Uncle Sam

Uncle Sam January 8, 2009

To be fair, illustrating the personal finance page is a difficult and thankless job. Being asked, week after week, to draw a picture of abstract ideas like “the importance of maximizing your 401(k) contribution” — on deadline — is not an easy task. There are only so many giant piggy banks, ladders and staircases one can get away with.

Bilde

So I’m not trying to pick on hj, our paper’s talented illustrator, for coming up with the drawing to the right to accompany a year-end article that carried a headline of something like “Keeping your nest-egg safe from Uncle Sam.”

On the other hand, though, just look at that picture. Uncle Sam is terrifying. The bear markets carrying off the family’s retirement savings are smiling and almost cuddly, but the usually patriotic symbol of American government looks cruel and demented.

Removed from the context of the accompanying article, this could easily be mistaken for a piece of anti-American propaganda whipped up by an uncharacteristically whimsical member of al-Qaida.*

This article had very little to do with al-Qaida, of course. If it had then this depiction of Uncle Sam would have created a massive outcry. Subscriptions would have been canceled, front-page apologies would have been published and people would have gotten fired. As a general rule, any portrayal of Uncle Sam accompanying an article about terrorists or Iraq or Afghanistan or Grenada must show him as powerful and benevolent. It’s only when the subject is taxes, as it was with this drawing, that he is allowed to be portrayed as a cruelly perverse predator menacing innocent families. When the subject is taxes, it is not only expected but required that Uncle Sam be drawn as the malevolent figure shown here.

One wonders how the powerful and benevolent Uncle Sam of the war drawings is supposed to acquire the money he needs to remain so powerful if taxes and therefore government itself are to be universally despised as cruel, destructive and illegitimate.

But hold that thought, for a moment.

* * *

The ‘vixen and I are currently in a billing dispute with PECO Energy, our regional electric utility. My wife moved into our new home one month before the lease on her old apartment expired. That was nice at the time, allowing for a more relaxed approach to moving all of her and the girls’ stuff out of the old place. For the last month of her lease at the apartment, then, she still had an active PECO account there.

The average monthly electric bill in that smallish apartment was $60 or $70, but we figured the bill for that final month would be a bit less than that. All the appliances were gone except for the refrigerator. The heat and air conditioning and all the lights were off.

PECO sent us a bill for that final month for $220.

That’s right: The bill for an empty apartment in which no electricity was being used was three times the usual bill for an occupied apartment.

I spent a great deal of time on the phone with various PECO representatives but wasn’t able to reach any resolution. I told them that until they explained to me, in writing, how it was possible that not using energy should cost $150 more than using energy did, they shouldn’t expect to get any money from me. I have never received any such explanation, so that’s where things seemed to sit.

Until last month. Last month, here in our new home with our new PECO account, we were charged a late fee. We paid the previous bill in full and on time, but it seems that PECO had subtracted from that payment the $220 they claimed was owed to the previous account — meaning the new bill was no longer paid in full and thus incurring the late fee.

Mah. Thur. Fah. Curse.

This kind of billing horror story is par for the course here in the U.S. of A. Reading the above account, it’s quite likely you were thinking, “That’s nothing — you should hear about the stunt our utility pulled …” So there’s no point in my providing the details of our household’s similar encounters with Comcast (the cable/Internet provider whose monthly bill has always exceeded the guaranteed price stated in our two-year “contract”) or Verizon (“unlimited texting doesn’t mean there’s no limit …”).

These companies do this because they can.

Dubious billing practices, mysterious hidden fees, billing “errors” that they correct only for that small percentage of customers who pore over the fine print and call to complain — these things have all become not just their standard operating procedure, but their primary business model. PECO is not an energy company, it is a company that generates and distributes energy as a pretext for its main business of creative monthly billing. Comcast is not a cable and Internet company, it is a company that incidentally provides those services in order to pursue its primary business of creative billing. Verizon is a billing company that levies a monthly fee from a quarter of American households, occasionally also providing some of them with wireless and long distance service.

