WHY U.S. CONSUMERS DESERVE BEING FLEECED AND EXPLOITED

A critical but overlooked fact in the coverage of Travis Kalanick’s forced resignation from Uber is that the ride sharing company’s financial performance supposedly was improving. Despite some despicable management abuses, including improperly obtaining the medical records of a rape victim, customers remained loyal. Uber’s revenue growth was outpacing its losses and it still commanded more than a 75 percent market share.

This shouldn’t come as a surprise. U.S. consumers have lost so much trust in corporate America they have become inured to wrongdoing. Dealing only with U.S. businesses that adhere to high ethical standards is no longer viable. As an example, leaving Uber for its competitor Lyft is hardly a compelling moral alternative. One of Lyft’s backers is Carl Icahn, the vulture investor who destroyed TWA and now serves as a “special advisor on regulatory reform” to President Trump. Compared to Icahn’s questionable ethics and greed, Kalanick is a choir boy.

Consumers have adopted a victim’s mentality and blame myriad corporate wrongdoing on forces beyond their control. But the sad truth is that consumers encourage corporations and government to fleece and exploit them. Whereas our forefathers were fearless individualists who revolted against their colonial masters because they wouldn’t accept “taxation without representation,” Americans today are akin to the Omega House fraternity pledges in “Animal House” whose hazing required them to bend over and say, “Thank you sir, may I have another?” while getting their behinds paddled.

Let’s start with Facebook, an inherently unethical company that provides a “free” service for the sole purpose of exploiting its users. Facebook’s management has shown a stubborn indifference to its users’ privacy concerns and their preferences not to have ads clutter their pages, but the company continues to grow and prosper. Even more disheartening is that the Facebook community doesn’t demand a cut of the advertising revenues the company receives because of the ongoing content they provide. Perhaps I’m romanticizing here, but I imagine that if Mark and Sheryl tried peddling their Facebook model in pre-revolutionary times, the colonists would have “leaned in” and demanded “no exploitation without profit sharing.”

Then there is America’s airline industry, which has been whittled down to three dominant carriers because consumers remained silent while the government blessed the formation of the cartel. United, Delta, and American became immensely profitable after coming to appreciate that travelers have no limits to the abuse they are prepared to sustain if fares are kept at historically low levels. Travelers express anger and threaten boycotts when an airline occasionally beats up a passenger or ejects them from a plane for not being sufficiently docile, but the airlines know it’s all mock rage. If United ran a promotion offering $100 round trip tickets anywhere in the country with the proviso that one passenger would be pummeled and bloodied, the airline’s servers would crash because of the overwhelming response.

The banking industry, once the most trusted, also has come to appreciate consumer submissiveness. A federal judge three years ago was so appalled by Wells Fargo’s abusive treatment of its customers he demanded a corporate resolution affirming the president and the majority of its board endorsed the behavior. Despite the bad publicity, Wells Fargo didn’t lose any market share, allowing the bank to fleece its customers yet again by opening bogus accounts and damaging their credit ratings. Most of Wells Fargo’s customers have chosen to stay put, which perhaps is understandable since Bank of America and JP Morgan Chase also have engaged in considerable wrongdoing.

But the most egregious examples of consumers getting what they deserve involve Comcast, which ranks as America’s most hated company, and AT&T, also reviled for its poor customer service and its continuous deceptive overbilling practices. (See here, here, and here for just a few examples). There were no vociferous consumer protests when Comcast announced plans to buy NBC Universal, giving the cable company control of several major networks; AT&T’s acquisition of Time Warner, which will give it control of CNN, HBO, and Warner Bros, also hasn’t encountered meaningful consumer opposition.

There was once a time that companies had to be deemed morally fit to hold a broadcasting license. RKO General was forced to sell its chain of highly profitable radio stations because its parent company was involved in an overseas bribery scandal. An FCC judge ruled the company wasn’t fit to hold broadcast licenses because of various transgressions, including overcharging advertisers. AT&T’s continuous history of overcharging customers apparently is no longer considered a moral impairment.

If you don’t respect yourself, you shouldn’t expect respect from others. Consumers would be wise to consider the adage next time they post on Facebook, are sitting miserably on an airline flight, getting scammed by their bank, or waiting interminably on hold “due to unexpected heavy call volumes” to protest improper billing issues.

If you choose to do nothing but bellyache, here’s my best counsel for you: Bend over, and repeat after me: “Thank you sir, may I have another?”