The History of Consumer Regulation in the USA

USA consumer regulation dates back to few centuries. The history shows struggle for America to free themselves into a social and free regulation of their own markets and industries. One of the commissions formed in 1887, The Interstate Commercial Commission had the base role of setting rates, imposing taxes and set operational for railroads.at this era railroads were viewed as a natural monopoly and market. The ICC rates provided predictable, adjustable profits to the trusts.

The industry struggled to oppose the regulations and was backed up by the US Attorney General then who created a work friendly relationship between the industry and the commission instead of fights (Steiner, 2006). This bore out in 1930s where railroads got regulation of their own that were not rationalized based on market failure or natural monopoly. This could later see interstate highway taxes go down.

In 1913, the Federal Reserve System was formed to regulate the federal banks. Though previously around mid-18^th century, (1963) there existed a currency regulating body for national chartered banks. The strength of banks was in the state banks then.

The Federal Reserve Act in 1913 brought stabilization to the banking systems in the USA. This saw creation of a central bank that directed the flow of credit and money that would easily enhance the USA economy (Stole, 2006 ). This commission had the authority over all financial systems and values of money in the USA thereof.  In 1980s, few governors held meetings to decide on fluctuation of interest rates by banks – this was to be done by changing the rates paid to banks by short-term deposit. This is where the deflation and inflation came about.

Thereafter, several regulatory bodies’ formation broke up. In 1914, The Federal Trade Commission was formed with an aim to control market. In the year 1927, FCC came up from the former Federal Radio Commission (FRC). Three years later (1930) The Federal Energy Regulatory Commission was also initiated. The Energy Act regulated the rates for gas, oil, and electricity (Stole, 2006). This provided easy transactions for the citizens who use the commodities because they knew the taxes and the destined prices.

The year 1932 saw formation of the Federal Home Loan Bank Board. This aimed at helping financial parties, societies, or associations in making building and mortgage loaning. The FHLBB though did not make the best out of its duties and only few billions were gained out of businesses. They later renamed it to Office of Thrift Supervision (OTS) in 1980s. In 1999, the saving bank charter was eliminated and OTS went with it (Steiner, 2006).

The banks that were not members of the Federal Reserve System were regulated by the Federal Deposit Insurance Corporation that was formed from the Banking Act of 1933. The government too has to insure banking and the taxpayers who take loans, mortgages and deposit to the banks.

The year 1934 saw legislation boom of major acts, The Security and Exchange Act and the Communications Act. The Communications Act led to establishment of FCC that had the powers to license, examine, regulate and direct all communications from telephone, radio and other forms of communication (Stole, 2006).

The National Labour Relations Board was formed in the year 1935. This was drafted from Wagner Act of 1935. The aim of the board was to ensure that oaths not to be in communist parties by union officers were taken as a certification requirement (Hyman, 2011).

Citizens and consumer groups needed a right of fairness. The establishment of The Administrative Procedure Act in 1946 could make it a reality for the citizens and consumers to quench their thirst for fairness. Majorly, the act was formed to give allowance of time to judge, scrutinize the proposed regulation before they were passed. This would allow for appealing changes, and amendments.

Later in 1966, the APA Act undertook amendments and included The Freedom of Information Act. This Act gave the citizens and corporations a chance to fully scrutinize, investigate and inspect any document belonging to the government. Though this was legalized there were exceptions provided to avoid extremities and intrusions in the government secrecy (Hyman, 2011). 

The environment plays a key role for the consumers. It sets the base for production and consumption of any product or service. In 1970s, environment protection agency was established to secure and keep the environment safe. It got the name Environment Protection Agency (EPA). In 1972, Consumer Product Safety Act was established. This was not enough as far as product safety and features were concerned. The Commodity Futures Trade Commission followed up in 1974. In 1975, concern for nuclear capacity was initiated and The Nuclear Regulatory Commission was established. The same year saw the formation of International Trade commission. This extended favours and advantages to both the local and international businesses.

The Federal Elections Commission was also formed. The commission highlighted rules and regulations for all election practices, whether minor or major. This eliminated election malpractices in the USA. It ensured smooth campaigns, equity and election of competent leaders to boards, panels, committees, executives, associations and government.

The Home Mortgage Disclosure Act of 1975 needed banks to show where they made their mortgage loans. This was due to long grievances by citizens of banks’ tendencies of not lending to the poor or minority. This later saw passage of the 1977 Community Reinvestment Act (CRA) that ensured equity in lending to all communities including law, average and high states. Branches were set to be opened all over for banking firms. Quality rates and fair taxation was also generated to eliminate discrimination and overpricing.

The Federal Trade Commission is the sole dictator of markets in the USA. It works along with other bodies though. The main role is to afford the people of USA competent products and services. The agency prescribes a number of subjective rules and laws that ought to be observed in the markets. The FTC comprises of five president appointed members confirmed by the senate too. This body too enforces the civil law and the anti-corruption department thus increases the transparency.

The FTC act bars deception in the markets. These deceptions vary from omissions, exaggerations and lies. These variations make the clients act under the circumstances of influence because they need a commodity or service. The commission has other acts that its jointly works with to realize its goal, they include; Truth in Lending Act, Fair Credit Billing Act, Fair Credit Reporting Act, and the Equal Credit Opportunity Act, as well as continuing enforcement of industry specific acts, such as the Petroleum Marketing Practices Act, and the

Comprehensive Smokeless Tobacco Health Education Act of 1986, and additional laws relating to consumer privacy such as the Do-Not- Call Registry Act of 2003, and the Controlling the Assault of Non-Solicited Pornography and Marketing Act of 2003.

The set FTC authorities give directions that govern firms in regard to production, processing and selling o products. Unsecured and unregistered products are banned and heavy fines imposed on the perpetrators. The registry directive from FTC demands that every product be registered and checked for standards and tested before put into the markets.

Registration gives products a unique code as either a serial or identity code (Hyman, 2011). This code is significant in identifying the features of the commodities and making the correct judgement before using them by a customer.

All firms too have to be registered, hold annual general meetings, must have a governing body and file returns on sales and advances in their business. Any changes in pricing, quality and process of manufacture have to be reported before the product comes out to the market.

Introduction of National Traffic and Motor Vehicle Safety Act in 1966 by the US congress gave thumbs up for the automotive industry. It was signed into law by President Johnson. The automobile industry was then better, unified to standards of quality and safety. Cars were then made better with head rests, energy absorbing steering wheels and safety belts (Hyman, 2011). These and many more advances showed enhancement in road safety and precautions. This showed relevant reduction in road accidents.

Food and Drug Administration (FDA), formed in 1906 is an initiative to protect and promote public health. This is achieved by regulating and inspecting food safety, tobacco implements pharmaceutical medications and other drugs quality, usage, prescription and manufacturing. This also controls and gives sincerity in firms to the normal people who purchase the drugs and food.

The history of consumer regulation is long and shows continuous and dramatic changes, progression and adjustments as time goes by. This betters it and relevantly updates it to fit the current situations and demands.