illnesses. However, new drugs are being placed on the market with no require ment that there be either advance proof that they will be effective in treating the diseases and conditions for which they are recommended or the prompt reporting of adverse reactions. These new drugs present greater hazards as well as greater potential benefits than ever before-for they are widely used, they are often very potent, and they are promoted by aggressive sales campaigns that may tend to overstate their merits and fail to indicate the risks involved in their use. For example, over 20 percent of the new drugs listed since 1956 in the publications "New and Non-Official Drugs" were found, upon being tested, to be incapable of sustaining one or more of their sponsor's claims regarding their therapeutic effect. There is no way of measuring the needless suffering, the money innocently squandered, and the protraction of illnesses resulting from the use of such ineffective drugs.

The physician and consumer should have the assurance, from an impartial scientific source, that any drug or therapeutic device on the market today is safe and effective for its intended use; that it has the strength and quality represented and that the accompanying promotion material tells the full storyits bad effects as well as its good. They should be able to identify the drug by a simple, common name in order to avoid confusion and to enable the purchaser to buy the quality drugs he actually needs at the lowest competitive price.

Existing law gives no such assurance to the consumer-a fact highlighted by the thoroughgoing investigation led by Senator Kefauver. It is time to give American men, women, and children the same protection we have been giving hogs, sheep, and cattle since 1913, under an act forbidding the marketing of worthless serums and other drugs for the treatment of these animals. There are other problems to meet in this area :

An extensive underground traffic exists in habit-forming barbiturates (sedatives) and amphetamines (stimulants). Because of inadequate supervision over distribution, these drugs are contributing to accidents, to juvenile delinquency, and to crime.

Two billion dollars worth of cosmetics are marketed yearly, many without adequate safety testing. Thousands of women have suffered burns and other injuries to the eyes, skin, and hair by untested or inadequately tested beauty aids.

Factory inspections now authorized by the pure food and drug laws are seriously hampered by the fact that the law does not clearly require the manufacturer to allow inspection of certain records. An uncooperative small minority of manufacturers can engage in a game of hide-and-seek with the Government in order to avoid adequate inspection. But protection of the public health is not a game. It is of vital importance to each and every citizen.

A fifth of all the meat slaughtered in the United States is not now inspected by the Department of Agriculture, because the coverage of the Meat Inspection Act is restricted to meat products moving across State lines. This incomplete coverage contributes to the diversion of unhealthy animals to processing channels where the products are uninspected and can, therefore, be a threat to human health.

In short, existing laws in the food, drug, and cosmetic area are inadequate to assure the necessary protection the American consumer deserves. To overcome these serious statutory gaps, I recommend:

(1) First, legislation to strengthen and broaden existing laws in the food-anddrug field to provide consumers with better, safer, and less expensive drugs, by authorizing the Department of Health, Education, and Welfare to

(a) Require a showing that new drugs and therapeutic devices are effec tive for their intended use-as well as safe-before they are placed on the market:

(b) Withdraw approval of any such drug or device when there is substantial doubt as to its safety or efficacy, and require manufacturers to report any information bearing on its safety or efficacy;

(c) Require drug and therapeutic device manufacturers to maintain facilities and controls that will assure the reliability of their product;

(d) Require batch-by-batch testing and certification of all antibiotics;
(e) Assign simple common names to drugs;

(f) Establish an enforceable system of preventing the illicit distribution of habit-forming barbiturates and amphetamines;

(9) Require cosmetics to be tested and proved safe before they are marketed; and

(h) Institute more effective inspection to determine whether food, drug, cosmetics, and therapeutic devices are being manufactured and marketed in accordance with the law;

(2) Second, legislation to authorize the Federal Trade Commission to require that advertising of prescription drugs directed to physicians disclose the ingredients, the efficacy, and the adverse effects of such drugs; and

(3) Third, legislation to broaden the coverage of the Meat Inspection Act administered by the Department of Agriculture, to promote adequate inspectionin cooperation with the States and industry-of all meat slaughtered in the United States.

(B) Require "truth in lending"

Consumer debt outstanding, including mortgage credit, has almost tripled in the last decade and now totals well over $200 billion. Its widespread availability has given consumers more flexibility in the timing of their purchases. But, in many instances, serious abuses have occurred. Under the chairmanship of Senator Douglas, a subcommittee of the Senate Banking and Currency Committee has been conducting a detailed examination of such abuses. The testimony received shows a clear need for protection of consumers against charges of interest rates and fees far higher than apaprent without any real knowledge on the part of the borrowers of the true amounts they are being charged. Purchasers of used cars in one study, for example, paid interest charges averaging 25 percent a year, and ranging well above this; yet very few were aware of how much they were actually paying for credit.

