The media has been slow to catch on, but slowly, way too slowly, people are beginning to realize there is an ugliness to Consumer Watchdog.

Let us strip away the veneer immediately.  Consumer Watchdog has much less to do with protecting the consumer and much more to do with enriching the corporate lawyers who make up their top management.  Under the imprimatur of protecting consumers in the State of California, or being gadflies for justice, these snakes who, in some circles, have managed to be labeled butterflies, have enriched themselves to the score of millions of dollars.  So let’s be clear here, Consumer Watchdog is a sham organization whose ultimate victims are the very consumers they purport to champion. And of course the organization’s founder, Harvey Rosenfield, a trial lawyer and protege of wacky Ralph Nader, has become a wealthy man while “looking out” for all of us.

Earlier this year, even the most liberal policymakers were forced to step back and repudiate the Consumer Watchdog’s actions.  In an example of the kind of nastiness they purport to reject, Consumer Watchdog created a controversy from a ten-second humorous aside by State Senator Ed Hernandez.  It was a moment that was clearly not an example of political hilarity, but obviously meant to be funny, when Senator Hernandez told a witness during a marathon four-hour hearing that he would be redistricted out of worrying about an ex-constituent.

Hernandez’s 2-second comment was a joke.  However, Consumer Watchdog used that brief blurb from the 4-hour long hearing in a totally lame political ad that unfairly condemned Senator Hernandez and also acted as a fundraising effort for Consumer Watchdog.  They portrayed themselves as the heroic political adventurers protecting the politically shy from the beastly disregard of an arrogant legislator.  Don’t get me wrong, there are plenty of reasons to criticize Senator Hernandez, especially if you are of a libertarian bent like me — but the Consumer Watchdog hit was a total farce.

The author of the bill in question, Assemblymember Mike Feuer, released a statement to the press distancing himself from Consumer Watchdog’s tactics.  Former Assemblymember Dave Jones, the new Insurance Commissioner, who was also the sponsor of the bill, called the entire hearing one of the best and most comprehensive hearings he had ever attended and repudiated Consumer Watchdog’s tactics.

Now, believing they are safe because political timelines eradicate memory, Consumer Watchdog is at it again.

The WatchHog, as so many of their critics are beginning to call them, has intervened in a rate discussion between Mercury Insurance and the California Department of Insurance to throw out a baseless accusation that Mercury Insurance has folded their campaign contributions for Prop. 17 into a request to increase their rates.  They do this, of course, without any proof, justification, respect for facts, dignity, or basic honesty.

For years, Consumer Watchdog, has had way too much influence with State Insurance Commissioners — acting like they are kingmakers.  The organization has been allowed to insert itself in a core responsibility of the Department of Insurance rate hearings.  What is more, the Department has paid Consumer Watchdog millions for intervening on these issues, which anyone outside of state government or running a business would believe is the Department’s job. Harvey Rosenfield and his trial lawyer buddies have made a healthy living demigoging against the insurance industry.

It will be interesting to see if current Insurance Commissioner Dave Jones is finally willing to completely distance himself from the tactics of Consumer Watchdog — or whether he will be bullied by Rosenfield, which is his tactic of choice.

At the very least, Jones should finally recognize that Consumer Watchdog is not an independent party protecting the consumer, but a piggish special interest group willing to enrich themselves by destroying the reputation of others.

Consumer Watchdog’s special dislike of Mercury Insurance jaundices their viewpoint and creates an obvious conflict of interest.  Their bile manifests itself in a public nastiness that should disqualify them from participating in what is supposed to be a dispassionate, business-like rate hearing with the Department of Insurance.

Mercury Insurance, whose 90 year-old owner, George Joseph, a miner’s son from West Virginia who came to California and built his fortune the old-fashioned way, through shoe leather and door-to-door visits selling insurance policies after working a full day in a low paying job, has responded.  Their simple, straightforward declaration, which lazy reporters in the mainstream media will probably too easily ignore, actually articulates how claims have increased, and the costs of automotive repairs has gone up.  So the shocking reason why Mercury is looking to charge more, is that the cost of providing insurance is going up.  Go figure.

Of course, all of this comes at the beginning of what will be a campaign for Consumer Watchdog to prevent the Mercury and other insurance companies under the umbrella of the American Agents Alliance from passing a ballot measure that would allow you and I and all California drivers to be able to continue to get a discount for having consistently been insured, even if you change from one insurance company to another.  This simple idea makes sense in 48 other states and is actually an excellent consumer protection. Of course one can presume that Rosenfeld and his buddies will not be opposing the measure because of valid public policy concerns, but rather because (as I said above) they have turned attacking insurance companies into a lucrative endeavor.

Consumer Watchdog also has a campaign to take control of health plans, as they have been allowed to do with automobile insurance policies in the state of California — as if Obamacare’s pending implementation isn’t bad enough.

Imagine this, California consumers already pay among the highest automobile insurance rates in the country due to the selfish efforts of Consumer Watchdog and now these same corporate lawyers, inserting their own rights for intervener fees, want to “reform health care as they did auto insurance.”

It is especially appalling that these corporate lawyers have dared to compare themselves in the past to civil rights activists protecting the downtrodden, when in fact their own business plan is to sell their brand and services, and even their soul, to the highest bidder in order to garner profits for themselves.

As for the initiatives being promulgated, my advice is very simple: Read them.  Yes, it is that simple.  The initiative to allow you to change carriers without losing your consistent coverage discount, entitled the Automobile Insurance Discount Act of 2012, is very straightforward.  It is totally sensible policy and there is no sound reason to oppose it.  Perhaps more to the point of consumers fooled by Consumer Watchdog it also provides an opportunity for those who are hoping for discounted options after being out of the insurance market.

This is going to be a long campaign season and there will clearly be bigger issues than being able to take your consistent coverage discount from one insurance company to another.  However, there will perhaps be no other issue that so clearly defines the corruptibility of groups like Consumer Watchdog and their interest in integrating their own fundraising capacity and personal profits in the initiative process.

We’ll spend more time on this issue.  We will demand greater accountability from Consumer Watchdog and greater clarity on their own motives and profits.

This entry was posted on Friday, December 23rd, 2011 at 4:00 am and is filed under Blog Posts.