User:Bluerasberry/History of Consumer Reports

The history of Consumer Reports begins with the development of Consumer Reports from the consumer movement in the United States in the late 1920s, into its founding, and through its work in product testing, advocating for consumers, and doing educational outreach to consumers. Consumer Reports is best known for publishing both a magazine and a website called Consumer Reports.

Founding
Consumer Reports' history shares its origin with the general consumer movement advanced by Frederick J. Schlink and Stuart Chase when they published Your Money's Worth in 1927. The book described how corporations manipulate consumers in the marketplace with unfair practices in selling foods, medicine, cosmetics, automobiles, and household equipment. The book called for a nonprofit organization to have oversight of the marketplace. The message of the book appealed greatly to the public, who also expressed interest in founding an organization. In 1929 Schlink and Chase founded Consumers' Research as the first consumer organization in the world.

Schlink founded the organization in New York City but soon moved it to the small town of Washington, New Jersey. In 1933 Schlink and Arthur Kallet, a board member of Consumers' Research and former colleague of Schlink at the American Standards Association, published 100,000,000 Guinea Pigs, a book which compared all consumers to guinea pigs upon whom corporations test potentially unsafe products. In 1935 employees at Consumers' Research complained of labor conditions and organized a strike in which Schlink and Consumers' Research vice president J. B. Matthews were unable to satisfy the protesters. Kallet led some workers to fork from Consumers' Research and found Consumers Union on February 6, 1936. At the founding labor practices were a concern and A. Philip Randolph agreed to serve on the board of the organization to advise about labor issues. This organization published the first issue of Consumers Union Reports, later to be renamed Consumer Reports in May 1936.

1930s-40s - In conflict with government and industry
Critics called Consumers Union "un-American" from its inception until 1954 when the US government issued a statement clearing investigation of the organization.

Background: industry defends itself against consumer organizations
During the Recession of 1937–1938 public confidence in business was low and the new criticism from consumer groups weakened trust in advertising, media, and branded goods. The idea that the public were the "guinea pigs" on whom corporations tested products was an idea which spread after the publication of 100,000,000 Guinea Pigs and industry sought to counter it and the general concept of consumer regulation over industry to restore market confidence. Industry's strategies to counter the consumer movement included the following:
 * Founding commercially-backed equivalents of non-profit organizations like Consumers Union
 * Running advertisements which said that consumers should trust corporations and advertisements
 * Discrediting consumer organizations and their supporters, particularly by calling them "Un-American" and "Communist"

1939 New York World's Fair
Consumers Union exhibited at the 1939 New York World's Fair. This was controversial because other exhibitors represented commercial interests and feared that Consumers Union would attack their products.

The World's Fair was, among other things, a collaboration between business and government to help New York City recover from the Great Depression. There was a Consumers Building at the fair to which consumers movement leaders were invited. CU president Colston Warne said, "This affair might give us the opportunity to insert a critical note toward the usual advertising ballyhoo that constitutes the center of the arena of a twentieth century world's fair."

A few weeks before the fair opened the American Home Economics Association, the American Standards Association, Consumers Union, and a coalition of other consumer groups complained publicly to fair managers that they had been disallowed from reasonable participation in shaping the content of the pavilion, and that the exhibition seemed poised to present only business and retail interests and to exclude consumer interests. In the end, CU was left with the only noncommercial consumer exhibit at the fair. The fair organizers prohibited CU from sharing any publications which rated products by brand name. CU's exhibit dramatized marketplace fraud and gave consumers purchasing advice. It also included guinea pigs in an attempt to teach consumers that they do not have to be "guinea pigs" by letting corporations test dangerous products on them.

Accusations of communism
Hearst Corporation's Good Housekeeping magazine had a practice of awarding a "Good Housekeeping Seal of Approval" to products which the magazine endorsed. Consumers Union followed Consumers Research in continually complaining that the Hearst Corporation's Good Housekeeping Research Institute could not inform or protect consumers reliably because it had inadequate scientific testing and because it was commercially dependent on the advertisers whose products it reviewed. In 1939 the Federal Trade Commission ended a four-year investigation of the business practices of Hearst by initiating hearings which charged that the magazine published exaggerated and fraudulent advertising claims and which attacked the integrity of the Seal of Approval. The FTC found that Good Housekeeping's seal communicated that the Hearst Corporation was ensuring that products passed rigorous scientific tests when in fact it was not conducting such tests. Richard E. Berlin, the executive vice president and general manager of Hearst Magazines, committed to fight the accusations.

Directors at Consumers' Research had accused strikers who formed Consumers Union of being communists. Other publications such as Elizabeth Dilling's 1934 The Red Network stated the same. On December 3, 1939 J. B. Matthews, who had been vice president of Consumers' Research, testified to Martin Dies, Jr. in the Dies Committee on the un-American activities of Consumers Union. The charges included the communist backgrounds of the Consumers Union board and staff, that CU head Arthur Kallet was a Communist party organizer, and that the 1935 strike which led to the split of Consumers Union from Consumers' Research was itself a Communist plot. According to Matthews, the plan of Consumers Union was to "discredit advertising of reputable American firms and products through propaganda issued by the consumer organizations which is designed to make the American public dissatisfied with the profit system" and then entice them to convert to Communism. Berlin from the Hearst Magazines distributed the report to publishers with a press release. Part of the release is quoted here:

"...certain subversives (who) were pretending to serve the consuming public but were actually motivated by communistic theories have been attacking the institution of advertising, and Good Housekeeping in particular, as a leading medium in the advertising field. We believe that the underlying motive of these attacks on advertising is to destroy the freedom of the American press by first destroying its principal source of revenue, advertising. We believe that this subversive movement needs to be publicly exposed. I herewith enclose a copy of a report issued by the Dies committee..."

