Author: A.T.

Yesterday I suggested the benefits of buying airline tickets far in advance, at great prices, even if you’re not sure you’ll use them. (You might want to click “Yesterday” for more on that.)

Another pointer for you not-so-frequent fliers is that ticket prices go up and down daily — hourly, sometimes — as the flight date approaches. Don’t assume, just because the cheap seats are all sold out two weeks before you want to leave, that some may not materialize a few days later. Keep trying.

But here’s what I wanted to tell you today, and that’s the value of “stand-by.” Today I was supposed to fly from Cincinnati to Miami at 12:55 on a supersaver ticket purchased for peanuts. Unfortunately, the non-stops were full, so I had to buy a ticket that routed me with a stop in Atlanta. Non-stops are nicer, but in this case flying non-stop would have cost several hundred dollars more.

Normally, what someone does in this situation is simply show up for the 12:55 flight to Atlanta, switch planes, and arrive a little worse for wear in Miami. Indeed, all too often I would probably do that too. But it’s often worth it to remember the stand-by option.

When I got to the airport, I saw there was a non-stop leaving at 12:30. I “stood by” and not only got on (it was badly overbooked, they had told me, but I gave it a shot anyway), but got two seats to myself. So I got to Miami almost three hours faster (and enjoyed a longer flight, which makes it easier to open up the laptop and write this comment).

Had I not made it, I would just have walked down the concourse to my scheduled flight.

I realize this is not earthshaking news. But do understand your supersaver options when you buy your ticket. Stand-by can work out nicely.

Tomorrow: Pay Your Taxes

There are three kinds of people in the world. Those who never have occasion to board an airplane. Those who do so only every so often. Those of us who live up here.

If you never fly, skip this comment. If you always fly, you probably know at least as many nuances of the game as I do. But if you’re somewhere in between, I have a couple of suggestions.

Obviously, it’s imperative to join the frequent flier programs — surely you’ve done that — and, where possible, to concentrate all your flying on one airline, and all your credit card purchases on one airline-affiliated credit card (or the American Express or Diners Club “Express Miles” programs) so you build up maximum points and maybe even qualify for a “gold card” or “medallion level” or some equivalent category that will generally keep you from getting stuck in the center seat on a crowded flight.

You also know to book your flights as far ahead as possible — and that the “nonrefundable” tickets ARE refundable, with a $50 charge, in the sense that you can apply them against other tickets. So it can make sense to buy five round-trip supersavers now, for this summer, even if you only wind up taking two of the trips. The cost: $150 lost on those three other tickets. The gain: fares like $300 transcontinental round trips instead of the full-fare $1,400.

Do call the airline to cancel once you know for sure you won’t be using one of your tickets — it’s not required, but you should do it.

But otherwise, especially if you can afford to do this without going into debt on your credit card (and therefore incurring not just the $50 but also 18% interest on all five tickets), here is a cheap way to maintain lots of flexibility in your summer (or any other) travel plans without paying the normal high fares.

Have you got your ticket for Labor Day week-end yet? You should. And if you’re not sure whether you’ll be spending it on Cape May or Cape Cod, that’s the point: buy your super-savers to both, and forfeit $50 for having the privilege of deciding what you want to do right up to the last minute.

Tomorrow: Stand-By

I’ve just spent two months running around California. Compared to the way people used to do it — on horseback — the United Shuttle (800-SHUTTLE) is a vast improvement. But compared to air travel as we’ve come to know it — or to competitor SouthWest (800-I-FLY-SWA), it’s awful.

I’m sure this isn’t fair, but apart from any other negative comments one might make (Calcutta comes to mind), my own unscientific conclusion is as follows: on a sunny day, the Shuttle will be half an hour late. If there are clouds, an hour. Rain, between two and three hours. Light fog — canceled.

I realize this comment may not be all that helpful to you. How many people fly from LA to San Francisco to Sacramento on a regular basis? And of those who do, how many could possibly have failed to notice that they are sitting around a chaotic waiting area for hours with several hundred other unhappy people?

I don’t think I’ll rush out and buy UAL stock just yet.

Tomorrow: Super-Savers

Yesterday, I described my GM MasterCard and how it credits me with 5% of everything I charge toward a new car. Sort of.

