Customer Reviews

Gotcha Capitalism: How Hidden Fees Rip You Off Every Day-and What You Can Do About It

5 star:		(22)
4 star:		(8)
3 star:		(4)
2 star:		(1)
1 star:		(2)

 

 

Bob Sullivan has written an extraordinary and frightening book on what happens when technology makes it increasingly easy for corporations to rip consumers off, when the government fails to do a decent job of regulating those corporations, and when consumers aren't educated enough to make rational marketplace decisions.

Technology today gives us automatic teller machines, internet, wireless phones, cell phones, satellite and cable television, electronic bill payments, etc. etc. These gadgets and services are marketed as life simplifiers, and in many ways they are. But there are also hidden costs to using them that gouge the consumer. Sullivan's claim is that unless these hidden costs are recognized, consumers are prey rather than free agents. Hence the "gotcha."

ATM fees, for example, are almost never fully disclosed on the ATM screen. They average about $5 per pop--that is, you pay a good chunk of money to access your money. How bizarre is that? But bizarre as it is from the consumer's perspective, it's good business for the banks because service fees are major revenue sources for banks. These days, according to Sullivan, about one-third of all bank revenues come from fees. In fact, many banks now make more income from fees--checking account fees, bounced check fees, ATM fees, and so on--than from interest on loans and investments.

Or take credit cards. A credit card company can legally raise your interest rates simply by sending you a finely printed and obscurely written announcement informing you of the increase and stating that unless you formally object in writing, you accept it. The companies know that most consumers won't even bother to read the announcement before tossing it. In fact, they bank on it.

Or take hotels. Many of them are now charging us for the exorbitantly priced room bar items if we simply touch them. Sensors in refrigerators record when the door is opened and an item removed. It doesn't make any difference if you put it back. You pay for it even if you don't eat or drink it. Telephone calls to other rooms in the hotel are also routinely charged for now to the tune of a couple of bucks a call. Unless you ask for an itemized bill when you check out, you've no idea.

Or how about this one? You get a warning from your credit card supplier that you've got 24 hours to pay your overdue monthly bill, and that you can pay by phone by dialing an 800 number. You're flummoxed, so you call and pay. Guess what? The credit card supplier is gonna charge you $10 or $15 simply for taking your call. No rhyme, no reason. But they do it because they can get away with it.

And so it goes. Hidden fees that nickle and dime us to death, hidden in services and technological life-simplifiers. Millions of us are overcharged, and it all adds up to big profits for the corporations.

According to Sullivan, part of the problem is that there's simply no regulatory watchdog. The Federal Trade Commission, which should be looking out for consumers, employs half the people it did twenty years ago. But in that same two decade period, the technology which corporations manipulate to bilk consumers has exponentially grown. Go figure.

Late last year, Mark Schapiro's Exposed: The Toxic Chemistry of Everyday Products and What's at Stake for American Power blew the whistle on what a horrible job the government is doing in regulating harmful chemicals in consumer goods. Bob Sullivan has done something similar when it comes to toxic hidden fees. Highly recommended for the consumer who wants to quit being manipulated.

Technology writer Bob Sullivan has compiled a powerful accounting of the various ways that American consumers are routinely being screwed by companies large and small. The driving force behind this explosion of unfair business practices is computer technology and the shift to an online/database economy: economic transactions are essentially invisible now, and it is much easier for profit-driven companies to simply make up a bunch of fees or "service charges" when no actual services are being provided, and tack them onto our already-expensive bills. Even that tiny fraction of consumers who figure out the scams will find it hard to get the bogus fees refunded, and the vast majority of consumers will either be unaware of how they're being ripped off, or will be too tired or busy to object.

Sullivan explains and documents with great clarity how companies have scientifically researched the most effective methods for hiding bogus fees, and what the tipping point are, so that they steal tiny amounts from millions of customers, but in ways that these customers either won't detect, or understand. And it doesn't matter if you catch one company ripping you off: they all do it, so there's really nowhere for consumers to turn. Don't like your cell phone company? Of course not, but is it worth it to drop them and go to another? Probably not, since they're all total crooks.

