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CPSIA – Consumer Groups and the CPSIA

Walter Lippmann, founding editor of The New Republic and winner of the Presidential Medal of Freedom in 1964, once cited the components of wartime mythmaking as “the casual fact, the creative imagination, the will to believe, and out of these three elements, a counterfeit of reality.” Hmmm. He might have been talking about lead in children’s products. Mr. Lippmann explained: “Men respond as powerfully to fictions as they do to realities [and] in many cases they help to create the very fictions to which they respond.”

Last week, a number of interested stakeholders met with the staff of the House Energy and Commerce Committee to discuss what to do about the CPSIA. Do I need to explain why the situation is urgent? The list is long, and the victims are basically defenseless. Mass market companies are inconvenienced but not hobbled; small businesses are crushed, confused and scattering into other markets. Consumers, unaware that the federal government has meddled in an unprecedented way with a market upon which they depend, are oblivious to the threat posed by the weakening or departure of their suppliers. And the Dems just smile and tell us this is all for our own good. Don’t worry, they know what’s best!

Various stakeholders tried to explain the many ways this law has caused harm and the reasons why it is appropriate to loosen the noose around the business community’s neck. Scan my remarks, the HTA’s presentation or the words of the AAFA as an example, and you will see how high the stakes are.

No meeting on the CPSIA would be complete without consumer groups chiming in to defend this “perfect” regulatory scheme. In this case, Consumers Union, the Consumer Federation of America and the American Academy of Pediatrics all touted the triumph that is CPSIA. CU spent a fair amount of time asserting that the public database rules adequately protect manufacturers and that the perceived defects in the proposed database plan had already been addressed by the Commission. [See Nord's blog and Northup's blog on this topic.] What, me worry?! CU also noted that there WAS broad support for the CPSIA (back in 2008), as if that were sufficient justification to stick with a clearly defective law. This was nothing more than the Waxmanis’ argument that no further discussion is merited because of the Perfect Legislative Process. Ah, the infallible Congress, how could I forget?

My special friend Rachel Weintraub of CFA took the opportunity to reassure the gathered crowd that the law has done us all a lot of good. [She was careful to not put anything in writing. Given that limitation, I must work off my notes and apologize for any inaccuracies.] Her reasoning relied on the assertion that consumers “thought” that someone issued a “stamp of approval” for children’s products being sold in U.S. markets. This strikes me as “transference”, meaning that this may be how Rachel feels herself or how she feels we the general public OUGHT to feel. In any event, there are a lot of consumers out there, and I rather doubt Rachel is able to know how they all felt. She went on to assert that consumers lost faith int he regulatory system. Ditto. After recounting the many wondrous things the law has engendered, she asked that the law be given more “time to work”.

More time to work? To what end, to finish the job and put everyone out of business . . . other than CFA? OMG.

And then there is my personal favorite, the AAP through their Washington representative Cindy Pelligrini. Ms. Pelligrini has been making trouble over lead for many years. I first encountered her when the 2007 testimony she ghosted for Dr. Dana Best was used to justify the Illinois lead labeling law (see below). For last week’s meeting, the AAP submitted a position paper announcing its unwillingness to support any change to age limits, lead limits or even the consideration of risk by the CPSC. Why do you suppose the AAP cannot support the consideration of risk? Ms. Pelligrini explained in her oral remarks that the AAP felt consideration of risk would be too BURDENSOME ON THE AGENCY. What a heartbreaking scenario, the terrible burden! The AAP is so considerate to think of the quality of life of CPSC Commissioners.

The AAP was able to muster support for tightening the lead limits in the CPSIA to 40 ppm, however. Perish the thought of dropping the 100 ppm standard! When I questioned the process by which this position paper was created by the AAP, Ms. Pelligrini wrote me to explain that it is old news, derived from their January 21, 2009 letter to Henry Waxman. So, apparently, nothing has happened in the last 24 months nor any additional data developed to merit reconsidering their recommendations. I see.

Of course, I recognize that the metabolic impact of lead has not changed because of the development of injury statistics (or, more accurately, the development of no-injury statistics), and in this sense, I suppose, the AAP position need never change. On the other hand, I have previously addressed the issue of science being used as a bludgeon to “prove” preconceived notions. In my post of December 14, I discussed an article entitled “The Truth Wears Off”. It could have been about the story the AAP tells about lead.

