Tallying up the 100-day scorecards for Obama

Even as they decried the 100-day mark of President Obama’s administration as an artificial benchmark, analysts were busy toting up the grades.

There's plenty of ground to cover. A lot has happened since Inauguration Day in January, with passage of a $787 billion economic stimulus plan, announcement of mortgage help for homeowners, the outline of a plan to help stabilize the economy, and intervention from banks to insurance companies to the auto industry.

The 100-day assessments have been mostly positive. But one report card delivered on Wednesday was sobering: The government's own quarterly numbers showed surprisingly low economic activity for the period of January-March 2009, pretty much coinciding with the 100 Days. In other words, we are not out of the woods by any measure, and there's a lot of work to do.

Economy still very slow
Bloomberg News said the 6.1 percent drop in the economy reported on Wednesday was a stark reminder that we are still in the worst slump in 50 years.

Obama says an era has ended
In a coming article for the Sunday magazine of the New York Times, the President says "I actually think that there was always an unsustainable feel about what had happened on Wall Street over the last 10, 15 years."

Poll ratings stay up
The Wall Street Journal says that President Obama continues to enjoy high popularity ratings, according to the latest Wall Street Journal/NBC News poll: 61% of people approve of the job Obama is doing as president.

Below the radar
The Huffington Post offered up 10 achievements you didn’t know about, including the observation that The Obama White House cleared an important hurdle in the health care reform debate when it appropriated $19 billion in the stimulus package to help implement an electronic medical record system.

Report cards at a glance
The Washington Post’s 44th Presidency blog says that most of the report cards have been favorable.

Swine flu spawns unusual travel refund policies

Travelers booked for Mexico, the epicenter of the current swine flu outbreak, are getting some unusually lenient treatment from several airlines and tour operators: reduced or waived penalties for changes in travel plans. That seems to signal the seriousness of the epidemic in Mexico, as well as the poor health of the travel industry, which can ill afford to anger consumers as the recession wears on and traffic slumps.  

American, JetBlue, United and other big U.S. airlines will let travelers going to, from, or through Mexico change their destinations or travel dates without penalty or increased fares for the same type of discount ticket. At least two big tour package operators—MLP, which operates tours for Continental, Delta, and Northwest, and Apple Vacations—are allowing their customers do the same. Contact your airline or travel agent for specific limitations.

In general, that preserves the value of the travel that was purchased, but you won’t get a cash refund. Nevertheless, this is a big departure from standard cancellation policies. “The only other time I’ve seen blanket change policies like this has been during hurricane warnings,” says JoAnne Kochneff, a 20-year travel agent at Travel by Gagnon in Grand Rapids, Mich.

Most consumers buy non-refundable airline tickets. When you change or cancel those, you get a travel voucher for future travel on the same carrier, minus itinerary change penalties of $150 for domestic travel and $250 for international, plus you pay any higher fare on the new flight. With tour packages, you typically pay at least 30 days in advance and get zero refund if you cancel or want to change plans.

So far, cruise lines have not announced similar give. Travelers usually pay in full for a cruise 60 to 75 days in advance, and get no refund if they cancel or change plans. Today, however, when three Carnival Cruise ships failed to call on their scheduled Mexican ports, the cruise line gave passengers a mere $20 credit. A Carnival spokeswoman told us the company is working on a cancellation/change policy related to the recent Centers for Disease Control Travel Health Warning, which recommends the postponement of non-essential travel to Mexico. The Cruise Line International Association has not returned a call for comment.

Extraordinary circumstances aside, in most cases, your contract, not law or regulation, governs trip cancellations and changes, and there are few consumer protections, says Alexander Anolik, a San Francisco travel law attorney and author of Traveler’s Rights ($21.95, Morris Publishing). “A health warning from the government is only a warning and does not negate any contractual obligation you have,” says Anolik. Only a government action preventing you from travel to your destination provides sufficient force majeure to allow you to break your contractual obligation without penalty.