While this book does a great job cataloging these injustices, it leaves open the question of what we can actually do about it. The book promises readers that they can save $1000.00 if they know how to guard against various unfair business practices. What is really needed, however, is legal protection against these fraudulent and deceptive practices. Hopefully this book may do for digital-age consumers what "Silent Spring" did for the environmental movement: spur politicians, citizens and citizen activists to rein in the insane greed of these large and powerful companies, and pass legislation that has some actual teeth to it. Otherwise, the hopelessness and passivity that these companies are counting on will continue, and we will all lose out.

I definitely recommend that as many people as possible read this book, take it to heart, and get our leaders to do something to correct the problems it describes. (Joe Sixpack)

I found Gotcha Capitalism to be really helpful, particularly the real-world anecdotes used to show how these fees happen to us every day. For example, after reading about the credit cards from department/furniture stores and the possibility of it appearing as though you don't have to pay interest, unless you read the mouse type. I immediately checked my statements, now that I know for what to look.

The information is very practical and useful in everyday situations.

Besides informing us of the sneaky way companies try to get extra dollars out of us, there are also other eyeopening things we should know. One thing that got my attention was companies sending new contracts marketing them as "junk mail" so people couldn't call the company and say no thank you I do not accept this. Silence was golden. When challenged all the way up the Supreme Court, they found this contractually binding! Do not throw away your junk mail and read this book!!!!!!!!!!! there are soo many other things in here that you just have to read it.

I'm always surprised by what little attention people pay to their money and where it's going. This book is for those people.

Cell phones. I know people who pay $85 a month for their cell phones. My husband and I pay $6.66 a month. You buy a $20 cell phone. Then every three months you buy a "top-up" card for $20. This $20 is a deposit from which you draw to pay for your cell-phone calls as you make them. When the $20 is used up or at the end of three months, whichever comes first, you buy another $20 "top-up" card. Simple, no? Sullivan doesn't mention this type of cell phone.

401(K). I have all my 401(K) money in a fund called "stable value." I have wondered why I'm getting a return of only 2.6 percent when I'm getting 3.5 to 5 percent on CDs at several banks. Sullivan tells me the program administrator is skimming a good chunk of what I could be earning. So don't listen to people who say you should contribute the maximum possible (10 percent where I work) to your 401(K). Contribute only as much as you must to get the company match.

Landline phone. It used to be that if I made a long-distance call, the charge would show up on my next bill, and I would pay it. Once or twice a year I might call my sister, talk for an hour or so, and pay $25 to $30. That was fine with me. Along came a month when I had made no ld calls, and a $5 ld charge shows up on the bill. I called the company. The $5 would be applied to any ld calls I made during the month, but for ten or eleven months out of the year, I was making no ld calls. That was $50 a year I was paying for NOTHING! I hate paying for nothing. I could have had a new pair of shoes or a decent handbag. So I cancelled my ld service and bought an ld calling card. I am much happier.

Grocery stores. I eat a lot of Hershey's Special Dark chocolate bars. Yesterday at Kroger's, the 6.8-ounce size was on sale for $1.50. The 4.25-ounce size is $1.69. Guess what? The store is out of the 6.8-ounce size.

Social Security. Sullivan doesn't mention this topic, but I have talked to several people who didn't know that at full retirement age, you can begin collecting your full social security benefit and continue working. Each year you continue to work, your SS benefit will increase. You may be able to live on your SS check and bank your salary, boosting your retirement funds. And as long as you're getting company health benefits, you don't have to sign up and pay for Medicare A or B or prescription drug benefits.

This book is a must read for anyone who has a bank account, credit card, cell phone, etc. We are all being ripped off by these services and we must be informed to fight back. Sullivan presents each service/industry by chapter and provides us with strategies for getting our money back (where possible). Please read this book, you will not regret it.

