Negative Option Revisited

Legitimate companies use negative option techniques to snare customers.  But in the long run, negative option leaves such a bad taste in everyone's mouth that it damages your company's reputation.   Is there another way?  

Negative option is a means of selling people on services - usually content or other subscription-type services - by offering a come-on price (or free)  for the first six months, six weeks, or whatever, and then charging your credit card the "full subscription amount" once the "trial" period elapses.  Or they just keep your credit card on file and keep re-charging you for services or subscriptions, until you say "stop" or even thereafter.

What these marketers hope, of course, is that you are just too tired and distracted to bother canceling the service before the trial period has ended.  Or they count on the fact that most people don't reconcile their credit card accounts on a daily, weekly, or even monthly basis, so they just don't notice they are being charged by AOL ten years after they stopped using the service.

Or they count on people thinking "Oh, $29.99 isn't a lot of money, I'll just pay it" even though the website in question is one they stopped visiting years ago.  And yes, people do this, even people of modest middle-class means who cannot afford to squander money like that.

So sadly, negative-option seems like it will be here to stay.

What brought up this issue yet again, was a subscription to Cook's Country, which is a magazine and public television show that also publishes America's Test Kitchen.   This is a great magazine and I really liked it.   It methodically attacks different recipes and food items from a scientific trial-and-error point of view, without preconceived notions, and then publishes the results.

They are great folks, and even did a movie about Fanny Farmer and re-created one of her signature menus from back in the day.  If you have Netflix, it is a good watch.   Sadly, their food empire is based on using negative-option, and this sort of is a buzz-kill.   I no longer feel warm and fuzzy about them.  I feel about them the way I would about a cable company and that says a lot.

Mark decided he didn't want the magazine anymore, so we let the subscription lapse.   The first thing we noticed was a credit card charge after the subscription lapsed.  What's up with that?   And a while later, a cookbook arrives in the mail.   Turns out, you get this cookbook as a separate subscription, and when you cancel the magazine subscription, they send you the cookbook, claiming that you didn't cancel that as it was separate.

So more phone calls and waiting on hold and we get the cookbooks cancelled.   A year goes by.   All is well until....

A charge for $34.95 appears on my credit card.   I call the company and they claim we still had an online subscription from January of last year, even though we cancelled the magazine and cookbook before then.   This is very odd, as my credit card was replaced with a new one with a different credit card number back in September.   How did they get the new credit card number?

When I call them, they promise to cancel the subscription and issue a credit.   To be on the safe side, I call Bank of America and ask them to dispute the charge.   The credit is never forthcoming, and Bank of America never hears a word from Cook's Country, so they cancel the charge and issue a credit.

In the meantime, I googled "Cook's Country bills my credit card" and get page after page of complaints.  This one is typical.  The complaints are all about the same.  People thought they cancelled the service only to find new charges.  Cookbooks arrive without being ordered.  It seems no matter what you do, they keep charging your credit card, without your authorization.

Of course, they claim you authorized the charge as a continuing charge for a subscription service.   That's their claim, anyway.   It is a shame, to me, that a legitimate organization resorts to this sort of thing.   But perhaps they farm out the billing to a company that works on commission, and you know how that sort of thing works out - like with Wells Fargo.

Commission sales, when unregulated, can lead to problems.  I recounted how a county paper decided to increase circulation by using a subscription company, who in turn offered commissions to sales people for signing people up.  The sales people went around to every apartment and just wrote down the names of people from their mailboxes, along with the address - cashed their commission checks and moved on.   Meanwhile, hapless "subscribers" find newspapers they didn't want on their doorstep, and ominous "final notices" in their mailboxes for subscriptions they never ordered.

Scale this up 100,000% and you have Wells Fargo, who offered commissions to sales people to sell credit cards and other accounts to customers.   When you incentivize people that way, they just resort to fraud to "make their numbers" and set up phony accounts.

