NAAG, NAAG, NAAG
State attorney general used to be a fairly mundane job. Attorneys general spent their time advising the governor and legislature on legal matters and hoping for a colorful crime to prosecute. Now, however, some attorneys general are trying to redefine their role, banding together to police the nation's businesses.
They've hectored airlines to be more specific in advertising special fares and frequent-flier programs. They've interfered in corporate mergers, trying to enforce guidelines far stricter than those set by federal regulators. And they've threatened to regulate advertising of aspirin and used cars.
Led by high-profile attorneys general such as John Van de Kamp (D–Calif.) and Robert Abrams (D–N.Y.), the National Association of Attorneys General (NAAG) in 1987 set up guidelines regulating corporate mergers. These guidelines were, in most respects, far stricter than those used by federal authorities. The attorneys general also signed a compact agreeing to work together to enforce their rules. Even before the compact formally went into effect, the attorneys general of New Hampshire, Massachusetts, and Maine threatened a merger between Federated Department Stores and Campeau Corp., ultimately forcing Campeau to sell several Federated stores.
Last year, NAAG established guidelines for airline advertising, requiring airlines to go far beyond federally mandated disclosures on the terms of discount fares. The rules require, for example, that television ads disclose all restrictions and penalties on special fares by voiceover rather than a printed message on the screen. The attorneys general threaten airlines that don't meet their requirements with prosecution under state laws against deceptive advertising.
The attorneys general do have their critics. Business executives have charged them with prosecuting business to further their own political ends. Some have privately suggested that the NAAG rename itself the National Association of Aspiring Governors.
And William MacLeod, director of the Federal Trade Commission's Bureau of Consumer Protection, charges that the airline-advertising rules have actually hurt consumers. By requiring airlines to load so much information into their ads, they've discouraged price advertising. "Price advertising that formerly was driving the intense price competition in the deregulated industry has decreased," MacLeod told the Wall Street Journal. "That isn't consumer protection."
At least one attorney general isn't very pleased with his fellows. Writing in the Wall Street Journal, New Mexico's Hal Stratton (R) charged, "Some ambitious, high-profile attorneys general are working feverishly to move the organization away from its traditional role as a forum and clearinghouse and turn it into a shadow Congress that would dictate national law in many areas of business regulation. They are using the cover of consumer protection to impose their own anti-business, pro-government regulation views on the entire nation and are bypassing the legislative process."