The author knows what he's talking about and he covers a lot of ground but there are several reasons not to bother buying this book. Two stars is probably too low bacause he's done his homework, it's just that reading this book can only serve to make you mad and not much else.

1. For most the Gotchas he admits that there's not much you can personally do about it except be aware.
2. The book is very specific in most parts so it already feels dated as new gotchas come along every day.

I think what the author is trying to do it great, it's just the the only real answer to these problems is a wholesale change in the consumer protection laws in the US.

Sullivan tells readers how companies take advantage of us, focusing on 13 industries (credit cards, banks, cell phones - what's behind all those fees, getting out of "cell-phone jail," grocery stores, etc.)telling us how they do it and providing examples (including sample letters and phone scripts) of how to get your money back.

"Big deal," say some - "what's few dollars here and there?' Sullivan's independent researcher surveyed people and concluded the average was $964/year; "Consumer Reports" reported $4,000/family. So, it pays to pay attention to those asterisks, fine print, innocuous letters intended to obtain approval of contract changes w/o even reading, arcane/complex wording, and the signature line. (Sullivan reports an instance where buyers' unknowingly were also purchasing monthly credit insurance, failed to pay it, and racked up large late fees in addition.)

"Gotcha Capitalism" is also a good reference to wave at those contending "free markets cure everything."

This is a wonderful book ... great research, awesome information. And it's pretty difficult to use the way I'm sure the author intended it to be used because there is no index.

In the course of any given week it is difficult to estimate just how much legalese, fine print and gobbledygook the average consumer encounters while just trying to take care of routine transactions. There seems to be a fee for just about everything you do these days from your neighborhood bank, your cell and home phone service providers, the internet service you subscribe to and of course the credit card you use to pay for many of these services. There are literally fees on top of fees and it seems that no one is looking out for the interests of the average consumer. Bob Sullivan noticed this and set out to provide some much needed assistance for all of us who are caught in this extremely expensive maze. "Gotcha Capitalism: How Hidden Fees Rip You Off Every Day--And What You Can Do About It" is literally a godsend for battered and bruised consumers. Within the pages of this extraordinary little book you will discover dozens of ways to avoid and challenge the fees and hidden charges that are so rampant in the marketplace today.

What makes "Gotcha Capitalism" so special and so useful is that it is written in simple language that all of us can understand. In the first two-thirds of the book Bob Sullivan takes us on a tour of the booby traps and minefields that we consumers are bound to confront in the course of conducting our everyday business. I knew that the deck was stacked against us but until you see it all spelled out in one place you really have no idea how corporate America is continually plotting to seperate you from your hard earned dough. Seems that there are what Sullivan refers to as "sneaky fees" just about everywhere. Bob Sullivan covers a wide array of services most of us use on a regular basis and points out what we should be looking out for and what we should avoid. Topics covered in "Gotcha Capitalism" include credit cards, home mortgages, car loans, your 401(k), pay TV, internet, cell phones, gift cards, travel and rebates to name but a few. Some may be tempted to read just the chapters that apply to them and that is fine but I chose to read the book cover-to-cover. My thinking is that I might be able to help out a friend or family member with a problem that Sullivan addresses here. Now the final third of the book is what the author refers to as his "Toolkit". Here you will find a boatload of practical information such as sample letters, worksheets and the addresses and phone numbers of various regulatory agencies and advocacy groups. So as you can see, "Gotcha Capitalism" is a book worth hanging on to after you have read it.

If consumers in this country are to stand a fighting chance against those who would cheat us then we must take the responsibility to inform ourselves. Make no mistake....this can be hard work. But the rewards of being educated and persistant in these matters are there to be had. Taking a few hours to read "Gotcha Capitalism" is a great way to get yourself up to speed on these extremely important matters. Very highly recommended!