Negative option works the same way.   When Webshots was sold and decided to revert back to a screen-saver company, many folks who paid for their premium service assumed that since the service was gone, they would no longer be charged.   But they found new charges on their credit cards for screen-saver services, and of course were outraged.   How does this equate into a sustainable business model?

Well, it can, for a while.   An article I read about AOL noted that half their income was from folks who still paid the monthly service fee, even though they didn't use AOL anymore.   Some, such as my late Mother-in-Law, thought you "needed" AOL to access the internet, and paid this fee on top of her DSL monthly charges.  Oddly enough, she was not alone.  I've know people that even today pay an AOL fee on top of their monthly internet access charges, even though the ISP provides a default e-mail address and you can set up free e-mail on gmail, hotmail, and yahoo, among others. 

So yes, you get the clueless demographic with this approach.  And I guess America's Test Kitchen, being a PBS show, gets a lot of clueless older people who subscribe to Smithsonian and don't check their credit card statements too closely.  But long-term, they are alienating subscribers, which does not bode well for their business model.

Reforming negative option is impossible, because the people using it know that reform would mean revenues would be cut in half - at the very least.

For example, if you forced the subscriber to "opt in" to renewals, it would force the subscriber to think about whether they are using the service, how much it costs, and whether it is worthwhile.  When all it takes is a click of a mouse to say "no" more people would say "no" and you'd lose business.

If you sent an e-mail or text alerting them to auto-renewal and giving a link to their website to opt-out, the same result occurs.  It is more hassle to go to the website, log in, and opt out, but the result is more people would do just that.

If you relied on people actively remembering to renew, you'd have no subscribers at all!  Sending renewal notices by mail is expensive and doesn't result in a high response rate, as people don't want to hassle with getting out a checkbook and stamps and mailing stuff in - even if that is the safest way of doing it.

The problem, of course, with even that approach is that marketers have screwed that up.   I was getting dozens of "renewal" notices for various magazines which were either not renewal notices at all (but rather offers for a new subscription) or were far in advance of the expiration date - sometimes by years.   You send in a check and find out you have renewed your subscription until the year 2035 by sending in responses to all these "renewal" notices.   Or you end up getting two or three or even four copies of the magazine in question.

They don't make it easy to know how many issues you are subscribed for, how many remain, how much you are paying, and when the actual renewal date is.   And newspapers are no better, using "negative option" subscription services in the same way as well as being opaque (intentionally) about your subscription, when it starts, ends, and renews.

They say print is dead - I wonder why?   It is just cheaper and easier to read free stuff online, even if the content isn't as good.   Paying for content is problematic because they play games with your payments.   Honesty is in short supply in the subscription business, which is why a lot of people are hesitant to subscribe to things.

Angie's list recently switched to a non-subscription model because of the negative publicity surrounding their negative option model.   No one wanted to sign up for a hassle, just to read about plumber recommendations.   Whether they will succeed with this new model remains to be seen.   Some argue they are now making their money from the tradesmen themselves, which creates an interesting conflict-of-interest.

So maybe people are realizing negative option is odious.  When you treat your customers like shit, in the long run, they will flee to the next available alternative.  The railroads and trollies found this out the hard way - people flocked to more expensive auto transportation, as it was less painful.   Cable companies are mystified as to why no one wants their "content" when they can stream on the Internet for far less.   There is a lesson here, for marketers, if they chose to learn it.

When you make doing business with your company a toxic relationship, people will flee eventually.  It may take a year, five years, or a decade, but eventually, you will be left with nothing.


UPDATE:   Cook's Country issues a refund, after Bank of America already canceled the charge.  So I guess I have to call the bank again to cancel the cancel.

Also, a reader alerts me to an article in the New York Times which illustrates why they may be using negative option so aggressively - there is a schism in the organization between one of the founders and others who want him to step aside.

It is very sad to read, as it illustrates how greed takes over once something becomes popular.   The media types want to turn it into some sort of monster empire, like Martha Stewart's failed "Omnimedia".  The founder just wants to do his thing - but a lawsuit may be preventing him from starting a new enterprise.

I guess his only consolation will be the tens of millions of dollars he made from this.  Boo-Hoo.