Without going into the arguments about the falsity of the AAP’s claims (or at least their fatally misleading nature), I would like to draw your attention to the “detached from reality” position they take on lead limits. They want to establish a limit of 40 ppm for lead. Anyone remember that Mr. Obama’s vegetable garden at the White House was at 93 ppm? The AAP points to research they conducted with the U.S. Geological Survey to come up with this limit. In other words, it is their estimate (however faulty) of background lead “contamination” in our environment. [As if the natural presence of an atomic element constitutes "contamination".]

AAP’s suggested lead limit of 40 ppm is basically below the reliably measurable limit and imposes uncontrollable economic risks on manufacturers. By uncontrollable, I mean that the odds of finding a part or component with lead levels in excess of 40 ppm are pretty good in almost any manufacturing setting – given the disorder, irregularities and complexities of the real world, defects of this nature are not really preventable, at least in a prophylactic way. [This is different than saying anyone is likely to be injured, please note.] Even a Six Sigma company would find this a major challenge. Remember, if you find such a part or component, the entire lot becomes a liability and may have to be discarded, a total loss. The imposition of this kind of manufacturing risk will cause many market departures and other bad economic impacts. You will only have to discard one big lot to get the message – find something less regulated to do.

My word against hers, right? Well, perhaps not. My home state of Illinois is running a test on this point. Illinois has a new law that requires labeling toys (you know, a warning label that Scott Wolfson doesn’t think matters) if they have paint with lead over 40 ppm. Actually, since lead-in-paint is now illegal under federal law at 90 ppm, the Illinois law effectively requires labeling for paint on toys BETWEEN 40 and 90 ppm. Feel safer already? Not everyone does. See the coverage in the Akron Beacon-Journal on such labeling. The headlines of the article says it all: “Label on doll shoes made by Toys R Us subsidiary worries parents. Warning about lead is cause for concern. Company says product is safe, but some experts say children shouldn’t be exposed to even small levels of metal in toys.” The AAP thinks this would be a jolly good rule for the entire economy.

I could go on. [If you are bored, you are welcome to consult my response to the "no safe level of lead" argument in response to Bob Adler's attempt to "prove" this point.] In point of fact, the consumer groups are just trying to gum up the works. There are apparently still some members of Congress (I am not ready to name names) who are “true believers” and according to rumor, are ready to block any sensible effort to fix this law. I guess it’s tough for some people to admit a big screw-up. Keep this in mind the next time you hear the media blame Republicans for “gridlock”.

In any event, you should not feel particularly comfortable just because the Republicans are running the show in the House. The Republicans are in fact very aware of the issues and the details of the problems under the CPSIA and at the CPSC, and are motivated to do something about it. They have the votes and the intent to move something useful forward. However, the Senate is still controlled by populist Democrats who just seem deaf to reason, argument or data. As long as they (or even just one of them) stands in the way of putting this part of the economy back on track, we are stuck. Even with the grudging cooperation of Senate Democrats, we also need the White House to sign the law. And then there’s the persistent zealotry on the CPSC Commission. Many variables and risks remain.

Despite the odds and the death march aspect of this “war”, we must carry on. We must keep fighting, we must keep calling, we must keep protesting. The words of Ronald Reagan ring in my ears:

“I do not believe in a fate that will befall us no matter what we do. . . .

I do believe in a fate that will fall on us if we do nothing.”

We are the People, this is our country. We do not need to be held hostage by a small group of zealots. The task of taking back America did not end at the 2010 midterm elections. If the Dems will not help us, and if the consumer groups are going to be obstructionist to the very last, then we must fight and we must fight with vigor and intensity. No one is going save you . . . but you.

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CPSIA – Consumer Groups and the CPSIA

CPSIA – Freedom of Information Act Request – Follow-up

As sent today:

Dear Sir,

It has now been almost two months since I submitted the below request for information under the Freedom of Information Act. Your office acknowledged receipt of this request on April 1 and stated the following:

“Due to certain procedural steps we are required to take under our statute, there may be delays in providing the records. Please be assured that every effort is being made to process each request as equitably as possible, and that the records or information that you have requested will be made available to you at the earliest possible date.”