Excessive and untimely use of credit arising out of ignorance of its true cost is harmful both to the stability of the economy and to the welfare of the public. Legislation should therefore be enacted requiring lenders and vendors to disclose to borrowers in advance the actual amounts and rates which they will be paying for credit. Such legislation, similar in this sense to the truth-in-securities laws of 1933-34, would not control prices or charges. But it would require full disclosure to installment buyers and other prospective credit users, and thus permit consumers to make informed decisions before signing on the dotted line. Inasmuch as the specific credit practices which such a bill would be designed to correct are closely related to and often combined with other types of misleading trade practices which the Federal Trade Commission is already regulating. I recommend that enforcement of the new authority be assigned to the Commission. The Government agencies most concerned in this area have been cooperating with the subcommittee in developing the information necessary to prepare a workable and effective bill; and in view of the exhaustive hearings already held, I hope that the Congress can complete action on this important matter before it adjourns.

(C) Manufacture of all-channel television sets

Five out of six home television receivers today are equipped to receive programs on only the 12 very-high-frequency (VHF) channels. As a result, in most areas, stations desiring to operate on any of the 70 ultrahigh frequency (UHF) channels would usually have such small audiences that there is little incentive to make the substantial initial investment and continuing expenditures that effective broadcasting requires. The result is a sharply restricted choice for consumers.

After extensive study, the Federal Communications Commission has concluded that an effective and genuinely competitive nationwide television service, with adequate provision for local outlets and educational stations, is not possible within the narrow confines of 12 VHF channels. Legislation now before the Congress would authorize the Commission to prescribe the performance characteristics of all new television receivers shipped in interstate commerce to assure that they can receive both VHF and UHF signals. I strongly urge its passage as the most economical and practical method of broadening the range of programs available. This step, together with the Federal aid for construction of educational television stations which is nearing final passage by the Congress, will speed the full realization of television's great potential.

(D) Strengthen law promoting competition and prohibiting monopoly

The most basic and longstanding protections for the right of consumers, to a choice at a competitive price, are the various laws designed to assure effective competition and to prevent monopoly. The Sherman Act of 1890, the Clayton Act of 1914, and many related laws are the strongest shields the consumer

possesses against the growth of unchecked monopoly power. In addition to the measure now nearing final passage which would provide subpena powers for civil as well as criminal antitrust investigations, several other improvements are needed:

(1) The Federal Trade Commission should be empowered to issue temporary cease-and-desist orders against the continuance of unfair competitive practices while cases concerned with permanent relief from such practices are pending before the Commission. Under the present law, smaller competitors may be driven into bankruptcy or forced to accept merger on adverse terms long before present remedies become effective, thus reducing the competitive safeguards vital for the consumer. Similarly, deceptive trade practices in consumer goods may do their damage long before the Commission can "lock the barn door." I, therefore, reiterate my previous recommendation that the Congress give prompt consideration to effective legislation to accomplish this purpose.

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(2) The consumer's right to a reasonable price can also be adversely affected by mergers of two business firms which substantially reduce effective competition. As in the case of unfair methods of competition, damage once done is often irreparable, and the Government, acting through the courts, cannot readily restore the degree of competition existing prior to the merger. cordingly, I strongly recommend enactment of legislation to require reasonable advance notice to the Department of Justice and to the appropriate commission or board of any merger expected to result in a firm of substantial size. This will enable the businessman to obtain advice in advance, without litigation. as to whether a proposed merger would be regarded as contrary to the public interest. In addition, along with the recommended authority for the FTC to issue cease-and-desist orders, it is an essential safeguard against combinations which might cause unwarranted increases in consumer prices. (3) In view of the potentially anticompetitive abuses to which the use of patents and trademarks are by nature subject, I recommended

Enactment of legislation requiring publication of the terms of all settlement agreements between different persons applying for patent rights on the same invention-for recent hearings have shown that such agreements may include features designed to weaken future competition at the expense of the consumer; and

Enactment of legislation authorizing the FTC to apply for the cancellation of any trademark which is, or becomes, the common descriptive name of an article and thus should be in the public domain.

While a competitor has such a right today, it is important-if the FTC is to have clear authority to halt this kind of unfair commercial advantage-that the Senate insert this provision in its review of trademark legislation (H.R. 4333) already approved by the House.

(E) "Truth in packaging"

Just as consumers have the right to know what is in their credit contract, so also do they have the right to know what is in the package they buy. Senator Hart and his subcommntitee are to be commended for the important investigation they are now conducting into packaging and labeling practices.

In our modern society good packaging meets many consumer needs, among them convenience, freshness, safety, and attractive appearance. But often in recent years, as the hearings have demonstrated, these benefits have been accompanied by practices which frustrate the consumer's efforts to get the best value for his dollar. In many cases the label seems designed to conceal rather than to reveal the true contents of the package. Sometimes the consumer cannot readily ascertain the net amount of the product, or the ratio of solid contents to air. Frequently he cannot readily compute the comparative costs per unit of different brands packed in odd sizes, or of the same brand in large, giant, king-size, or jumbo packages. And he may not realize that changes in the customary size or shape of the package may account for apparent bargains, or that "cents-off" promotions are often not real savings.