Trust Issues

Faye Dunaway refuses to talk about her performance in "Mommie Dearest" as she felt it was too "over the top".   Frankly, compared to my childhood, I thought it was subdued and restrained.

You may get the impression, reading this blog, that I have "trust issues" with regard to other people.  And this is true, but it is in part due to my upbringing, which was a classic Skinner-box learned helplessness experiment.  It is also due in part to the realization that the commercial enterprises in our country are not our friends and are basically out to screw you six ways from Sunday, if they feel they can get away with it.  I tend not to trust banks, credit card companies, or anyone trying to sell me anything.

When I saw the movie (and read the book) "Mommie Dearest" I felt like I was reading my autobiography.  It was so close to the truth of my childhood as to not be funny.   In that book, Christina Crawford talks about the "night raids" her Mother would conduct, while drunk, being completely irrational and violent.   Christina was lucky - she only had a Mother who did this and not a Father as well.

My Father's drunken tirades were nothing like my Mother's, at least in terms of frequency.  Since he wasn't home most of the time, we didn't have to deal with his anger control issues very often.  When he was home, we tried to leave or make ourselves scarce, lest he notice us and start something.

We used to call him "Mr. Ho-Ho" as he was always pretending to be jolly and friendly.  However, it was a thin veneer, and quite easily detectable as entirely false.   To be fair, his children were a complete puzzle to him.   None of us was a "chip off the old block" - wanting to join junior Calvary or go out for sports.  My oldest brother was subjected to a lot of pressure in this regard - forced to go out for football and other activities and earn his varsity "letter" in prep school.

Unfortunately, he was a rather thin and awkward and sensitive artistic type, ill-suited for the gridiron.   He bravely stuck it out, though, sitting on the bench most of the time, appeasing his father, lest he get yelled at or beaten.   Later on in life, he would reject my father's values of materialism and "getting ahead" in life, as being false.   And sadly, I think this had more to do with his difficult relationship with his Dad than any real political leanings.

When my other brother came of football age, my Dad forced him to sign up for "Pop" Warner Football, which he detested.   My Dad never "threw the ball around" with us kids or took a real interest in the game or even tried to explain it to us.  He didn't watch football every Sunday while the family gathered around the television.  As a result, we had no interest in the game.   He thought that for some reason, we would spontaneously become enthused of it as it was some sort of American rite of passage.

Anyway, my brother decided that "Pop" Warner football just wasn't his thing, my Dad berated him for hours, calling him a "quitter" and "Mr. Quitter" and saying idiotic things like, "Wherever you go in life, from now on, you'll be known as the guy who quit 'Pop' Warner football!"   He did this for over an hour, mentally castrating my poor brother, who was at that pubescent age where what your Dad thinks of you has a great affect on your brain.

When it was my turn for "Pop" Warner football, I told my Dad, "no thanks, not doing that!" which was a shame, as I was the only one in the family who really had the build for it.   But he had made it so toxic at that point that the idea of even trying it was scary.

My Dad would occasionally go into rages, and these were unpredictable and violent.   Like in Mommie Dearest, he would go through our bedrooms, complaining they were messy and dirty, and then do things like overturn bookcases and furniture and then tell us to "clean up this mess!" - a mess he largely created.   I am not sure if he learned this from a drill sergeant or what.  I am not sure what he wanted to teach us in this manner.  What we learned was that he was an asshole.

When we would start crying (as little kids are prone to do), he would scream at us to stop crying and then say, "Smile dammit!  I want to see you smile!   You should be happy!"   It was pretty sick stuff, in retrospect.

We also called him "Mr. Half-a-stick-of-chewing-gum" because about an hour after his fugue state had dissipated, he would realize what a shitty job of parenting he was doing and then try to apologize to us, offering us a stick of chewing gum as a present.  Unfortunately, since he had already eaten all the chewing gum, there was only one stick left, which he would divide in half and offer each of us a half-stick.   It was so fucking pathetic, I kind of felt sorry for him.

