CPSIA – Making It Up as We Go Along

743 days have passed since ANY Democrat in Congress did ANYTHING to help us on the CPSIA. There are 68 days left until Election Day.

The CPSC today whacked education company Lakeshore Learning Materials with a recall of Magnetic Maze products. This recall involved 18,500 units of a total of five products sold over a 18-month period. Was this recall justified? Well, anything goes these days but consider the facts:

There have been no reported injuries from this “hazard” – namely loose magnets. The company has received ten reports of loose magnets. The CPSC sums up the “hazard” this way:

“The magnetic maze board’s plastic wand can separate and expose a magnet that can be a choking hazard to children. Also, if a child has more than one of these toys and the magnets detach and are swallowed, the magnets can attract each other and cause intestinal perforations or blockages, which can be fatal.” [Emphasis added]

Before we unpack this baloney, please consider for the umpteenth time where the CPSC’s LEGAL BASIS for issuing a recall comes from. The authority to recall consumer products derives from the FHSA which restricts the agency’s authority to “imminent hazards”. Section 12(a) of the FHSA provides this definition: “As used in this section, and hereinafter in this Act, the term ‘imminently hazardous consumer product’ means a consumer product which presents imminent and unreasonable risk of death, serious illness, or severe personal injury.” [Emphasis added]

So the CPSC must reach the legal conclusion that this product creates an IMMINENT AND UNREASONABLE RISK of death, serious injury or severe personal injury to order a recall. Did they meet that standard here?

The CPSC provides two explanations for this recall, namely small parts/choking hazards and intestinal perforations from ingestion of magnets. Of course, the latter hazard is derived from a fear of Magnetix, a notorious recall in the bad zone of 2007/8. There is no indication that these magnets were strong magnets as found in the Magnetix product.

A quick glance at this product confirms that the product is DESIGNED with small parts. These products were certainly tested for compliance with law (we know these folks well, and they are exemplary corporate citizens who are exceptionally careful about legal compliance and safety). Therefore, the assertion that the presence of small parts in this product somehow constitutes a violation of law or good practice just doesn’t hold water. I could use stronger language, but I think this is a nonsense excuse.

And what about intestinal perforations? That’s pretty icky, shouldn’t we be intolerant of loose magnets? Well, the CPSC states the conditions under which these magnets could be a problem:

Step 1: The child must have more than one recalled product. [You need two products to have two magnets! There are 18,500 defective units in the world, let's not forget - a total universe of 18,500 magnets.]

Step 2: TWO magnets must fall out, one from each unit. [Ten loose magnets in the world are known. As noted above, there is no indication that these magnets are dangerously strong enough to perforate anything. A niggling detail?]

Step 3: An idiot child must choose to EAT these two yummy loose magnets in one sitting.

This has never happened, apparently. Could it happen?

This is well-beyond farfetched, but there you go. At today’s CPSC, the agency is apparently no longer permitted by the politicians who run the place to reason or to assess any form of risk. If the risk can be put into words, that seems to make it real enough to punish any company severely. No doubt this recall exposes Lakeshore to grievous penalties, too. And for what? Can anyone make the case that this makes anyone ACTUALLY safer? And, call me picky, but is this a case of “imminent and unreasonable risk of death, serious illness, or severe personal injury”? I believe this speaks for itself – the answer is no.

Remember, these regulators work for us, the citizens of this country. As the regulators confuse and scramble the expectations of industry and consumers, as they disregard their enabling legislation to chart a path that makes sense only to them – something important is lost. Is that acceptable? Not to me. Remember this on November 2nd. Let’s hope it’s not too late by then.

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CPSIA – Making It Up as We Go Along

CPSIA – Illinois Politics in the Gutter

742 days have passed since ANY Democrat in Congress did ANYTHING to help us on the CPSIA. There are 69 days left until Election Day.

After two years of banging my head against the wall on the CPSIA, it has become clear that much of the problem is in Congressional leaders from two states, California (Waxman, Boxer, Feinstein) and Illinois (Durbin, Rush, Schakowsky). [I hope I'm not forgetting any other "worthies".] I live in Illinois. The fact that our state is part of this disaster is no surprise. I get to follow the local political goings-on in the paper and on the Internet. Of course, people talk, too. We sure know how to pick ‘em in Illinois . . . .

I think it’s well-known that I am not a big fan of Ms. Schakowsky for her cheerleading for the noxious CPSIA and her leadership of the gang that stymied any effort to fix that awful law and its regulatory by-products. And it’s hard not to be utterly disgusted by her legislative agenda, which earned her the rank of NUMBER ONE SPENDER IN CONGRESS and which has been a job-killer of the first order. She provides many reasons to dislike her passionately . . . but did you also know that her husband is a FELON? As a lawyer, I have very little sympathy for felons. One never becomes a felon by accident. [As a matter of fact, the prospect of being accused of a felony under the CPSIA is one of my hottest "hot buttons" as I deeply resent that our government could make something that inappropriate possible under federal law.]

Yes, in fact, Schakowsky’s husband is a crook. Robert Creamer was convicted of financial crimes in 2005 (check kiting and tax evasion, a $2.3 million fraud committed against nine financial institutions to fund his salary, among other things) while Schakowsky was a sitting member of Congress, served five months in the pokey for his felonies and then was placed under house arrest with his member of Congress spouse for 11 months. Perhaps you think this is some sort of Illinois sitcom or perhaps a new kind of reality show. Here is Creamer’s jail release record, if you are curious.

Creamer’s criminal record is absent from his bio, interestingly enough. Anyone shocked to learn that Creamer was an important advisor to our very own Governor Blagojevich, a fellow felon? Creamer has quite a business going as a political consultant – Democrats from all over the country clamor for his help. Hmmm.