They do this because they can.

It used to be that these companies didn’t do this because they couldn’t. They used to be regulated because they were monopolies. Monopolies — unchecked by competition or other market forces — have to be regulated to prevent them from exploiting their customers.

Over the past three decades, however, electric utilities and phone companies and cable providers have all been deregulated. The theory was that competition would arise that would keep down prices and prevent the exploitative and dishonest billing practices once outlawed and restrained by regulation.

The theory didn’t work.

“It doesn’t matter,” the PECO representative said.

I had just informed her that if our billing dispute was not resolved, quickly, we would be canceling our PECO account and switching to one of the other providers under Pennsylvania’s “electricity competition” scheme.

“It doesn’t matter,” the PECO official said — out loud, knowing that our conversation was being recorded (“for training purposes”) and not in the least fearing any repercussions for admitting such a thing publicly — “You can change electricity suppliers, but you’ll still have to deal with us as your distributor. So you’re going to end up paying what we say.”

She’s evil and a thief, but she has a point. It doesn’t matter that PECO is charging us $220 for services they never provided. It doesn’t matter that the utility is, essentially, stealing this money by fraud. The bottom line is they’re big and we’re small and so like all of their customers we have no recourse when hit with false charges, dubious fees and phantom surcharges. All we can do is say, “Thank you, sir, may I have another,” and pay whatever they tell us to pay as quickly as possible lest we incur a late fee on top of it.

We are going to end up paying whatever they say. And so are you.

That’s how this corrupt little system works now that we’ve decided to pretend that our monopolies are not really monopolies and that therefore their monopolistic exploitation of their customers isn’t really exploitation. You will pay them whatever they say you owe, whether or not there is any legitimate basis for this billing, and there is next to nothing you can do about it. And because they know there is next to nothing you can do about it, they will continue to increase and to pad what they say you owe. They will add surcharges and fees for additional services you have not ordered and have never used, or for additional services that are purely abstract and hypothetical (“identity-theft protection”?).

They do this because they can.

* * *

So the illustration above isn’t wholly inaccurate. The menacing, finger-waggling predator it portrays is a recognizable figure to most American households. But for most households that figure usually isn’t the “tax man.” It isn’t Uncle Sam who is looming over terrified families and destroying their houses. It’s the monopolistic monthly billing compa
nies,** unregulated and unrestraine
d, who play this role for most Americans.

J-p-morgan
Back in the first Robber Baron age, these large monopolistic entities were called “trusts.” The name still seems apt, since trust is exactly what we have yielded to them — our naive, unreserved and undeserved trust.

We have placed our trust in such entities — in the utilities and monopolies and corporations large and very large — because we have been following an ideology that tells us we must not and cannot trust our own government. We have nothing to fear from unregulated monopolies, this ideology tells us, only from the regulator itself. It is the government, the star-spangled menace in the first drawing above, whom we must fear, not the good and benevolent and eminently trustworthy monopolies.

It is because of that sort of image of Uncle Sam that we have ended up with images like this second one, a sadly accurate satire from 1911. The larger figure there, the one in charge, is J.P. Morgan (via this site). Substitute the institution — JPMorgan Chase — for the man and the satire still seems apt.

Now of course I don’t believe the citizens of a democratic country should blindly trust their government. I don’t even believe that the citizens of a democratic country should blindly trust in their own ability to control their government. But I do believe that such citizens can control — and restrain, and direct — that government. That is, by definition, what it means to be the citizens of a democratic country.

Democracy isn’t automatic, and it’s usually not easy, but it is possible. And if we have a government of the people and by the people, then we have the power to ensure that it is also a government for the people.

In other words, we — we the people — are Uncle Sam. Uncle Sam is US.***

Uncle_sam
Right now, the image we need of Uncle Sam is something like this one here to the right. That guy looks like he’s ready to bust some trusts.