My request relates to pending legislation currently under consideration in the U.S. House of Representatives. As such, the request is both relevant to the development of this legislation and rather time-sensitive. The public has a right to know about these documents. Disclosure of these documents is in the public’s interest – transparency in how we are governed is a paramount interest of U.S. citizens. The disclosure of these documents are very relevant to the development of the Consumer Product Safety Enhancement Act, the subject of a recent hearing by a subcommittee of the House Committee on Energy and Commerce. I testified at that hearing.

Notwithstanding the assertion in the April 1 letter above, the requested documents have not been disclosed yet. This is especially disappointing as the documents involved in this request are few, easily-located and in the possession of very few, easily-identified people at the CPSC. The effort to gather, review, redact (if necessary, which seems unlikely), duplicate and transmit these documents is almost certainly inconsequential. I find the delay inexplicable and inexcusable under your statute.

I urge you to rapidly comply with this request for disclosure. As I noted in my original request, your agency’s rules demand it – “disclosure is the rule and withholding is the exception.”

Thank you for your prompt consideration of this matter.

Richard Woldenberg
Chairman
Learning Resources, Inc.

——————————————————————————–
From: Rick Woldenberg
Sent: Tue 3/23/2010 3:44 PM
To: ‘cpsc-foia@cpsc.gov’
Subject: Fast Track FOIA Request Relating to Draft House Legislation Know as “Consumer Product Safety Enhancement Act of 2010”

I am making this document request pursuant to the Freedom of Information Act and 16 CFR §1015. I would like to receive copies of all documents (written or electronic, including notes and staff briefing packages) relating to (a) interactions between Chairman Inez Tenenbaum and/or Commissioner Robert Adler and/or their staff and the House Committee on Energy and Commerce (and/or staff associated with that committee or its members) relating to the Consumer Product Safety Enhancement Act (CPSEA), and (b) any CPSC legal analyses or legal opinions relating to the CPSEA. Since the CPSEA is presently being circulated in draft form on Capitol Hill and since the committee’s staff is seeking feedback from various stakeholders at this time, time is of the essence for this information request. Please accord this request “fast track” status.

In making this request, I note the following statement in 16 CFR §1015(b): “The Commission’s policy with respect to requests for records is that disclosure is the rule and withholding is the exception. All records not exempt from disclosure will be made available. Moreover, records which may be exempted from disclosure will be made available as a matter of discretion when disclosure is not prohibited by law or is not against the public interest.”

My contact information is found below. Thank you for your cooperation.

Sincerely,

Richard Woldenberg
Chairman
Learning Resources, Inc.

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CPSIA – Freedom of Information Act Request – Follow-up

CPSIA – Waxman’s New Amendment Progress Report

In the last couple weeks, Rep. Henry Waxman’s staff on the House Committee on Energy and Commerce has been approaching Republicans and various stakeholders for feedback for a “bipartisan” approach to fixing the CPSIA. In these discussions, the staff has acknowledged that the law is “flawed” and requires surgery, not just tweaks. An interim (artificial) deadline of this week has been established for comments on their planned amendment. A draft of this amendment has not seen the light of day yet. No one knows what it will say.

While this may sound “good”, the Waxman staffers have also attempted to constrain the development of the amendment. For starters, they insist that the amendment be based on the failed Waxman amendment of last December. [Last year's try was covered in several posts in my blog from December 11-16.] They have also drawn quite a few lines in the sand, such as no change to age limits in Children’s Products. They favor exemptions for individual product categories or even individual products, a Swiss Cheese approach. [I hate this approach, as does just about everyone else other than the Waxmanites.]

The Waxmanites seem interested in helping out the ATV’rs. Apparently, the legislative logic is that if the amendment caters to the ATV’rs, who have been quite noisy and enjoy wide support among members of Congress, no one will be able to vote against the amendment for political reasons. Thus, the makings of a Democrat victory and the appearance of bipartisanship. I can see it now: “The two parties worked together and fixed the parts of the law that caused unintended consequences. All is well!”