And the Illinois sewer continues to spew to this very day. Mr. Creamer, who was a critical thought leader and trainer for the 2008 Obama campaign (Obama is another Illinoisan with a CPSIA taint), is now apparently part of Democrat Alexi Giannoulias’ campaign for Senate against Mark Kirk. Here’s a still of Alexi Giannoulias posing with Mr. Creamer:

Also conversing with Mssrs. Giannoulias and Creamer is lobbyist Larry Suffredin. Here’s what Wikipedia says about his lobbying practice: “Suffredin is a registered lobbyist with Cook County, the City of Chicago, and the State of Illinois. Suffredin lobbyist clients include resort and casino company MGM Mirage, owners of the Grand Victoria Casino in Elgin, Illinois, and Penn National Gaming, owners of the Hollywood Casino, Aurora, Illinois, the Illinois Alliance of Competitive Telephone Companies, the Donors Forum of Chicago, the Illinois Arts Alliance, and Illinois Citizens for Handgun Control, the Chicago Bar Association, and Kankakee Regional Landfill LLC. He is also a registered lobbyist for Abbott Laboratories, Nursepower Services Corporation, and Quest Diagnostics.”

I assume the three of them were discussing the weather. “Pretty sunny out today, Bob.” “Larry, did you see that rain cloud as you drove in?” “Alexi, surely it won’t rain on your parade!”

This still is from a Giannoulias campaign video pitching an endorsement by Jan Schakowsky. Perhaps there are a few dots to connect here. . . . Giannoulias chats with Creamer at the 1:45 point in the video, check it out yourself:

An Illinois Senatorial candidate hanging out with a felon who stole from banks? Hey, isn’t that practically the very question that dogs Giannoulias in this campaign? How ironic! And then there’s the issue of members of Congress who consort with thieves. This is even more ironic given the Dems’ practice this year of viciously bashing banks and bank bailouts. Perhaps defrauding banks is okay, but keeping them afloat is not. there an odor in the room???

What integrity! How inspiring! Can’t wait to vote . . . .

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CPSIA – Illinois Politics in the Gutter

CPSIA – Cadmium Law Rammed Through in California

741 days have passed since ANY Democrat in Congress did ANYTHING to help us on the CPSIA. There are 70 days left until Election Day.

California State Senator Fran Pavley (hope you’re sitting down, she’s a Dem) rammed through the latest in state cadmium regulations, setting a 300 ppm limit on cadmium in children’s jewelry. This law, if signed by the CA Governor, will enable a barrage of lawsuits by consumer groups feeding off this kind of CA legislation. Zero lives will be saved, but plenty of jobs will be lost. We are already hearing of companies that are pulling out of California and more will follow. The craziness in California is basically unbearable at this point.

What really steams me about this law is Pavley’s VERY OWN PRESS RELEASE. Consider these quotes:

“Senator Pavley (D-Santa Monica) . . . is seeking a ban on the dangerous metal cadmium after learning that manufacturers are simply replacing lead with cadmium. ‘Cadmium is a known cancer causing agent and there is no reason for our most vulnerable citizens – our children – to be exposed to this highly toxic metal,’ said Senator Pavley. ‘These manufacturers are replacing one toxic metal for another when less toxic alternatives like zinc are available. It’s completely irresponsible to use cadmium in jewelry marketed to children.’”

“As an Assembly member in 2006, Pavley authored a law to ban the use of hazardous levels of lead, a powerful neurotoxin, in children’s jewelry. . . . However, a loophole in the law has allowed jewelry makers to substitute cadmium. Recent laboratory reports in the United States are now showing that the heavy metal cadmium is being used in place of lead. ‘It’s a shame that jewelry makers are using a loophole in the law to harm our children,‘ said Senator Pavley. ‘There is absolutely no excuse for manufacturers to use this dangerous agent in products for kids.’”[Emphasis added]

Let’s be clear about something – there is absolutely no publicly available information to suggest that anyone is substituting cadmium for lead in jewelry (or in any other children’s product). That’s pure urban legend. If there is such evidence, someone should put the evidence up for all to see. This is a LIE – during election season. Shocked? I’m not . . . I live in Illinois.

I have already thoroughly covered the fact that there are NO KNOWN CASES of cadmium poisoning in children from any consumer product – EVER. This makes me surmise that Ms. Pavley is either stupid or she’s a liar. One thing’s for sure, she doesn’t know what she’s talking about. But I’m sure her message of crisis “averted” is a good seller back in Santa Monica.

Oh, by the way, did you catch her recommendation that zinc be substituted for cadmium because it’s so much safer? Certainly we can trust the esteemed Ms. Pavley, a world-renowned toxicologist and metallurgist, right? Ummm, well, what about zinc poisoning? It’s pretty icky – here’s what you get with Ms. Pavley’s preferred way to kill kids:

• Body pain
• Burning sensations
• Chills
• Collapse
• Convulsions
• Cough
• Fever
• Low blood pressure
• Metallic taste in mouth
• No urine output
• Rash
• Shock
• Shortness of breath
• Vomiting
• Watery or bloody diarrhea
• Yellow eyes or yellow skin

Hey, this sounds much better than cadmium poisoning. Of course, neither will ever occur in children because of their contact with children’s products. After all, no one’s ever had the cadmium poisoning California wants to prevent. If no one’s ever had it . . . do we need to change anything to prevent it in the future? Do we need to know anything to make this judgment?

Nahhhh – besides I love zinc convulsions!

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CPSIA – Cadmium Law Rammed Through in California

CPSIA – EU Warns on Foreign Manufacturers Legal Accountability Act

738 days have passed since ANY Democrat in Congress did ANYTHING to help us on the CPSIA. There are 73 days left until Election Day.

The EU has served notice of its objections to Henry Waxman’s latest brainstorm, the Foreign Manufacturers Legal Accountability Act of 2010. This profoundly misconceived bill, championed by leftist consumer groups for its supposed benefits to consumers while ignoring the real problems likely to cripple commerce, has garnered increasing corporate interest in recent weeks. With more and more attention being given to persistent job losses and anemic (if any) economic growth, this bill seems suicidal. That apparently is no deterrent to our saviors, the Democratic majority in Congress. Reliable sources tell me that this bill will resume its relentless march toward law upon the return of Congress to Washington later this Fall (before Election Day).

