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Do Not CallA Boon Or A Shot In The Foot?

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“Do Not Call”– A Boon Or A Shot In The Foot?

As I write this piece, the final day for signing up for the current “Do Not Call” registry has arrived and it appears that more than 42 million people have signed up for the program. I have no way of knowing how many individuals this disconnects from unwanted calls, but I suspect that it numbers over 80 million adults–the primary target of this rule.

As a consequence, a sizable portion of this countrys families can now sit down to a peaceful dinner without interruption from someone hawking a free trip to Orlando or a low mortgage interest rate. Ah, nirvana–peace at last.

There is no question that the use of the telephone for business solicitation has in recent years been overutilized and perhaps even abused in some cases. The popularity of the registry is in itself evidence that the public is fed up with this activity.

But it does raise the question–Is this a good move or has the government, specifically the Federal Trade Commission, shot itself in the foot? At a time when government is trying to stimulate the economy and create jobs, is this barrier to legitimate commerce counterproductive?

Perhaps if we can set the emotions aside it might be instructive to take a look at the history of telemarketing.

I have been told by old-time insurance agents that in the 1920s and 1930s, when telephones were becoming commonplace, they were never used as a tool for solicitation. But, that all changed during World War II, which brought gas rationing. No longer was it practical to drive across town to make a cold call on a prospect using up ones limited supply of gasoline. To prevent such rationing from disrupting the flow of commerce in our business, the telephone became our salvation–eliminating many needless trips by automobile and saving precious time in the process.

When I entered the business in 1956, the telephone was the essential tool for reaching new people in need of our product. I can recall eight death claims that my company paid in my early years that were the result of phone calls I made. Sure, I talked to a lot of people who were not interested, but more importantly, I talked to some who desperately needed our product and my services.

Not only was insurance placed in force, but wills and trusts came into being, some of which might never have been created but for that all-important phone call. Buy and sell agreements in business settings and estate planning in my later years often sprang from an initial telephone contact.

Today, at my stage in life, refinancing a mortgage is of no particular interest, but I do take comfort knowing my son and other members of the family enjoy substantially lower monthly payments on their homes because of the relentless marketing of lower interest rates. The housing loan, so essential to sustaining our economy, has roots in the marketing of low interest rates.

But to those who dont like the calls–not to worry–as soon as mortgage interest rates start rising, the calls will cease, with or without the registry. Same thing with credit cards: When interest rates rise, we will not likely be hearing from companies issuing credit cards. It is a touch of irony that when good news abounds (low interest rates) we tire of hearing about it.

The travel industry, employing millions of people, was hard hit in the aftermath of 9/11. As a consequence, there has been an enormous telemarketing effort to reinvigorate that business. Are we as a country so insensitive to the plight to those trying desperately to save their jobs that we cant tolerate a few phone calls trying to drum up business?

The insurance industry, recognizing the detrimental effect the registry will likely have on our business, is trying to mobilize its resources to obtain an exemption from the FTC rule, much like that granted under a previous Federal Communications Commission rule.

I am sympathetic to that effort, but I believe it would be better just to scrap the rule altogether. Not only will business solicitation be inhibited, but the costs of compliance will also be substantial. How much time and energy will be lost by agents and other salespeople searching the registry to see if its OK to place a phone call?

Our economy has progressed because we have relied upon efficiency in the way we do business. Putting salespeople back on the street in gas-guzzling cars and SUVs does not strike me as a progressive move.

Most of the people I know have in their offices and homes answering machines or voice mail. At a time when we have the greatest capacity to screen calls, why has it become so burdensome to take a call from someone trying to stimulate a business activity and one often more vital than generally is realized?

The FTC rule itself offers ample testimony to the fact that telephone solicitations are effective in generating economic activity. By a not so strange coincidence, the FTC rule, which places an unneeded barrier to commerce, provided an exemption for political fund raising.

If it is essential for politicians to have access to the telephone to obtain or retain their jobsthen why is it not even more important for the private sector to have equal access to create and protect the jobs of millions of Americans? These phone calls are not initiated to annoy you (although they may), rather they are made in an effort to provide someone a job.

Reproduced from National Underwriter Life & Health/Financial Services Edition, September 15, 2003. Copyright 2003 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.


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