We need the FTC and the FCC and the various state public service commissions to follow this example — to roll up their sleeves, flex their muscles and defend their country, defend their people from exploitations large and small. We need an SEC that can stay awake long enough to prevent people like Bernard Madoff from bankrupting charities and we need an FCC that can hold Internet and wireless companies to the terms they claim to guarantee in their supposed “contracts.”

The latter might seem unworthy of this level of attention. The stupid billing tricks and petty frauds I’ve complained about here — the ones routinely practiced by the various utilities, wireless companies and Internet/cable monopolies — might seem like they’re too nickel-and-dime to get very worked up about. But those nickels and dimes can be unrelenting, inescapable and cumulatively devastating.

My family could afford to pay PECO money that they didn’t earn and that we didn’t owe, but not all families are as fortunate as we are. What was for us a (substantial) inconvenience could be, for many families, the difference between making ends meet and not. For many families, a $150 bogus overcharge from the utility company will mean a cash advance on a credit card or a payday loan, either of which could eventually wind up costing them hundreds or even thousands of dollars more — money they do not have.

Right now, most such families have no recourse. That has real consequences for real people. (And — as Tom Geoghegan points out here — it has larger, corrosive pedagogical consequences for all of us.) Those families need help.

Those families need Uncle Sam on their side.

– – – – – – – – – – – –

* The members of al-Qaida, of course, believe that any visual depiction of human beings is a form of idolatry and is therefore prohibited. This is one of the seven main reasons that no one associated with al-Qaida will ever become a great editorial cartoonist. The other six are too obvious to bother spelling out here.

** I haven’t even mentioned here the creative billing practices of the credit card lenders. Unlike the energy/phone/Internet monopolies, I have managed to keep my own dealings with these debt merchants to a minimum, but they’re really the pioneers and the industry leaders in the burgeoning field of creatively bogus billing. The average American household carries a credit-card balance of something like $8,000. In addition to the usurious interest rates they charge, the debt merchants have a whole host of lucrative revenue-generating fees and charges that all but ensure these families will stay in debt in perpetuity. They do this because they can.

*** Those of you who didn’t fail Fifth-grade Social Studies are now saying, “No duh.” But you’d be surprised how many are surprised to think of it this way. Reflexive or visceral anti-government sentiment, in a democracy, is strangely popular given that it is both a form of self-loathing and a self-fulfilling prophecy. Right now, for instance, there’s a pseudo-libertarian reading this very paragraph and shouting, “How naive! The government isn’t of, by or for the people — the government is against the people!” He’s wrong, of course, but if everyone believed that, then his nightmare could become reality. If all the citizens of a democracy abandon any belief in government as the servant of the people for the common good, and if they oppose every attempt to make it so, then they’re not going to remain the citizens of a democracy for very long.


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  • Memories of PECO: I sold my house and called to have the electricity shut off on my account. I had to supply my account number, address, phone number, and then my Social Security number. So the so-called customer service person told me I had given a fake SS number and lectured me about nasty pranks. I called back, and PECO threatened to sic the police on me. (Fortunately, I had a real estate agent to tell, “Fix this if you want that commission.”)
    Which wasn’t as bad as when PGW insisted on installing an upgraded gas meter which promptly billed me $3,000 the following month (for hot water and a clothes dryer only).

  • rm

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    Fred, GBOAT!
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  • J

    Hmm, AGs . . .
    Kicking off what might be either a huge diversion in this thread or else something that might be answered with a one-line reference to a clause in the Constitution or a simple principle of English common law:
    Why do we elect state Attorneys General? It’s now well-established to be a huge distorting factor to criminal justice (and every other area of law, really) to have these guys running for office every 4 years. Particularly since AGs are generally angling to become Governors, they A.) pander to the public by promising to “get tough on crime” (and all the shitful ugliness that actually entails) and B.) sell a lot of influence to large corporate interests.
    Elected AGs seem to rather tip the balance of the whole justice system, too: Public Defender offices are creaky-boat affairs whereas I never heard about assistant AGs going 10 years without a raise. But more to the point, Public Defenders are regular ol’ civil servants, whereas head AGs are fairly slick elected officials and assistant AGs are their handpicked appointees (read “fraternity buds who want to eventually succeed them”).