But that in short, is how learned helplessness occurs.  When you put an animal in a Skinner box, and none of their actions creates any kind of rational feedback - positive or negative - they just cower in a corner and whimper.   What we learned from him was avoidance as that was usually the best strategy for his fugue states and rages, which were unpredictable.

As I noted, my Mother was pretty much the same way, only more so.  And when my older siblings were old enough to leave home (or at least have a driver's license) and my Father had his mistress (and thus, blessedly, was rarely home) my Mother would go into her fugue states which were pretty much the same as my Father's, only without the half-stick of chewing gum.  Unfortunately, I was not able to escape these, as I noted before, but was left alone with a severely mentally ill woman.

Again, the antics portrayed in the film Mommie Dearest are not an example of "over the top" over-acting, but a realistic portrayal of a rage-aholic Mother, as I can attest to, from personal experience.  Although my Mom had no fetish about wire coat hangers.

It wouldn't have been so bad, had the four children stuck together through this and at least offered support to each other.   But maybe in a situation like this, it is "every man for himself" and people learn to look out for themselves and to hell with the other guy.  My sister had largely left home by the time I was 8 years old, so she was not so much a presence in my life.  She spent the rest of her life trying to "understand" her relationship with Mother, and of course, calling my Father periodically for infusions of cash.   Sadly, in her short life, she was never able to break free of the parental leash.  Many children don't and they don't because parents enjoy this sick form of control.  Well, some parents do, anyway.

When my Father re-married, he was ecstatic to have three new children to lord over and who were needy.  He was tired of the old ones anyway, who were no fun anymore, being resistant, dead, or mentally ill.

My older brother I remember only because he tended to mock me and belittle me, I guess in a way of making himself feel more important.   Like I said, my Father tended to belittle him, so maybe this was his way of coping - passing along the fun.   He left home early and never looked back and resisted their attempts to steer his career.

My other brother, well, he learned to take care of himself and to hell with everyone else.   Drugs, of course, were part of the problem, as was mental illness.   Mentally ill people tend to be selfish people - taking what they want from society and not thinking about consequences or outcomes.   He would do stupid things and get into legal trouble and act mystified as to why everyone was upset.  Once he adopted the role of "troubled child" it provided a set of normative cues and expectations to live up to.

At first, his antics seemed to only harm himself.   But as a kid, I had a paper route, and when I delivered the evening paper, I had to collect money and balance books and then pay the paper distributor.  It was arduous work, and when people didn't pay, I often ended up at the end of the week barely breaking even.   One day, I went to settle up with the distributor and found I was nearly $20 short.   The distributor yelled at me and called me an idiot and I could not figure out why I was short on money.   I later on found out that my brother had stolen money from my money pouch to buy drugs.   He felt that the money was his for the taking and whatever consequences I had to face were no concern of his.

While this was hurtful at the time, in retrospect, I realize this only made me stronger and made him weaker.   I know that sounds weird (particularly when you calculate the compound interest on $20 over 40 years) but his self-destructive actions ended up destroying him.   On the other hand, they merely made me resolute not to go down the same path.

I told my parents, of course, thinking that justice would be served.  They yelled at him, but they never asked him or forced him to give me my $20 back and to this day, I was never made whole.   I guess my way of coping and "looking out for myself" was to get a job and try to be independent as possible.   First I had the paper route and then the dishwashing job at the Olde Tyme Gas Light Restaurant which lasted until the cook shot himself in the kitchen.

The odd thing was, my parents were not happy with my initiative.   They felt that working was somehow beneath the children of someone in their station in life - even though they were one or two generations removed from poverty themselves.   I was told in no uncertain terms that they did not like the fact I was working and would not help me in any way whatsoever and that I was "on my own".   It was very odd.

When I went to General Motors Institute, my Mother would run that down as being "some sort of trade school" or whatever.   She felt that a useless liberal arts degree was the only education worth having as it had taken her so far in life (the sarcasm light is ON).  After seeing my older siblings flounder with liberal arts degrees (which even back then, were considered worthless in the job market), I kept to my own inclinations and ideas.   And besides, my parents, with their odd behavior, had largely squandered what little credibility they had in the advice department - career or otherwise.