Among the “have-nots” in this approach:

  • “Common Sense”. This case-by-case or product-by-product approach means that the Waxmanites refuse to even consider trusting the CPSC to do its job and assess risk for itself. The only people the Waxmanites and consumer groups can trust are . . . are . . . themselves. You won’t be able to draw a line between those that are “in” and those that are “out” in any rational way.
  • Rhinestones. On the subject of rhinestones, my understanding is that they are so resolute on keeping these innocent stones in the bill that they would be willing to write rhinestones in explicitly. This is the opposite of case-by-case exclusion – it’s a case-by-case INCLUSION.
  • Educational Products. While the Waxmanites say they want to exclude educational products, they can’t figure out how to do it since you might use an educational product in your home. Horrors! Again, without a simple notion of what’s safe and what’s not, how do you expect a sensible rule to emerge from this primordial goo?
  • Bikes. They really want to figure out how to help bikes but can’t seem to do it. For this reason, they are chatting about an indoor/outdoor exclusion. In other words, and I am not kidding, they have suggested a rule that if you keep something in your garage, it’s “out”, and if you keep it indoors, it’s “in”. So everybody – move all your toys, children’s clothing and shoes, furniture, books, pens, appliances and so on into your garage, quick, so you can qualify for this great new exemption! [Try to resist holding a garage sale, though, because that presents special risks under the law!]

Not one to look a gift horse in the mouth, I am happy they are thinking of an amendment, but I am not happy that we still find ourselves adrift without any sense of what’s safe and what’s not. It is hard to foresee an amendment that does much good with this kind of inflexibility. Bipartisanship promises to be hard to obtain or a sham staged by Democrats for their own benefit.

Remarkably, a hidden issue that may weigh on these proceedings is the growing awareness of paralysis at the CPSC. The agency saw a massive increase in its budget last year, to match its massive new responsibilities, but still finds itself mired in open projects and conflicting priorities. Simple things are taking forever. Agency paralysis cannot be prevented in this environment without a significant paring of CPSIA priorities, something that the Waxmanites have a hard time conceding. And Obama won’t give the agency more money, so they’re stuck. And we’re stuck.

That’s not where you want to be.

Something to think about as we go forward:

  1. Principle One: Your silence is deemed to be your approval. Silence = approval. You must swing from the rafters to get their attention, too. No, don’t do that – too dangerous.
  2. Principle Two: An unopposed view, particularly a document with footnotes, is considered definitive. After all, if it were wrong, why didn’t anyone point it out, with footnotes? This is really how the Waxmanites think.

You need to keep these principles in mind. Your loud involvement can help a lot.

To Be Continued . . . .

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CPSIA – Waxman’s New Amendment Progress Report

CPSIA – RILA Requests Comments on its Global Standards

We received the following request from RILA about its new Global Standards. Here are some FAQs they supplied. RILA is asking for comments by December 1 which I think is too tight. We have asked them to extend the date into mid-January . . . it is the Xmas season.

These standards are yet another massive threat to the manufacturing community. It is essential that MANY companies contribute their ideas and comments to protect our ability to do business with the mass market merchants. Frankly, you ignore this standard at your peril. Please send RILA your comments.

Dear Supplier,

Earlier this year, the Retail Industry Leaders Association (RILA) joined with the British Retail Consortium (BRC) to develop a retail-led, Global Standard for Consumer Product Manufacturing (GSCPM). RILA has been distributing drafts of the Standard through fellow trade associations, including possibly your own, since July 2009.

You have been identified by a RILA member as a key stakeholder in the development of this Standard and attached you’ll find the latest draft of the BRC/RILA Global Standard for Consumer Product Manufacturing.

As the BRC/RILA Standard drafting process comes to an end, we welcome your comments and value your feedback on the content. Please email all comments directly to Jim.Neill@rila.org by December 1, 2009.

Key components of the BRC/RILA Standard includes development of Sector Specific Guidelines, as well as a phased, orderly implementation. Please consider working with us in the development of these in the near future and let me know if you’re interested.

In addition to the BRC/RILA Standard, you will also find attached a Frequently Asked Questions document about the Standard and the program. If you have further questions, please do not hesitate to contact me.

I look forward to working with you in the upcoming months.

