Please Initial Here, Here, Here, Here, and Here, And Sign There
In theory, I agree with Jim Manzi that adults ought to take responsibility for contracts that they enter. “To the extent that we can count on people to act responsibly,” he writes, “we can have a less regulated economy that will tend to produce greater freedom and growth.”
But I think that Jim neglects to mention a major obstacle to this kind of system: the legal profession, and its ever-expanding presence on the American scene. Is it even possible for the average American to read and understand all the terms put before her by corporations, government, and the former following the dictates of the latter? Perhaps if I really worked at it, I could grasp all the “terms of use” I agree to on the Internet, the intricacies of my two credit cards, the warranties on the consumer products I buy, the tax laws in all the jurisdictions where I earn freelance income, the insurance provisions in car rental agreements, the liability agreements in parking garages, the waiver I’m forced to sign when I rent a kayak on the Back Bay in Newport Beach, California, the forms I’m forced to fill out whenever I visit a new doctor or dentist, the arbitration clauses in the health and dental insurance I carry, the non-disclosure agreements I’ve been given, the signs on the doors of seemingly every building in California telling me that cancerous materials are lingering about, my cell phone contract, and all the rest…
I suspect, however, that if I did read all the relevant language, I’d be losing rather than gaining utility, especially because odds are that if I ran any one of the documents by a lawyer friend they’d patiently explain to me that although it may seem like the language of the agreement states X, it actually means Y, or at least it did until the terms changed without warning, as the contract states they might, to Z (except in California, Wyoming and Texas, where the clause in question is superseded by statutes 1, 2, and 3 respectively).
Of course, this doesn’t mean that adults are absolved of understanding all the agreements that they enter, or that Jim is wrong about the particular case of credit cards, on which I take no position. But the volume of legal material the average person is “expected” to read, the needlessly complicated, sometimes deliberately confusing language in which it’s written, the fact that laws outside the agreement often bear on its terms in significant ways, and the low probability that the terms of any single agreement are ever going to be invoked all undermine the kind of society where voluntary agreements between adults can make us happier, richer and freer.
I’m unsure how this situation might be improved upon, since the prospect that lawyers are going to stop writing in incomprehensible jargon is unlikely — were contracts written intelligibly and concisely, first year law associates wouldn’t get paid 6 figures to read them carefully for clients, and their partner bosses wouldn’t get to bill their time at $300 an hour. Nor is the situation helped by the fact that so many legislators — and members of their staff — are trained by the same profession, such that the average American is often enough unable to understand a piece of legislation passed by their Congress, or a criminal statute that might land them in jail if they break it.
If ever the inertia could be reversed, however, I sure think we’d benefit from more English and far less legalese.
Well, we’ve already taken some steps to remedy this with credit cards: Note that every offer you get has, somewhere amidst the jargon, a very readable box with all the really pertinent info: APR, penalty rate, yearly fees, etc. Last time I shopped for a card, I made use of this — I skipped the pitch, looked at the box, and tossed any offer that had a fee or didn’t show a low enough APR. But there’s still plenty of legal nonsense to wade through when you agree. How much further should we go? At a certain point, disclosure requirements and limits on how companies can talk about their products start to encroach on First Amendment rights (see, for example, direct-to-consumer drug advertising in Europe — which essentially doesn’t exist). Seems to me that the best, albeit imperfect, way to deal with these things is through fraud/false advertising laws. Companies simply need to be held accountable for saying things that are actually true, and consumers then need to educate themselves.
— Peter Suderman · Jun 1, 04:55 AM · #
I noticed two things in this debate.
1) The credit card companies make their big money from the tail that doesn’t use credit cards well – either because of being irresponsible or in bad times or both. As such, they have an incentive to confuse their clients about the terms of their contract, to better shunt people into this tail. This is not the case for, say, selling things on ebay where I want it to be clear what I’m getting and what I’m paying, or for marketing, where they may oversell the experience of the product (“gets stains out no matter what!”), or your kayak rental form which is just a confusing way of say “not responsible!”
At first I thought this was a net-even issue, or a nice bonus to collect, but the more I hear from insiders and cc quants since I’ve looked at it, the majority of the business seems to be harvesting these clients. Normally ‘adverse selection’ is a problem for businesses; here it appears to be the entire model.
2) As others would say, this is not a deal if you understand the fine details of the contract you sign. I’ll take it for granted the most-naive consumer can understand every part of a legal document designed to confuse them. However part of difficulty of navigating the contract the ambiguity of the contract, the slippery-ness and consumer-experienced arbitrariness of what constitutes a credit event. Can you get your balance lowered for shopping at Walmart? Is that fraud if it happens? Your FICO score going down 10 points?
The move then is that credit cards are the worst form of credit ever, and no one should trust them. But that’s not the way we talk about them, and it is certainly not the way the credit card companies talk about them (“there are some things money can’t buy….”)
— Mike · Jun 1, 05:14 AM · #
Peter,
It’s not disclosure agreements and formal legal limits on how companies can talk about their products that I’m looking for — though admittedly I haven’t really a solution to this problem.
