Consumer laws mean insanity is in store

24 September 2004

I have this nightmare. Newly elected Sheriff Andrea Cabral drags me along the dank corridors of the Suffolk County jail. I pass by the grim cells. In one sits a sullen man. He's in for handing out free milk - around a schoolyard, no less. Next to him is a landlord who installed water meters in his apartments. A woman glares at me; she forgot to put little price stickers on every item in a carton of dishwasher soap.

Cabral roughly tosses me through an open door and it clangs shut behind me. My crime? A customer of mine bought a bottle of carbonated juice. I didn't charge a nickel deposit.

Welcome to consumer hell, a uniquely Massachusetts experience, a place of consumer laws gone awry, a world of irrationality and higher prices that the rest of the country has left behind.

Massachusetts regulates the price of milk, with a law on the books that prohibits stores from selling it below cost or giving it away free. With the apparent exception of New Jersey, no other state has a similar rule. The law supposedly was intended to help consumers and protect the little milk stores that feared competition from supermarkets. The effect has been the opposite: Prices for Massachusetts consumers are higher and the rule actually acts to the detriment of smaller retailers, who can't use deals on milk as a lure to attract shoppers.

It is as irrational as another archaic regulation - an only-in- Massachusetts prohibition against landlords metering their tenants' water use. The ban encourages waste (up to 39 percent less water is used when it's metered, according to one industry estimate), costing landlords money and, inevitably, pushing up rents. Yet despite many efforts to change it, including one this year that came within a hair's-breadth of passing, the law remains on the books.

That's true of another goofy rule: item pricing. Massachusetts and Michigan are the only two states that still require stores affix individual price tags to each item. Before bar codes and scanners, that made sense; today it's just silly. The attorney general loosened the requirements somewhat last year, allowing for the use of alternative (and reportedly, unworkable) technology that individually prints prices, yet the state still refuses to get rid of the regulation outright.

Trial lawyers are thrilled. Target just settled a class-action lawsuit for $1 million, the latest in a string of lawsuits that have cost the state's retailers more than $8 million.

Consumers, on the other hand, pay more. Ultimately, that $8 million comes from our pockets. On top of that, affixing prices adds about 3 cents to the cost of each item.

The zealots bringing the lawsuits say it's worth it, claiming that consumers are happy to pay more for the convenience of having prices marked individually.

Really? If it's true, then the zealots should start up their own store, mark prices individually and then run ads: "Everything 3 cents more than the competition!" If consumers really value item pricing, they'll go. Of course, we all know they won't.

But wherever you shop, if you buy something to drink, another outmoded law confronts you: the bottle bill. The law itself is a mish-mash: Beer and carbonated water, for example, require deposits; wine and fruit juice do not. Deposits were a well-meaning idea back in the days when no one recycled. Today, they actually hinder recycling (municipal recycling programs would generate more money for themselves if they could pick up and resell valuable items such as aluminum beer cans), waste energy (as consumers drive back and forth to return their cans and bottles), and contribute to litter (roaming packs of bottle and can hunters tear through plastic bags of trash, leaving a mess in their wake). Deposits have become little more than a tax - and an egregiously high once at that. On a $2.40 12-pack of soda, for example, the deposit amounts to 25 percent.

Each of these foolish rules, ostensibly designed to help consumers, actually harms them. Each one drives up prices, boosting our cost of living for the most ordinary of items. Moreover, these laws are regressive: They hit those on low or fixed incomes the most. Who's hurt by milk price regulation? Families with kids. Who's hurt by item pricing? Certainly not the price-insensitive folks who shop at Nieman Marcus; rather, it's those who frequent big-box stores trying to stretch their dollars. Who's hurt by the deposit bill? Working-class beer drinkers pay the tax while the wine and brie crowd gets off scot-free. Who's hurt by the water-meter prohibition? Frugal users of water end up subsiding the profligate ways of their wasteful neighbors.

And so I make this plea: Repeal these stupid laws. Allow water metering, don't regulate milk prices, get rid of item pricing and free us from the scourge of bottle deposits. I'm in a nightmare here, and I want to wake up.