In fact, the only time they seemed to be happy was when I flunked out.   As I noted in The Parent Trap there are a lot of parents who love to lord over the ruined lives of their children, and my parents were prime examples.   In the cocktail circuit, whining and bitching about your failed children was seen as some sort of perverse status.  As I noted before, my Dad once called me on the phone, ecstatic that his step-daughter qualified for full disability - he crowed as if she had graduated from Harvard.  I guess that is what qualifies as "success" in my family - going on the dole.  Real success is criticized as being flawed or "selling out" - you see how sick this is and how damaging it can be if you adopt those normative cues.

So what changed in my life?   I finally woke up one day and realized that clinging to "family" was going to kill me, quite literally.   It was not a healthy or loving family, but rather a twisted relationship where everyone was looking out for themselves and screw everyone else.  Where failure was success and success was failure.   Where being needy and weak meant you were loved.  The best thing to do was walk away and live my own life.   And the rest, as they say, is history.

But this is not to say I don't still have trust issues.  I think part of the experience of random rewards and punishments is that it programs your brain to be wary and skeptical.   Again, perhaps this is a good thing, to some extent, as it prepares you for the disappointments in life - when you realize that even friends and family and husbands and wives can have ulterior motives or perhaps no motives at all, but just random madness.

When something sounds too good to be true, I tend to be very skeptical.  I've been burned before, from the get-go.   And when someone seems irrational or crazy, I just walk away, as I learned the hard way, many times, that dealing with crazy people is an exercise in futility and a sure way to end up victimized in short order.

And when some company offers me a "great deal" I realize that they are not doing this out of the goodness of their hearts, but to make money, sometimes in odious ways.   And I walk away from that shit, too.

Theoretical Conservatives, Hypothetical Liberals

There are a lot of people who run the country who have never worked a day in their lives at a real job.

 

One interesting thing about politicians, is that today, many of them are professional politicians, and this is largely a mistake of our own creation.   In order to be elected to office these days, you have to live the life of a choir boy - preferably not molested by a priest, and preferably not Catholic (yes, even today).

You have to be a real boy-scout and have no "dirt" in your past that might even suggest some sort of impropriety.   So we really limit who can run for office to people whose lives are totally unreal or surreal, or just fake.  And when they run for office, we force them to adopt these artificial personas that are more caricature than reality.

And as a result, we have people who never did anything in their lives other than to run for office.   Bernie Sanders is an example of this, and one reason why I never understood the fascination with him.  He was against a lot of things - mostly people who actually do things - as being capitalists and evil, not realizing that a lot of people struggle to run small businesses and feel put-upon by the Bernie Sanders' of the world who don't realize what a struggle it can be to make payroll.

The same is true on the Right - there are a lot of politicians who have elaborate theories about how the economy should be run, but no real experience in running a business.  Sure, George Bush played at running an oil business - in the carefully minded playpen set up by his Dad.   But he really never ran the risk of real failure, even after he failed at it.

Other politicians "work" at think-tanks or law firms, in-between elections, but usually the "work" comprises trading on their names and goodwill.   Very few are people who start and run businesses, as working for the government would be a pay cut to them.

And few are working people - folks who punched a clock in the factory - and know what is like to work a job from 9 to 5 for 30 years on the hope they will get a pension and be able to retire after raising a family and putting the kids through school.

And unfortunately, we as citizens get whip-sawed between these two extremes - these professional politicians who have theories on how our lives should be lived but of course, no real experience.   They want to create a health care plan for us little people, secure in the knowledge that they will never have to use it themselves.  They have theories about our lives, but no real understanding of them.

They want to change our tax code, but likely never have had to sit down and fill out a form 1040 in their lives.  Their accountants handle all of that, of course.   And of course, they probably pay less in taxes - as a percentage of income - than we do.   At least we know Mitt Romney did.

