"When AT&T provides broadband service by speed, it will do so in discrete, non-overlapping tiers," Quinn said in written testimony. "We will strive to provide service within the speed tier purchased by the customer and, if we find that we are not providing service within the ordered speed tier, AT&T will take action either to bring the customer's service within the ordered tier or give the customer an option to move to a different tier."

There's actually no word on pricing yet, but we're going to make a bold, brave prediction that you'll pay more than your current package for the better tiers.

"AT&T To Create Tiered Internet Access For Subscribers" [CNN Money]
(Photo: Getty)

Several unhappy patients at the advisory meeting faulted their surgeon for not ruling them out as a poor candidates for LASIK, or for failing to stress the severity of possible side effects.

The FDA is also planning to begin a study on LASIK patient satisfaction in 2009 along with the National Eye Institute and two industry groups: the American Society of Cataract and Refractive Surgery and the American Academy of Ophthalmology.
 
Patient and consumer advocates at Friday's meeting objected to the groups' involvement with the study, citing conflicts of interest. Industry representatives said it would help them understand why some patients are unhappy with their LASIK results.

Alpha Consumer, who was at the hearing, recounts:

[Susan Wones of Denver said one] of her Chase credit cards jumped from a 14.9 to 25 percent interest rate after she got close to, but didn't exceed, her $6,000 credit limit. She said the interest rate on a second Chase card similarly shot up after she went $15 over her credit limit in the middle of a billing cycle, even though the beginning and ending balances were under the limit.

The NFL does not allow one team, in the midst of the fourth quarter, to unilaterally move their end zone 20 yards in their favor just because they don't like the point spread. The rules are laid out before the kickoff, and the umpires enforce the same rules for both home and visiting teams for the whole contest. It's time for legislation at the federal level that tells the credit card industry, "Game Over" to unilateral, one-sided, rule changes.

As a registered Republican, it has typically been my philosophy that business and commerce flourish and perform better with minimal government interference. However, when an industry sector proves time and again that it is unable to police itself and behave and engage in fair and ethical trade practices, legislative intervention is required.

"credit card abuses faced by our middle class families add insult to injury ...charging interest on penalty fees is wrong...contracts are totally incomprehensible...if this problem is going to be resolved it is going to be resolved here in Congress...The fed is looking at disclosures, it's (looking is) endless."

The Credit Cardholders' Bill of Rights is a wonder-packed piece of legislation that would:

• Ban arbitrary rate increases
• Force creditors to provide 45 days notice of any rate increase
• Ban double-cycle billing
• Empower cardholders to set limits on their cards and ban over-the-limit fees once that ceiling is reached
• Ban excessive fees
• Ban lending to subprime borrowers
• Require creditors to mail bills at least 25 days before the due date, instead of 14 days as currently required
• Require creditors to apply payments first towards high interest items

The Credit Cardholders' Bill of Rights: Providing New Protections for Consumers [House Financial Services Committee]
Live blog from credit card hearing [U.S. PIRG]
Credit Card vs. Consumer [Alpha Consumer]
HR 5244 - The Credit Cardholder's Bill Of Rights [THOMAS]
Write Your Senator
Write Your Representative
PREVIOUSLY: How To Write To Congress
Credit Card Victims Muzzled, Ordered To Release Financial Histories Before Sharing Their Experiences
(Photo: the illustrious untitled13)

An October hearing on companion legislation in the House Judiciary Committee quickly devolved into a sob story, with three consumers sharing in horrifying detail how arbitration left them financially ruined. Today's hearing will be comparatively sedate, featuring one panel of academics and lawyers.

Join us at 9:30 as the professionals slice and dice the wonderful and evil qualities of the most anti-consumer practice allowed by law—for now.
(Photo: xsparrowx)
9:32: Video Link - Constitution Subcommittee hearing to examine S. 1782, to amend Chapter 1 of Title 9 of the United States Code with respect to arbitration. Coverage begins momentarily. Oh Congress, you could de-sass anything.
9:34: Here we go. Senator Feingold (D-WI) is chairing the hearing, already decrying our lost right to jury trials.

9:35: Arbitration is especially evil because contracts are often non-negotiable.

9:36: Arbitration's extra-judicial nature precludes discovery and restricts judicial review. It's the 'gitmo of contracts.

9:37: Voluntary alternate dispute resolution is great, but consumers must be given the right to choose arbitration or a jury trial.

9:37: The bill is meant to apply to disputes between investors and securities brokers, which is important to some people.

9:38: And now to Senator Brownback (R-KS).

9:40: Brownback thinks the proposed law is "over-broad" because it applies to any dispute where the two parties have unequal power.

9:40: He is worried that removing arbitration would lead to a flood of lawsuits that would clog the judiciary. Then us poor consumers would have no meaningful chance of recovering anything.

9:41: More reasonable, he wants a distinction between fine print arbitration, where arbitration is snuck into an agreement, and agreed arbitration, where two equal parties agree to send disputes to an arbitrator.

9:42: Employees are 20% more likely to recover from arbitration than litigation.

9:42: California studies show that consumers won 65% of cases against businesses.

9:43: These statistics conflict directly with what we heard during the last hearing. Consumers have a 1.6% chance of winning most arbitrated cases.

9:44: Eh, weak point. The trial bar suggests that a series of small cases should be bundled together into a class action. Brownback offers "My toaster doesn't work" as an example. If most toasters of a certain brand don't work, a class action would be justified. The problem is that class actions also fail most consumers. Who wants a $5 coupon towards a new toaster when the lawyers handling the case get $5 million for their work? But that is a whole separate bill. We do not want to drag our broken toaster into arbitration.

9:46: Feingold is clarifying that the bill applies only, exclusively to mandatory arbitration. Other arbitration is more palatable.

9:47: The witnesses have been sworn in.

9:47: Oh good, we do have an aggrieved consumer: Fonza Luke of Birmingham, Alabama. She works two jobs in health care, and serves on the board of her church. She has four children and six grandkids.

9:48: She is going to talk about how mandatory binding arbitration applies to employees.

9:49: She spent 30 years as a licensed nurse and always earned the highest honors and accolades. Always took the hospital up on new training opportunities.

9:49: In November 1996, she was told she would lose her job if she didn't sign a mandatory binding arbitration agreement.

9:50: She didn't think it was right, and after speaking to her husband and pastor, she refused to sign.

9:50: The hospital tried twice more to get Fonza to sign, and when she still refused, she was fired for insubordination.

9:51: "The only things I did that were insubordinate were things that younger, white employees did all the time." "I believe [the hospital] fired me because of my race and my age."

9:52: The EEOC (Equal Employment Opportunity Commission) agreed and fined the hospital.

9:52: She sued in federal court, but was told that she had to go to arbitration, even though she had refused to sign the agreement.

9:52: She was told that she implicitly agreed to the proposed agreement because she continued to work for the hospital.

9:53: Her appeal was rejected, and she was sent to arbitration.

9:53: The arbitrator was paid by the hospital and rejected Fonza's claims of discrimination. "I don't even think he looked at my claims."

9:54: Now Peter B. Rutledge of the Catholic School of Law.

9:55: He's talking about "the data."

9:55: "'The data' are conflicting with calls to abolish arbitration." Dude, just say that the numbers tell us to shut up.

9:56: Costs would rise, consumers would lose access to justice. Irony would run through the streets without abandon.

9:56: "Eliminating arbitration would not make individuals as a whole better off." We are bothered by the phrase 'individuals as a whole.'

9:57: Most arbitration studies refer to employment arbitration, not the standard consumer arbitration that we hate.

9:58: His argument boils down to this: litigation is expensive and time consuming, so why not arbitrate?

9:58: Litigation is expensive, but that is a factor that each consumer must weigh. Sure, arbitration could work in certain circumstances, but arbitration can only be fair when consumers choose it over litigation. That choice is what this bill seeks to restore.

10:00: Onto Richard M. Alderman of the University of Houston Law Center.

10:01: Yuck! Congress eliminated mandatory arbitration for used car dealers, but hasn't given us the same freedom.

10:01: The car dealers complained that stronger dealers would impose arbitration on weaker franchises, so Congress stepped in and provided relief. Thanks for forgetting the rest of us, Congress.

10:02: Bingo: Business has opted out of the civil justice system in favor an alternate form of justice that they control.

10:03: Our courts do more than hand down decisions. They interpret statutes and form common law. By escaping the courts, we kill democracy. Do you want to kill democracy? Didn't think so.

10:04: Arbitrators are not bound by precedent. No common law, no uniformity. Different consumers in identical situations can receive different outcomes.

10:05: Arbitrators can not contribute to, or modify, common law. We have frozen the law and prevented any adaptation to new or novel situations.

10:05: Should a powerful party should deny weaker parties access to the courts and our common law?

10:06: Onto Richard Naimark of the American Arbitration Association. Wonder what he might possibly say.

10:07: "The AAA does not represent an industry." Arbitrators are independent lawyers, not employees of the AAA.

10:07: He agrees that the issue is access to justice.

10:08: Back to this old point: arbitration is cheaper than litigation.

10:08: Arbitration is cheaper "IF due process protections are built into the process."

10:09: 'Due process protections' and access to courts and consumer choice are not the same thing.

10:10: Due process means that costs must be reasonable, everybody should have access to legal counsel, the arbitration must be in a mutually agreeable location (we heard at the last hearing that this is not followed.)

10:10: Those provisions are necessary for people to take arbitration seriously, but they do not justify denying consumers access to the court system. Nothing does.

10:11: Onto Tanya Solov, the Director of the Securities Department with the Illinois Secretary of State. We're going to hear about investors.

10:12: This is all the Supreme Court's fault. They're the ones who ruled that investors could be roped into mandatory binding arbitration.

10:13: Don't think investment disputes affect you? Half of all Americans invest, and most investment agreements include clauses requiring mandatory binding arbitration.

10:13: A win in arbitration results in meager recovery, sometimes less than the cost of arbitration.

10:14: "Arbitration may be desirable if both parties knowingly and willing agree to arbitrate at the time of the dispute." 'However, even if arbitration is cheaper and faster, especially when investors lose their life savings, a fair hearing with a public review is more important than a cost-effective solution.'

10:15: She supports the act.

10:17: Onto Mark A. de Bernardo or Public Justice. He has testified more than 40 times before Congress. Impressive.

10:18: He supports arbitration over litigation. Again, litigation is not always the solution, but consumers must be given the choice.