  • In other words, we — we the people — are Uncle Sam. Uncle Sam is US.
    Yes. Exactly.
    It’s one reason I get in so many arguments with libertarians. It’s like, somewhere in their brains, there is a deep instinct that says the government is always some kind of inherited aristocracy, an “other” which they have no control over or relationship to, that exists only to screw us all over.
    Oh, except the military. Inexplicably, when libertarians complain about The Government, the military is not included. Too much Heinlein, is my guess. The libertarians I know are all SF fans.
    These companies do this because they can.
    When I was a phone monkey at a cell phone company, I started to hate everyone, because the people who called were whiny jerks who couldn’t be bothered to read the really obvious terms of their own contracts, an the company I worked for was a psychotic money-grubbing monolith that exploited human tendencies like not reading contracts in order to get more money out of people.
    I didn’t understand why people seemed to have this weird trust that this giant for-profit company wouldn’t make “unreasonable” charges. Like foreign data roaming or massive overtime. Really, I’m not talking about people getting dinged by obscure things here — I’m talking about things where it wouldn’t have taken very much research at *all* to know that you were ringing up a $900 phone bill.
    I don’t know, it seems to tie into the weird notion of government as an adversary, and for-profit companies as your buddy. It’s like people don’t accept the need for government oversight of private companies because on some level they really haven’t grasped the fact that a for-profit company exists for the express purpose of making a profit, and that screwing people over is profitable, and that left entirely to their own devices these companies will do just that.
    Has anyone noticed that one of Jack Chick’s motifs is ugly people? All of his people are big-nosed, rumple-shirted, bad-haired, and often profusely sweating.
    Not exactly. His Jews and Catholics and witches and other unsaved people are ugly and sweating, but his saved people look wholesome and well-groomed, like the plaid-shirted dude here.

  • Matt

    I can’t say I disagree with your specific problems with the various companies that engage in these practices. It’s a mess, and needs fixing pronto.
    On the other hand though, the libertarians have got a point. The government is by definition a trust for which there is no higher recourse, even in theory. Government is the ultimate monopoly. Verizon can send you to collections, the government can send you to jail. And if government abuses its power, there’s no one higher to complain to. It’s something to be aware of when you give government power to try to fix problems. There’s a balance to be struck.

  • Ann Onimous

    The bottom line is they’re big and we’re small and so like all of their customers we have no recourse when hit with false charges, dubious fees and phantom surcharges.

    This is flatly untrue in the state where I live. I don’t know where you are or how it it there, but here in Massachusetts, you DO have recourse, precisely because the state recognizes that you are little and they are big.
    Here in MA, if you have an unresolvable conflict with a utility company, you pick up the phone and call (617) 305-3531 or 1-800-392-6066 to talk to the Consumer Division of the Department of Public Utilities. There is a phone bank of agents to take calls about exactly the sort of billing situation you describe. I know this because I worked there, and I had reason to invoke their powers myself (thanks, Verizon!)
    The first thing they’ll ask is whether you attempted to talk to the utility company, yourself, and if not, they’ll tell you to do that first. (As you’ve described doing here.) Then, if you’re not satisfied by the company’s response (as one would reasonably not be by being told what you were), you call them and register a complaint. They ask a bunch of questions.
    And in cases like you describe, within about three days, you get a call back from the DPU telling you they’ve straightened it out. No cost to you, no further hastle.
    These are also the people you call if:
    – Your landlord is running a hallway light on your circuit
    – Your electric company informs you that all prior bills were “projected” and having checked the actual meter, charges you several grand to make up what they hadn’t charged you over the past three years
    – Your gas company tries to bill you for money your roommate owed for gas at a previous apartment
    – Your electric company turns off the juice to the refrigerator that holds the insulin to treat your diabetes with in the middle of August
    – Your gas company turns off your heat between November and April
    – Your phone company bait-and-switches you on service plans
    What’s going on behind the scenes is that if the utility company tries to break the law in dealing with you, and the DPU calls them on it, their failure to comply then puts them in conflict with the government, which is bigger than they are, and entitled to simply impose stiff sanctions and then take the money out of their bank accounts. This is marvelously improving of their attitudes and they comply right quick.
    I certainly hope that your state has one of those, too. And I certainly hope that those of your readers here in Massachusetts know about this service that’s available to them — so many of them erroneously believe, as you express here, that there’s nothing to be done about it.
    P.S. There was a class action suit against, uh, I think it was Bank of America? about changing credit card terms unilaterally, and they lost. I got $0.60 of the judgment — and a new improved terms that explained I could refuse changes, though they could also refuse to lend me further money if I did.