Today, though, let me tell you what rubbed me wrong about the good folks who live inside the GM MasterCard computer (or, more likely, their marketing department).

It was simply this. Printed on my monthly statement was this message:

AS A VALUED CARDMEMBER, WE WOULD LIKE TO OFFER YOU THE OPTION OF SKIPPING YOUR PAYMENT THIS MONTH. THIS IS ANOTHER WAY THE GM CARD GIVES YOU THE FINANCIAL FLEXIBILITY YOU EXPECT. WE’LL BILL YOU AS USUAL NEXT MONTH. (FINANCE CHARGES WILL ACCRUE.) WE APPRECIATE YOUR BUSINESS.

Leaving aside the English (“as a valued cardmember, we . . .” they are not a valued cardmember, I supposedly am), the point of this message was, of course, not to offer me something good at all. It was to offer me something bad. Namely, a chance to borrow from GM at 18.65%, non-tax-deductibly . . . and not just on that month’s balance, but on any new purchases I made during the month, since once you get on the debt treadmill, you’re on it in full until you get off. Which they hope you won’t.

I can’t blame GM for trying to convert me from a smart credit-card user (one who uses them for convenience only) to a dumb one (one who uses them to borrow — as 60% or more of all the people who use credit cards do).

But just in case you’re not aware of it, offers like this, or the “checks” they send you to be “helpful” around tax time — write one of the checks to anyone you like — are just ways to try to get you to start the interest-rate clock ticking.

Thanks but no thanks.

Tomorrow: The United Shuttle

I have one of those General Motors MasterCards that credits me with 5% on every charge I make toward the purchase of a new GM car. Which means — sort of — that everything I charge on the card costs me 5% less.

I say “sort of” because there’s a limit of $1,000 credit a year for a maximum of $7,000 over seven years . . . but if you do wait seven years to use your credits, then, because of the time-value of money, those earned in the early years are worth somewhat less. You “earned” $1,000 rebate in year one, but it sits fallow and is still only worth $1,000 seven years later. Which means that in today’s dollars, that $1,000 is really only worth $547 (if you think if you think you can compound your money at 9% after tax — few can) or $759 (at a more realistic 4%).

So maybe the nominal 5% discount for using the card is more like 4% when you take this time factor into account. (It all depends on what you think you could earn on your money, but also on how long you wait to cash in those rebates.)

It’s also only “sort of,” because the assumption is you’ll be buying a new car (until recently, I always bought used cars — a great way to save money), and that it will be a GM car or truck. What if you’d rather buy a Taurus or a Honda? Or even a Saturn — the rebate doesn’t apply to a Saturn (nor to a Saab or Lotus, which are also GM products). It’s hard to quantify, but for most people there is a “cost” in this lack of flexibility.

So it can be a good deal — a lot of people DO buy new GM cars! — but it’s only sort of 5%.

But that’s not what’s got me exercised. For that, please tune in tomorrow.

Tomorrow: The GM MasterCard: Don’t Do Me Any Favors

The last few days I’ve been moaning about the defeat of three California ballot initiatives I worked on.

All three would have been good for the people of California but bad for lawyers.

Even in California “the people” outnumber the lawyers by a handy margin, yet the lawyers won. How come?*

Partly, as described yesterday, they just lied. Lie loud enough, long enough, and — especially on a subject that requires some analysis to fully understand — you can persuade the electorate of anything. (Unless, as sometimes happens, the opposition has enough money to answer all your charges with an even larger TV ad campaign, which we did not.)

But what really made the lawyers’ lies credible were the list of endorsers joining them in opposing Props 200, 201 and 202. “Join Ralph Nader and vote no” ran the commercials. And along with Nader were just about every liberal and labor group you can think of.

If these propositions were really good for the people, how could that be? Isn’t it more likely that I’m the one lying to you, not the lawyers?

Certainly millions of people of good will could conclude that — and did. Had these same groups all been fighting for the propositions, I think they would have won handily.

Now, I wasn’t “there,” but here’s what I think happened.

It begins with Ralph Nader and his man-in-California Harvey Rosenfield, a self-described consumer advocate. Ralph has always opposed any form of no-fault auto insurance, even for the 30 years Consumers Union, publishers of =Consumer Reports/= , strongly favored it. He even opposed the form of no-fault they have in Michigan, the state Consumer Reports has credited as having the best auto insurance system in the nation (and the one that comes closest to what Prop 200 would have provided).