Shortly after Dies' presentation of the Matthews report both President Roosevelt and Eleanor Roosevelt publicly condemned it, as did Harold L. Ickes and Dies' HUAC-colleagues Jerry Voorhis and Joseph E. Casey. Various publications suggested that Matthews and the Dies Committee cooperated with the Hearst Corporation to suppress news of the Federal Trade Commission's investigation of Good Housekeeping's "Seal of Approval" by denouncing others.

Later in the House Un-American Activities Committee's 1951 Guide to Subversive Organizations and Publications, Consumers Union is described as "a Communist front headed by the Communist Arthur Kallet" and noted that "Ben Gold... (was also a member) of the labor advisory committee of Consumers Union". The consensus of that committee was that Consumers Union was "subversive and un-American".

In October 1939 Red Army founder Leon Trotsky testified to Martin Dies in the House Un-American Activities Committee. Soon upon returning to Mexico he left his residence in the home of artists Diego Rivera and Frida Kahlo after a quarrel and began living alone. In May 1940 Ramón Mercader, also known as Frank Jacson, assassinated Trotsky. In a hearing organized by the House Committee on Un-American Activities in 1950, the committee noted that Lydia Altschuler, the educational director of Consumers Union, managed a mail drop hosted for the purpose of transmitting coded messages which allegedly supported Jacob Epstein in assisting Mercader/Jacson in prison escape. Altschuler "refused to answer all questions relating to her participation in this underground movement, on the ground that to do so might incriminate her". The Venona project named the ALTO case after Altschuler and only after some years was able to decode the messages to learn that they discussed plans to free Mercader. Criticism of Consumer Reports about this event stated that Altschuler was a communist and an employee of Consumers Union.
 * Prison break plot of Trotsky's assassin

From 1938-39 J. Robert Oppenheimer served on the board of Consumers Union after accepting an invitation to join from Mildred Edie Brady and Robert A. Brady. The record in Consumers Union archives of Oppenheimer's communication with Consumer Reports is short but includes a 1938 letter in which Oppenheimer makes a recommendation for a person to manage milk testing at Consumers Union.
 * Oppenheimer loses security clearance

The Bradys were close friends with Alger Hiss and Haakon Chevalier, both of whom were accused of Soviet sympathizing and the latter of whom Oppenheimer said to have attempted to recruit him into the Communist Party. In 1953 the United States Atomic Energy Commission notified Oppenheimer that they revoked his security clearance. Oppenheimer requested what came to be called the Oppenheimer security hearing, during which the board stated to him that "It was further reported that in 1938 you were a member of the Western Council of the Consumers Union. The Consumers Union was cited in 1944 by the House Committee on Un-American Activities as a Communist-front headed by the Communist Arthur Kallet." Colston Warne said that Oppenheimer lost his security clearance because Consumers Union was "drawn into his loyalty oath orbit".

1940s-50s - Focus on product testing with Kallet as head
Historians of the consumer movement describe Consumers Union as being less radical in the 1940s and 50s. Business Week noted that the organizations' membership rose during the Post–World War II economic expansion.

In August 1957 following a board vote on the future of the organization, Arthur Kallet ceded his position as director of Consumers Union to become a board member. This followed a debate among the organization's board led by Kallet, who argued that Consumers Union should continue to concentrate on product testing, and Colston Warne, who argued that the organization should use its status to influence United States government policy. Kallet said that he was fired from his position.

In 1957 Consumer Reports had 900,000 subscribers paying $5 per year to receive the magazine. The organization had 250 staff, including 75 part-time shopping staff in 50 cities.

1950s-70s - Warne encourages international movement expansion
Colston Warne was appointed president of Consumers Union's board he encouraged the organization to do more advocacy work. In 1960 Warne led CU in supporting the foundation of the International Organisation of Consumers Unions, now known as Consumers International. This organization encouraged the replication of the CU model in other countries, particularly developing countries, by providing infrastructure for local grassroots activists to do as they liked to advance the consumer movement.

Activism in the United States and prompting by CU led President Kennedy to propose the Consumer Bill of Rights in 1962. In 1964 with CU support President Lyndon B. Johnson appointed Esther Peterson as the first Special Assistant for Consumer Affairs in the FTC's Bureau of Consumer Protection.

1970s-90s - Karpatkin encourages increased domestic advocacy
In the 1970s Consumers Union opened three offices to conduct advocacy. In 1974 Rhoda Karpatkin became executive director of the organization and backed advocacy efforts as vital to the organization's mission. During this time organizational funding went down due to the new programs. Consumer Reports had been a grantmaking organization to various other consumer organizations in the United States, but when its own funds lessened, CR laid off many staff and greatly cut back its grantmaking.

A point of discussion was also whether Consumers Union should become more involved in advocacy, and thereby becoming more biased for certain positions, or to remain neutral and continue with mostly product testing. In December 1981 the local members of The Newspaper Guild signed a petition to remove Karpatkin from her position over her financial judgment, bringing the organization's policy disagreements into the open. Also around that time the Early 1980s recession and the recent postage rate increases caused organizational funding to drop and expenses to raise. This drastically cut Consumer Reports' available funds and led to discussion about the funding of the organization.

Between 1990 and 1993 Consumer Reports' paid circulation expanded from 3.8 million to 5 million. In response to the subscribers' median age having risen to 42, the organization improved and rebranded its children's magazine, Penny Power, into Zillions: Consumer Reports for Kids. By 1995 Consumer Reports was also available through third-party online subscription services. Critics speculated that Consumers Union would not be able to compete with specialty magazines which rated the huge number of new electronic products and software.

2000s-present - Online outreach with Guest as head
In 2000 Karpatkin announced her retirement. In February 2001 James A. Guest replaced Karpatkin as head of Consumers Union.