10:20: He is rattling off statistics that prove how arbitration is better than sliced bread, all without addressing the issue of consumer choice.

10:22: "I do believe this bill would be a death blow to arbitration in America." We agree.

10:23: "Arbitration is a job saver, litigation is a job destroyer."

10:24: Onto F. Paul Bland, Jr. We will make no joke about his last name. None.

10:25: He wants to respond to some of the comments thrown around today. "Outlandish comments" have been made.

10:25: He's pissed and wants people to look at the big picture, not little studies and "the data."

10:26: The studies are rigged. One study selected one case out of every one thousand to show that consumers won.

10:27: Here is how the studies define a consumer win: Consumer loses their house, goes into arbitration. If the consumer recovers $1, that's a win.

10:27: What is the one place in the country where the data isn't handpicked? California. All data must be posted.

10:28: Bland is so angry. He's practically yelling at the other witnesses.

10:28: Employee win rates and damage awards are much worse in California.

10:28: Blackballed: Every arbitrator that gave a large award to a consumer suing an HMO never heard another case involving HMOs again.

10:30: AAA talks about due process, but prior to 2001, they had never enforced due process claims. Only when they were sued in federal court did they begin to selectively enforce due process.

10:30: AAA doesn't provide neutral arbitrators. They hand over a list of seven arbitrators who all specialize in defending the industry.

10:31: That's what happened to Fonza.

10:33: Question time.

10:33: Feingold is praising Fonza for refusing to sign the arbitration agreement, but wants to know why she refused.

10:33: Fonza was told that she would be waiving her rights because she felt that she could be fired too easily as she was approaching retirement.

10:34: The hospital offered nothing in exchange for signing the agreement.

10:34: The arbitrator that heard her case refused to allow any evidence that the EEOC spent months collecting. Courts would have allowed Fonza to present her evidence.

10:35: Holy shit! The woman who was raped in Iraq and accused Halliburton of covering up her case is trying to sue the company in federal court. She is now being told that she must submit to mandatory binding arbitration.

10:36: Going back to the revolution, colonists complained that King George selected judges and who were dependent on him for their salary. Their decisions were decried as horrifically unfair. Sound familiar?

10:39: "To try to make arbitration more like a court won't work. The question is should consumers be forced into arbitration."

10:42: Brownback was the Kansas expert on "fence law." What is fence law, and why is Brownback talking about Kansas fence law?

10:42: Oh, this is when a cow breaks through a fence and does unspeakable things to the neighbor's property.

10:43: He is still talking about fence law, the civil alternative to pulling guns.

10:45: He is asking the AAA how more due process could be added, possibly by legislation.

10:46: The AAA would require legislation to protect the little guy by enshrining their due process requirements into law. Still doesn't get us to consumer choice, though there might be new opportunities to sue for violations of those protections. If the AAA hands over a list of biased arbitrators, consumers could potentially sue for failing to follow the due process requirement of a neutral arbitrator.

10:47: Rutledge is concerned that all arbitration—consumer, employment, securities—is lumped together. "The data" don't support that. "The data" are angry.

10:48: Brownback also wants more data.

10:48: Rutledge is defending himself from Bland's claims of "outlandish comments." Don't mess with "the data."

10:49: He believes the best, most accurate data have been cited in his testimony. Powerful words. Maybe he wants "the data" to speak for themselves.

10:50: A batch of schoolchildren have walked into the hearing room.

10:50: They do not look amused. These kids today, with their rock music and sneakers... they have no respect for "the data."

10:52: The Illinois Secretary of State rep also wants to know how these studies classify a win.

10:53: Even without that data, she thinks there is more than enough support to pass the bill.

10:53: Feingold wants to hear more about how we lose something as a nation when we chose arbitration over common law.

10:54: Our system depends on private parties litigating in public to keep market players in check. When you make proceedings secret, the marketplace loses vital information.

10:55: We have a right to know if someone is suing Mattel for making deadly toys. "This is your life. This is your house, this is your health, this is your automobile. If this is secret, you do not have a way to protect yourself."

10:56: Feingold is picking up on our choice argument: Do you think that it means that no reasonable person would choose arbitration?

10:56: Right, if nobody chooses arbitration, that strongly damns the institution.

10:57: Consumers rarely choose arbitration. Of 20,000 cases, 4 were brought by consumers. This is not a valuable alternative that helps consumers. "There are not consumers out there crying because they might lose the chance to arbitrate."

10:58: Brownback wielding self-deprecation: "The fence law expert is back."

11:01: He wants to know if there's a way to bring arbitration into the tradition of common law.

11:02: No.

11:02: Alderman does not believe there is any way to create public law outside of the courts.

11:03: We don't want arbitrators interpreting statutes. Federal judges are nominated by the President and confirmed by the Senate. Businesses pick arbitrators who save them money. They should not be allowed to interpret Congress' work.

11:04: The Texas Better Business Bureau required its members to use BBB arbitrators regardless of what their contracts stated. BBB arbitration was considered fair, but when one of the arbitrators ruled against the biggest homebuilders in the state, the businesses chose to withdraw from the BBB rather than face another unsuccessful arbitration. It is a money-saving business decision, not an open and fair system of justice.

11:08: Feingold contrasting mandatory binding arbitration and a Congressional hearing: "This is exactly what a hearing should be, a fair hearing of the issue."

11:10: The hearing is adjourned.

Today's hearing will feature two panels. First, three aggrieved consumers will share their horror stories. Then, the presidents of Discover, Bank of America, and Capitol One will explain that the three consumers who just testified are not at all representative of average cardholders. Right.

The tears and lies start flowing at 9:30 a.m.
(Photo: samwilkinson)

9:25: Two choices for your viewing and listening pleasure: Video Link—Audio Link
9:34: And we're off. Levin has arranged for an interesting hearing. The first consumer we will hear from is Janet Hard. Janet is married to a steamfitter. She has a Discover card that jumped from 18% to 24% because her FICO score dropped. When Janet complained, the rate dropped to 21%. Discover's President will testify today.

9:37: Levin is most incensed by the retroactive nature of rate increases. Take a consumer whose debt jumps from 15% to 27%. That new rate applies not to new debts, but to all incurred debts.

9:41: Bonnie Rushing has two Bank of America cards. One is associated with AAA. Both cards had an 8% rate. BoA bumped the AAA rate from 8% to 23% because Bonnie's FICO score fell. It didn't matter that her payment history was perfect. Bonnie isn't sure why her FICO score dropped, but she thinks it may be because she opened a store-branded card at Macy's to receive an immediate 10% discount on a purchase, unaware that it would affect her FICO score.

9:43: When Bonnie received the rate-increase notice, she opted-out and closed her account. BoA tried to pressure her to keep the new, higher rate, but after she complained to state and federal authorities, BoA let her close her account. BoA's president will testify today.

9:44: Capital One raises rates by looking for accounts that haven't been bumped in three years—but they don't use FICO scores.

9:44: One consumer was hit by three rate increases in three months. Oftentimes the rates doubled or tripled. The consumer was able to reduce her rates by calling and fighting the credit card companies.

9:46: Levin: "If you shop with a credit card, as most consumers do, dangers lurk."

9:46: Most people don't realize that their FICO score drops even if they approach—not exceed, approach—their credit limit.

9:47: The Committee asked who determines a FICO score, who determines when a rate jumps because of a FICO score. The answer: computers.

9:47: Issuers don't know why a FICO score drops. They have four "reason codes," generic statements like: "balance grew too fast compared to credit limit," or "balance on bank cards is too low."

9:48: By law, consumers are entitled to know who supplies credit data. Even with this data, few consumers realize that a rate hike was caused by a lower FICO score.

9:50: When Janet Hard received her rate increase notice, she was told that it was because her balances were too high and her accounts were delinquent. When pressed, Discover couldn't explain which balances were too high, or which accounts were delinquent.

9:51: Levin does not want any increases for consumers who pay their bills on time. At least not retroactive increases.

9:53: Credit card companies have drop rates when the Subcommittee calls to inquire about an account.

9:55: Levin's solution is S. 1395, which would:

"bar companies from charging interest on debt paid by the due date, cap penalty interest-rate increases, prohibit interest from being charged on late fees or over-the-limit fees and prohibit late fees if a card-issuer delays crediting a payment."

9:55: Senator Norm Coleman (R-MN) is claiming that the nature has credit has changed. It used to be something you earned. Now, creditors are tossing cards like confetti.

9:56: It seems like a personal problem, but it has nationwide implications.

9:57: For background: Abusive credit card practices affect everyone. In a country of 300 million, we charged more than $1.8 trillion dollars on over 691 million credit cards in 2005. Back in the eighties, Americans charged about $70 billion per year.

9:57: Coleman argues that the democratization of credit has helped America, but it has been tainted by federal regulations that raise rates. Eh? Coleman asked credit card companies to regulate themselves so Congress can focus on something else. Apparently, his strategy of "Be Nice, Please" is working. Double-cycle billing is now a thing of the past. See, no federal regulation needed. "These are serious steps and constitute self-reform."

9:59: 'There is a competitive advantage to offering fair user-friendly offers.' Sure, but nobody does. At least he realizes that there still massive problems, with universal default and rate increases out of the blue.

10:00: Claire McCaskill (D-MO) argues that even lawyers can't understand credit card offers.

10:01: Creditors hate closing accounts. You can't call, or write on a bill that you want your account closed. You have to write a separate letter.

10:02: Senator McCaskill's mother wrote in that she wanted to cancel her credit card. That didn't stop them from sending her checks for the holiday season that would re-activate the card.

10:03: Excellent: McCaskill is calling credit card debt "The Next Subprime Disaster ^TM." She is absolutely right.

10:04: If the credit card companies won't stop financially raping Americans, McCaskill wants to break out some serious regulation.

10:04: Senator Tom Coburn (R-OK) has no opening statement.

10:05: Interesting: Levin is swearing in the witnesses. Most testimony is not sworn—there is simply no need. Lying to Congress is a felony that carries up to five years in jail.

10:06: Here is Janet Hard, the consumer with the Discover cards.

10:06: Janet is a registered nurse turned stay-at-home Mom.

10:07: She used credit cards to make ends meet, which is always a losing strategy. She figured that she could make boost her income when she went back to work when she stopped taking care of her kids.

10:07: She learned about the rate increases only after she realized that her payments were no longer reducing her debt at the usual clip.