Nader denies getting any appreciable support from the trial lawyers, but he has in fact worked hand-in-glove with the trial lawyers for decades (often to good and beneficial result). He denies it, but his various efforts have gotten tremendous financial support from trial lawyers. So our three lawyer-limiting initiatives are proposed and Nader sees his power base threatened. Can they use his name against them? Sure.

Not because he’s corrupt, but because he really believes that any encroachment on a citizens right to sue, no matter how slight, is not worth making, no matter what the benefit. And because when you’ve worked so closely all your productive life with a group of people who’ve loyally supported you, and on whose loyal support you count for the future, you just naturally tend to see things their way.

(Nader told the New York Times recently he’s gotten “less than 1 percent” of his support from lawyers. But here’s what some nationally known trial lawyers told Forbes a few years ago: “We are what supports Ralph Nader. We contribute to him, and he fundraises through us.” — Fred Levin. “I can get on the phone and raise $100,000 for Nader in one day.” — Herb Hafif. “We suport him overtly, covertly, every way possible. We have supported him for decades. I would think we give him a huge percentage of what he raises.” — Pat Maloney.)

So now Ralph goes to his closest associates — people like Joan Claybrook, who runs the Nader-founded Public Citizen and who is on the board of Consumers Union, and Harvey Rosenfield, his disciple in California — and he says (as I imagine it), “Listen, there are some really bad corporate dudes out to screw the rights of the little guy in California –can you help me?” And they fall all over themselves wanting to help. Who wouldn’t?

Never mind that with regard to by far the most important of the three initiatives, the overwhelming majority of “little guys” would benefit dramatically, with hundreds of dollars more in their pockets each year, and with far greater assurance that, if badly hurt in a car crash, their financial loss would be covered.

So Rosenfield becomes a man with a mission. Though he periodically claims to the press that “less than 10%” of his support comes from trial lawyers, his own records, misfiled in Sacramento (they were never meant to be made public), show that essentially 100% of his support comes from trial lawyers. He just flat-out lied.

But other consumer groups didn’t know this when Rosenfield approached them — starting, presumably, with the ones he and Nader had worked most closely with in the past — and said (again, as I imagine it), “Listen, there are some really bad corporate dudes out to screw the rights of the little guy in California — can I add your name to Ralph Nader’s and mine in opposing them?”

So the inner circle said yes — heck, there was a time I would have said yes — without ever investigating or hearing the other side of the story.

So now Harvey had maybe a dozen names to go along with his own and Nader’s, and he could approach the slightly-less-inner-circle. “Would you join all of us in signing a statement?” And the next circle, seeing the fine names of their traditional allies, and hearing the terrible ways auto insurance rates would rise and injured people would fare worse (lies, but convincingly told) — they signed on, too. Again, without ever having called us to hear our side.

By June 29 of last year, without our even knowing it, they had assembled 75 names — everyone from Consumers Union to the NAACP and some AIDS groups — to sign a statement many of them had probably not even read, let alone investigated for accuracy. It contained by our count 41 deceptive, unfair, misleading or outright untrue statements. And of course, we documented all this and sent it to as many of the 75 as we could locate.

But by then the battle had been largely lost. Do you know how hard it is to get someone to change a public position? (“Well, we didn’t hear both sides of the story, we didn’t do our homework, so now we’re switching sides.”) Do you know how hard it is to get someone to disassociate himself, let alone oppose, a group of 75 traditional allies?

So, yes, with great effort we did get a few people to disassociate themselves from the statement. And yes, we did get some brave Democrats to sign on with us — Roberta Achtenberg and John Tunney and former Massachusetts congressman Chet Atkins; Amfar co-chair Tom Stoddard and Medical Education for South African Blacks co-founders Joy and Herb Kaiser and tobacco-industry-nemesis Joe Cherner; Stanford University President Emeritus Richard Lyman, Democratic Leadership Council President Al From and liberal philanthropist Peter Norton (yes, that Peter Norton of Norton Utilities). And we did have one important grassroots consumer ally, Voter Revolt, whose canvassers knocked on hundreds of thousands of doors and garnered more than 15,000 small donations.

