Cradle of consumerism

From ''Nader to nadir.'' That's how one observer has described the slide of consumer activism in America. In New England, however, the decline has been less precipitous.

''As a region, New England (and New York) has the highest concentration of grass-roots consumer groups in the country,'' states Stephen J. Brobeck, executive officer of the Consumer Federation of America (CFA).

True, the numbers have dropped here since Ralph Nader championed consumers' rights in the '70s. Federal funds dried up and many activists now prefer nuclear-freeze marches to hounding business. But a hefty body of consumer law has built up, especially in Massachusetts and Connecticut. ''And the groups that have survived are stable,'' says Mr. Brobeck. Of the 393 groups surveyed by the CFA last year, the greatest number (77) is concentrated in New England.

Their targets?

Following in the tire tread of the infamous Corvair, ''lemon'' automobiles remain a concern. Recently, many lemon-law battles to protect new-car buyers have been won. But new fronts are forming - including keeping a lid on local telephone rates and protecting folks from the vagaries of bank deregulation. With budgets tied to membership dues, activists are tackling issues that will generate continued public support.

''People don't necessarily identify themselves as 'consumers.' But they do see themselves as, for instance, bank customers,'' says Jody Forchheimer of the Massachusetts Public Interest Research Group (MassPIRG). This consumers group founded by Ralph Nader is a loosely linked organization in 25 states. With 75, 000 dues-paying members, MassPIRG is one of the largest.

This spring MassPIRG released a study on check-clearing delays (the time it takes a bank to credit your account with a deposit). Of 94 banks surveyed, 25 percent placed a hold of more than a week on local checks. Twenty percent held out-of-state checks for more than two weeks, the report stated.

The study prompted lawmakers to sponsor a widely supported bill, now pending before the state legislature. The bill requires banks to clear checks (less than in-state banks within four days, and from out-of-state banks within seven days.

Another issue kicking up sand in the banking arena is the potpourri of new services that resulted from deregulated competition. On one hand, the customer generally benefits from more deposit options and the higher interest rates that come with them.

But the dizzying array of choices has left people puzzled, says Ms. Forchheimer at MassPIRG. And as competition trims profit margins, banks are raising minimum balances and charging for customer services that used to be free.

''I got a letter recently from a man on social security. He said, 'My bank solicited me to direct-deposit my social security check. I did. And now they're charging me for it,' '' says a concerned Paula Gold.

As head of the Massachusetts Office of Consumer Affairs and Business Regulation, she's in a position to alleviate consumers' banking and other concerns.

She oversees eight regulatory agencies and 28 licensing boards. The regulation of banks, insurance companies, utilities, alcoholic-beverage sales, and cable television all fall under her supervision. Few states in the country, if any, have a consumer office that carries such responsibilities and is accorded a place in the governor's cabinet.

But Ms. Gold doesn't consider her role to be one of consumer advocate. Rather , she assumes the part of impartial arbitrator between consumers and business. Nonetheless, her efforts run parallel to MassPIRG's, at times.

''We're concerned that banking services remain available to all people - that banks don't go to total cost-based pricing so that the small child's or the low-income person's account becomes impossible to maintain,'' Ms. Gold said in a recent interview from her 14th-floor office situated a broken-toaster's throw from the State House.

''I think this is very important for the banking industry to think about as well. Because what happens is that if they don't think about things of this nature, regulators and legislators will - and the solutions may not be as good for the public or as palatable for the banks.''

In fact, a bill forbidding fees and minimum balances on savings accounts for those over 65 or under 18 is before the legislature now.

Meanwhile, Ms. Gold's office released last week the first of three comparative surveys of 167 Greater Boston bank services (see chart on B1). Additional surveys will compare other types of accounts and credit-card fees, according to Ms. Gold.

Massachusetts has a robust and innovative banking industry. Add that to the strong state and private consumer efforts, and the result puts Massachusetts at the fore of consumer banking issues. The other New England groups contacted see it as a not-yet-ripe debate.

But a New England-wide consumer debate is brewing over the AT&T breakup and the resulting hodgepodge of long-distance fees. Fears are rising that local rates may force low-income users to do without.