10:08: Janet was initially told that the rate was increased because of a spot credit check. When she called to complain, Discover agreed that she was an excellent customer, but refused to drop the rates.

10:08: She also has an HSBC account, which accesses the same credit data. HSBC did not raise her rates.

10:09: She does not want to shirk her debts. She wants to be treated fairly. "We feel as though we've been robbed."

10:10: Onto Bonnie Rushing. Downsizing cost her a job and income security, but she never missed a credit card payment.

10:11: Still, the rate on her BoA AAA card unexpectedly tripled. Bank of America said that she had been sent a change in terms notice without responding, and so her rate was bumped. Bonnie could no longer refuse the rate or close the account.

10:13: Bonnie tries escalating to a supervisor, who offered to renegotiate the rate down from 23% to 21%, still much higher than the 7.9% Bonnie had enjoyed.

10:14: AAA intervened and was able to press BoA into accepting the original, fixed rate of 7.9%

10:15: A bank executive told Bonnie that the change was made because she was a "good long-standing customer whose business they did not want to lose."

10:15: Bonnie took her experiences with the call center very seriously. More than anything, she's upset that they treated her without respect, without realizing that she was a decent person who was trying to responsibly pay off her debts.

10:16: Onto Millard Glasshof, who has been retired since 1992. He's here with his wife.

10:16: In 1997 he received a MasterCard with Bank One. He originally agreed in 2004 to payoff a balance of over $5,000 at 14%.

10:17: In March 2005, Chase took over Bank One and bumped the rate to over 17%.

10:18: Millard had never missed a payment. Chase could not explain the increase.

10:19: He received a letter, which he didn't understand. He thought it said that his new payments were $111. He called to confirm, which Chase did. When he paid $111, Chase hit him with fees for insufficient payments.

10:20: After the Subcommittee looked into his situation, Chase miraculously dropped his rate to 6%.

10:20: Janet's original debt was over $8,000. She made only $500 in new purchases. Of $2,400 in payments last year, $1,900 went towards interest, not the principal.

10:22: Janet had no idea that her rate increase was triggered by her credit score. Her rates were dropped back to their original levels after the Subcommittee started asking questions.

10:23: Millard had $4,800 in debt. Last year he made no new purchases, but did pay $1,100 in interest and $200 in fees. He made $1,300 in payments and still owes $4,800.

10:24: Millard had no idea why his rate was increased.

10:24: He hasn't missed a payment in two-and-a-half years.

10:24: Chase says that an automated review of closed accounts, like Millard's, showed that his FICO score had dropped, triggering a rate increase.

10:25: Levin is really pissed that these rate increases are retroactive. More troubling, none of the consumers testifying realized that rate increases applied to past debts.

10:28: We remember a program we watched some years ago—it may have been Frontline's look into credit cards—when our favorite debt-expert, Elizabeth Warren, explained that credit cards are the only financial instruments that retroactively raise the price of goods after purchase. How would you feel if the guy at the electronics store knocked on your door, pointed to the TV in your living room, and said "By the way, that now costs $500 more. Pay up." We hadn't thought of it like that before, and it bothered us greatly.

10:32: It may have been this Frontline episode. Well worth watching.

10:33: Back to the hearing. Senator Coleman wants to know why the consumers didn't receive (or read) the notices from credit card companies.

10:33: Millard is arguing that he never read in any of his notices that his rate was increasing. That would have helped.

10:34: Janet thinks notices from credit card companies are deliberately misleading.

10:34: Coleman: "Do you know what the U.S. Prime Index is?"
Janet: "No, I do not."
Coleman: *stunned silence*

10:35: Coleman: "I'm trying to figure out what, if anything, we can do with notices." He thinks Janet was pretty much screwed from the start because of her debt levels. She had no hope. All her fault. "You may have been treading water, you may have treading for a long time."

10:36: We have an idea for notification, Senator. If a credit card wants to increase a rate, they should sent a notice. The notice should have two lines in massive fonts that show:

• Your Current Rate;
• Your New Rate

10:41: Senator McCaskill is reading the paragraph that raised Millard's rate. Nobody understands what she is saying.

10:41: McCaskill: Did you call after you received this letter and ask what you were supposed to pay?
Millard: Yes.
McCaskill: Did they send any confirmation?
Millard: No.

10:42: Ok, we want back and found Elizabeth Warren's statement:

Frontline: But they would say they're just making capital or money available to people in a convenient way.

Warren: Well, in a convenient way, and changing the price after people borrow it. You know, that's a heck of a deal. I don't know any merchant in America who can change the price after you've bought the item except a credit card company. After you have borrowed the $5,000, they can change the interest rate from 9.9 percent to 29.9 percent. I just don't know anyone else who can do that.

Hey, listen ... you make exactly the point that the credit card companies keep trying to make: "Hey, ... we don't make anybody take the money." And they're right; they don't hold a gun to anybody's head when they borrowed that money. But they did the much, much slicker way, and that is, they just put it all into contract papers. They put it all in clauses that people can't read. They put it all in things like "universal default terms" and "15 days to change the terms of this contract" and arbitration agreements that [say] "We will hold the arbitrator to see if we have abided by the terms of the contract." ... They have teams of lawyers to figure out just the way to write the contracts that will maximize the profits for the credit card companies and minimize the likelihood that any customer will quite figure out what has happened when he or she uses that credit card.

10:46: We think Tom Carper is giving a statement. He represents Delaware, where most of these credit card companies live. He's going to ask the witnesses what they would do if they were credit card companies. This should be good.

10:50: Carper: Is it not unreasonable to raise rates when a customer's risk increases?

10:51: Oh, he's talking universal default, the most evil and hated practice where a credit card company boosts your rates because you didn't pay a late fee owed to the library. Real fair and equitable.

10:51: Holy shit, I can't believe this worked. Bonnie: "Credit card companies are businesses, they have obligations to their shareholders." Come on, Bonnie, realize you're getting played and hit back!

10:52: Bonnie walked into the trap, but at least she's arguing that she met all her debts and should not have been subject to a rate increase.

10:53: Levin comes back to argue that the increases are automated and unfair. "If it's a risk-based decision, isn't it weird that you were sent additional blank credit card checks in the mail?"

10:54: We like Levin's style. Rather than look over at Carper and say: "Dude, shut up," he's having every witness show that the rate increases had nothing to do with their risk profiles. Such a classy place, this Senate of ours.

10:57: Coleman's back with a hypothetical. He's asking if anybody would have a problem if they could no longer use their credit card and pay off the debt at the existing rate.

10:57: Nobody does.

10:58: Bonnie: "No, that's how a contract should work."

10:58: Carper is arguing that that current disclosure laws force banks to offer just that.

10:59: Bonnie: "No, they said I could not do that. Point-blank, 'No.'"

11:00: Carper: Did you look for new credit cards?

11:00: Witnesses are confused. Why would they look for new cards?

11:01: McCaskill wants to know if anybody was warned that using a credit card to pay off another card carries separate charges.

11:01: Nope, nobody knew.

11:01: The witnesses are dismissed.

11:02: *Cue ominous music, summon industry representatives*

11:04: The representatives have also been sworn in.

11:04: Here is Roger Hochschild, President and CEO of Discover.

11:04: He's going to talk about pricing policies.

11:04: Pricing is based on each customer's risk profile. "We make every effort to ensure that a customer can manage the credit we give them."

11:05: It's because credit cards are different than other loan products. Each transaction is a new loan, and they're responsible to make sure each loan is paid.

11:05: Now he's going to talk about all the background work they to do to set a base APR.

11:06: "We decline more applicants for credit than we approve." Really?

11:06: They don't solicit high-risk customers or offer them special products like balance transfers. They even reach out to people who seem like they might be in trouble before their accounts are delinquent. Wow, what a great company.

11:07: "The risk associated with some accounts rises over time." It's just like automobile insurance, see? If you get in an accident, your rate increases. Not crazy, just reasonable.

11:08: When they raise rates, they give customers the option of closing the account and paying off the debt at the current rate.

11:08: Their philosophy is to "Do The Right Thing." Just like Spike Lee.

11:09: Onto Bruce Hammonds of Bank of America, who sounds like he has the entrails of the poor caught in his throat.

11:09: "We constantly monitor our customer's behavior." And you folks worry about government.

11:10: 9%-10% of customers refuse higher rates, close their accounts, and pay off the debt at the old rate.

11:10: Risk-based pricing is good for consumers, says the largest bank in the country.

11:11: Ha! Customers who are re-priced often adopt better financial practices. Right, that's what happens, BoA. Don't feel free to provide data.

11:12: Bank of America is arguing that they are a friendly bank, even friendlier than Discover.

11:13: "Customers like our policies." "We listen to our customers. I personally have spent hundred of hours listening to our credit card customers."

11:13: "If any of us are wrong, the market will tell us." (By crashing.)

11:14: Onto Ryan Schneider of Capital One. Repricing is an "essential tool."

11:15: He just argued that credit cards are not like car insurance. Hear that, Mr. Hochschild?

11:15: "Capital One shares your concerns." Awww.

11:15: They have just one policy that governs repricing. See, just one policy, which means consumers are safe.

11:17: Consumers need to miss a payment by more than three days twice in a year before they are repriced. Capital One does not look at bounced checks or FICO score shifts. They also don't use universal default, which actually is a very good pro-consumer policy.

11:18: Levin's first question to Discover: What happened with Janet?

11:20: Roger doesn't want to talk about it, because it's personal. But he will, anyway.

11:20: They used a "holistic approach" to her account. He just called her a liar and said she missed payments.

11:21: Levin is asking about her payment history.

11:21: Roger agrees that she was repriced even though she made all her payments over the course of a year. She was charged no late fees.

11:22: Ah, Roger is complaining about one late payment from March 2004.

11:22: Other than that, she was on time. What a terrible customer.

11:24: Levin is asking why Discover won't agree to limit their use of universal default.

11:25: Roger: "Not using a cardholder's behavior on other accounts is like taking the battery out of the smoke detector."

11:26: Levin: "It's not important to Citibank? It's not important to Chase?"

11:27: Levin is lecturing BoA about the basics of fairness, calling them financial bullies. "Why should [your customer] be penalized because of some outside activity, which never happened—that she didn't know of—why if it's good enough for major companies like Chase and Citibank, why should you at Bank of America continue that practice?"

11:29: Bruce of BoA: Because their risk increases! "We have a responsibility to the safety and soundness of the institution."