Don’t mistake this bill for good policy. We have gone over the many unforgivable flaws of this legislation in this space in the past. It is starkly anti-small business and is an economic depressant. The likely impact would be akin to a trade barrier tariff and could be this generation’s version of Smoot-Hawley. It is also almost certainly a flagrant violation of the WTO and would trigger retaliatory regulations in our principal export markets. Trade war – just what we need . . . since export sales is about all that’s working here now. Small business owners, please consider the impact on your export business if you need to set up registered agents in 50, 60, 70 countries. Think of the legal fees, think of the potential litigation that would be invited. How many such markets would you close?

There’s more cooking in Congress to “help” us this election season. These guys are going to keep trying to “save” you until you save yourself on Election Day. Stay tuned.

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CPSIA – EU Warns on Foreign Manufacturers Legal Accountability Act

CPSIA – Obama Doesn’t Get It . . . .

In response to the release of yet more terrible jobless claims numbers this AM, President Obama renewed his call to lower taxes on small business and to ease the small business credit crunch. The legislation, which promises to lower certain taxes on small business and to increase federal funding of loans to small businesses through various means, is “stuck” in Congress. Mr. Obama blamed the Republicans for “blocking” the bill: “‘There will be plenty of time between now and November to play politics,’ Obama said. ‘Let’s put aside the partisanship for a while and work together.’”

I think this is rich, personally. We run a small business and I know what it feels like to be a small business in the Obama-cized children’s product market. We are facing skyrocketing costs nicely matched with soft revenues and mounting taxes (funded by the company, too). Cost increases include $300K in new medical plan expenses to accommodate the terms of the Obamacare initiative, plus astronomical all-in costs for increased safety testing under the new CPSIA rules and related manias. The increased testing has yet to reveal any useful information of identify any health threat that constitutes a human safety risk – so all that money is wasted.

These costs have a common link – they are both a result of increasing regulation. I know, I know, Mr. Obama has lectured us that we really need all these new regulations. Well, I don’t agree, but in any event, we see these regulations as major impediments in our business. These high costs affect our cash flow and our business outlook – to the bad. Do the Democrats think we maintain our sunny disposition when we face a shaky market lacking confidence (soft revenues), higher costs (a lot higher) and mounting cash needs from higher taxes and other federal regulatory expenses? This is rather a recipe for managers who want to hide until the storm passes. Who will spend money on new investment now? While we are not cutting our product development efforts, we haven’t bought new equipment, fixtures or additional office/warehouse space in several years now. And we have no plans to do so. Welcome to the Dems’ economy. No wonder new jobless claims are over 500,000 in the last month.

In the case of the CPSIA, the Dems are only too happy to whack us with heavy regulations, all justified by imaginary benefits. The imaginary benefits of the new CPSIA regulations are as invisible as the imaginary problems they are designed to solve. The absence of data on effectiveness is matched by the absence of data suggesting that there was a problem in the first place – the “know nothing’s” jacked up your costs and destabilized your business to no purpose. Now Mr. Obama wants to fix it all with another handout. Throwing money at the problem is new style. And after that handout is parcelled out, the Dems will proceed to raise taxes on higher income individuals (read, small business owners, particularly S Corp owners) to attempt to staunch the hemorrhaging Federal deficit, and then express “shock” at the sluggish economy. No doubt the next step will have to be more handouts and perhaps Cap-and-Trade to raise more costs. What a great cycle. . . .

Is there another way? Well, as for small businesses in the children’s product market, I would note that the voluminous new CSPIA rules (two feet high and growing) impose massive costs on industry (to comply) AND on government (to enforce). I think of the stupid health official bent on enforcing his food handler’s license rule against the little girl in Portland operating a lemonade stand – many of the new CPSIA rules are pointless from a safety standpoint and cost big money to administer as well as to comply with. If the Dems seriously want to stimulate the economy and add jobs, here’s an efficient way to do it for NO out-of-pocket cost – DROP your boundless regulations and go back to something more modest and manageable. This also means that the Obamite idea that life is better with lots more government needs to be shelved. I submit the recent rules on testing frequency and “reasonable” testing programs as evidence that inviting bureaucrats to become involved in operating businesses brings nothing but trouble, inefficiency and devastation. There must be a better way.

Hey, I figured out some time ago that I am talking to myself here. The CPSC certainly doesn’t care or understand what I am talking about (or else they might have done something about it perhaps 300 blogposts ago). The Democrats in Congress likewise are deaf and disinterested. I cannot name a single Democrat, NOT ONE SINGLE DEMOCRAT, who will stand up in front of their peers and demand significant amendment or revocation of the CPSIA. The Dems are in lockstep agreement – no light shines in if your head is in the sand, after all.

You can’t work with people like this.

I urge you (URGE YOU) to select the CPSIA perpetrator of your choosing and WORK to knock them out of Congress in this election cycle. Remember – they are trying to put YOU out of business. You need to return the favor.

Return the favor . . . this is my theme song until polls close on November 2. Then the party begins.

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CPSIA – Obama Doesn’t Get It . . . .

CPSIA – Tea Party Comments

I received a provocative comment on my recent blogpost on the Tea Party and quote from it here:

“I’ve come on here less and less because the blog is starting to seem less a good source of information and more like a long, angry political rant. If that’s what you want, more power to you. You’ve certainly earned the right to rant. You have the freedom to write what you want and I have the freedom not to read it. If you’re posting this because you care, well yes, I do think you’re alienating quite a few people, myself included.”

This is a fair comment and probably accurate. The blog is angrier and more focused on elections and politics that before. Frankly, I have known for some time that I increasingly lapse into a rant. Why is that?

