I Have a Terrific Deal On Mandatory Arbitration Clauses For You

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The CFPB has proposed a new rule that would prevent big companies from forcing their customers to accept mandatory arbitration in place of an actual trial in an actual court. Iain Murray is unhappy:

Like most of the CFPB’s rules, this may sound good at first hearing. In fact, it will be a disaster for the average consumer who enters into contracts like credit-card or mobile-phone service agreements….The inefficiency of the legal system has to be budgeted for, and so without arbitration, fees will go up and some people just won’t be offered a service at all.

….Those won’t be the only ways the consumer will suffer — those who are currently “denied their day in court” will as well. Because arbitration services are much cheaper, companies that use them generally pay all the fees for the consumer as well as their own. That’s not the case in court, where the consumer bears a considerable cost. If you are lucky enough to get a contract after this rule goes into effect, you’d better budget something for your day in court, because you’re going to have to lawyer up. Of course, there’s always the chance that you’ll be asked to participate in a class action lawsuit, which this rule is primarily designed to facilitate.

Fair enough. As it turns out, corporations all offered their services quite widely back in the dark ages before arbitration clauses, but it’s true that arbitration does indeed have some benefits. Still, we’re all free marketeers around here who believe in contracts freely arrived at without undue coercion. Right? So here’s what I propose: my bank and my cell phone company should offer me the choice of accepting arbitration or not when I first sign up. If I accept, they offer me a discount. The CFPB’s only role will be to ensure that the discount is reasonably in line with the actual cost savings from arbitration. Deal?

No? I guess there must be something else going on. I wonder what?

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SIX TRUTHS

Reclaiming power from those who abuse it often starts with telling the truth. And in "This Is How Authoritarians Get Defeated," MoJo's Monika Bauerlein unpacks six truths to remember during the homestretch of an election where democracy, truth, and decency are on the line.

Truth #1: The chaos is the point.

Truth #2: Team Reality is bigger than it seems.

Truth #3: Facebook owns this.

Truth #4: When we go to work, we're in the fight.

Truth #5: It's about minority rule.

Truth #6: The only thing that can save us is…us.

Please take a moment to see how all these truths add up, because what happens in the weeks and months ahead will reverberate for at least a generation and we better be prepared.

And if you think journalism like Mother Jones'—that calls it like it is, that will never acquiesce to power, that looks where others don't—can help guide us through this historic, high-stakes moment, and you're able to right now, please help us reach our $350,000 goal by October 31 with a donation today. It's all hands on deck for democracy.

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