11:29: He disagrees with McCaskill, credit isn't like the subprime sector—but would be if they lost the ability to reprice based on consumer risk. See what he did there, hijacking her argument?

11:31: Uh-oh, Bruce is angering Chairman Levin. In his testimony, Levin argues that BoA boosted Bonnie's rate because she was getting closer to her debt ceiling, even after they sent her checks that if used, would bring her closer to her debt ceiling. Bruce is hedging, saying it wasn't really the checks, it was other things, like um, you know, stuff. Levin does not seem convinced.

11:34: Senator Coleman wants to know if credit card companies can improve the way they give notice.

11:35: Regulation Z will already change the appearance of bills and rate change notices. Credit card companies supported the new regulations, in part, to escape from stricter action from Congress. That strategy might not work out.

11:37: Coleman: when you buy a car, you can compare to several others. Credit card companies are similarly different, with varying policies on rate increases, opt-out, etc. How can consumers judge the different policies?

11:38: Let's see how the companies cloak their notices as something other than legalese.

11:38: Capital One sees the onus on Regulation Z to make notices clear.

11:39: BoA agrees, but it's not easy because consumers want rewards and bonuses, and he doesn't know how to keep up. And if consumers dislike BoA, they can go to any other competitor.

11:39: Discover thinks it's great (not dangerous) that consumers have more than one card, because they can shift their business based on how companies satisfy their needs.

11:41: Discover: "Credit cards are excellent tools for the middle class."

11:43: McCaskill wants to know why it seems that the behavior the companies encourage is the behavior they use to indicate risk.

11:44: She wants to know how her mother (oh, it's personal) was charged $9 interest by a credit card company that owed over $200. How could she be charged interest by a company that owes her money?

11:45: Discover apparently has a guide to using credit wisely on the internet. McCaskill is not pleased with this answer.

11:46: She wants to know at what point they stop sending checks to people approaching their credit limit.

11:48: Nobody has an answer. It's based on risks, not the credit line. "If the risk is up, we stop sending checks."

11:48: McCaskill's mother was obviously a high-risk card-holder, with lots of cards, lots of debt, but she still gets checks.

11:49: All three state they don't use credit scores as the sole basis for raising any rate.

11:51: Good, McCaskill wants to see BoA's data that consumers pay more after their rates are raised. "That seems mighty counterintuitive."

11:51: The credit card representatives breathe a sigh of relief as they are embraced by the soft easy questions of Delaware Senator Tom Carper.

11:52: Now they get to talk about how much they care about consumers. They love us, they really do, and they constantly strive to keep us educated.

11:55: Carper: Do any regulators tell you how to manage risk?

11:55: Now everyone gets to point to Office of the Comptroller of the Currency as the source of meaningful federal regulation. Hmm, let's scroll through the archives to see how past editors might characterize those meaningful regulations:

The Currency Comptroller routinely goes double-dildo with national banks to undermine states' consumer protection laws.

11:57: Carper with a hardball: "What stops me from taking my business to another creditor? Because I get offers everyday."

11:58: Everybody: Nothing stops you!

11:58: This is what preachers know as "call and response."

12:01: Discover had no clue that they lowered a witness' rate. It certainly had nothing to do with the hearing. Know how? Because otherwise Discover's President would have known before this morning.

12:02: He does seem to know an awful lot about why her rate dropped, you know, for someone who didn't know her rate fell.

12:03: Contradiction alert: Roger just said that any factor in the risk model could affect her risk profile, and that a credit score, by itself, could affect her rate. Let's go back to 11:49:

All three state they don't use credit scores as the sole basis for raising any rate.

Can anyone reconcile the discrepancy in this sworn testimony? Bueller? Bueller?

12:07: Levin wants to know about opting out.

12:09: All agree that it requires a proactive notice from a consumer.

12:11: Levin wants to know why people shouldn't be able to opt-out at any point if they stop making payments and just put the card down.

12:12: His scenario: someone doesn't understand the opt-out notice and just says "the heck with this company," without making new purchases.

12:12: Discover: If they do not opt-out, right, they are charged the higher rate.

12:13: BoA: Yep.

12:13: Levin: "That strikes me as manifestly unfair."

12:14: Levin wants to know if Hammonds of BoA is troubled by Bonnie's rate increase from 8% to 23%.

12:16: Hammonds: Well, everyone used to pay 19%.

12:16: Levin: Did her story trouble you?

12:16: Hammonds: Sure, sure. But I do believe we made the right risk decision.

12:17: One of the highest indicators of risk is constantly making the minimum payments.

12:18: BoA discourages customers from making minimum payments. Behind the scenes, not say, by printing any warnings on the bill.

12:22: Levin is bringing the hearing to an end, but is reminding consumers that credit card companies do not treat their customers fairly. Several pieces of legislation are in the pot, and Levin will make sure the issue stays on the Senate agenda.

12:30: If you want to learn more about the inner workings of credit cards, we highly recommend that you watch Frontline's documentary on abusive credit card practices. We also caution everyone as we roll into the holiday season, please use your credit card responsibly. Don't take on debt you can't afford, and don't ever let anything stop your from paying off your credit card in full every single month.

Today's smoker will feature two panels. The government agencies responsible for keeping us informed, if not safe - the FTC, the National Cancer Institute, and the CDC - will testify first, followed by scientists from the Johns Hopkins Bloomberg School of Public Health and Penn State University.

Take out a cigarette and meet us in the foyer at 2:30 for the latest from Washington.
(Photo: zakgollop)

02:25: Video Link - In the olden days, hearing rooms came filled with smoke.
02:35: And we're called to order. Mostly empty room, which is surprising for a tobacco hearing.
02:36: The National Cancer Institute (NCI) has determined that light cigarettes can often be more deadly than regular cigarettes.

02:37: This Senator, whoever he is, was convinced to stop smoking when his 10-year-old daughter came home from school and told him that smokers get black boxes in their throats, and asked when he would be getting one. Aww, cute.

02:37: This is new, the Committee has a short video.

02:38: It apparently demonstrates "the FTC method and the smoking robot."

02:38: "Smokers don't smoke like a robot."

02:38: This thing is high-tech and blurry. It looks like menacing rectangle with wires.

02:39: The FTC admits that they don't know what they're doing with tar and nicotine ratings. Why should big tobacco hide behind flawed ratings to claim that their products are healthier?

02:41: Who is this guy Chairing? Ah, it's Frank Lautenberg (D-NJ). He wrote the law banning smoking on airplanes. Next time you fly and see the 'tampering with smoke detectors carries a $2,000 fine,' you can know to thank Frank.

02:42: Stevens is here! There's something about his voice, we can't help but smile.

02:42: He's reading from a statement, unwilling to wing it.

02:43: Oh no! He has another meeting at 3:30, but he's looking forward to finding out why the FTC test remains the same if cigarette technology has changed.

02:43: Big tobacco was invited to testify, but for some reason, they refused to attend. Something about their 1994 experience may still be fresh in their minds.

02:45: FTC Commissioner William E. Kovacic is testifying. His agency has taken bold steps to curb the proliferation of cigarettes.

02:45: Their original test was designed to provide a uniform standard for judging the tar and nicotine content for cigarettes.

02:46: Smokers of light cigarettes often inhale deeper to get more of that yummy, luscious nicotine.

02:46: The FTC has wanted to change the test, but scientists asked them to wait until there was more science.

02:48: Still, all science says light cigarettes aren't healthier at all.

02:49: They will change the test as soon as the science is complete. At that point, a newer, better smoking robot will be released.

02:49: The FTC wanted to hand over cigarette testing to "one of the science-based agencies." They again recommend that a science agency take over the smoking robot. It looks cool, we'll take it.

02:50: Cathy Backinger of the National Cancer Institute is also concerned that light, low tar, and ultra light, present "the illusion of risk reduction."

02:51: Big tobacco apparently likes deceptive practices (filters, health claims) to keep people from quitting. That's news to us.

02:52: She makes light cigarette smokers sound like scuba divers. Deep breathes, held breathes, all to contain life-sustaining nourishment.

02:53: "Light cigarettes are not an alternative to quitting." Thank you for that.

02:54: Internal big tobacco documents show that cigarette makers know they're deceiving people, but like profits more than the truth.

02:56: David L. Ashley of the CDC has a lab that tests cigarettes, people's response to cigarettes, and it sounds like they too have a smoking robot.

02:57: We think there's great holiday gift potential for the smoking robot.

02:57: The CDC's smoking robot tests up to 20 cigarettes at a time.

02:58: This guy is Mr. Science on speed. He has tests, results... lots of science.

02:59: Smoking robot doesn't try to suck down nicotine, unlike smokers. Smoking robot can't be trusted.

02:59: Super smoking robots exist, with bigger "breaths." These robots can inhale 50ml or 45ml puffs, which better approximates the average smoker's experience.

03:00: In sum, he wants more smoking robots for greater testing variation, not just the FTC's robot. We approve.

03:01: Senator Lautenberg is impressed both at the panelist's detail, and their ability to stick to the 5-minute limit.

03:02: Before we go further, we would like to request that the Committee order the FTC's robots to fight the CDC's robots in a cigarette testing battle to the death. All in favor?

03:03: The FTC really doesn't want responsibility for testing cigarettes. Moreover, they aren't sure if anyone benefits from their tests at all.

03:04: The military taught Lautenberg how to smoke. Cigarettes were used to calm the nerves.

03:05: We're starting to go in circles here. Nobody likes the FTC tests, big tobacco knows that the tests are useless.

3:09: The design of the cigarette affects the FTC's test, but the CDC isn't going to ascribe motive to big tobacco.

3:10: The FTC can alter its robots to get better test results.

3:10: They can also work with colleagues to draw attention to how the robots aren't accurate?

3:10: The robots are not government property. They are owned by a trade association.

3:11: The FTC used to test, but they abandoned their robots in the mid-80s, when they realized that robots were expensive and not accurate.

3:11: NCI doesn't have robots.

3:11: The CDC owns its robots.

3:11: Stevens: "Where did you get them?"

3:11: The CDC bought them from manufacturers who sell to big tobacco.

3:12: Stevens doesn't want excuses. He wants to know if any agency has asked for money to buy robots, or build better robots.

3:12: These robots are from the 60s? Damn, that's Jetsons old!

3:13: Increasing cigarette taxes reduces cigarette use. That's applicable to the SCHIP debate going on.

3:14: Stevens wants to know if anyone prosecutes cigarette bootleggers.