What can you do if that never happens and your travel provider doesn’t volunteer a more flexible cancellation/change policy for travel to Mexico or elsewhere in the future? Here are some strategies:

• Try to negotiate a break. If you’re a frequent traveler or affinity club member, remind customer service about the value of your business, which can be taken elsewhere.
• Book through a travel agent. Because they regularly bring volume business to the same companies, they can use their added clout on your behalf and often have access to special customer service people who can bend the rules.
• Don’t be tempted by trip cancellation insurance. Standard policies don’t protect against the present circumstances. ‘Termination-at-will’ policies might cover this situation, but they’re very expensive and difficult to get.—Jeff Blyskal

For  more on the swine flu outbreak, see the CR Health Blog.

Bailout Watch #13: Drivers for Capital One execs

Richard Fairbank, chief executive officer of Capital One, had home security expenses of only $771 but the bank also classified as a security expense $46,278 for his personal use of a driver. 

Other Capital One executives received similar perks. Lynn Pike, president of banking, received $2,510 for home security and $2,589 for personal use of driver. Home security system costs totaled $2,451 for John Finneran, general counsel and coporate secretary, and $1,237 for Peter Schnall, chief risk officer. For Gary Perlin, the bank’s chief financial officer, however, no home security expenses were paid. Capital One received $3.6 billion in government bailout funds.—Andrea Rock 

Rising to the supermarket savings challenge

Call us a bunch of lab geeks, but we love testing things here at Consumer Reports. So when a producer for San Francisco KGO-TV’s “7 On Your Side” called to see if I’d be willing to take its supermarket savings challenge, I jumped at the chance. 

KGO pitted me against Andrea O’Brien, an avid Consumer Reports reader who follows the supermarket saving advice that Tightwad Tod Marks has been dispensing for years, including his latest installment in the May 2009 issue.  

When I arrived at O’Brien’s San Jose, Calif., home to get the list of groceries and prices that I was supposed to beat, I was impressed to learn that this savvy shopper had already used her Safeway Club discount card to lop $30.95 off the $120.56 she might have otherwise paid. She got her weekly shopping bill down to $89.61. This was going to be a tough challenge.

As it turned out, I was able to knock another $18.05, or 20 percent, off O’Brien’s bill, as shown in the video report here. I got the bill down to $71.56 in large measure by shopping at three stores that Consumer Reports has top-rated  for low prices: Costco, Wal-Mart, and Trader Joe’s. In a couple of instances on my item-by-item shopping list (PDF), I bought in bulk; to correctly calculate my and O’Brien’s prices on an equivalent basis, I multiplied the lower unit prices that I obtained by the number of ounces, pounds, cups, or square feet that O’Brien purchased. 

But KGO-TV news anchorman Dan Ashley raised a good question: How much extra time did that take me? I spent 86 additional minutes inside Costco, Trader Joe’s, and Wal-Mart to obtain $18.05 in savings. That works out to $12.62 per hour, a pretty good return if your goal is to cut costs. That doesn't include drive time between stores, two of which were just down the road from Safeway. You’ll have to calculate that time, and its value to you, based on your own location and circumstances. However, consumers often visit stores like Costco, Trader Joe’s, and Wal-Mart for favorite store brands, bulk quantities, or known savings—or just because they like strolling the aisles. So it may not be strictly appropriate to consider the drive- and store-time, or at least not all of it, as an extra cost of saving.—Jeff Blyskal 

Bailout Watch #12: Secured parking for Bank of America exec

Bank of America, the recipient of $45 billion in taxpayer bailouts, recently announced it is raising interest rates for millions of U.S. cardholders who carry balances. As of year-end 2008, Bank of America had $166.3 billion in outstanding credit card balances, ranking second only to JPMorgan Chase, with $183.3 billion, according to The Nilson Report, a newsletter covering the credit card industry. 

While tough times apparently dictate extracting more cash from its customers, the bank nevertheless remains generous with perks to its top executives, as we pointed out last month. 

Following its tradition in past years, the bank also picked up the tab for security-related costs on behalf of its highest paid execs in 2008. CEO Kenneth Lewis received $13,791 to cover home security and secured parking costs. For other top-paid officers, here’s what employer-paid security expenses came to: 

• Joe Price, chief financial officer: $10,136.
• Barbara Desoer, president of Bank of America’s Mortgage, Home Equity and Insurance Services: $13,099.
• Liam McGee, president of Consumer and Small Business Banking: $4,856.