  • Raj

    McJulie: [Jack Chick’s} Jews and Catholics and witches and other unsaved people are ugly and sweating, but his saved people look wholesome and well-groomed, like the plaid-shirted dude here.
    And he’s square-jawed, as a good RTC Manly Man(TM) should be!
    What’s with the cat that keeps appearing in the tracts?
    Why does Satan always have that ridiculous egg-shaped head?

  • heckblazer

    The second Uncle Sam cartoon is a decent summary of the response to the Panic of 1907. That in turn directly lead to the creation of the Federal Reserve, as people decided that saving the market should not be contigent of the benevolance of a single private citizen.

  • Hawker Hurricane

    Never mind the cat, look at the dog, Fang!

  • CHip

    re modern “service” contracts: there’s a bit in Good Omens about the erstwhile Snake sending one Below as an example of the way they should be doing things.

  • rea

    Surely, legal action against the companies has to be some kind of an option.
    Setting aside any concenrs about arbitration provisions, it is still just not economical to sue over $220. $22,000, maybe. But factor in a $60 or so filing fee and 10-15 hours of work, and how does suing your utility company over $220 make sense, even if you don’t try to hire a lawyer but do it yourself?

  • @rea,
    It makes sense because the Evil Utility Company expects us to decide it’s not worth it. That’s why they overcharge.

  • Consumer Unit 5012

    @Muse of Ire:I was reading the paper this morning about Obama’s plans and the Congressional jockeying over tax cuts and I actually said aloud, “For God’s sake, will you stop cutting my taxes?” How does anyone expect the Government to carry on with its normal day-to-day functions, much less the bold new expenditures now being contemplated, without some freaking money? I just don’t understand how people can talk about a possible trillion dollar national debt and then advocate cutting taxes.
    To the sort of mindset that thinks that the Free Market is God’s smarter younger brother, cutting taxes is like bacon–no matter what the question is, it’s ALWAYS the correct answer.

  • Has anyone noticed that one of Jack Chick’s motifs is ugly people? All of his people are big-nosed, rumple-shirted, bad-haired, and often profusely sweating.
    Not exactly. His Jews and Catholics and witches and other unsaved people are ugly and sweating, but his saved people look wholesome and well-groomed, like the plaid-shirted dude here.

    Or the Hitler-Youth-poster classroom Creationist in Big Daddy. Or the guy no one wants to sit next to on an airplane in Flight 144.

  • Not Really Here

    Then Jack Chick brought in a poet to testify that truth is beauty, and beauty is truth, therefore what is beautiful must be true…

  • Dear Slacktivist: Please check your spam trap. I put links into a comment I posted here, and your filters decided it was comment spam.