Best Regards,

Jim Neill
Vice President, Product Safety
Retail Industry Leaders Association
1700 N. Moore Street, Suite 2250
Arlington, VA 22209
Direct: 703∙600∙2022
Mobile: 202∙412∙8960
Fax: 703∙841∙1184
mailto:Jim.Neill@retail-leaders.org

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CPSIA – RILA Requests Comments on its Global Standards

CPSIA – Nancy Nord Announces a Delay in the "15 Month Rule"

As hinted at in this space on Thursday, the CPSC is apparently going to delay the issuance of the so-called “15 Month Rule”. In Nancy Nord’s new blog, she provides the following important information:

“Periodic Testing – On a related issue, the CPSIA requires that we issue a rule setting out further testing requirements within 15 months of enactment (November, 2009). The agency will not meet that deadline in spite of best efforts to do so. This issue is extremely complex and we need additional input from the affected public before we give answers. The staff will hold workshops on December 10th and 11th to seek public participation. A Federal Register notice will be published with details about the workshop and will also provide details for those who wish to submit written comments. In addition, a draft “Guidance Document on Testing and Certification” will be discussed with the Commission at a public meeting on November 9th. See http://www.cpsc.gov for webcast details.” [Emphasis added]

This is good news for the business community on several levels. First of all, the CPSC is now communicating informally through at least one blog. While it increases the number of places to watch for legal developments, you can’t beat candor and openness. In addition, the CPSC is doing the considerate thing – giving advanced notice of a material event (the delay in this much-anticipated and much-feared rule). They are being nice, which is MUCH appreciated.

Finally, the Commission is being candid and admitting a small failure. [In fact, the admission is being done in a bi-partisan way, as Democrat Tenenbaum presumably consented to Republican Nord announcing this development in her new blog.] It is somewhat more complex than that, in fact. This is probably not best understood as a failure of the CPSC (although they are going to miss a date). They are CHOOSING to miss a date. Why? My guess is that they realize how important this rulemaking is, and are probably troubled by what the rule would look like under the (defective) CPSIA. It’s a public acknowledgement, the strongest in a long while, by the agency that it is genuinely troubled by the unintended consequences compelled by the new law. Withholding the 15 Month Rule is a sign of resistance against doing more damage in the marketplace.

The CPSC has heard from many stakeholders that this rule could be the final straw. I think it’s fair to assume that they do not want to do more damage. It is a bi-partisan worry, too – which is in the character of the CPSC over the years. They have not traditionally been the enemy of the business community, so it is nice to see them act with consideration again. Rumorville has it that the CPSC Staff could not find the magic words to make this rulemaking “work”. Good to admit it. There’s a lot implicit in that statement, most of it very good.

In my comment to the Nancy Nord blog, I ask the Commission to use the plain English meaning of the statute to make their decisions. If they cannot make a sensible decision using the plain English meaning of the words (e.g., does “any” mean “any” or not?), then the Commission should go to Congress and ask for an amendment. A statutory scheme based on twisting words into pretzels does not serve anyone’s interests. To understand our obligations, we go to the statute and read it. How can we run our businesses if there is a super-secret meaning to plain English words? Are we expected to master hundreds of pages of releases spread of months or years to discover the nugget explaining that “any” doesn’t mean “any”? This kind of treasure hunt inevitably fails. [If you like treasure hunts, see my recent blogpost on resale shops.]

Importantly, the CPSC has announced a two-day meeting on the 15 Month Rule on December 10/11. This is a critical meeting for all stakeholders. Please try to make it. I will be there.

Bottom line, this announcement is another gratefully-received sign of a shift in the wind. Let’s see whether more good follows in coming weeks. We now have more dots to connect. It would be wonderful to be able to trust the CPSC and the law again. Guys, please keep plugging away!

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CPSIA – Nancy Nord Announces a Delay in the "15 Month Rule"

CPSIA – Washington Post Notes Zealous CPSC Enforcement Actions

In today’s Washington Post, Lyndsey Layton wrote an article entitled “A Vigorous Push From Federal Regulators” in which the current enforcement approach of the CPSC is given considerable space. The Post notes the decision by the CPSC to make rhinestones illegal as an example of “getting tough” on the law. [Btw, for those of you playing along at home, the CPSC has yet to deign to call me or answer my letter on rhinestones dated September 17. I shouldn't be surprised, after all they have thousands of similar unanswered questions on their desks - what's so special about me?!]