One of the "selling points" of the Trump administration was that Trump was a "businessman" and would know how to run the country like a business.   This is sort of hard to parse, as in terms of business, his record is kind of spotty.  He built luxury high-rises using tax incentives designed for public housing.  He paid too much for Atlantic City casinos, over-mortgaged them, and then walked away when it all went to hell - leaving Atlantic City as a nightmare ghetto.

In the end, he basically had nothing left but his name, which he licensed to everything from condo projects to neckties and suits, to steaks, to a reality TeeVee show, which of course, was not real.   He is more celebrity that businessman.   And the Republicans castigate Hollywood types for even having political opinions but then elect one as President (Republicans seem strangely silent about Hollywood types having political opinions when it is someone like Charlton Heston having them, however.  Then it is "free speech" - right?).

The Left, of course, doesn't like the idea of business people in government.   Rex Tillerson was confirmed as Secretary of State, and Democrats, other than Virginia's John Warner denounced this pick.  The problem here is we have a businessman in government, but not some guy running a corner store or a haberdashery like Harry Truman, but one of the richest people in the world.

In fact, some folks have had to decline to work in the Trump administration as untangling themselves from their business interests would be close to impossible.

Of course, we have had business people in the White House before - most notably Robert McNamara - the guy who brought you the Edsel and the Vietnam war.   Again, a guy with a lot of business theories (one of the "whiz kids" at Ford who had no real experience in the car business, but a business degree) but no real experience about how average people live.

Sadly, it seems this trend will continue indefinitely.  Ordinary people simply cannot run for office, because they likely tweeted something wrong or posted something on their Facebook page that would come back to haunt them.  The media holds our political leaders to an almost puritan standard, acting shocked when they do human things like get drunk or have sex (two pastimes more popular than baseball and apple pie in America).

So we will continue to have these theorists, who don't live in reality, but instead live artificial lives, and study us regular folks as if we were specimens in a zoo - trying to discern our eating habits and whatnot and control the environment in our cages.   One side wants it too hot, the other side, too cold.   In the meantime, ordinary people suffer.

Maybe we need less theory and more reality.

The Jill Stein Trump Putin Connection

The media has been publishing a cropped version of this photo, showing former national security advisor Flynn next to Putin.  But who else's smug face is in this photo?  Yup, Jill Stein!

The Trump administration is quickly morphing from a bold new populist and conservative movement into a rolling dumpster fire chasing Trump down the street.  What is interesting about the situation is that Flynn was accused of chumming around with the Russians, in particular, old Vladimir Putin, who is shown in this photo having dinner with Flynn.

What is fascinating to me is that the media uses a cropped version of the photo above, which eliminates one member of this love-fest party - Jill Stein.   It is fascinating to me that she was present at this meeting.   During the campaign, it was noted that she was traveling to Russia, and many folks at the time said, "What the fuck?" but sort of forgot about it because she was not deemed to be relevant and it was assumed that Hillary would win.  So it kind of got swept under the rug.

What was Stein doing in Russia while running for President of the United States?  Or more precisely what was Stein doing in Russia while acting as a spoiler for Hillary?   Why was she seated at the same table as Trump people?   It is all very odd, and the kind of stuff that is fodder for conspiracy theories.

What is disappointing to me is twofold.  First, that she would travel to Russia and remain silent about human rights abuses in Russia as well as abuse of the political process.  The Russian foreign minister this morning tweeted that the dismissal of Flynn had overtones of "thought crimes" which is ironic as the Russians just upheld the conviction of a Putin opponent for criticizing Putin.   The country that invented thought crime and still practices it today - aggressively - calls us out on it.

The second thing that disappoints me is that anyone in their right mind could support Jill Stein, particularly after she was paling around with Putin.   If you are voting for a candidate on the Left, maybe you shouldn't be voting for someone who supports (and argues for better relations with) a brutal dictator.

Leftists are just idiots, plain and simple.

And how many people "protesting" and marching today either voted for Stein or didn't vote at all?

