Biden's beef with bad customer service
Digest
The "Time Is Money" initiative, launched by the Biden administration, targets corporate practices that waste consumers' time and money. This initiative arose from the administration's efforts to address "junk fees" and President Biden's concern about companies exploiting consumers. The initiative aims to create a more transparent and consumer-friendly market by addressing a broader range of shady business practices beyond just junk fees. Specific targets of the initiative include making subscription cancellations easier, implementing automatic cash refunds for delayed or canceled flights, and addressing other consumer-unfriendly practices. The initiative raises the question of government intervention in the free market, with the administration arguing that market failures, such as lack of transparency and information asymmetry, justify intervention to protect consumers. The initiative draws on the concept of "sludge," coined by behavioral economists Richard Thaler and Cass Sunstein, which refers to systems that make it difficult for consumers to make choices. The initiative aims to reduce sludge in the private sector by making it easier for consumers to navigate complex processes and make informed decisions. While the initiative focuses on the private sector, the administration acknowledges the existence of sludge in the public sector, citing the US tax system as an example. The administration has taken steps to address sludge in the public sector, such as implementing direct file for tax returns, which allows Americans with uncomplicated tax situations to file for free online.
Outlines
Combating Corporate Shenanigans: The "Time Is Money" Initiative
The Biden administration launches the "Time Is Money" initiative to combat corporate practices that waste consumers' time and money. This includes making it difficult to cancel subscriptions, obtain airline refunds, and file insurance claims. The initiative aims to create a more transparent and consumer-friendly market.
The Genesis of the "Time Is Money" Initiative
The initiative arose from the administration's efforts to address "junk fees" and President Biden's concern about companies exploiting consumers. The initiative aims to address a broader range of shady business practices beyond just junk fees.
Specific Targets of the "Time Is Money" Initiative
The initiative targets various areas, including making subscription cancellations easier, implementing automatic cash refunds for delayed or canceled flights, and addressing other consumer-unfriendly practices.
Government Intervention in the Free Market: A Necessary Evil?
The initiative raises the question of government intervention in the free market. The administration argues that market failures, such as lack of transparency and information asymmetry, justify intervention to protect consumers.
Keywords
Junk Fees
Unexpected charges added to bills for services like hotel bookings or concert tickets. The administration has taken steps to regulate these fees.
Sludge
Systems or practices that make it difficult for consumers to make choices, often due to lack of transparency or complexity. Coined by behavioral economists Richard Thaler and Cass Sunstein.
Information Asymmetry
A situation where one party in a transaction has more information than the other, leading to potential exploitation. The administration argues that information asymmetry justifies government intervention.
Race to the Bottom
A situation where companies compete by lowering standards or engaging in unethical practices to gain an advantage. The administration argues that the Time Is Money initiative aims to prevent this.
Direct File
A simplified online system for filing taxes, allowing Americans with uncomplicated tax situations to file for free. Implemented by the IRS as part of the administration's efforts to reduce sludge in the public sector.
Q&A
What is the "Time Is Money" initiative and what are its main goals?
The "Time Is Money" initiative is a Biden administration program aimed at combating corporate practices that waste consumers' time and money. It targets areas like subscription cancellations, airline refunds, and other consumer-unfriendly practices, aiming to create a more transparent and consumer-friendly market.
Why does the administration believe government intervention is necessary in this area of the free market?
The administration argues that market failures, such as lack of transparency and information asymmetry, justify government intervention to protect consumers. They believe that companies may exploit consumers due to a lack of information and that government intervention can help level the playing field.
What is the concept of "sludge" and how does it relate to the Time Is Money initiative?
"Sludge" refers to systems or practices that make it difficult for consumers to make choices, often due to lack of transparency or complexity. The Time Is Money initiative aims to reduce sludge in the private sector by making it easier for consumers to cancel subscriptions, obtain refunds, and make other choices.
How does the administration address sludge in the public sector?
The administration acknowledges the existence of sludge in the public sector, citing the US tax system as an example. They have taken steps to address this, such as implementing direct file for tax returns, which allows Americans with uncomplicated tax situations to file for free online.
Show Notes
It's an array of actions the Biden Harris administration is taking to stomp out business processes that waste consumers time and money, like, for example, making it unnecessarily difficult to cancel a subscription, get an airline ticket refund, or file an insurance claim.
On today's episode: In a competitive market, companies want to treat their customers well or else they'll lose their customers to competitors ... so why does the White House want to intervene in this area of the free market?
Related Episode:
Junk fees, unfilled jobs, jackpot
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