Any economist who remotely accepts capitalism will acknowledge that by marketing things, we create extra demand that human needs alone do not justify. Extra demand equals growth, and growth is fundamental to the workings of our economy.
The Do Not Call Registry (DoNotCall.gov) that has just taken effect to govern telemarketing is bad for the economy. So deleterious, in fact, that the positive effect of June's quarter-point interest-rate cut may be more than negated by the hundreds of thousands of consumers who have already blocked their phones to inbound sales calls.
Even under superficial analysis, this registry, which is cosmetically beneficial for the consumer, is a huge mistake:
1. The penetration of telephones is greater than that of televisions, computers and even literacy. We are potentially cutting off the single biggest source for selling.
2. If we are worried about intrusion, we should add Internet spam, door-to-door sales, street vendors and all other forms of push marketing to the list.
3. As for the coercion aspect, there are perpetrators who are far more insidious than telemarketers. At least you see telemarketing coming. When will the "brainwashing" potential of television or the disguised "manipulation" of product placement come up for review?
4. For lower-income people (I know, having worked in this area), the phone is the critical point of contact and a status symbol. Has anyone asked these people what they want? Many don't have the luxury of going online or jumping in their SUVs to shop or have a comfortable retirement courtesy of Del Webb.
5. Lots of jobs will be lost. Jobs held by single moms, high-school dropouts and other vulnerable groups. The people who run these operations won't be the first ones out of work. The poor souls who make the calls will be.
6. This action will cause some telemarketing operations to close and will drive up the cost of doing business. It may, in fact, erase opportunities—the only opportunities some people have to find out about and buy new products they may want. And it will reduce the chances some entrepreneurs have to sell their products.
7. All sorts of marketing opportunities come from the flexibility of calling times (which are already regulated) that traditional shopping does not allow. Not everyone works Monday to Friday in a 9-to-5 job.
8. The phone companies will lose revenue. Let's not forget, telecom stocks are hardly enjoying their best years.
The reality is that telemarketing became fashionable to hate. Therefore, it was an easy target —far easier than the overt (and endless covert) advertising on television, the in-program endorsements by radio presenters and the other forms of saturation marketing out there.
The vision of a middle-class utopia in which the odd phone-sales call breaks up a family's bucolic serenity no doubt had a part to play in the creation of this law. If our lawmakers had more respect for the broader effects of their actions, perhaps this and other recent shoot-first-and-ask-questions-later behavior could be avoided.
We are setting a precedent that may lay the groundwork for far more sweeping restrictions on the marketing industry. Nobody is forced to buy anything in our society. If TV and print ads that have managed to put five pairs of sneakers into every teenager's closet are not seen as dangerous, they may be soon, especially with 2004 elections around the corner.
A controversial but brilliant British politician, the late Enoch Powell, who was far brighter than any of the current senior Washington politicians I can think of, summed up the dangers of this type of act best: "Remove advertising, disable a person or firm from proclaiming its wares and their merits, and the whole of society and of the economy is transformed. The enemies of advertising are the enemies of freedom."