Tuesday, September 29, 2009

Credit danger at Bloomingdale's: 93.24% Interest!

You've got to be kidding: 93.24% interest? Can't be.

I blinked a few times, read the statement again and yes, that's what it said.

If I were to pay less than the full balance on my Bloomingdale's charge card, the store would add a finance charge of $2 on top of the 23.99 percent interest charge on any outstanding balance.

And if that happens, read the small print, "the actual ANNUAL PERCENTAGE RATE (their caps) charged on that account is 93.24%."

But wait. There's more, as I read in the really fine, gray print on the reverse of the bill.

There I learned that even if I pay this current bill in full by the due date, should I make another purchase at Bloomingdale's during the current billing period, a finance charge will appear on my next bill. And that will be based on the current balance (even though my full payment is in the mail!) plus the value of my purchase.

These terms, folks, should be illegal.

Just like all the other usurious interest rates charged on bank credit cards, and all the late fees, etc., etc. The U.S. Congress has been tinkering around the edges of credit card abuses instead of moving directly against these outrageous, confiscatory interest rates.

What cracks me up is that some of the big banks are now proudly advertising that you can opt out of overdraft protection on a credit card. Proud of what? That they've been forced by public outrage to make the "protection" optional? People were shocked to discover they had spent beyond their credit limit without realizing it and were then hit with such outrageous interest rates and charges that they amount to nothing less than theft!

So, Bloomingdale's, I won't be using your charge card ever again.

And the lesson to us all is to remember that the discount you get on the day you agree to take a department store charge card is a weapon that might just wreck your finances.

Just say no!

Thursday, September 24, 2009

Quit Whining, Soft Drink Manufacturers. You've Been On the Government Dole for Too Long!

When you're out to buy a drink to go with take-out or fast food, the cheapest choice is always a Coke or a Pepsi or a Sprite. Plain bottled water usually costs more. A cup of coffee or a bottled tea costs more, and real juice, orange or apple for example, costs a lot more.

This fact should be at the heart of the growing debate about imposing a tax on sugared soft drinks rather than a false argument about individual freedom-of-choice or why Americans are getting so fat.

Advocates of the tax are focusing on the link between increased consumption of soft drinks and the rise in obesity. They say cheap soft drinks are helping to make us a nation of fattys, with all the bad health consequences that result from being obese. Placing a tax on soft drinks to raise the price, say proponents, will discourage consumption, and the money raised could be used to pay some of the cost of providing universal health care.

The opposition,led by the American Beverage Association, has framed its criticism as an objection to another form of government intrusion. It's recent quarter-page ad in The New York Times waved the flag of personal freedom:
  • "Our goal is to help Americans better understand the relationship between calories consumed and calories burned--as it should be their choice what to eat or drink and not the government's."
Before you swallow that appeal to your rights, consider that the government has had both feet planted in our food supply for decades.

Every year, for example, $10 billion of our taxes are handed out in subsidies to American corn farmers, which has had the effect since the effect of keeping corn prices below the cost of growing it. Our taxes then provide an indirect subsidy to soft-drink manufacturers in saving them about $243 million a year on high-fructose corn syrup, the sweetener used in almost all our soft drinks, according to a Tufts University study. (That study is called "Sweetening the Pot," and can be found at a Tufts' website with a series of fascinating reports on how U.S. government agriculture policies are affecting our food choices.)

That taxpayer-provided discount on the corn syrup is one reason--although not a big one-- for the low price of soft drinks; the cost of the syrup represents only 3.5% of the total cost of making a soft drink, according to the Tufts researchers.

Meanwhile, farmers who raise healthy food--fruits and vegetables--get no tax subsidies at all. That puts the healthiest food at a price disadvantage against all the food products, besides soft drinks, that benefit from the subsidies. Beneficiaries include the giant agribusinesses that concoct all manner of processed foods as well as beef, pork and chicken producers who feed corn to huge numbers of animals in confined and often cruel conditions.

Furthermore, we have a long tradition of using tax policies to push behavior in one direction or another, and whether you favor the push depends, quite naturally, on your self-interest rather than your conservative or liberal ideology.

You don't hear builders, for example, objecting to the tax deduction for mortgage interest that indirectly lowers the price of owning a house and puts renting at a disadvantage. Nor did General Motors object when Congress gave tax breaks to purchasers of Hummers.

So, the idea of using a tax to push consumers away from soft drinks is consistent with past policies. Making the drinks more expensive still leaves people free to buy and drink them, but might push some toward healthier choices.

And, the money that would be raised by the tax could be used not only to help pay for universal health care but also to provide support for vegetable and fruit farmers and help build regional food production networks.

So, beverage makers should quit their whining. It's time they had to face the competition without the advantage of subsidies from taxpayers, although ending the corn, soybean and wheat subsidies has proven politically impossible. But if free enterprise and free choice are really the beverage-makers' goal, then they should be lobbying for an end to the subsidies just as vigorously as they are opposing a tax on soft drinks.

But I won't be holding my breath waiting for that to happen.

What do you think?

Thursday, September 10, 2009

Healthy Froot Loops? Not.

When my sons were little and asked for cereals like Froot Loops, I used to say, "Honey, that's not real food. Real food doesn't come in those colors." I wasn't kidding. To get the rainbow of colors into this junk food, Kellogg has to add two artificial blue colorings, a red and a yellow.

Years of reporting on the harmful effects of artificial ingredients in food convinced me long ago that a healthy diet consists of food the way it comes from nature. If it takes lab scientists to create it, then I'm not interested in putting that so-called food in my body.

Now along comes a new food industry program meant to tap into Americans' increasing awareness that much of the food on supermarket shelves is just corn in different disguises, sweetened and salted to a fare-thee-well.

It's called the "Smart Choice Program," and its green check-mark label will soon be adorning Froot Loops and other foods that don't deserve that designation.

Message to consumers: ignore the label. Read the ingredients list.

The gall of Kellogg in using the label is to be expected. But supposedly respected nutritionists, like Eileen T. Kennedy, dean of Tufts University's school of nutrition science, gave their approval. The New York Times quoted her as saying that Froot Loops would be a better choice for a child's breakfast than a doughnut.

Wow. What an insult to every parent in America. Here are your choices, Mom & Dad. Serve those kids sugary fried food or sugary food made from corn, with fiber and a vitamin pill thrown in.

And, it's not only an insult to our health, it's an insult to our budgets at a time when everyone--except the bankers--are having to find ways to trim expenses.

If you take a look at the ingredients list you can see what a travesty this is. Sugar is listed as the first ingredient and actually accounts for 41% of the weight of the cereal. It amounts to 3 teaspoons of sugar, as much as in many cookies.

And the price for this combo of cheap corn, cheap fiber, and the equivalent of one vitamin pill? $6 for a 19-ounce box!

Here are some ideas of healthy breakfasts that will cost less or certainly no more. Some can be prepared the night before and grabbed right out of the fridge, others may take a few minutes to prepare and eat at home:
  • A hard-boiled egg and a banana
  • A peanut butter and jelly sandwich
  • Cinnamon toast: slices of whole wheat bread and butter with a sprinkle of cinnamon and sugar
  • A bowl of Quaker Quick Oatmeal (costs a shy more than $2 for an 18-ounce package) sprinkled with raisins. You can microwave it in the time it takes to find your keys.
  • A smoothie: milk and whatever fruit is on hand whipped in the blender.

Here's my bottom line: If Froot Loops were actually healthy, the name of this product wouldn't be a deliberate misspelling of "fruit." Had they spelled it right, the name itself would be a fraud. Just like the new "Smart Choice" label.