When I go, I think I want to go like Donny.
Cremate me. Stick my ashes in a Folger’s can. And scatter them over the ocean in a high wind.
Rail about the Vietnam War, and cover the Dude in my ashes if you want. But these things are optional.
I won’t care, anyway. I’ll be dead.
The famous—or infamous—scene from the Coen brothers’ “The Big Lebowski” came to mind when I read my MarketWatch colleague Jessica Hall’s latest article on funeral prices.
The government, in the form of the Federal Trade Commission, is thinking of updating the rules so that funeral homes have to post their prices online. The original rules on price disclosure were written before the internet. You can send them your comments here.
There really isn’t any good argument against this. It’s just price disclosure.
“We’re 100% in favor of transparency,” Christopher Farmer, the general counsel of the funeral industry’s trade association, told Hall. “But we do not believe a rigid federal rule is the way to accomplish this.”
That, of course, makes no sense. But then no industry is really “100% in favor of transparency.” In a free market, their job is to make money. Comparison shopping is the responsibility of the consumer.
In the movie, Donny ended up in the Folgers can because Jeff Lebowski and Walter Sobchack (Jeff Bridges and John Goodman) objected to paying $180 for an urn when all they wanted to do was scatter the ashes anyway.
They ask if they can rent the urn.
The director replies that “it is our most modestly priced urn,” and that prices go up to $3,000.
The gag in the movie is that hardly anybody is actually going to haggle in a funeral parlor. It’s a moment when we are almost uniquely vulnerable. You’re bereaved. And even if you aren’t suffering with grief, it would be too embarrassing. Who wants to look like a cheapskate at a time like this?
This is why people spend $10,000 on funerals.
It’s why, according to the FTC’s own findings, 61% of funeral homes post no prices on their website, and even the ones that do rarely include things like starting prices or an itemized list.
And it’s why the price of cremation varies from funeral home to funeral home by a factor of nearly 10. Some charge $595. Some charge nearly $5,000. (Are you kidding me?)
And that, of course, is the point of regulations like this. Requiring companies to post prices online is about the lightest touch regulation you can get. You’re not telling them what they can charge. You’re simply making sure the customer knows the price well in advance, before they are under any pressure to buy.
I can’t see why any honest and ethical funeral director would object. And if we assume that most of them are honest and ethical, then surely most of them would have no problem with this new rule.
All in all, it’s surprising that the industry doesn’t make more money. There are a handful of funeral companies on the stock market, and a quick review shows that most of them have been pretty mediocre investments. The sector has underperformed the broad S&P 1500 index
over 10 years and five, in most cases by a significant margin. (The exception has been Service Corp. International
an $11 billion funerals-and-cemeteries operation based in Houston.)
Sure, I’m not a fan of endless federal regulations. (I think we should have a policy of “one in, one out.” Every time we come up with a new one that makes sense, we should get rid of one that doesn’t. There are plenty out there.) But this is a simple rule that makes total sense. One wonders why we even need a consultation period.
On reflection I think I’d prefer to go in a “Chock Full o’ Nuts” can instead of Folger’s. I just like the name.