  • Ian

    The government is by definition a trust for which there is no higher recourse
    Elections.
    We’ve been having landlord problems in my neighborhood, forced evictions to bring about rent increases. It turns out that if you can raise awareness of an issue, get hundreds of people marching in the streets and thousands of people thinking about single issue voting, you can topple your MPP and replace him with someone who will solve the problem. Solve it or it will be his neck on the chopping block next.
    When people get mad at a government, they vote it out. When people get mad at corporations who hold monopolies or long term contracts over them, really their only recourse is to get government to regulate those companies.

  • Hawker Hurricane

    In a democracy, even a representitive one, we are the government. If the government is evil, what does that make us?

  • J

    *In a democracy, even a representitive one, we are the government.*
    No, we are not. The government and the people are distinct, even when the former is in theory a selected client of the latter. Our nation is of, by and for the people, not our government.
    You don’t have to believe me: Just go to somewhere where the “United States” is hated. Unless you’ve got on helmet and rifle or are wearing your Pentagon or CIA ID badge (or those little American flag lapel pins that are like the new masonic emblem for the Brotherhood of Assholes), people will pretty warmly receive and assure you that they don’t hate you: They hate your government. You are free to take that personally–insist that you are your government and your government is you. But I don’t feel the need and don’t see the point.

  • Hawker Hurricane

    J, the places I traveled that hated Americans, most made no distinction between the people and government. When I was there, I assured them that I was with the Canadian Navy, not the American one.
    The one place where I did see them make the distinction (Australia), they made it clear it was the *current* government they hated, not American government in general. Where my excuse was “Don’t blame me, I voted with the majority!”
    HH, SM1(SW) USN, 1984-2004

  • J

    This, by the way, is why when, say, a congressman is convicted of embezzling or bribery or such, his constituents don’t also go to jail.

  • J

    *J, the places I traveled that hated Americans, most made no distinction between the people and government. When I was there, I assured them that I was with the Canadian Navy, not the American one.*
    Well, then you’ve had a different experience than me.

  • Jeff

    I put links into a comment I posted here, and your filters decided it was comment spam.
    I will not comment — I will not comment — I will not comment. Mmmmmmppph!

  • Eleas

    Impressive and… just a bit frightening. I hope things will eventually work out, but all the same it looks bleak. It seems to me that the US sentiment favours putting up with most anything, so long as it’s done to you by a corporation as opposed to the government. I can understand why it’s become the dominant attitude, but it’s still sad when things have gone as far as they have.

  • Hawker Hurricane

    It’s the dominant attitude because the corporations have spent large sums of money in advertising and politicians to make it so.

  • Matt

    PREACH!
    First time I’ve commented here, but I love this entry. You’ve summed up the “RON PAUL gubment’s out to get you” sentiment nicely.

  • Dean Booth

    The current relationship between US citizens and Uncle Sam is best expressed by Cheney’s response to the fact that two-thirds of Americans think the Iraq war was not worth it: “So?”
    When most Americans believe Israel’s actions in Gaza are wrong, it would be shameful if the Congress did not speak out against Israel. Instead, they go beyond shameful and pass a resolution supporting Israel’s war crimes. I find myself asking “Who are these people?”
    We are not Uncle Sam because the government does not represent us.

  • LanceThruster

    Richard Pryor in Superman III(?) got rich steering fractions of cents into a personal account. I have no doubt that companies know exactly how much they can steal without people noticing or complaining. Since these records will be tracked and analyzed endlessly, they can also increase the amount of fraud as their statistic show how much will float.
    Who wants to comb through this shit to feel they’re not being cheated, but are being cheated anyway (including the time wasted of such unproductive tasks). Why is is that you make an error, and you pay through the nose? When the company does, they treat it as no harm, no foul.

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  • How did you resolve it?
    I would have been tempted to file a complaint with the local police, or the DA. This is extortion, and it’s a RICO violation — and the best part is, in dealing with companies like this, you don’t have to prove scienter (criminal intent) on their part. All you have to prove is that they did what you allege — bill you extortionately, and not fix it.
    The collections on the other account? I’d file that as another RICO violation.
    I hope they backed down. How’d it come out?