Here’s the problem – I can’t provide much information to you anymore because there’s nothing much to report. There is a steady drumbeat of ordinary or trivial details from the agency to pass along but the excesses of this CPSC administration have gone on so long that they now bore most people. On a more macro level, the news spigot shut off because (a) the Dems in Congress stopped listening a long time ago and are doing NOTHING to fix this mess, and (b) the CPSC has demonstrated that they are going on their merry regulatory way no matter what we say or think. Time and partisan appointments are giving Mr. Waxman his tacit victory.

So we are stymied. And what tools do I have left at my disposal? Consider what I have already tried: I have employed representation in Washington for now almost two years. The cost of this exercise comes out of my personal pocket. No need to feel sorry for me, but that’s a fact. I have also testified before Congress, I have testified before the CPSC (several times, at their request), I have written numerous comment letters (none of which were answered), I have appeared in endless articles and on 60 Minutes, I have given speeches, sponsored a rally, and yes, given up thousands of hours of my life to write almost 500 blogposts for you (and the CPSC) to read. I have left no stone unturned.

If you had done all this over a two-year period and produced the scant results I had, what would YOU do, Anonymous? Keep mumbling to yourself? Is that really productive? If the problem is as serious as I say it is, then continuing with a losing strategy seems pretty dumb to me. It was Albert Einstein who reportedly said “The definition of insanity is doing the same thing over and over again and expecting different results”. It appears that a change in strategy is needed – if we want to produce a different result.

And blaming the parties responsible is appropriate. My readers know I am being honest and candid here. You know where I stand. The Dems are responsible for this mess. They may have had help creating the law in 2008, even the signature of Mr. Bush to close the deal. Then again, when the carnage became clear, the Dems employed the Nancy Reagan “Just Say No” defense in the face of indisputable evidence of their policy failures. The Dems have been a rock of intransigence and indifference for two years now. The Republicans have not. Again, that’s a fact. And the CPSC is being run by Dem politicians who work consistent with the wishes and desires of the Congressional Dem leadership. I am supposed to overlook this? Possibly not notice, look away? That view, if you hold it, insults my intelligence.

These days I have few choices available to me. I can continue to pursue a clearly ineffective strategy and find my voice increasingly marginalized by its irrelevance, or I can work within the political system (as is my right) and find another route to the desired outcome. I hate the CPSIA and I hate what Congress and the CPSIA have done to the CPSC. I cannot abide by this. So now what? Sucking my thumb is not an option. It’s time to get RID of these people. They made themselves a big part of the problem and deserve what they get. After all, the rules of the games were known in advance, and they knew what they were doing.

It’s my right to take steps politically to fix this situation. I hope I don’t lose you as a reader, Anonymous, but if you have better things to do or better sources of information, I trust you will come here less often. My commitment to our employees, customers, suppliers, consumers and other stakeholders remains unwavering and has to come first. I am loyal to them and won’t be defeated by this year’s version of tyranny.

Onward to November 2 and the defeat of the people responsible for this Greek tragedy!

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CPSIA – Tea Party Comments

CPSIA – Component Testing Rule Comment Letter

August 3, 2010

Todd A. Stevenson
Director, Office of the Secretary
Room 820
U.S. Consumer Product Safety Commission
4330 East West Highway
Bethesda, Maryland 20814

Agency: Consumer Product Safety Commission (CPSC)

Re: Docket No. CPSC–2010-0037 Conditions and Requirements for Testing Component Parts of Consumer Products.

Dear Mr. Stevenson:

I am hereby submitting comments in response to the Solicitation of Comments on the Conditions and Requirements for Testing Component Parts of Consumer Products (Docket No. CPSC–2010–0037) published in the Federal Register on May 20, 2010 (the “Proposed Rule”).

This request for comments comes after, among other things, a two-day workshop held at the CPSC on December 10-11, 2009. Our company incurred the expense of sending three people (all panelists on multiple panels) to attend this “sold out” event which was purportedly to solicit stakeholder feedback on this rule and the so-called “15 Month Rule” (also up for comment today). There is little evidence from the Federal Register that any of our feedback was taken or possibly even heard. I have lost track of how many comment letters I have filed, panels or hearings I have appeared at and essays or letters I have written about the CPSIA and these issues. So far, my comments have added up to . . . nothing. Nevertheless, I am filing this letter in the vain hope that perhaps this will be my lucky day and you may listen to me, finally.

I would like to make some general comments first.

a. Some Positives in the Proposed Rule. I am in favor of the concept of component testing and applaud the Commission for taking steps to make it a reality, however flawed. In addition, I am also enthusiastic about composite testing. Regrettably, however, the devil is in the details.

b. CPSC Data Demonstrates that Risk is Low, so the Proposed Rule does not Need to be so Strict. I have analyzed the recall data published on the CPSC website and determined that from 1999 – 2010, the CPSC can account for ONE DEATH and THREE ASSERTED INJURIES from lead or lead-in-paint. If the goal of these rulemakings is to reduce deaths and injuries from lead, then these data must be borne in mind. With so few incidents involving lead injury of any kind in children’s products (less than occurs on AN AVERAGE DAY from swimming pools and spas in the U.S.), there is no justification for building such an ornate rule for something simple and logical like component testing or composite testing. Likewise, incidents of fraud in testing are equally infrequent and in any event, already addressed by other statutes. Congress did not require this complicated regulatory scheme, and the data cannot justify it.

c. The Proposed Rule Puts Compliance First, Before Safety. This rule seems to place a very high emphasis on the need to comply, as opposed to the need to make children safer. One is not necessarily the equivalent of the other. My favorite example is our company’s record of compliance. Founded in 1984, our company has recalled a grand total of 130 pieces in its history, all recovered, out of perhaps one billion pieces sold. Not bad. Were we to meet the myriad requirements of this rule, I cannot fathom that our products would be safer. Does all that extra compliance benefit anyone? It certainly will cost a lot (we pay, you don’t). As I read your rule, I wondered why you didn’t list the wire transfer instructions for the top testing companies. You might as well . . . . Still, the casual waste of our resources cannot make anyone safer – they were already completely safe.