The real problem for the Democratic Party is the rise of these "Progressives" who want to turn America into a socialist paradise.   The problem is, very few people in America want a socialist paradise.  Socialism loses elections, time and time again.   Even the folks who would arguably benefit from such cradle-to-grave social programs tend to vote against it.   And maybe they realize that while it all sounds good on paper, when push comes to shove, turning your life over to government bureaucrats tends not to be the best solution to anything.

As for Flynn, from what I am hearing, he and his son are going to "self-investigate" Comet Ping-Pong Pizza and get to the bottom of this "Pizzagate" scandal.

Good Luck, Mr. Flynn!

P.S. - the big problem with Flynn was that before he lost his mind and started tweeting about Pizzagate, he was a die-hard Democrat.

Unfortunately, his shitty management skills got him fired by President Obama, and like a petulant child, he decided to go after Obama and the Democrats by supporting and spreading wild conspiracy theories.   I think the Republicans never trusted him, as he was not a right-wing ideologue, but rather a "useful idiot" whose rage they could employ against Hillary. 

Trump's mistake was to hire him (and Bannon) as part of his administration, instead of dumping that dead weight as he should have.  You use people like that in a campaign, and then get rid of them once you are in office.  Every President does it.   I am certain that Pence and Kushner will push him to dump Bannon before long as well, as Bannon's antisemitism isn't going to sit well with anyone for long.

The dumpster fire rolls on!

UPDATE:  Gore lost to Bush by 600 votes in Florida.  Ralph Nader got over 90,000 votes in that State.  If even half the votes for Jill Stein went to Hillary in Michigan, Pennsylvania, and Wisconsin, Hillary would have won those States and won the Presidency in 2016.

Election interference?  Nah!

Third Party Candidates end up as spoilers - and elect people who are diametrically opposed to their own agenda.  Ask any Mainer about their three-way Governor races - put to bed only by ranked-choice voting.

We can only hope that DeSantis gets the GOP nod and that Trump runs as a third-party candidate!

Used Parts Versus New

Are used auto parts a bargain?  Let's look at some numbers and find out.

As I noted in an earlier posting, used auto parts, like used tires, are one of those "bargains" that the poor seek out and end up even poorer for doing so.  As I noted in my tires posting, often used tires are sold as "bargains" for being half the price of new ones.  But since they have less than half the usable tread left and since the mounting costs are the same for less than half the mileage (effectively doubling your mounting costs or more) they are no real bargain, any more than a half-roll of toilet paper at half-price is a "bargain" compared to a new one - the cost per sheet is actually higher.

The same is often true for other car parts.  But unlike my tire posting, I did not run numbers on car parts in my previous posting on the subject. Suppose we use as an example, an alternator for a 2005 Chevy Silverado, which is a pretty popular truck.   What is the spread between new and used parts costs?

One junkyard site produces the following hits.

Year Part Model	Description	Part Grade	Stock#	US Price	Dealer Info
2004 Alternator Chevy Truck Silverado 1500	w/o hybrid; 105 amp (opt K68),5.3L	C	6E0418	$50	Martin's Auto Salvage, Inc. USA-NC(Raleigh) Request_Quote 1-919-231-6416/1-888-325-3301 Request_Insurance_Quote
2003 Alternator Chevy Truck Avalanche 1500	105 amp (opt K68),5.3L	A	6F0302	$50	Martin's Auto Salvage, Inc. USA-NC(Raleigh) Request_Quote 1-919-231-6416/1-888-325-3301 Request_Insurance_Quote

This site has both new and used parts:

