in drug-resistant pathogens.
6. The Volcker Rule.
Five federal agencies have issued final rules to jointly restrict the way banks sell securities. The rules make sure big banks can’t make risky bets with their customer’s deposits, using government-insured money to make speculative bets that threaten the entire financial system.
7. Cancer and Alzheimer’s rates jumping dramatically.
Over the last two decades, Alzheimer’s disease jumped from #25 to #12 in a ranking of the causes of death and disabilities. And, it’s likely to continue rising as the Baby Boomer generation grows older – unless new strategies for treatment and prevention are found, according to the National Institutes of Health. Cancer rates will also jump as baby boomers get older because boomers are such a large demographic and cancer rates are higher among older people.
8. The federal government shutdown.
It was incredible to me that the federal government shut down for 16 days in 2013 because a group of conservative members of Congress don’t like government. Consumers need government services. That vital services were shut down, causing hardship for consumers is terrible. My advice to consumers: If someone in your area runs for public office who hates government, don’t vote for them. Shutting down the government to make political points in unforgiveable.
9. Big fines for pharmaceutical companies.
Big Pharma continues to ignore laws governing ethical practices. For example, Johnson & Johnson agreed to pay more than $2.2 billion to resolve charges related to the prescription drugs Risperdal, Invega, and Natrecor, including promotion for uses not approved as safe and effective by the U.S. Food and Drug Administration and payment of kickbacks. Another example: After nearly five years of litigation, a settlement was announced on behalf of investors totaling $688 million in class actions against Merck & Co. Inc., Schering-Plough Corp., and Merck/Schering-Plough Pharmaceuticals. The actions stem from claims that Merck and Schering, which merged in November 2009, artificially inflated their securities by concealing information and making false and misleading statements about the anti-cholesterol drugs Zetia and Vytorin.
10. EPA gas and car standards.
U.S. Environmental Protection Agency is proposing standards for cars and gas that will significantly reduce harmful pollution and prevent thousands of premature deaths and illnesses, while also improving the efficiency of the nation’s cars and trucks. When adopted, the standards will help avoid up to 2,400 premature deaths a year and 23,000 cases of respiratory ailments in children.