Safety is the reason the CPSC exists. This document fails because it confuses the desire to powerfully enforce the CPSIA with actually making people safer. The only thing that may be accomplished is business death for many companies, principally small ones. Swashbuckling enforcement may make great headlines but no one will be any safer. Compliance is not safety.

d. Science Has Apparently Been Rendered Moot at the CPSC. While I accept that Congress has banned certain phthalates in toys, I do not accept that the ban is a SCIENTIFIC CONCLUSION. It is legislation, not science. Notably, the CPSC has twice investigated phthalates and held that phthalates were safe in toys. Yet, on page 28213 in the Federal Register, the Proposed Rule discusses the “risk” presented by a product that might have a violative concentration of phthalates in a component, but with an overall concentration that wouldn’t violate the ban. It goes on to assert that a component-based rule is “more protective of human health”, as though the agency had reached the scientific conclusion that phthalates were dangerous – which is not true. Re-characterizing the legislative ban as an assessment of “risk” may appear to legitimize your rule, but it is certainly not an accurate statement of the historical position of the agency. I object to the rule’s equating of a ban by politicians to a scientific judgment. Science is under enough assault without the stamp of approval of the CPSC announcing its death.

My specific comments on this proposal:

1. Component Testing Looks Better Than It Is. I wish I felt we (or anyone else) would use component testing extensively in the future. There are several reasons why this option will be of little use to anyone, particularly the small companies that it was intended to benefit. [Companies with enough scale may find the Proposed Rule useful – one of the many ironies of the CPSIA is that its principal beneficiaries may be the companies that prompted its passage.]

a. Limited Market Availability for Component Certificates. While some high volume components of children’s products may quickly be tested to meet these requirements, many other kinds of components are not likely to be tested:

i. Low volume components
ii. Components made in small lots
iii. Components made by small suppliers (many fabrics)
iv. Components which derive only a tiny percentage of revenues from regulated products or which principally cater to other industries (e.g., paper clips or aluminum foil in a science kit)

Unfortunately, it appears to me that the logic of this rule is that if we can be certain that some certificates will be widely available (e.g., paint, plastic pellets), therefore all other certificates will be available. That’s plainly ridiculous.

b. Complexity. The subdividing of compliance testing into component parts and the whole, some tests done on parts and some on the whole, with tests of varying dates substituting from time to time, is simply a mindboggling mess. I cannot imagine that this can be successfully managed on any scale (how many products need to take advantage of this rule before test reports develop big and inconsistent holes?). And how will retailers be able to interpret this patchwork quilt of tests? This scheme will be self-defeating on all levels.

Add to this the requirement that components need to be traceable, and you basically rendered the component testing opportunity moot. Of course, I am presuming that industry will take your rules seriously. To me, it’s completely inconceivable that anyone will build your traceability system. [Traceability will not raise revenues, only mindless complexity, and as noted above, cannot conceivably improve safety.] If you take these rules seriously, you will cry, laugh/scream – or walk away. The paperwork required for this exercise is well beyond almost all companies’ capabilities. [Does the CPSC have ANY tangible evidence that its requirements can be met by anyone . . . other than Mattel and Wal-Mart? Presumably, no one at the agency living in the real world thinks that traceability rules can be met by the typical Handmade Toy Alliance member, or other small businesses like ours.]

c. Unrealistic Expectations on Manufacturing Control and Traceability. To take advantage of this rule, a manufacturer must take responsibility at the sub-micro-level for manufacturing quality. Let’s recall for a moment that we are not making drug treatments here, nor are we building the Space Shuttle. We are making simple plastic toys and games, children’s shoes, pens, shirts, books, educational materials and so on. Consider this instruction from your new rule: “The manufacturer must exercise due care that the manufacturing process does not add a prohibited chemical from an untested source, such as the material hopper, regrind equipment, or other equipment used in the assembly of the finished product.” Our company has several hundred vendors producing thousands of SKUs – do you honestly believe we could possibly manage how all these independent companies wash out their molding machines or manage their regrinding operations? Is this some kind of sick joke?

By the way, this verbiage will end the use of recycled materials in children’s products. This is completely unjustified for safety reasons and is certainly very unfriendly to the environment. As noted above, your agency’s responsibility is to manage safety. You have no basis in fact for asserting that these theoretical sources of lead are or could constitute a public safety risk.

d. Liability Risk. The Proposed Rule goes to great length to ram home the message that all the risk is on our shoulders. The monotonously repetitive use of the term “due care” throughout this document makes abundantly clear that the CPSC is perfecting a myriad of claims to be made against any and all manufacturers of children’s products when it suits the purpose of the agency. Many of the claims may be perfected with the agency’s 20-20 hindsight. The Proposed Rule minces few words on this preservation of rights: “The above information is needed so that, if noncomplying products are found, the Commission can use this information to determine whether a finished product certifier, component part certifier, or third party conformity assessment body is not complying with the appropriate requirements.” Under the Proposed Rule, even a missing piece of paper can be the basis of charge of failed due care. A fear of criminal charges seems realistic.

Will aggravating letter writers be the first to suffer under this hammer? The answer is – it’s entirely up to YOU under your rule. Small companies will see how the deck is stacked against them and steer far from the component testing option (if they understand the obtuse wording of the rule).

2. If Few Companies Can or Will Use Component Testing, Has the Agency Provided “Relief”? Of course, the answer is NO. The Proposed Rule may look like good policy, but if the practical impact of the rule is that few people can or will take advantage of it, it is simple window-dressing. The impact on small businesses, exemplified by the well-known and sympathetic Handmade Toy Alliance, will be severe. They are not the only ones in need of help, either. If small companies like HTA members cannot take advantage of these rules in large part or would be too scared to take a chance in the face of the awesome display of governmental power in the rule’s terms, then they will suffer and shrink. I would note that the Notice on the “15 Month Rule” explains how a failure to protect small companies could play out badly (see “Caveats and Possible Market Reactions to Third Party Testing Requirements” on page 28358). Those negative impacts could result from a failure of policy here, too.

