Madison Avenue v. the FTC

Advertising men, articulate by nature, are increasingly disturbed by their most articulate critics. They could live with the sniping Harvard professors so long as their words were eloquent but unofficial. But the admen fear the professors' presence in the Kennedy Administration; they fear Democratic Administrations in general. And in particular they view Presidential Assistant Arthur Schlesinger Jr. as a sort of bogeyman because back in 1960 he proposed--halfheartedly, he says now --a tax on advertising.

With Schlesinger and fellow Critic John Kenneth Galbraith currently on duties remote from advertising, there is another man in Government whom Madison Avenue is becoming nervous about. He is the Federal Trade Commission's aggressive new chairman, Paul Rand Dixon, 48.

Instant Justice. Worrying the ad community is the FTC's recent cease-and-desist order against Colgate-Palmolive Co. and its hard-selling agency, Ted Bates & Co. In a Bates TV commercial, Palmolive's Rapid Shave cream was applied to "sandpaper," and the sand was shaved cleanly off. But Dixon's FTC found Bates had used Plexiglas instead of sandpaper and that sand was not in fact shaved off the real thing. The FTC then ordered that Colgate and Bates should never again falsely advertise shaving cream or use "spurious mock-ups or demonstrations for any product."

The "for any product" phrase amounts to a permanent and unspecified threat of punishment, says the general counsel for the Association of National Advertisers, Gilbert Weil, who insists that "Colgate and Bates should be entitled to their day in court on each new charge without facing a penalty." As now defined by the FTC, any future misdeeds can be considered as violations of the existing injunction and carry a punishment of up to $5,000 a day. The FTC's Dixon concedes that the ruling is uniquely broad, but he also contends that "all we are ordering them to do is to obey the law." Admen are also concerned about Dixon's request for power temporarily to halt publication of any ads that he considers "out-and-out frauds"--before the advertisers have had a chance to plead their cases fully to the FTC.

Not all admen condemn the FTC out of hand. Says Fairfax Cone, chairman of Foote, Cone & Belding: "The industry cannot police itself; it never could. The FTC is reaching for more authority to do what it is supposed to do." Even blunter is Dr. Max Geller, president of New York's Weiss & Geller agency, who says, "Agencies don't get paid for sticking to principles. If a company wants to go haywire in its claims, the agency either goes along or loses the account. Agencies need the moral crutch of Uncle Sam's regulations to resist the pressure of clients in this Darwinian jungle."

Over-Reacting. But so many admen are exercised over what they consider federal threats to repress them that delegates from no fewer than 17 advertising trade groups will troop to Washington next week to lay their fears before Commerce Secretary Luther H. Hodges. There are some who think that admen are overreacting to criticism, and thereby lending weight to it. Says Batten, Barton. Durstine & Osborn's President Charles Brower: "Somebody does a survey that shows that nobody wants to live next door to an advertising man, and they all start running up and down the walls. Advertising is going through what just about every other profession has gone through. Lawyers used to be called shysters. Doctors used to be called quacks. But they managed to live through it. Advertising's worst sin is that it has become interesting to people."

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