Who Do You Trust?

Judy Fischer was frustrated by how hard it can be to tell the good guys from the bad guys on the World Wide Web. So she decided to start an organization called the Web Assurance Bureau that would log consumer complaints and develop a seal of approval for ethical companies. After sketching her business plan, Fischer doled out $277 to a cheap online software dealer with a reputable-looking home page and a money-back guarantee.

The software soon arrived in the mail. But it didn't work. And the dealer that had sold it no longer existed. No web page, no address, no recourse for Fischer, and certainly no money back. She called the Federal Trade Commission (FTC), but no one knew where the company had gone, where it had come from, or, indeed, that it had ever existed. It had taken Fischer's money and vanished into cyberspace without leaving a footprint.

The driving logic of the Net has been to eliminate the middleman, like your doctor and the drugstore clerk. But informed, relatively disinterested middlemen are often central to consumer protection, and to eliminate them is to destroy an important safeguard. As one crafty scoundrel who had defrauded customers in an online auction wrote, "Ha Ha Ha Ha. All you people are really quite ridiculous. You make a deal via e-mail, never see the person, never speak with the person, and then get upset when you get ripped off. You must be a bunch of morons."

As one crafty scoundrel wrote, "Ha Ha Ha Ha. All you people are really quite ridiculous. You make a deal via e-mail, never see the person, never speak with the person, and then get upset when you get ripped off."

Although the Internet has made products cheaper and information more accessible, it can also extend society's lowest standards, from Matt Drudge's unsubstantiated mudslinging to fly-by-night software companies. Moreover, as the Net has become increasingly unruly and inscrutable, Congress and the Clinton administration have made little effort to protect consumers. After writing the report that shapes the central organizing principles for the Clinton administration on Internet issues, special adviser Ira Magaziner emphatically declared, "The Internet doesn't need government."

But it does. The Internet under Magaziner and Clinton's genial permissiveness would be like New York City without stoplights.

Perhaps the clearest way to see the threat that flat-out unregulated commerce poses to consumers is to log on to one of the nearly 400 drugstores that have appeared on the Internet in the past few years. Visiting many of these sites is like going to Tijuana, except better: You can get almost anything you want without having to worry about paying for the gas to drive to the border. Is your doctor reluctant to prescribe a pill that you just know you need? Log on, order, pop it in your mouth, and rock 'n' roll.

The Food, Drug and Cosmetic Act of 1938 requires that a patient consult a licensed doctor before getting a prescription filled, but, as with most laws, Internet companies can dodge it. Customers fill out a generic form online that some staff doctor looking for a little extra dough just has to rubber stamp: no physical exam, no waiting rooms, no blood tests.

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