— Conor Friedersdorf · Jun 1, 12:04 PM · #
“Nor is the situation helped by the fact that so many legislators — and members of their staff — are trained by the same profession”
No kidding, Skippy? You think there are too many lawyers in Washington? Conor, you are a master of the maddeningly understated statement. THE SITUATION ISN’T HELPED? It’s BECAUSE of lawyers and their hold on Washington that government is so dishonest.
I give you two famous phrases as examples of the problem with Washington:
“It depends on what the meaning of is, is.” Bill Clinton
“I will create or save 2 million jobs.” Barack Obama
That’s real leadership for you. Tweakers-in-chief. Vote for me and I’ll thrill you with my tweaking of phrases.
Lawyers are experts in using language to confuse, obfuscate, manipulate, and annihilate. Unfortunately, one party is wholly owned and paid for by the trial lawyers. Enough said.
Conor, you say you haven’t a solution to this problem. Here’s a thought: QUIT VOTING FOR DAMN DEMOCRAT LAWYERS.
— jd · Jun 1, 01:00 PM · #
jd
You should think your comments through a little bit. Do you really want to stand by the assertion that the purposfully obscure language that lawyers use is the democrats fault? All the main posters on this site make an effort to be intellectually honest, as far as I can tell. To do that you have to question your assumptions before you write, including ideological assumptions. Commenters should try to do the same. That’s the tone of this site. Just yammering on in the typical no nothing way about socialist obama and high taxes and liberals or about dumb ass Bush and Iraq and dumb ass conservatives is just a waste of computing resources.
— cw · Jun 1, 02:34 PM · #
In lawyers’ defense, there are two main problems that aren’t their fault.
1) There’s a common law principle that all ambiguities are interpreted in favor of the customer in “contracts of adhesion.” This is reasonable — the customer is on the “take it or leave it” side of the transaction, and the issuer is in the best position to resolve ambiguities. Unfortunately, you end up with contracts that look like a wish made with an evil genie — because the company’s lawyers are trying to write language that addresses every possible situation and is capable of only one intepretation for each situation, you get a lot of language. (Related to this, some of the situations being resolved are quite technical, which leads to technical language.)
2) Required disclosures are bigger and bigger parts of the language. Health insurance policies and drug warning language often has large sections dictated by law, and believe me, those sections aren’t any clearer than the rest.
3) Lastly, it’s just harder, often a lot harder to write unambiguous contract language in “plain english.” You can always write it retroactively — by identifying the specific situation that happened in any particular case and saying in Paragraph 1 – “Hey! If you do X, Y will happen!!”, but there are a lot of different X’s possible in the future, and at best, a “plain english” contract that also was completely unambiguous for every reasonable possible future situation would depend on many many pages of interlocking and cross referenced definitions.
(As an example of those interlocking definitions, “ambiguous” here means “capable of being interpreted two or more ways without offending the conscience”, not “I have no idea what this means.”)
— J Mann · Jun 1, 04:30 PM · #
Another reason you get the weird legal language is that much of it is boilerplate that has stood up to judicial scrutiny. There is a judicial record saying that the first paragraph of section a. means this. In otherwords, people agree on what it means. So lots of contracts get cobbled together from languge that may be a hundred years old.
— cw · Jun 1, 05:23 PM · #
Complaints about legal terminology remind me of those people who think that it would be better if computers could be programmed in plain English. Legal language and programming languages exist for similar reasons – so that intent can be stated precisely. Plain English isn’t good for that. Remember, you can’t add too much water to a nuclear reactor!
— Hyman Rosen · Jun 1, 08:27 PM · #
Hyman,
Legal terminology is, of course, useful in various circumstances, but there is an important difference between programming language and legal language — the latter must be understood by the populace if we are to maintain a fair, democratic society.
In addition, you’d be hard pressed to find a bunch of computer programmers who are deliberately using the complexity of the language to obfuscate.
— Conor Friedersdorf · Jun 1, 09:09 PM · #
Actually, all those warnings you see entering buildings in California (often labeled a Prop 65 warning) is not due to lawyers at all, but to citizens. The well-meaning citizenry voted for a proposition that required all buildings holding carcinogenic or other potentially harmful chemicals to post a warning announcing their presence. Since most cleaning chemicals are potentially harmful chemicals, and since car exhaust has benzene, every office building and parking garage now has a warning outside. No lawyers were required in the creation of this absurdity.
— Eric · Jun 1, 10:35 PM · #
The answer, of course, is effective consumer protection agencies.
Yes, the dreaded “collectivism.” BOO!
However corporatist and untrustworthy the FDA et al. have become in the past 30 years, and however shambolic the BBB can be, there are very good reasons for them being there in the first place.
There is also room for private collectivism (a few brains just began to fizz and spark…) in the form of groups like the ACLU, the Sierra Club, etc.
Business, especially as they become larger, discover that their legal resources can improve their bottom line by essentially conning gullible individuals, smaller competitors, etc. Government agencies and private groups provide (limited) protection against this kind of abuse.
My take FWIW.
— Mason · Jun 3, 06:49 PM · #
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— reciprocityf · Jun 8, 12:16 PM · #