3:14: Bootlegging is up to the states or customs, but the fedgov doesn't care all that much. At least not the FTC and CDC.

3:15: Stevens: "Cigarette makers do a lot of advertising. I've seen some as a matter of fact."

3:15: Youth smoking has increased since the landmark tobacco settlement.

3:16: Stevens wants to know if anybody has ever studied pipe smoking. Nobody has done a study.

3:17: The NCI did study cigar use, but emphasizes that all tobacco, regardless of form, causes cancer.

3:18: Lautenberg: "Do you believe tobacco advertising increase is the reason we're seeing an increase in smoking?"

3:19: The FTC thinks it's a function of less money going towards tobacco control.

3:19: Lautenberg thinks "the most efficient testing machines are humans."

3:19: Apparently, this smoking thing causes cancer and heart disease and slew of other fun ailments.

3:21: @parad0x360, @Hambriq: Studies show that most people think light and ultra light cigarettes are healthier than regular cigarettes.

3:24: Jonathan M. Samet, Epidemiologist at Johns Hopkins, is arguing that the US' actions have global consequences.

3:25: Epidemiology studies show that light cigarettes are just as dangerous as regular cigarettes.

3:28: Cigarette content warnings often have no relation to what people end up inhaling or processing.

3:28: The FTC tests are misleading to smokers, as are warning labels.

3:29: Onto Jack Henningfield, who has a ridiculous mass of silver hair.

3:30: He's a Vice President for Research and Health Policy at Pinney Associates, and an adjunct professor at Johns Hopkins.

3:30: The marketing and warning labels undermine all efforts to keep kids away from cigarettes.

3:31: Americans are too quick to trust product content labels.

3:31: This guy's own sister doesn't believe that the FTC would allow cigarette companies to publish false information.

3:32: Hey commenters, consumers flocked to cigarettes with lower tar and nicotine levels when they were introduced. The lower ratings came care of the FTC's flawed tests.

3:33: The FTC underestimated big tobacco's willingness to design cigarettes that could circumvent the FTC's tests.

3:34: Major design changes include ventilation holes that smokers can cover, but machines ignore.

3:35: @Beerad: That's the problem. Most people conflate less nicotine and less tar with health. But the tests aren't accurate, and the cigarettes aren't healthier.

3:36: 60% of cigarettes are sold in convenience stores. How convenient. Teenagers spend twice as much time hanging out in convenience stores as adults. Really? That's it? Twice as much?

3:37: "Teenagers talk about what they see. It's called viral marketing." This is Marvin Goldberg, professor of marketing at Penn State talking.

3:38: 4 out of 5 smokers say they smoke light cigarettes for health benefits. Studies show that people can't be convinced that light cigarettes are the same as regular cigarettes.

3:39: He's making our point. It's syllogistic reasoning: light cigarettes have less tar. Less tar is healthier. Ergo, light cigarettes are healthier.

3:41: Stephen Sheller, of Sheller P.C. claims that the tobacco industry simply can't be trusted.

3:44: They know what's going on, but they don't want to do anything to keep people healthier.

3:44: He just compared big tobacco to Katrina.

3:44: If they admit something is wrong, they become culpable. They hate suits more than anything, so they go to great lengths to feign ignorance.

3:45: He wants a legislated ban on listing tar and nicotine levels.

3:46: One federal judge called big tobacco: "The king of disinformation and concealment." Another called them "racketeers."

3:47: Lautenberg doesn't want to show any bias that isn't "Senator-like," but he's worried that tobacco kills over 400,000 Americans every year.

3:49: Telephone surveys show that people who quit would be willing to take up smoking again if they thought that cigarettes were safer.

3:51: Sheller is pissed that the FTC never does anything. He wants their jurisdiction yanked. "Put an end to it, please."

3:52: Most light cigarette smokers don't realize that they are inhaling toxins.

3:53: The taste is smoother and cooler, leading people to think that it's also safer. Not unlike "fruit drinks and alcohol."

3:53: Lautenberg: "Is this simply deceiving consumers while the government looks the other way?"

3:54: 'This area is not the FTC's competence.' Dr. Henningfield thinks that the FDA has significant experience determining standards for "light". No reason that similar standards can't apply to cigarettes.

3:56: Lautenberg wants to know why nobody cares about the Surgeons General's warning.

3:56: Smokers are committed, like sports fans. They're not dispassionate and reasonable.

3:59: The hearing is adjourned.

Committee markups are where our Congressional representatives do actual work. Amendments will be proposed, debated, and voted on. Unlike hearings, there are no witnesses. The House and Senate versions of the Do Not Call Improvement Act are currently identical, but may emerge in different, competing forms depending on what happens in markup.

Join us starting at 2 p.m. as we fly between the chambers with the speed and alacrity of a pigeon.
(AP Photo/Pablo Martinez Monsivais)

1:45: House Video Link
1:50: Senate Audio Link - Ted Stevens didn't want to put on makeup today, so the Senate hearing will be audio only.

2:21: House Energy and Commerce Committee Chairman John Dingell (D-MI) has called his hearing to order, and is giving his opening statement.
2:23: The House will also be marking up H.R. 2601, which will permanently reauthorize and fund the Do Not Call List. Dingell wants no amendments on the bill.
2:24: He does have concerns with Congressman Mike Doyle's (D-PA) H.R. 3541 - not good, we don't really care what the Direct Marketing Association thinks of the bill.
2:25: Maybe the Committee also wants to consider a bill to ban power mowers that interrupt Committee hearings? Really, neighbor, who has a power mower in the city?
2:28: Ranking Member Barton (R-TX) also supports the Do Not Call List reauthorization.
2:29: Barton: "I'm willing to bet there's a telemarketer out there, bless his heart, who wants to call me. I don't want him to call me."
2:30: The House is moving onto the first bill on their docket, H.R. 1534, the Mercury Export Ban Act of 2007.
2:35: Wait a minute, the House just skipped over to their fourth agenda item, H.R. 2601, the Do-Not-Call Registry Fee Extension Act of 2007. Let's stay with that while we wait for the Senate Commerce Committee to kick off their hearing.
2:36: Under the reauthorization bill, the FTC would be required to provide biannual reports to Congress on the status of the list.
2:36: Rep Stearns (R-FL) wants more data on how the FTC scrubs the list.
2:37: Stearns is going to offer an amendment to tighten the definition of "prior business relationship." Great idea, and a large potential loophole for annoying consumers.
2:37: Stearns also supports H.R. 3541. Good.
2:42: Congressman Upton (R-MI) wants to balance permanent registrations with the need to keep the registry accurate. In Congressional parlance, "accurate" is usually a synonym for "hindered."

2:47: The Senate Commerce Committee feed just went active. Let's go see what they are up to.
2:47: Stevens is talking... did they already pass the Do Not Call List? Which he wants renamed the Never Call List. (we'd support that!)
2:48: Stevens wants the agenda items approved en masse.
2:49: Without objection, so ordered.
2:50: The WSJ apparently called the CPSC Reform Bill 'The most significant consumer safety legislation in a generation.'
2:50: Pryor has no amendments for the bill.
2:52: Dorgan is cheering the Do Not Call List as one of the government's most successful efforts.
2:53: Everybody likes the Never Call List.
2:53: Klobuchar is here to praise the CPSC bill.
2:54: She's especially proud that there's finally a federal lead standard.
2:54: And that toys will now be required to carry batch numbers to make recalls easier and more efficient.
2:54: Target and Toys R Us, in particular helped craft the bill.
2:55: This is one big Pat-Everyone-On-The-Back fest.
2:55: Boxer (D-CA) is lauding a requirement for internet retailers to identify if a toy presents a choking hazard. Not a bad idea; those pictures on Amazon are never detailed enough.
2:57: McCaskill wants to talk about amendment 3, an improved whistleblower protection standard.
2:57: If whistleblowers don't get a timely decision from the CPSC on their case, they could appeal to federal court.
2:58: Stevens wants to know if this would kick every instance of the CPSC not acting over the federal courts.
2:59: McCaskill says that this is exactly the same protection issued to any other whistleblower.
3:00: Senator DeMint (R-SC) is on the way to offer an amendment.
3:03: DeMint has arrived, fresh from dealing with Amtrak amendments.
3:03: His amendment deals with prescription drug reimportation.
3:04: Dorgan wants to know what bill DeMint think he's amending.
3:05: Unknown Senator: "There's no bill before us."
3:06: Nope, already passed the CPSC Reform Act, so DeMint can't do anything.
3:06: But now, Dorgan is condemning DeMint for his stunning lack of courtesy, since DeMint gave no notice that he would offer his amendment.
3:06: DeMint thought Dorgan knew, which is why he thought Dorgan would offer a second-degree amendment. But now, nope, no amendment.
3:07: Dorgan: "Your staff did not contact my staff."
3:07: DeMint is again talking about drug reimportation. "The has apparently passed, and I apologize for any offense."
3:07: Done with the CPSC Reform Act.
3:07: "That's it."
3:07: We heard a gavel, and now rustling. We assume the Committee hearing is over. Sure would've been nice if their feed went active at 2:30. Senate Commerce and Science fails us again with their technology.
3:08: Overheard from the audience: "Well that was a bummer!"