3. Maintenance of Records for the Life of a Product Plus Five Years Is Unduly Burdensome (Not to Mention Pointless). Please consider our case: We still produce certain items from our original product line in 1984. Clocks don’t go out of style in education, even if Tickle Me Elmo and Furby last only one year. The requirement that we must retain records for the life of the product plus five years could theoretically be forever in our case. Perhaps the CPSC can provide us free unlimited warehouse space for all these records. In any event, our case also makes clear how pointless this requirement is. We have only had one recall in 26 years, which we successfully administered without the assistance or guidance of the thousands of pages of rules and legislations that befell us under the CPSIA. How, precisely, will decades of records improve the public weal in OUR case? Your rule is very good at spending our money, our resources and our time, but doesn’t make a reasoned connection to safety in any way. We are not Mattel and in any event, they don’t define the market. Had you listened to us in December 2009 at your workshop, you would know this already.

4. Composite Testing Rule for Paint LOWERS the Lead Standard to Sub-trace Levels. In yet another example of overly risk-averse rulemaking, the agency’s new composite testing rule for paints requires that lead content must never exceed that for any individual component paint in the composite. This slices the 90 ppm limit by two-thirds for a three-paint sample and by 75% for a four-paint sample. This super-stringent rule ensures that it is literally a gamble to use composite testing – so why would anyone bother? Even more bothersome, since the new policy of the agency is to impose strict liability for lead-in-paint violations, this new rule demonstrates the ascendency of the debunked notion that there is “no safe level for lead”. If the agency really wants to take this position, it should not permit composite testing for paints. Too risky . . . .

5. The Regulatory Flexibility Analysis is Flawed and Self-Justifying. The analysis justifying this Proposed Rule is a “best case” scenario, and takes none of the foregoing into account. If in fact the rule will hard or impossible to use, or will create too many legal risks or recordkeeping burdens and thus go largely unused, the reasoning in this section will be completely inapplicable.

6. The Burden of Recordkeeping is FAR GREATER than Asserted in the Proposed Rule. At our company, we produce about 1500 “catalog” items and several thousand other SKUs and custom products through a network of hundreds of factories in various countries. We do not control these factories – they are generally family businesses like our company, and are independent of us. Typically, we provide only a small share of annual revenue of any of our factories and thus have limited leverage over their business practices. Like many small businesses, we have a very limited infrastructure in place to supervise factories “on the ground”, although it is worth noting that our safety record indicates that our business methods have worked well for more than two decades.

To implement the recordkeeping set forth in this rule, I estimate that we would have to spend $50,000 – $100,000 in software development expenses to store and manage the desired records. In addition, we would need to expand our staff significantly. To reach out to all of our factories, negotiate and monitor many new business practices, will take a significant increase in staff. I posit that we would need to open an Asian office with as many as 5-10 local employees. A Chinese office would cost us at least $500,000 per annum. In addition, we would have to increase our clerical and management staff in the U.S. to help with data input, software management, project management, audits, vendor relations and general management. This would cost us at least $250,000 per annum. We anticipate that this intrusion on the business practices of our vendors would cost us business relationships and would lead to significant cost increases. The total cost of these disruptions would add another $500,000 or more per annum. It is not inconceivable that we ALONE could incur annual expenses of $1.5 million and certainly at least 10 man-years of labor (more than 20,000 hours) to comply with these rules. There are THOUSANDS of companies affected by this rule. We estimate that the assessment of cost and man-hours in the Paperwork Reduction Act section of the Proposed Rule is LOW by a factor of 100x-5,000x.

I would suggest that this rule be greatly simplified by making the following changes:

a. Eliminating the Requirement for Traceability Recordkeeping. As noted above, this ornate rule architecture is completely inappropriate for the minimal, almost non-existent threat, demonstrated by the CPSC’s own injury data. Recordkeeping requirements should minimized or dropped altogether.

b. Encourage the Exercise of Business Judgment. The presumption that only the CPSC (or Congress) can make sound judgments when considering safety issues is simply not supported by the data. Again, our company is a good example of that – we scrupulously maintained our safety record without the CPSC’s oversight, coercion or even encouragement since 1984. The concept of “business judgment” is well-defined in U.S. common law and has real meaning under the law. I think the concept of using components supported by GCCs is simple enough. Given that the restrictions on lead are clear under the CPSIA, why not let businesses exercise their judgment on how to meet those requirements and then measure them on their success in doing so? What is to be gained by inserting the CPSC into all aspects of how we conduct business? We were doing just fine before you arrived on the scene.

Given the few lead injuries noted in the CPSC’s historical data, the agency could save its scarce resources and remain effective as a safety administrator by focusing on known safety issues and incidents and leave the vast majority of law-abiding and safety-conscious companies ALONE. The data suggests that higher and higher mountains of regulations will never reduce injuries from the historically miniscule levels documented on the CPSC website.

c. Allow Composite Testing Using the Overall Concentration as the Pass/Fail Measure. Again, this is justifiable based on the historically minimal risk posed by the regulated substances. The already low lead levels specified in the CPSIA have not reduced injuries or deaths from the negligible levels that predated it. Since the number of recalls is so dramatically affected by agency policy (e.g., strict liability or not, how recalls are accounted for, etc.), the only reliable measure of the effectiveness of policy is injuries. Composite testing holds the promise of real savings to the many law-abiding companies affected by the CPSIA. Loosen the noose and they may actually save some money.

Component testing can be a simple and effective way to lower costs, but a different approach is necessary to get to that result. A sharp reconsideration of the Proposed Rule will be required to achieve this goal.

Thank you for considering my views on this important subject.

Sincerely,

Richard Woldenberg
Chairman
Learning Resources, Inc.
380 North Fairway Drive
Vernon Hills, IL 60061

Read more here:
CPSIA – Component Testing Rule Comment Letter

CPSIA – Why Hasn’t Data Changed Opinions at the CPSC?

