Five years ago, a new quirky-sounding consumer-rights group set up shop in a sleepy corner of Capitol Hill. “Consumers for Paper Options is a group of individuals and organizations who believe paper-based communications are critically important for millions of Americans,” the group explained in a press release, “especially those who are not yet part of the online community.”
This week, Consumers for Paper Options scored a big win, according to the Wall Street Journal. Securities and Exchange Commission chairman Mary Jo White has abandoned her plan to loosen rules about the need to mail paper documents to investors in mutual funds.
Mutual funds were lobbying for more freedom when it came to mailing prospectuses — those exhaustive, bulky, trash-can-bound explanations of the contents of your fund. In short, the funds wanted to be free to make electronic delivery the default, while allowing investors to insist on paper delivery. This is an obvious common-sense reform which would save whole forests of trees.
Consumers for Paper Options fought back. The group warned that changing the default from paper to electronic delivery would “Confuse potentially millions of investors who suddenly stop seeing important printed fund performance material from investment firms.”
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This is almost laughable: A D.C. lobbyist forming a sham “consumer” protection to fight for federal rules requiring more paper and envelopes be wasted, while getting paid by the envelope lobby.
But the envelope CEOs and the paper lobbyists aren’t the only ones who care about keeping this junkmail flowing. Those paper mills that exist in the U.S. are deeply threatened by digitization. Among the shrinking list of things that go on paper these days are things the government forces people to put on paper. Allow mutual funds to mail fewer prospectuses, and those paper mills will lose a significant amount of work.
The employees at these mills will see their hours reduced, if they’re not simply laid off. The added costs of mailing me unwanted paper nibbles away the value of my retirement account, but is a tiny uptick in my 401(k) really worth laying off paper mill worker in East Millinocket, Maine?
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Here’s the thing about the federal rule requiring the mailing of the prospectus: It’s absurd and wasteful, and it differs only in degree from most subsidies whose defenders use the same “save the jobs” rhetoric.
Ozymandias and statolatry