3:13: Back over to the House side.
3:13: What? still on the Mercury Export Ban Act?
3:14: Take a page from the Senate, fellas, and speed up.
3:14: Michael Burgess (R-TX) is saying something, but as Meghann points out: He might be right, but I don't care because he's so annoying.
3:14: There's a roll call vote on reporting the bill to the full House.
3:15: Anyone with insomnia should invest in a Congressional clerk.
3:18: Only the Clerk's mic is active, so it sounds like Dingell is screaming from down the hall to vote 'aye'.
3:19: The clerk is tallying the vote... such pressure.
3:20: 45 ayes, and 2 nays.
3:20: The bill is agreed to and reported to the full House.
3:21: Onto H.R. 3461, Safeguarding America's Families by Enhancing and Reorganizing New and Efficient Technologies Act of 2007
3:21: Enhancing and organizing new and efficient technologies? Who the hell came up that name?
3:22: Mary Bono (R-CA), apparently.
3:22: This one is all about keeping the kiddies safe. Code from keeping porn away from vulnerable children.
3:21: Enhancing and organizing new and efficient technologies? Who the hell came up that name?
3:22: Mary Bono (R-CA), apparently.
3:22: This one is all about keeping the kiddies safe. Code from keeping porn away from vulnerable children.
3:23: That was fast. Onto H.R. 2601, the Do Not Call Reauthorization Act.
3:24: There will be an amendment. Why, why, does our video feed keep freezing.
3:25: Stearns is going to offer, and then withdraw an amendment. Sounds useful!
3:25: He wants Congress' intent clarified.
3:25: A loophole in the telemarketing sales rule allows firm to bundle numbers on the Do Not Call List, which are then passed onto firms.
3:26: Businesses send cards to senior citizens telling them to return the cards for more information.
3:26: The card, when returned, establishes a business relationship, allowing businesses to annoy our grandparents.
3:27: Question: "Why are you withdrawing the amendment?"
3:27: Stearns is deferring to the Senate. The Senate just passed the same bill, and if he amends the House bill, a conference committee will be required to hammer out the details.
3:27: Stearns wants the bill to sail through, sans conference, on the suspension calendar.
3:28: Instead, he wants Chairman Dingell and Ranking Member Barton to send a letter to the FTC asking them to close the loophole.
3:29: Stearns withdraws the amendment, Dingell will send the letter.
3:30: Rep Terry (R-NE) is offering a clarifying amendment.
3:31: It's illegal for private sector debt collectors to call people on their wireless number. People don't say when filling out forms whether their number is a cell or a landline, leading to confusion about what numbers can be called. Technical issue.
3:33: The Chair will work with Terry to fix it, and the amendment is withdrawn.

3:34: Onto our bill, H.R. 3541, the Do-Not-Call Improvement Act of 2007
3:35: Congressman Doyle (D-PA) is offering a substitute amendment.
3:35: "Our bill takes one more hassle off [the consumer's] plate."
3:36: AARP shipped in a batch of red-sweater clad seniors to support Doyle's bill.
3:36: There are apparently people who worry the Do Not Call List negatively impacts our economy.
3:37: But the List allows marketers to target people who are open to their services.
3:38: Doyle's amendment will allow people to also remove their name from the List in case they change their minds. Very reasonable.

3:34: Onto our bill, H.R. 3541, the Do-Not-Call Improvement Act of 2007
3:35: Congressman Doyle (D-PA) is offering a substitute amendment.
3:35: "Our bill takes one more hassle off [the consumer's] plate."
3:36: AARP shipped in a batch of red-sweater clad seniors to support Doyle's bill.
3:36: There are apparently people who worry the Do Not Call List negatively impacts our economy.
3:37: But the List allows marketers to target people who are open to their services.
3:38: Doyle's amendment will allow people to also remove their name from the List in case they change their minds. Very reasonable.
3:39: Chip Pickering (R-MS) also supports Doyle's bill.
3:40: Bart Stupack (D-MI) wants to distribute an article to Committee Members, something that apparently requires unanimous consent. So ordered.
3:40: Stupack thinks dinner interruptions are nothing compared to interruptions in the middle of the night for political campaigns.
3:41: Removing the exemption for politicians isn't german to the bill, and won't be offered as an amendment; but Stupack wants to take up the issue soon. Good idea. We hate political robocalls.
3:42: On a voice vote, the bill is reported to the House.
3:42: Dingell is ominously pointing out that there are certain technical imperfections with the bill. Dingell won't move the bill to the floor until they address these vague "small imperfections."
3:43: Imperfections = complications. Do Not Call reauthorization is gunning for the suspension calendar. If 3541 needs to be changed the changes need to be echoed on the Senate side to avoid a conference.
3:43: We're eager to hear what the imperfections are, and will keep an eye on the bill as it moves forward.
3:44: To recap our coverage, all of our bills have been favorably reported to their respective chambers. Next stop, floor debate.

Today's hearing will feature two panels. Four separate law firms will testify, along with the American Arbitration Association and Public Citizen. Join us as we struggle to interpret the Committee's legalese - which may prove just as futile as binding arbitration.
(Photo: xsparrowx)

2:00: Video Link
2:05: Today's commentary is brought to you by both Carey and Meghann in the hope that two pairs of ears will be able to decipher the Committee's legalese.
2:41: FINALLY! The hearing has been called to order.

2:43: The resolution on this feed is terrible. Someone, a Congresswoman - maybe Rep Sanchez (D-CA), is reviewing the history of arbitration.

2:44: Rep Cannon (R-UT) believes that arbitration provides protection for consumers because it's fairer (what?) cheaper, and faster. That's not right. Individual consumers don't have deep pockets, which is why class action waivers are unconscionable.

2:45: Arbitration is so complex and ingrained that this Committee can't possibly handle the topic today. Ok, Congressman, set up a webcam at the Hawk and Dove and we'll meet you there.

2:47: Nobody has proposed banning arbitration - just mandatory arbitration. Consumers would still have the option to forego a trial, but that's a choice they would be empowered to make, a choice they don't currently have.

2:49: Rep. Johnson (D-GA), sponsor of the measure is here, pointing out that people wouldn't voluntarily sign away other constitutional rights.

2:51: Arbitration carries its own anti-consumer charges. The fees to expedite a hearing can cost $500.

2:53: See Cannon, nobody wants to ban arbitration, they merely want to restore consumers' right to a trial.

2:57: One of the panelists is former Georgia Governor Roy Barnes, who is receiving quite the introduction from Rep Johnson - Governor Barnes helped save Georgia from the subprime meltdown and scared the Confederate flag from the Statehouse.

2:59: That was practically a eulogy.

3:01: Onto Laura McCleary of Public Citizen.

3:02: Arbitration allows "rulings that are silly, wacky, or contrary to law..." "They are flawed by design."

3:04: An eight month analysis of 34,000 cases of credit arbitration, data they could access only because California requires disclosure, showed that the 28 arbitrators who handled most cases ruled against consumers 94% of the time.

3:04: Arbitration involving businesses went against the consumer 99% of the time.

3:05: Credit card companies, specifically MBNA, are using mandatory arbitration to circumvent the Fair and Accurate Credit Transaction Act.

3:07: Onto Richard Naimark of the American Arbitration Association (AAA), who wants to find a balanced response to Congress' concerns.

3:08: AAA developed a basic code of conduct that makes arbitration slightly fairer than, say, a Gitmo tribunal. Consumers can have access to counsel, arbitrators must disclose financial interest.

3:10: He's arguing that only 2% of cases go to court, so consumers don't "get their day in court" anyway. The cases don't go to trial because they're settled, not arbitrated, usually because the parties think a jury will rule against them.

3:11: Gov Barnes is branding mandatory binding arbitration as a "contract for a crime." Payday lenders use binding arbitration to circumvent the courts.

3:12: He's challenging Cannon - nobody thinks it's fair to go to arbitration to prove that they are the victim of a crime.

3:13: Arbitration provides a small remedy but does not condemn the criminal action as illegal.

3:14: There are more payday lenders than McDonald's. Frightening.

3:15: Barnes doesn't want people to use arbitration to hide from criminal acts - one of the defenses raised is that if Congress didn't want arbitration used that way, Congress would act.

3:18: Onto nursing homes.

3:19: News to us: Shaving cream softens feces.

3:20: Nursing homes = Abu Ghraib.

3:21: We're struggling to see how this relates to binding arbitration.

3:21: Here we go - families are presented with 50-60 page disclaimers before their loved ones can be admitted.

3:22: Most people don't realize they are waiving their litigation rights to gain admission.

3:23: Because they were offered "the opportunity to sign," courts accept the agreements as valid.

3:23: The costs for arbitrating nursing home issues are significantly higher, as are the rewards.

3:23: Final thought: Mandatory binding arbitration kills grandparents.

3:24: Arbitration dissuades people from pursuing very valid claims. If a credit card company withholds a couple bucks, you won't sue, but if you can't form a class for a class action, the company walks away with oodles.

3:25: Appellate courts have been bench-slapping down such agreements as unconscionable.

3:26: Gov. Barnes: "I got mayhem and murder in the streets." Apparently, no one cares about stopping illegal payday lending in the criminal courts, and arbitration is keeping it out of the civil ones.

3:27: Illegal practices flourish when individual consumers can't pursue their claims as a class.

3:29: Conservatives should be all over this bill. They're all about returning power to the local level, empowering local decision makers. That's what juries are all about.

3:32: Cannon will have another chance to make his point. So far, none of the panelist agree with him. Apparently, soldiers need payday lenders.

3:34: Cannon is picking a fight with McCleary, wondering how much weight to give to her damning study. 'We can't trust any consumer who says "my widget broke"'

3:35: If you arbitrate, you are wrong. "Credit cases are going to against the person who didn't pay their bill."

3:37: McCleary can't convince Cannon because arbitration data isn't readily available - nobody discloses, so Cannon is technically right in saying that her data is narrow, the category is narrow, and the study as a whole is narrow. "The implications are not narrow."

3:38: Maybe if AAA wanted to part with their data, they could produce a story as wide as Cannon.

3:40: Point proven: according to the AAA, 60% of arbitrations are settled before they can reach arbitration - so not every arbitration results in a hearing before an arbitrator. Might as well kick things back to the courts.

3:40: Johnson wants to know how AAA gets their business. (Hint: consumers have no choice!)

3:41: "Unions and businesses primarily" refer to AAA.

3:41: Most arbitrators are lawyers, but not judges. AAA claims that there's no bias in selecting arbitrators, that they look for "senior, respected members of the community."

3:43: There is no court reporter in arbitrations, which means there's no practical way to file an appeal.

3:44: There is a limited right to discovery, as controlled by the arbitrator - the arbitrators who rule against consumers 90% of the time.

3:45: The word right here is fairly creatively used.

3:45: The first panel is excused. Onto the second panel.

3:49: Deborah Williams is 64 and bankrupt thanks to binding mandatory arbitration agreement.

3:49: Her dreams of owning a Coffee Beanery franchise turned to nightmares. The binding agreement required her to purchase all sorts of unnecessary equipment, and a Pepsi contract.

3:51: The average Coffee Beanery lasts three years, and costs $375,000.

3:51: Maryland's AG found that the Coffee Beanery committed fraud - but she was forced to arbitrate.

3:52: The arbitrator had significant financial ties to the Coffee Beanery, and had ruled in their favor repeatedly. The Coffee Beanery's own lawyer doubled as an arbitrator.

3:53: The Coffee Beanery dragged discovery out for over 7 months, because the company knew she couldn't pay the costs, and forced her and her layer to fly to Michigan - 500 miles away - four times for 11 days of hearings.