Misleading, fraudulent, or unhelpful practices such as these are clearly incompatible with the efficient and equitable functioning of our free competitive economy. Under our system, consumers have a right to expect that packages will carry reliable and readily usable information about their contents. And those manufacturers whose products are sold in such packages have a right to expect that their competitors will be required to adhere to the same standards. Upon completion of our own survey of these packaging and labeling abuses, in full cooperation with the Senate subcommittee, I shall make recommendations as to

the appropriate roles of private business and the Federal Government in improving packaging standards and achieving more specific disclosure of the quantity and ingredients of the product inside the package in a form convenient to and usable by the consumer.

As all of us are consumers, these actions and proposals in the interest of consumers are in the interest of us all. The budgetary investment required by these programs is very modest-but they can yield rich dividends in strengthening our free competitive economy, our standard of living, and health, and our traditionally high ethical patterns of business conduct. Fair competition aids both business and consumer.

It is my hope that this message, and the recommendations and requests it contains, can help alert every agency and branch of Government to the needs of our consumers. Their voice is not always as loudly heard in Washington as the voices of smaller and better organized groups-nor is their point of view always defined and presented. But under our economic as well as our political form of democracy, we share an obligation to protect the common interest in every decision we make. I ask the Congress, and every department and agency, to help in the fulfillment of that obligation.

THE WHITE HOUSE, March 15, 1962.

JOHN F. KENNEDY.

Instant coffee prices

(Survey conducted by Bernard Fensterwald, Jr., Arlington, Va., Jan. 5, 1962)

CALIFORNIA LAW CREATING THE OFFICE OF CONSUMER COUNSEL

(Enacted by the California Legislature and approved by Gov. Edmund G. Brown, the law went into effect September 18, 1959; Mrs. Helen Ewing Nelson was appointed October 2, 1959)

Chapter 1, part 2, division 3, title 2, article 5, Government Code, State of California Consumer Counsel.

12050. There is in the office of the Governor a Consumer Counsel who shall be appointed by the Governor and shall serve at his pleasure.

12051. The Consumer Counsel shall receive a salary as fixed by the Governor but not to exceed fifteen thousand dollars ($15.000) per year.

12052. The Governor may also appoint and fix the salaries of such assistants and employees for the Consumer Counsel as the Governor may deem necessary. Such salaries shall be fixed as nearly as possible to conform to the salaries established by the State Personnel Board for classes of positions in the State civil service involving comparable duties and responsibilities.

12053. The Consumer Counsel shall advise the Governor as to all matters affecting the interests of the people as consumers. The Consumer Counsel shall recommend to the Governor and to the Legislature the enactment of such legislation as he deems necessary to protect and promote the interests of the people

as consumers.

12054. The Consumer Counsel in carrying out his functions under Section 12053, shall make such studies as he deems necessary, or as directed by the Governor, and may render reports thereon from time to time to the people of the State.

12055. In carrying out the provisions of this article, the Consumer Counsel may

(a) Appear before governmental commissions, departments, and agencies to represent and be heard on behalf of consumers' interests.

(b) Cooperate and contract with public and private agencies for the obtaining of statistical surveys, printing, economic information, and such similar services as may be necessary and proper.

(c) Do such other acts as may be incidental to the exercise of his powers and functions as conferred by this article.

12056. Each agency, officer, and employee of the State shall cooperate with the Consumer Counsel in carrying out his functions under this article.

12057. The Governor, by executive order, may create such advisory committees as he deems necessary to assist the Consumer Counsel in carrying out his functions under this article. The Governor shall appoint the members thereof and they shall serve at his pleasure. The committees shall be under the direction of the Consumer Counsel. The members of such advisory committee shall receive no compensation for their services except that they shall receive their actual and necessary expenses incurred in the discharge of their duties.

B

SHOPPING SURVEY INSTRUCTIONS

1. Please go to the market named on the card given to you by your survey leader. Buy one each of the items listed on the next page. The purchases must be made at this store only, on Thursday or Friday, January 25 or 26.

2. For each item, buy the one that gives you the largest quantity of product for the least amount of money. Make your selection solely on the basis of the largest quantity of each product for the lowest price.

3. Take you wristwatch and note on the attached page the time you entered the store and the time you reached the checkout stand.

4. Turn your purchases and sales check over to your survey leader. You will be reimbursed in full for your purchases.

5. Please do not buy any other items except those listed while on this shopping trip. In other words, don't do any family shopping.

6. Please do not discuss this survey with anyone except your survey leader. Thank you for your cooperation.

SHOPPING LIST FOR SURVEY

Please buy one each of the items below. Choose the one in each category that gives you the largest quantity of product for the least amount of money. You may buy any size of each item available in the store (multiple banded packages, large, small, etc.) as long as you consider it the largest quantity for the lowest price.

You may buy any brand as long as you consider it the largest quantity for the lowest price.

Rice (any type of white rice except the precooked kind).

Solid-pack canned tomatoes.

Hot cereal.