The Post sums up the problem as follows: “‘It’s “shoot first and ask who we shot later,”‘ said Gary L. Yingling, a lawyer and pharmacist who worked for a decade in the FDA general counsel’s office and now represents companies regulated by the agency. ‘My concern is whether they’ve dotted their i’s, crossed the t’s, understand the statutory regulations and understand what the agency did yesterday. That’s a real concern.’”

Ms. Tenenbaum, from the same article: “We are enforcing the law; that’s what we do.”

Of course, the obvious problem here is that these regulators refuse to exercise judgment. They tend to hide behind their claimed responsibility to enforce the law (implying that this process must proceed without an exercise of judgment) and fail to explain or justify their use of force on any grounds rationally related to safety. Perhaps they feel this cleanses them of responsibility for their actions, as they didn’t write the law. It’s a classic bureaucrat’s excuse – don’t talk to me, I am just following orders. There is historical precedent for fearing government officials with this attitude.

Perhaps he CPSC will go on its merry way and put us all out of business, hobble a great industry and harm millions of kids by depriving them of essential products necessary to their development or preservation of their standard of living – but only YOU can stop them. The agency (which used to brag about its broad “enforcement discretion” back in the olde days at the beginning of the year) will respond to its Congressional overlords. You need to carpetbomb them with emails, calls and letters expressing your concern. Make sure to let them know how you have been victimized by the law and how it is harming kids in your community. We need to raise a holy stink if we want any chance to stopping the vigorous enforcers.

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CPSIA – Washington Post Notes Zealous CPSC Enforcement Actions

CPSIA – CPSC Recalls 40 Inflatable Bats for Phthalates

I know I am crazy, over the edge, worrying about a CPSC so hellbent on enforcing the awful CPSIA that it will chill the market and kill products and companies that are essential to those markets. I know I have a reputation . . . .

Well, consider this recall today: a California company agreed to a recall of 130 pieces of several toys, including an inflatable bat stenciled with “Home Run” on it. The bat was offensive because it violated the phthalates standard. A recall of 130 pieces spread over several toys, means that they must be recalling less than 130 pieces of the inflatable bat. So I called the company (Daiso Japan) and asked them exactly how many bats were involved – the answer? Forty. Feeling safer already?

This is a rather strict standard . . . and completely disproportionate to any conceivable risk. Phthalates do not “ooze” from toys – they must be mouthed and chewed. The CPSC knows this – their own CHAP examined this question and their own scientists participated in “chew tests”. So, in choosing to expend resources on a recall of 40 pieces of an inflatable bat that is clearly not intended or likely to be mouthed, the CPSC is imposing a strict liability standard with no apparent threshhold for recalls – one unit is enough to justify this public humiliation.

This is asinine, of course. How do you expect the business community to react to this development? Well, for one thing, they will overreact. I anticipate that our customers will demand that we prove that everything we make is phthalate-free, toy or not. This means expensive tests to prove that we have not used an additive not found in nature. [It's an ADDITIVE - it will only be there if added.] The application of this rule by the marketplace to every product, whether or not subject to the ban, means that more of our items will lose marketshare simply because we cannot afford to test them to prove we were compliant. The cull of items will accelerate.

This turn in the market will dramatically increase our costs. At this point, we have seen cost increases in the range of 12-40%. Perhaps those surcharges will fall over time, but right now, that’s a pretty hefty chunk of lost profits. The impact will be lower revenues as products are dropped and volumes decline in the face of forced price increases. Price increases in a weak market is not a winning strategy.

Another factor will be fear. Companies will look at this development, connect the dots with the penalty-happy posture of this new CPSC, and realize that any misstep is subject to dramatic punishment. They will pull into their shell – or leave the market. This is called a “chilling effect”.

And what will be achieved? Recalls of less than 130 pieces is pointless from a safety standpoint. The presence of phthalates in a toy is not tantamount to devastating injury, even if banned. The CPSC used to tout its “enforcement discretion” but apparently has no intention of using it here. Even so, the use of phthalates in a baseball bat is hard to link to injury under any rational standards – baseball bats are not teethers. Ergo, there are no rational standards. “Common sense” at the CPSC is a sound bite only and a pathetic figment of the marketers’ imagination.

Enjoy! You can thank the Congressional Democrats for all the good this is bringing to your life.

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CPSIA – CPSC Recalls 40 Inflatable Bats for Phthalates