But basically, from Day One, long before the actual campaign began, the entire liberal establishment — to which I often contribute — had circled the wagons against three ballot propositions that would have greatly benefited the people of California.

The lawyers laughed all the way to the bank.

————————
*(That these things are possible in a democracy is perhaps proven by the ease with which Ronald Reagan was able to gain enthusiastic popular support for slashing the taxes of the relatively few richest Americans, while raising taxes on the working class, through a hike in the Social Security tax. Good marketing.)

Tomorrow: The GM MasterCard Sort-Of 5% Rebate

The last couple of days I’ve been commenting (venting? flaming?) on the way California’s lawyers defeated Props 200, 201 and 202.

Basically, they did it by lying — and by enlisting some very well respected liberal groups (whom I generally support and admire) to their cause.

But it’s more interesting than that. Some of the lies, it’s true, were just plain old flat out lies. (E.g., if Prop 202 passed, they said, it would be impossible to find a lawyer willing to work on contingency. Poor people would have to hire lawyers at $300 an hour or be denied access to justice. Simply not true.)

But two of the biggest lies were even more maddening. There’s probably even a debating term to describe the ploy. Maybe they teach it in law school. It is designed not only to win the argument when you’re wrong, but to so infuriate your opposition as to bring on a seizure. (Fortunately, only Hewlett-Packard co-founder David Packard, among our supporters, died during the campaign, and there’s no reason to think his death, at 83, was in any way related.)

The way it works, first you do something really rotten; then you point to that rotten thing itself as proof you’re right. Not very elegant the way I’ve phrased it, but highly effective the way they did it:

* First you sue Al Shugart, co-founder of Seagate Technology, three times for alleged insider trading (the first case was settled for pennies on the dollar to get rid of it, the second was thrown out of court after eating up $3 million in legal fees, the third is still pending); then you blanket the airwaves in his home state with commercials calling him a stock swindler because “he’s been sued three times for insider trading.” You morph his face back and forth with Charles Keating, the notorious convicted S&L felon, never mentioning that investors in Seagate — unlike investors in Lincoln Savings and Loan — have made, not lost, a pile of money.

* First you sabotage the early 1970s drive for no-fault auto insurance, by giving states where you couldn’t beat it “no-fault” in name only. (In states like Massachusetts there’s all the suing and fraud there is in California. You just need to chalk up $2,000 in medical bills to be eligible to sue. In Connecticut, the threshold was a mere $400. These thresholds merely give people an incentive to — often encouraged by attorneys — to get an MRI and a few chiropractic visits they don’t need.) Then, 25 years later when the next generation makes another run at it, you simply point to “no-fault” states like Massachusetts and Connecticut and say, “See? No-fault doesn’t save money. It’s a disaster. An old idea that hasn’t worked.”

That’s right: first sabotage it; then point to the wreckage to prove is doesn’t work. (In Michigan, the one state that comes fairly close to the true no-fault Prop 200 would have provided in California, people actually do pay substantially less for auto insurance than in California, while enjoying VASTLY better protection if they’re badly injured in a crash.)

Got to stop writing now. Feel that seizure coming on.

Tomorrow: How The Lawyers Co-opted the Left

Although most lawyers fought hard to defeat Props 200, 201 and 202, The San Francisco Recorder — San Francisco’s legal newspaper — endorsed all three. So when they asked me to comment on our March 26 defeat (as described yesterday), I quickly warmed to the task:

Rack up another win for F. Lee Bailey (who helped lead the first fight against true no-fault auto insurance in the early 70’s) and for lawyers everywhere who put their own interests ahead of the community they serve.

It’s not hard to win when you have so much money and are willing to lie. When RAND estimates personal injury insurance rates will drop 40% with true no-fault, just flood the airwaves with ads stating that rates will RISE 40%. When challenged, say it’s based on data the source for which told Newsweek’s Jane Bryant Quinn: “no reputable economist would have used the data that way.”

Lying is OK, apparently, if it’s in a greater cause: protecting $2.5 billion a year in legal fees.

Tell me this, Tom Brandi, Mylene Reuvekamp, et al [San Francisco personal injury lawyers] — what are YOU going to do for the crash victim rendered paraplegic in a hit and run? In a one-car crash? By an uninsured motorist? When fault can’t be proven? By a motorist with just $15,000 of coverage or $25,000? That’s 85% of the cases right there — what are you, personally, going to do for those people?