Year Part Model	Description	Part Grade	Stock#	US Price	Dealer Info
Alternator	03-04 CV CK PU 4.3L V6 4.8L 5.3L V8 (6S) ALT -Aftermarket List Price	AFT	e4499 2-08291	$292.56	Ace Auto Parts USA-MN(Saint-Paul) Request_Quote 800-637-6752 / 651-224-9479 Request_Insurance_Quote
Alternator	03-04 CV CK PU 4.3L V6 4.8L 5.3L V8 (6S) ALT	AFT	e9373 2-08291	$111.15	Ace Auto Parts USA-MN(Saint-Paul) Request_Quote 800-637-6752 / 651-224-9479 Request_Insurance_Quote
2002 Alternator Chevy Truck Silverado 1500	4.8,A,10-01MATCH		e1183 GB0206	$45	Ace Auto Parts USA-MN(Saint-Paul) Request_Quote 800-637-6752 / 651-224-9479 Request_Insurance_Quote
2004 Alternator Chevy Truck Silverado 1500	5.3,A,2-04		e1183 GI1342	$45	Ace Auto Parts USA-MN(Saint-Paul) Request_Quote 800-637-6752 / 651-224-9479 Request_Insurance_Quote
2004 Alternator Chevy Truck Silverado 1500	5.3,A		e1183 HB0169	$45	Ace Auto Parts USA-MN(Saint-Paul) Request_Quote 800-637-6752 / 651-224-9479 Request_Insurance_Quote

Note the staggering cost of a new alternator - almost $300!   The used one for $45 sounds like a bargain, right?

But what about new parts?  Autozone wants $139.99 for a basic alternator for a 2005 Chevy truck.  Sounds like a lot more, until you realize the new alternator (or rebuilt) has a warranty and should last the remaining life of the truck.  The used alternator?  Anyone's guess, as it is from a truck as old as yours is, and thus may not last very long at all. 

If you don't mind waiting a few days for shipping, for $88 you can buy a rebuilt alternator on Amazon, with free shipping - $40 more than one from a junked car.  Plus, you don't have to drive to the junkyard and spend an hour removing a greasy old alternator.

The big deal is, the new or rebuilt alternator will likely outlast your use of the truck.  The used one might be something you replace next week, next month, or next year.   Parts wear out, and if the alternator on your truck is worn out, chances are, the one on a junked truck is pretty much worn out, too.

It isn't worth half of the cost of a new one, or even one-quarter.   But like with used tires, the retailers of these used parts use lower prices as a come-on to get you to buy.   But you are not buying half as much alternator for the money, you are buying maybe 1/4 or even 1/10th.   It just isn't worth the hassle to save $40.

But this illustrates how shitty deals are sold to the poor.  It is like the lady who bought recap tires thinking she was saving money because the upfront cost was less.  What she didn't realize was that the overall cost would be more, over time.

The poor have no access to capital, either through savings or lending, so they bite on poor deals like this.   They end up spending more than rich people do or certainly more than middle-class people.  The middle-class person has the cash or credit card to buy new or rebuilt parts and not have to dick around pulling nearly-worn-out parts from old cars.   He comes out ahead of the poor person, who not only gets shitty deals in car parts, but in banking, lending, renting, home ownership, and so on.

So, this begs the question:  Which came first, the chicken or the egg?  Are poor people poor because they bite on shitty deals, or does being poor force them to accept shitty deals?   Given the narrow spread between "poverty" and "middle class" in this country, it is an interesting question.

I can only say from personal experience that you can be "poor" on $30,000 a year or middle-class on $30,000 a year, depending on how you spend your money.


NOTE:  This is not to say that used car parts or recaps or used tires are NEVER a good deal.  If you run a trucking company, chances are you put recaps on your trailers.  But that doesn't make them a good deal for passenger cars, and in fact, they are darn hard to find these days for passenger cars, due to liability concerns.  Used tires CAN be a good deal if you find a set of brand-new "take-offs" with rims that some idiot removed from his car so he could have bling rims.  His loss, your gain.  Similarly, used BODY parts can be a good deal, although new stampings from China are certainly cost-competitive.  And used parts for rare and antique cars, suitably refurbished, are often the only source for those vehicles.  But the local junkyard doesn't usually have that sort of thing, but rather later model junked and wrecked cars that are being parted out before being crushed.

But those are exceptions to the rule, and I mention them only because some yahoo, like clockwork, will respond with "Well, used car parts can be a good deal in certain circumstances where......"

Don't be that yahoo.