3:53: The cost of arbitration was over $100,000 - and the arbitrator found that the Maryland AG was wrong, there was no fraud, and that she had to pay penalties to the Coffee Beanery, including their attorney's fees.

3:54: She has lost over $1.5 million to the franchise.

3:55: She is borrowing money from her family just to file for bankruptcy - and even then, she'll need to pay the Coffee Beanery franchise fees over the next 15 years until her contract expires.

3:57: Onto Cathy Ventrell-Monsees of the National Employment Lawyers Association (NELA)

3:57: "Companies from Circuit City to Hooters To Halliburton" use arbitration to limit employee suits.

3:58: Employees are required to sign these agreements despite any laws that prohibit mandatory binding arbitration agreements as a condition of employment.

3:59: Wow, Cathy almost looks like she's going to cry.

3:59: Arbitration is a "modern version of separate and unequal justice for employees."

3:59: "Arbitrators do not need to follow the law. THEY DO NOT EVEN NEED TO KNOW THE LAW."

4:00: Companies continually use the same arbitrators that rule in their favor. As a result, the arbitrators have a direct financial interest in ruling in the companies' favor.

4:00: Pfizer has a 97% success rate.

4:01: Halliburton has an 82% success rate. They need to bum Pfizer's arbitrators. We wonder how Verizon's dinosaur-eating lawyers would fare.

4:02: Onto Peter Rutledge of the The Catholic University of America.

4:04: Arbitration lowers costs for companies, which is passed on in the higher wages, better share prices and lower prices. Thank god.

4:05: "Imagine what the increase in costs would be if arbitration was eliminated altogether." No, no, don't make us imagine the costs! Oh, wait, nobody is saying arbitration should be eliminated! Just that the constitutional right to a trial should be restored.

4:05: "Where are these people going to end up if arbitration is not available?" Court, good professor. They will end up in court, where they belong.

4:06: Rickshaw justice for the many is the alternative? That sounds awesome. That guy was nuts.

4:07: Onto Theodore G. Eppenstein of Eppenstein and Eppenstein - did he really go out to find another Eppenstein? Suspicious.

4:08: He wants to talk about arbitration in securities disputes - something we know absolutely nothing about.

4:09: This guy loves his resume. Enough already.

4:09: "Securities arbitration does not work for the investor."

4:10: The poor guy has been arguing about this for 20 years.

4:11: "The public pool [of investors] isn't pure." Arbitrators are pandering to keep their jobs.

4:12: This guy tells you he's going to say things a lot.
"Let me tell you something."
Ok.
"I'm going to give you examples."
Well, um. Ok.

4:13: He has data. 58% of the time, the customer goes home with nothing except a bill for arbitration.

4:13: Pfizer laughs at the industry's 58% success rate.

4:14: There is a place for arbitration, but it needs to be run independently. Great idea.

4:16: Geekybiker is absolutely right. If you haven't already, tell Congress to support the Arbitration Fairness Act!

4:18: The Chairwoman is sorry for Coffee Beanery woman's experience: Do you feel like you were ripped off? Um, duh.

4:19: Deborah is amazed to hear the professor and the AAA talk about the flaws in arbitration and wants to know: "What are you going to do for me? I lost everything. What are you going to do for me?"

4:21: Chair to the professor: if your data shows that businesses don't prevail, why would they chose to arbitrate?

4:22: According to the prof, a ten-year-old study has useful anecdotes. One corporation spent $1 m winning a case, and legal fees are the root of all evil. Lawyers are such great villains.

4:24: Chairwoman politely says, "You're on crack."

4:24: Consumers' win rate is falling, as is there rate of recovery. Maybe that has something to do with it? Maybe? Bueller?

4:26: The professor is rightly pointing out that some businesses have a higher win rate at trial - but, when they end up in court, the trial is overseen by a judge bound by the law, and both parties have a right to appeal.

4:27: This should be settled with KY wrestling. No one's data is good enough for the other.

4:28: Eppenstein angry. Testimony misrepresented. Rarr, Eppenstein.

4:29: The very threat of arbitration depresses settlement offers.

4:30: Onto Cannon's last stand.

4:30: Cannon wants to know if stockbrokers cheat their investors, won't the investors take their money elsewhere?
Eppenstein: 'If they have any money left!'

4:31: NELA has no issue with a waiver for unions because unions handle arbitration responsibly.

4:32: Not that it's relevant, but we have discovered that Chris Cannon has 8 (eight) kids. EIGHT!
He's never spoken to them at length.
Along with the rest of the planet.
He's like a metronome of bullshit.

4:34: He's now attacking Coffee Beanery woman. It's her fault she got screwed. According to him, "we live in a world of information." If Deborah had only done her homework, she could have kept the $1.5 million now lost forever.

4:35: Buzzers sound in the distance. Floor votes. The end is near.

4:39: Johnson is defending Coffee Beanery woman, implicitly calling Cannon a nut.

4:40: According to Ventrell-Monsees, her story is typical.

4:41: Epperstein says the public never hears about the egregious violations, the systemic raping of justice caused by mandatory binding arbitration.

4:42: Overheard on the video feed from a mystery person: "Unbelievable. I think I'm the only like regular joe blow kinda guy here and I am outraged." @Godai heard a slightly different version.

4:42: We didn't think it possible, but mandatory binding arbitration is even more frighteningly horrific than we knew. God help us all. The hearing is adjourned.

Today's hearing will feature just one panel. Labor activists from the National Labor Committee and the International Labor Rights Forum will appear beside a past president of the Toy Industry Association - formerly called the Toy Manufacturers Association, before the widespread use of Chinese sweatshops.

Storytime kicks off at 9:30 a.m., complete with heart-wrenching testimonials, pictures of sweatshops, and maybe even a surprise appearance from Senator Stevens. Cookies and apple juice, optional.
(AP Photo/Lee Celano)

09:30: The Committee has provided 20 kpbs of video link goodness.
09:40: Subcommittee Chairman Dorgan will be leading the hearing; we always enjoy the when Chairman takes the reigns and doesn't punt to a junior Senator.
09:41: 80% of our toys are manufactured in China.

09:42: Dorgan has introduced S. 367, the Decent Working Conditions and Fair Competition Act.

09:43: The Senator wants a conversation about whether we want to be the sort of country that accepts products made in sweatshops.

09:44: We know sweatshops exist, but the Senate wants to know if they are proliferating, expanding - or if moral concerns are constraining their use.

09:45: For a quick primer on the issue, the Salt Lake Tribune has an excellent article:

The Chinese Ministry of Health in 2005 noted at least 200 million of China's labor force of 700 million workers were routinely exposed to toxic chemicals and life-threatening diseases in factories. "More than 16 million enterprises in China have been subjecting workers to high, poisonous levels of toxic chemicals," the ministry said at a conference on occupational diseases in Beijing, which was reported by the state-controlled media. The ministry particularly blamed "foreign-funded" enterprises that exported goods.

China has more deaths per capita from work-related illnesses each year than any other country, according to the ILO. In 2005, the most recent year for which data are available, 386,645 Chinese workers died of occupational illnesses, according to Chinese government data compiled by the ILO and cited in the July 14, 2006, Journal of Epidemiology. Millions more live with fatal diseases caused by factory work, other epidemiologists estimated in the article.

09:47: Kernaghan claims that the average workweek is 87 hours, from 7:30 a.m. to 10 p.m.

09:48: Workers are required to stand as they are yelled at by supervisors, and if anyone speaks back they are immediately fired.

09:48: The standard salary is $0.53 per hour - overtime pay is regularly confiscated.

09:50: He's holding up a Barbie, claiming: "It doesn't have to be this way."

09:51: All of these conditions violate Chinese law, but local officials refuse to provide enforcement.

09:52: Some factories don't even bother hiring "permanent" workers, instead opting for a revolving door of temporary workers.

09:53: The toy industry claims that it needs no regulation - if the Chinese laws aren't being followed, then Kernaghan believes U.S. law, such as the one Senator Dorgan can force change.

09:54: Onto Harry Wu of the Laogai Research Foundation. The Laogai is the vast labor reform system that forces political prisoners and criminals to repent through hard labor.

09:56: China has claimed that they use a prison system just like we do, not the Laogai. The Laogai is one of the human rights concerns that Congress wanted addressed before granting China MFN (Most Favored Nation) trading status.

09:58: Many labor camps no longer work in agriculture, but manufacturing - toys, gadgets, clothes - everything.

09:59: Wu is holding up the Salt Lake Tribune article we linked to earlier.

10:00: China has one union that nobody accepts as legitimate - except Walmart, which refuses to acknowledge unions here.

10:02: Onto Bama Anthreya of the International Labor Rights Forum.

10:03: Few Chinese workers wear any sort of protective garb. There are 8,000 factories employing 3 million workers.

10:03: Mattel, Hasbro, Fischer-Price and Disney all use sweatshops, but the biggest beneficiary is Walmart.

10:04: If a worker is harmed during working hours, that's his/her problem, even after a supervisor verifies that the problem was the factory's fault.

10:05: A worker is required to work for 12 hours - but they really work for 17 hours - and if a worker misses a single shift, that's it, fired. So if a worker is maimed on the job and seeks medical attention, their job is gone, and they also waive any right to litigation.

10:06: When Lee Dur shut down because of Mattel's lead paint issues, all workers were laid off. Not a single one knew a thing about lead poisoning, or that they might have been exposed to lead. Quick, send a team of lawyers over there to advertise on their subways.

10:08: All of the companies manufacturing in China have excellent data on the Chinese labor markets. They know all about unemployment, but more importantly, they know exactly how many Chinese inspectors there are. They chose China as a destination not just because it's cheap - but specifically because there is an absence of enforcement and worker protections. That's pretty damn harsh - she's essentially calling Walmart and Mattel heartless killers.

10:11: Legal protection is urgently needed, not just from the Chinese, but from the U.S. - voluntary protections are routinely ignored.

10:11: Senator Sanders (I-VT) is here, ready to throw some socialist fire. But only after Peter Eio of the Toy Industry speaks.

10:12: Mattel was invited, but for some reason, chose not to attend. Maybe all the Barbies were having a tea party.

10:13: Eio has this wonderful English/Scottish accent, and nine chins.

10:14: He's talking up some industry association we've never heard of that vouches for the safety of toy manufacturing around the world.

10:14: Apparently, it was founded by important people - a Prime Minister, a Chamber of Commerce rep, which confers credibility on the organization.

