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Dec 12, 2010

What Are AARP's Values?

From a 2005 Businessweek article:
In Washington, an entity's power can be measured by the vehemence of the attacks it draws. By that standard, AARP may be outmuscled only by the White House in the slugfest over restructuring Social Security. ...

AARP's role in the Social Security debate has focused new attention on the hundreds of millions of dollars the group makes by endorsing and co-branding health insurance, financial products, and travel services that are sold to its members. ...

Just as important is the question of whether a group that makes millions selling financial services to its members is quite as impartial a player in the debate over private accounts as it would appear. ...

[I]t is equally clear that AARP makes a substantial sum of money from its partners' sales of mutual funds and other investment products to members. That raises the appearance of a potential conflict of interest. Whatever version of reform passes -- whether Bush's accounts carved out from payroll taxes, or the "add-on" accounts that many liberals favor to encourage retirement savings -- the overhaul is likely to create new markets and opportunities ...

AARP officials reject the criticisms. The organization's marketing "does not in any way influence AARP's public policy positions," says Dawn M. Sweeney, president of AARP Services Inc., the for-profit subsidiary that manages AARP's co-branding deals. ...

Still, the scale of AARP's commercial activities is enormous. The nonprofit is one of the nation's most aggressive in selling its name to marketers of financial and travel products. In 2003, the latest year for which financial reports are available, AARP collected $300 million -- or 39% of its $770 million in revenue -- by co-branding ...

If critics have focused on its policy role, AARP has received less scrutiny for the quality of its products. Many of the funds and insurance policies that AARP markets provide considerably less benefit than seniors could get on their own, a BusinessWeek analysis reveals. ...

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  • 2 Comments:

    Anonymous Anonymous said...

    I do not see any real conflict. There is no question AARP is involved in marketing various products. Some are worthwhile and some are not. Their medicare drug plan is very competitive per the medicare site. The plan may not be for everyone especially if you are not taking drugs. The supplement for medicare plan is just so so. Other products also require personal evaluation. Still they market for what is in place. What I mean is I do not see that as a conflict anymore then attorneys who obtain most of their income from insurance companies cannot fairly handle claimants (I handle workers comp and SSD cases). In policy mode they have been excellent in looking at matters for seniors and also those on SSD. Take a look at their website and see if they are, in any way, not straight in their expressed views. Having the ability to marshall many people/voters is vital in an age when everyone prefers to cut benefits and tamper with the existing system to the harm of those on it. On policy no conflict though I could say there is a conflict when they tout their products over others by taking advantage of their members.

    10:20 PM, December 12, 2010  
    Blogger coco GREEN said...

    Good arguement.

    3:52 AM, December 13, 2010  

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