I have recently published numerous blogs on CPSC recall data documenting the dearth of injuries and deaths from lead in the past decade. I am certainly not indifferent to the suffering of any victim, however, I note that data on injuries is a way to measure the urgency of the threat. There has been one death and three asserted injuries in the last eleven years from lead. We are a country of 300 million-plus and have a $15 trillion dollar economy – presumably, we need to prioritize.

I have also provided CPSC data on injuries and deaths from other hazards, such as cadmium (zero), pool drains (very low, but greater than lead), phthalates (zero) and pool and spa (extremely high, more in an average day than in a decade for lead, phthalates and cadmium put together). In fact, I documented the distribution of injuries and deaths among all recalled children’s products over an 11-year period. At one death and three unverified injuries, lead comes in last among all recall categories with more than eight recalls over 11 years (lead and lead-in-paint accounted for 248 of 899 total recalls in the surveyed period of time). Literally every significant hazard facing children in consumer products is worse and much more dangerous than lead according to the CPSC’s own data.

I have also shown that the data on recalls publicized by the CPSC tends to magnify the scale of lead recalls, making the recalls seem more threatening and the implied hazard more urgent than they really are. Among other things, the quantity of recalled products typically (if not always) includes inventory in the possession of the manufacturer. This inventory NEVER MADE IT TO THE MARKET. In addition, recall data also includes product still on the shelf at retailers. This inventory, which was sold by the manufacturer to the retailer, was never sold to consumers. Inventory in the possession of the manufacturer, its factories or its retailers has no conceivable potential to harm a child. The amount of product in the hands of consumers could be tiny. Please consider these facts when evaluating the claims of consumer groups on the “poor” effectiveness of recalls. The math gets all tangled up, doesn’t it?

Call me crazy, but this seems like some rather shocking data. The deaths and injuries from lead and phthalates are so small that they are trumped in a single day by pool and spa deaths and injuries. [The reported deaths and serious injuries from pools and spas since Memorial Day, at least 210, are AT LEAST FIFTY TIMES THE NUMBER OF DEATHS FROM LEAD IN THE LAST ELEVEN YEARS. In other words, it will take more than 500 years for lead to produce as many deaths and serious injuries as the last 53 days from pools and spas (if the lead death and injury rate doesn't taper off).]

And yet the CPSC seems to have no interest in this data, their OWN data. Why? Well, the best I can say is that they believe every life is precious and thus, economics cannot be considered when designing a response to the hazard. I did not invent this view of the consumer group-dominated Commission – I asked this very question of a person in a position to know, and got this answer. So there you go.

Does this hold water, that economics are irrelevant and should never be considered? First, on the relevance of economics, I think that’s a silly proposition. Of course economics matters. Please don’t feign shock or disgust. Let’s do an exercise: How much shall we spend to save a life? A child died from swallowing a lead charm on a single bracelet several years ago. This is the lone reported death from lead or lead-in-paint from a consumer product in at least 11 years and has been cited as a justification for the CPSIA maelstrom. In this space, I have adopted a proxy estimate of $5.6 billion in annual CPSIA compliance costs for the children’s product industry (based on a submission of the HTA to support their Congressional testimony).

So, is $5.6 billion the “right” amount to spend annually to prevent the next loss of life? Sure, you say, spend the $5.6 billion each year, every life is precious. Okay, does the cumulative spend of $61.9 billion over 11 years (to match the period in which the one death occurred) sound a bit extreme? Can you think of anything else that might be a better use of $61.9 billion? [Like a new national highway system? A new electrical grid? A few more cruise missiles? A few months of national health care?] I would note that $62 billion is double the provisional losses of BP from the Gulf oil spill. That’s a lot of coconuts, if you ask me.

Should we spend $61.9 billion on every cause of death? What about causes of death that are “worse”, meaning that loss of life is greater? Should we spend proportionately? If our resources are limited (I used to think that was relevant but lately, who knows?), how should we allocate our limited dollars? Is it okay to prioritize? Does lead make the cut if we try to allocate rationally?

It is worth noting that the value of a life or an injury is a heavily-litigated subject. It is a staple of tort litigation to estimate damages by assessing the economic value of a life or an injury. The U.S. government also engages in the same analysis. Certain agencies are forbidden by law to issue regulations that do not show an economic profit, that is, the cost of the regulation must be outweighed by its economic benefits. [Money spent or saved by the public versus the government is not relevant to this analysis - a dollar's a dollar no matter who spends it.]

The benefits of the regulation are calculated by assessing the economic value of lives and injuries. To regulate otherwise is economically irrational – which is where the CPSC seems to be. More to the point, economic irrationality is against the weight of U.S. jurisprudence, not to mention laws limiting the ability of the government to issue regulations. Hate to sound trendy, but it is Big Government completely out of control to contend that lives are “priceless” and to assert that the cost to avoid injury or death should not be limited by economic considerations. Please note that the EPA assesses the economic “value” of a life at $6.1 million. For even more perspective, the EPA says that one IQ point lost to lead is worth $8,346. CPSIA compliance costs are not less than $5.6 billion EACH YEAR. Do the math.

Okay, this is bordering on insulting your intelligence. Yet, astoundingly, the CPSC doesn’t get it. What about the behavior of the CPSC itself – do they ever consider economics? Again, at the risk of insulting your intelligence, of course they do. For one thing, they themselves have limited resources. They can’t do everything they want, and have to make choices. They have a BUDGET. They can’t hire everyone they want, can’t inspect everything, can’t process every claim immediately and so on. They also make practical judgments on some things. I reported recently the tarring the Commission received for making a practical judgment about how to implement the pool drain law. In that case, they chose to agree with the recommendations of industry, which is heresy in some circles . Certain members of Congress live in those circles . . . . No doubt the savaging of the Commission over that minor practical judgment will have the intended effect of eliminating whatever shreds of common sense or backbone extant at the CPSC and the Commission. Perhaps this is the end of their consideration of economics . . . .