10:15: 670 of the 8,000 factories are certified as not sweatshop death-traps. 290 toy brands representing 75% of global toy products that will require certification by 2009. Walmart, Target, Sears, K-Mart, etc, are apparently part of this group.

10:17: This sounds like a lot of talk, many meetings, but little action.

10:18: Balsy one, this Eio - he wants Congress to fund his certification effort.

10:19: Question time. Mr. Wu believes that American toys are made in Chinese prisons, an assertion backed, apparently, by evidence.

10:20: Dorgan is asking the panelists how they know their information is accurate.

10:21: Wow, Chinese prisoners are affixing labels that read "Made in America."

10:22: Kernaghan says documents are continually smuggled out of factories, but can't openly disclose sources because they'll be dismissed/shot/assigned to make Made in America toys in Chinese prisons.

10:23: Most U.S. companies have no knowledge of the manufacturing conditions in China. Mattel admitted during the toy recalls that they had no clue where many of their toys were made because contracts were recursively farmed out.

10:25: Subcontractors teach workers on their first day how to lie to Mattel auditors - but even Mattel's own audits show that some factories have an 80 hour workweek, mold on walls, etc.

10:26: Kernaghan is harping on Mattel's apology to China. Mattel was given waivers by the government in 2005 to pay workers less than legally required for overtime.

10:27: Bama Anthreya has personally toured these factories in South China to see for herself how inspections and audits are conducted.

10:29: Dorgan is asking Eio if the horror stories from the other panelists is possible, especially since his group covers only a fraction of Chinese factories.

10:30: The short answer: Yes, the testimony is accurate.

10:31: Dorgan sees three issues: 1) American workers have lost their jobs; 2) The products made are unsafe for American consumers; 3) We should not accept products made with forced or sweatshop labor.

10:32: Sanders (I-VT) is railing against "unfettered free trade agreements foisted upon us by multinationals."

10:33: "What you are telling us is that the time is long overdue for this Congress to reconsider these unfettered free trade agreements." "I want to thank you for doing that." We like free trade and all, but that's not what they said, Senator.

10:34: Particularly egregious, that the U.S. Chamber of Commerce went to a foreign government to lobby against worker rights. Dorgan points out that the same thing happened in the Philippines.

10:38: Dorgan has a story about the workers who made Huffy bicycles. When their jobs were shipped to China, workers, leaving after their last day, left their empty shoes in the parking lot. The message: you can export our job, but you can never fill our shoes.

10:41: Walmart buyers roam China like a pack of wolves. They go to factories saying 'you gave us a product for $.09 last year, we want it for $.07 this year.' One factory owner quipped that he'd have to stop paying himself to meet their price demands.

10:44: Dorgan is asking Eio to explain rumors that auditors are regularly deceived, making any certification worthless.

10:46: Eio also encounters people who have two sets of books, lying workers, etc, but he has trained auditors who know what to look for. Right, that'll work.

10:50: Mr. Wu was a political prisoner for 19 years, and was forced to work in a coal mine for 12 hours each day. Every month people would lose limbs, "it was quite normal."

10:54: Mr. Wu believes that change will happen when we Americans care about the working conditions in which their products are made.

10:55: These issues can apply to any number of countries - the hearing is focusing on China because that's who hosts the majority of jobs - and this will be part of Congress' future consideration of trade agreements.

10:57: Kernaghan is saying that there really isn't much improvement in working conditions anywhere. No progress at all - in some cases, people are significantly worse off. "The American people would be shocked."

10:58: According to Dorgan, there are many trade disagreements within the Congress, but everyone agrees that sweatshop labor is unacceptable.

10:59: Trade Promotion Authority has expired, and the Senate will block fast track authority in the future - at least until there's a new President.

11:00: Dorgan is going to push S. 367 soon - and we'll provide coverage when he does.

11:02: The hearing is adjourned.

AT&T doesn't have the cojones to appear before the committee, so the heavy task of defending the industry will fall solely to Verizon CEO Lowell McAdam. Facing off against the industry, Minnesota Attorney General Lori Swanson - who sued Sprint for illegally extending contracts - and representatives from Consumers Union, the Public Service Commission of West Virginia, and a researcher from George Mason University.

Set your phones to vibrate and keeping hitting refresh to watch as the Senate asks Verizon: "Can you hear me now?"
(Photo: KB35)

09:50: The video feed is alive and well.
10:05: C-SPAN was going to cover this hearing, but apparently the Attorney General confirmation hearing is more important.
10:09: "Meeting to order!" "Let me say two things: I will have to leave soon." Looks like Amy Klobuchar is going to chair this meeting. Good, we like her style.

10:10: @Papa Midnight: Locked phones might make an appearance, but the Senate cares more about other practices. Even our favorite bill of the 110th Congress calls only for a FCC study on unlocking.
10:11: Over 230 million Americans in a country of 300 million have cellphones. 18% of us, present company included, use their cellphone as their sole number.
10:12: We think Rockefeller (D-WV) is talking, one of the co-sponsors of our favorite bill, The Cell Phone Empowerment Act.
10:13: He's from West Virginia, where they don't have good coverage, which is why a requirement for accurate maps made it into the bill.
10:13: Rockefeller: our limited regulatory system is inappropriate when only four companies control the landscape.
10:13: And he's attacking the industry's deceptive billing, where the industry charges 'regulatory fees' to cover ordinary operating costs.
10:14: "If the industry was so competitive, one would have expected these deceptive charges to have evaporated."
10:14: "Sounds more like collusion than competition to me." Yes, yes it does.
10:15: Rockefeller is attacking the industry's assertions that the lack of complaints to the FCC indicates satisfaction with service. Most consumers know that a complaint to the FCC won't go very far.
10:17: Ok, we can't read nameplates today. This looks like Byron Dorgan (D-ND), but sounds like someone else. He has a story about how a cellphone once rang loudly in the oval office. Haha, irrelevant!
10:18: Ok Papa Midnight, he just mentioned that locking is only done in the U.S., and is something the Senate needs to take a look at as well.
10:19: The Senator is accurately tying Verizon's latest rejection of NARAL's text messages to net neutrality, and wants to hold a hearing just on that. Excellent.
10:21: Klobuchar is here, welcoming Minnesota's AG. Apparently, the cellphone industry pockets $100 billion per year.
10:22: She's painting the cellular landscape with remarkable accuracy: consumers enter into restrictive contracts without proper information, and can't cancel without even when the service is subpar.
10:23: She's casting her legislation as the modern-day solution that holds short of imposing new regulation, aiming only to give consumers the ability to find the best service at the best price.
10:24: Even with AT&T and Verizon's pro-rated ETFs, only 55% of the market is covered, so the Cellphone Users Bill of Rights - the other name for the Cell Phone Empowerment Act - is still necessary.
10:25: "If the cellphone companies are advertising who has the least amount of dropped calls, consumers have the right to know just where those dropped calls are."
10:27: "Competitive markets work best when consumers have access to the best information."
10:28: Yay! Senator Stevens is here.
10:28: NO! The Senator dropped his statement into the record without reading a word.
10:29: Jim DeMint (R-SC) is attacking the government. His office, like all Congressional offices, gets thousands of complaints each day, which shows that the federal government can't handle complex things (like a war in Iraq?)
10:30: DeMint thinks nothing beats a competitive market, which apparently, is provided by four cellphone companies that all follow the same practices. Still, "there is no compelling reason for the government to get involved."
10:30: 150 companies are competing for our business? Oh really, Senator? Name 15 of them.
10:31: "Consumers really are empowered." Um, no, they are not.
10:32: "Government regulation can't keep up with this dynamic industry." He's citing trial periods and prorated ETFs. Great, that's called staying ahead of the game so windbags like you can say, 'see, industry already did it!'
10:33: According to DeMint, companies are embracing unlocked phones. Hear that, iPhone owners? By the way, how's that 1.1.1. firmware update written at AT&T's behest working out for you?
10:35: Oh good, DeMint is done so we can stop banging our head against the desk and go get some ice.
10:36: McCaskill has had and hated: Sprint, Nextell, AT&T, and Verizon.
10:37: Uh oh, she didn't buy a text messaging plan for her three teenagers and didn't realize that they could receive text messages without her consent. This, from a member of the Senate Commerce Committee.
10:38: Ha, she's going on a good government bent and plans to introduce a bill banning people from taking cash to stand on line for Committee hearings. Lobbyists pay people big bucks to stand in line for a hearing so they're guaranteed a spot in the room. The lines are one of the best ways to figure out which hearings deal with big bucks. This hearing had a long line.
10:40: Damn! Line standers get $60 an hour! If you could stand in line from 9-5 each day, that works out to $120,000 per year. But we digress...
10:44: Senator Cantwell is talking. We doubt her consumer credentials. She used to be a VP of Real Networks, notorious makers of the insidious crapware Real Player, perhaps the most consumer unfriendly piece of multi-platform junk floating around the internet. At least she thinks that ETFs are harsh and unnecessary.
10:46: Cantwell is arguing that the Washington State AG receives more complaints about cellphones than anything else, especially with regards to coverage, disclosure, and billing errors.
10:47: 'I'm not convinced that the industry is self regulating.'
10:49: Another Republican, John Thune (R-SD) is here. Let's see if he agrees with DeMint's pro-industry anti-consumer views.
10:50: Tough to tell. He's looking forward to the panelist's testimony.
10:51: He agrees - $60 is a lot to stand on line.
10:52: We have no idea who is talking. Balding with glasses? Can you identify this Senator?
10:53: Glasses is taking us back to the first regulatory measures, which targeted the industry for its interstate nature.
10:53: He's wondering if there is enough competition, arguing that four or five competitors is necessary. Even in rural areas, he says, there are 3.6 providers, which he thinks is enough. We want nothing less than DeMint's 150 competitors IN EVERY SINGLE MARKET.
10:54: Pro-industry Senators are hellbent on proving that customers are satisfied because they aren't complaining to the federal government. Our site's existence apparently isn't enough to sway them, so we will add to our list of recommendations: call you Senator!
10:56: He's now railing against federal price controls, an idea nobody up until now has mentioned or endorsed. But yeah, Communism bad, competition good.
10:57: Ah, that was John Sununu (R-NH).
10:58: Senator Vitter (R-LA) is going Stevens on us and skipping his opening statement so we can get to the panelists.
10:59: Lori Swanson, the MN AG is talking about a Minnesota resident who was lied to by he