—Andrea Rock

A retirement plan for the suddenly self-employed

The recent economic turmoil has not only lengthened the lines at unemployment offices, it has also added to the ranks of the (at least temporarily) self–employed. Many people who once counted on a regular paycheck from a single employer are now trying to cobble together an income from freelance projects, consulting, and other kinds of odd jobs.

If you find yourself among the suddenly self-employed, it can be a scramble just to make ends meet, let alone save for the future. Believe me, I’ve been there. However, if you reach a point where you have any extra money to tuck away for retirement, there’s a very easy way to do it.

That’s the Simplified Employee Pension or SEP-IRA. With a SEP, you can save as much as 25 percent of your work income, or $49,000, whichever is less. Those contributions are tax-deductible, just as they are with a traditional IRA (though the latter restricts you to smaller maximum contribution).

The rules on SEPs are detailed in IRS Publication 560. The big mutual fund companies also have info on their Web sites—and you can be sure they’d be more than happy to help you set up an account. —Greg Daugherty

Greg writes the “Retirement Guy” column each month in the Consumer Reports Money Adviser newsletter.

Identity theft update

Since sharing my story earlier this month as the victim of identity theft, many readers have asked whether the IRS has gotten any closer to resolving the protracted mess. Just to recap, some scoundrel filed a phony 2007 Federal tax return with my name and Social Security number on it, seeking a refund check for thousands of dollars. The return had a mailing address for an apartment in New York City. 

Bailout Watch #11: Company car perks

As we reported in a previous post, corporate perks for top executives at financial corporations often include paying for home security systems and a company car and driver, which sometimes is categorized as a security measure. 

At Bank of New York Mellon, which has accepted $3 billion in taxpayer funds, the company's highest-paid officers received significant amounts in both perk categories. Here are the amounts reported in the company's filings for its top executives: 

• Robert Kelly, chair and CEO: $4,577 for home security. 
• Thomas Gibbons, chief financial officer: $149,835 for use of company car and driver.
• Gerald Hassell, president: $189,959 for use of company car and driver.
• Steven Elliott, senior vice chair: $110,854 for use of company car and driver plus $1,102 for home security.
• Thomas Renyi, former executive chairman who retired in July 2008: $98,203 for a company car and driver; $796 for home security.

—Andrea Rock

My afternoon at BJ’s

Because it’s not a national chain, BJ’s Wholesale sometimes gets short shrift in our coverage of warehouse clubs. Compared to the 800-pound gorillas of the industry, Costco and Sam’s Club, BJ’s Wholesale is a regional operator, though definitely a player, with 180 stores in 15 states in the Eastern U.S. By contrast, Sam’s and Costco have about 600 and 550 stores, respectively.

So when I heard about BJ’s free two-month trial membership offer last week, I took the opportunity to visit and assess some differences and similarities between the New England-based club and its key competitors.

Bailout Watch #10: CEO secure at American Express

It would be hard to top the money American Express laid out to ensure the security of its CEO Kenneth Chenault in 2008. He received $200,898 in company-paid expenses for a home security system. By contrast, such costs for Edward P. Gilligan, vice chairman, were only $1,609, while Amex spent $4,510 to secure the home of Alfred F. Kelly, president. Daniel Henry, the company’s chief financial officer, received no home security allotment, and only $513 was paid on behalf of Stephen J. Squeri, executive vice president, corporate development and chief information officer. 

But the home security system was just one sliver of Chenault’s overall security expenses. Amex paid nearly $46,000 for his “security during personal trips” plus “local travel” payments totaling $134,299 for the CEO’s personal use of company-owned cars, and another $414,702 for his personal use of company aircraft. The footnotes in the company's financial filings explain that American Express' security policy requires the CEO to use company-owned aircraft and autos for personal as well as business travel. 

The company has received $3.4 billion in federal bailouts. It ranks as the nation’s largest credit card issuer based on charge volume, which totaled $457.2 billion, up 2.4 percent in 2008, according to The Nilson Report, a newsletter covering the credit card industry.—Andrea Rock