Where does this leave us? Come on, guys, right where we were for the last two years! We continue to rail against this awful law, and the CPSC gets progressively more and more stone deaf. I feel increasingly like I am mumbling to myself, especially when they won’t respond to their own data or other data-driven rational arguments. Given that the Dems have made their name by being totally deaf to the legitimate concerns of industry, what choices are left to us? I am turning more of my energies to the 2010 Midterm elections. I hope you will also do what you can to change the dynamic in Washington. You’ve seen what these people have done in the last 18 months. Ready for more?

I’m not. And I am doing something about it.

Read more here:
CPSIA – Why Hasn’t Data Changed Opinions at the CPSC?

GUEST BLOG – American Apparel and Footwear Association (AAFA) Urges You To Participate in Survey on Impact of CPSIA-Mandated Testing

The American Apparel and Footwear Association (AAFA) Wants You!

Many have pointed out to the CPSC that the additional testing costs mandated by the CPSIA have been extremely burdensome on companies and have even caused many to either shut down or abandon the children’s product market.

This blog has provided concrete examples with its Casualties of the Week (for example see here, here and here).

Some are still not convinced. CPSC Commissioner Adler made the point at a recent CPSC briefing that “anecdotes are not evidence.”

The AAFA has been collecting information (”evidence”) from companies to see exactly how the testing rules have impacted their businesses. This information is important to help document to CPSC and Congress the economic impact of CPSIA.

To continue gathering data, AAFA recently published two surveys online to gauge the impact of consumer product testing. One survey is for manufacturers, wholesalers and suppliers and the other is for retailers and licensors.

If you are (or were) in the children’s product business, we strongly urge you to fill out this survey online. It only takes a few minutes.

The surveys are especially geared towards assessing the impact on businesses, and business awareness of, two proposed rulemakings that are due August 3, “Conditions and Requirements for Testing Component Parts of Consumer Products” and “Testing and Labeling Pertaining to Product Certification,” as well as how the stay of testing and certification requirements impact companies’ testing protocols and costs.

To access the survey for manufacturers, wholesalers and suppliers please visit http://www.surveymonkey.com/s/D6S3D7N

To access the survey for retailers and licensors please visit http://www.surveymonkey.com/s/D668GJT

Thank you for your participation.

Guest Blog Posted by the AAFA

Read more here:
GUEST BLOG – American Apparel and Footwear Association (AAFA) Urges You To Participate in Survey on Impact of CPSIA-Mandated Testing

GUEST BLOG – Congressional Office of Compliance Confirms: Congress is Dangerous to Your Health

Okay conspiracy theorists. Do you think the Capitol Hill newspaper Politico held this story until Rick was out of town? In a front page story today “Dangers on the Hill” Politico reported that Congress’ Office of Compliance have found an estimated 6,300 safety hazards that are “potentially fatal or could leave victims with serious injuries.”

That’s right, Congress is dangerous to your health.

Here are some of the juiciest excerpts from the story. In Rick’s honor, we provide commentary after each excerpt, Woldenberg style:

“Workplace safety experts say that if Congress were a private-sector business, it would be at risk for massive fines from government regulators.” (oh, the irony!)

“But Congress has exempted itself from key parts of federal workplace law.” (Without even proving it was impracticatable for Mr. Waxman to comply?)

“…the latest study offers arresting detail. Investigators estimate there are 1,742 electrical hazards, 1,058 fire-safety hazards, 102 storage shelving issues, 61 first-aid emergency-care lapses and 70 machine-guarding problems, to name a few found so far.” (Hey, no lead violations?)


The report divides the hazards into categories, with some more routine and others potentially life threatening. (Wait a minute, that sounds like risk assessment!)

“Furthermore, the report makes clear that the hazards may prove dangerous to Capitol Hill visitors, including constituents and lobbyists.” (in other words, visiting Congress is hazardous to….people)

“This measure was inspired by that year’s new Republican majority and some Democrats who were aggrieved by what they saw as supreme hypocrisy: Congress and regulatory agencies imposed all manner of rules on the private sector and the states through laws such as the Family and Medical Leave Act and the Americans With Disabilities Act, but lawmakers themselves did not have to obey those rules.” (Can anyone think of another law that they could have included – hint –it rhymes with SHEE SHPEE SHESH SHI SHAY)

The compliance office cannot issue investigative subpoenas to Congress and its entities, even to seek information that could solve a workplace hazard. (Call in the AGs!)

Whistleblower protections for staffers who report hazards are essentially nonexistent, leaving aides responsible for their own litigation costs if they are fired or an office retaliates against them. (C’mon, the Onion couldn’t write a better article – oh the hypocrisy!)

“It’s hard to defend Congress when things are this bad,” said Center for Progressive Reform board member Sidney Shapiro, … But if Congress is going to insist on running its own safety regime, then it ought to do it the right way.” (Are we sure they’re not talking about CPSIA?)

“Congress faces a major challenge in trying to fund fire- and life-safety projects, historical preservation and deferred maintenance campuswide, all within very limited resources,” said a congressional aide familiar with the blue-ribbon panel. (Hey, they told us safety at any cost – even if the costs don’t improve safety)

“On the upside, a number of offices have become more proactive about protecting safety by voluntarily requesting inspections ahead of the compliance office’s regular schedule; 154 offices in the 111th Congress achieved hazard-free status. “Over the years, we’ve found that working cooperatively with employing offices to reduce hazardous conditions in the Capitol complex can be more effective than a confrontational approach. The statistics bear this out by showing remarkable progress in reducing hazards.” [Working cooperatively? What a novel idea! Nah, we say use the CPSIA model – enforce, enforce, enforce, treat every risk equally, discourage cooperation and levy huge fines!]

We couldn’t make this stuff up. To read the entire article for yourself, click here. (warning it’s about 1800 words).

Posted by the Alliance for Children’s Product Safety Staff

Read more here:
GUEST BLOG – Congressional Office of Compliance Confirms: Congress is Dangerous to Your Health

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