Prop 200 would have provided them with up to $1 million per person in medical, rehab and wage loss — FOR LESS THAN THE COST OF AUTO INSURANCE TODAY.

What are YOU going to do for them?

I suspect I know: you’re going to feel a little uncomfortable for a minute reading this, you’re going to tell yourself I’m not stating this fairly (and that YOU didn’t write those TV ads — or the ones likening Seagate Chairman Alan Shugart, whose investors have tripled their money, to Charles Keating, a convicted felon). And then you’re going to go back to taking $2.5 billion a year out of the auto insurance dollar and feeling as if you really care about crash victims.

What’s so frustrating is that most of you really DO care. But self-interest can be blinding. When so much money is at stake, “the process” just seems to take over.

See you again two years from now, at the next election. Maybe F. Lee Bailey will be out of jail by then and available to help you with your selfless battle yet again.

Tomorrow: How the Lawyers Won

Regular readers of this comment will know that Californians got to vote on three ballot initiatives last Tuesday — Props 200, 201 and 202 — that came down hard on lawyers. “The tough 200’s,” we called them. “The terrible 200’s,” the lawyers called them.

The goal, of course, was not to harm the lawyers, any more than the goal of Automatic Teller Machines was to harm human tellers. Half my friends are lawyers. The goal was to make life better for NON-lawyers.

Not surprisingly, the lawyers won.

On Prop 200, which RAND estimated would have cut auto insurance premiums dramatically . . . and which would have provided far better protection to the worst-hurt crash victims . . . the lawyers won 65% of the vote. (They ran millions of dollars of advertising claiming that rates would go UP 40%.) They thereby succeeded in hanging on to the $2.5 billion a year that they take from the California auto insurance system.

On Prop 201, which would have done at the state level what Congress overwhelmingly did federally — discourage extortionate class-action securities suits while leaving the door wide open for those with substantial grounding — they won 60% of the vote. (They ran ads likening Seagate Technology’s Alan Shugart with Charles Keating, convicted felon — never mentioning that anyone who had bought Shugart’s stock around the time of his alleged transgression would, by now, have about tripled his money.) A few law firms that specialize in these suits thereby succeeded in hanging on to the several tens of millions of dollars a year they make from these suits. (One such lawyer contributed $2 million to this effort — peanuts, for him.)

On Prop 202, which would have limited a lawyer’s contingency fee to 15% when an acceptable settlement offer was made within 60 days of the initial demand letter, they won 51.4% of the vote; we got 48.6%. They ran ads claiming that lawyers would cease to work on contingency if Prop 202 passed — they’d all quit, presumably, and become gym teachers.)

It was not a great day for democracy, because — as usual — the electorate was not presented the facts objectively and given the opportunity to make an intelligent choice . . . a quaint notion of how these things should work. (Our ads weren’t perfect either. They were, for the most part, humorous jabs at lawyers in general, the only way we could afford to attract people’s attention, hoping they would learn the details from the “free media.”)

Of course, the Founders never meant for laws to be made by referendum. The idea was to elect capable representatives to do most of the thinking for us. But when it comes to measures that could adversely impact lawyers, legislators — mostly lawyers themselves — have proven to be only human. Which is to say they put their own interests first.

Tomorrow: F. Lee Bailey, Selfless Champion of the Innocent and Oppressed

Last night on HBO — a Time Warner module — I saw the last half of a movie that featured two gorgeous young teenagers as a modern day Bonnie and Clyde. They killed convenience-store managers, police; they could only have really hot sex after a robbery; virtually every scene was either of them robbing, killing or “making love.”

This morning on CNN — another Time Warner module or module-to-be (who can keep up?) — I saw the report of the 17-year-old who went car-shopping for his birthday by going to a parking lot and deciding what kind of car to carjack. The woman in the car had a tape recorder in her purse, which she had the presence of mind to turn on, so we have a complete account of her attempts to dissuade him, and his ultimately murdering her and taking the car.

He could probably have gotten the car without murdering her, but life is cheap.

What are the programmers thinking at HBO? Movies like this should not be banned by law, of course. But neither should executives choose to show them. Or studios choose to finance them.

Maybe instead of a V-chip for TVs we need an IQ-chip for idiot programmers.