In response to the long-distance confusion, Paula Gold's office produced a survey this spring of long distance companies and their rates. An update will be released soon, says a spokeswoman.

As for local phone rates, Vermont, in particular, may have an acute problem, according to Cort Richardson of the Vermont Public Interest Research Group (VPIRG).

Before AT&T splintered, ''Long-distance rates subsidized local service, expecially in low population-density areas like Vermont,'' says Mr. Richardson. Without that subsidy, rates will rise and ''there are many customers that will no longer be able to afford a telephone. That's more than an inconvenience. It can be dangerous for the elderly in rural areas.''

This year VPIRG lobbied the legislature for a ''lifeline'' rate structure - low-cost, limited phone service (five calls a month, for example). It failed, but a resolution asking the Vermont Public Service Department to develop lifeline proposals was passed.

Two bills in Massachusetts proposing a lifeline rate never made it out of committee. ''The telephone companies' own figures show that if local rates double, you'll see a drop off of 10 to 20 percent of customers,'' says MassPIRG staff attorney Keith Stroup. But he adds, ''Until the economic impact is actually felt, we probably won't make signifigant progress on legislation.''

The record is better on cars with chronic bugs.

Scads of consumer groups nationwide are steering ''lemon laws'' through state legislatures. But it all began in New England.

In 1982, Connecticut was first to enact a lemon law protecting new-car buyers. This year, that law was strengthened by a second bill, dubbed ''son of lemon law.'' This second bill sets up state-run arbitration panels (as an alternative to costly court battles) because the arbitration panels sponsored by auto manufacturers were not successful.

Of the New England states, all but New Hampshire have put the squeeze on shabbily built new cars.

This year, ConnPIRG and MassPIRG both tried to push a used-car lemon bill through, but failed. New-car lemon laws pass relatively easily because in the legislature ''auto manufacturers are looked at like out-of-state carpetbaggers, '' says ConnPIRG's Edmund Mierzwinski. But a used-car law affects local car dealers, which have a strong lobby.

In Massachusetts, Paula Gold was criticized for not backing the highly politicized proposal. Ms. Gold is the former chief of the attorney general's Consumer Protection Division, which MassPIRG says receives roughly 8,000 used-car complaints a year.

''She knows as well as anyone the used-car problem is very serious. We were very dissappointed she didn't put the full weight of her office behind it,'' says Jody Forchheimer at MassPIRG.

Ms. Gold responds: ''I've given qualified support to the bill. I know there are a lot of problems with used cars. But I'm most concerned about getting the new-car lemon law working. We have significant rights in Massachusetts now in dealing with used cars. I don't want a new statute to cut back on those rights.'' She would like to see ''more talk over the (used-car) law.''

The new-car lemon law is drawing her attention because ''some of the manufacturers are reluctant to participate (in arbitration) and nobody has set up a panel that meets with the new statute,'' says Ms. Gold. It was this same problem that prompted Connecticut to pass its second lemon law.

Why is this region such a bastion of consumerism?

''New Englanders tend to be more reform-oriented, as does California, than the typical state or region,'' says Stephen Brobeck of the CFA in Washington. ''Part of it is generational. Boston has a high concentration of young and younger middle-age people. They are traditionally more supportive of consumer groups.''

He adds: ''I think is also has to do with a continuity with the past - the ingrained values of individualism and self-reliance. Because of those values, any kind of movement that emphasizes self-help will have a receptive audience.'' BANK FEES NOW checking accounts

MINIMUM MONTHLY PER DRAFT CHARGE BALANCE FEE CHARGE FOR to avoid (if below (if below BOUNCED service fees minimum) minimum) CHECKm Bank of Boston $1,000 $3.00 $.30 12.50 Bank of New England 500 2.00 .15 15.00 Baybank Boston 1,000 2.50 .30 12.50 Canton Institution for Savings 0 0 0 10.00 Lincoln Co-op 250 3.00 .15 12.50 Marblehead Savings Bank 100 3.00 .25 10.00 Source: From survey of 167 banks issued by Massachusetts Office of the Commissioner of Banks. WHITNEY WOODRUFF - STAFF