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CPSIA – Obama Will Sign HR 2715 CPSIA Amendment Into Law Today

President Obama is expected to sign HR 2715, the CPSIA amendment that picks winners and losers and represents the end of legislative action to repair the misconceived CPSIA. Obama has to clear his desk before his vacation next week. This will be one of his last “to do’s” before R&R begins. Now what? Here is my prediction: a. The push will be on for the end of CPSIA rulemaking. Not only are the Dems on the CPSC Commission tired of this (times ten) but Congress wants this off their plate, too. Our petty concerns have been “addressed” and besides, what could go wrong anyway? Um, well, consider this ” colloquy ” between three powerful Democrats in the Senate. Before you read on, please note: – HR 2715 is a bipartisan bill, sponsored by both parties (obviously). This dialogue is among three like-minded Democrats. Why isn’t it a colloquy between both parties? Is this even relevant? As you will see, that depends on where you sit. – The three Senators involved have always agreed with each other on this law and have been remarkably resistant to any data, reasoning or argument that opposes their preconceived notions about the CPSIA or its groundings. Should their time-warp views be accorded any relevance? – Inez Tenenbaum has already cited this “colloquy” as her Congressional “instructions”. Dem to Dem. Storm clouds gathering? I have no idea if this dialogue actually took place or is just a figment published to justify the Dem agenda. Not even an interesting question to resolve, frankly. Enjoy: ” Mr. ROCKEFELLER. Mr. President, I rise to engage in a colloquy with my colleagues, Senators Durbin and Pryor, over the passage of H.R. 2715, a bill that passed on the House suspension calendar by a vote of 421-2 and the Senate by unanimous consent. Due to the fact that this bill bypassed regular order and failed to receive consideration in the Commerce Committee, I believe it is important to explain our intent in passing this bill.” Mr. DURBIN. I am frustrated that the Consumer Product Safety Commission has taken too long to promulgate rules required by the Consumer Product Safety Improvement Act, CPSIA, including the rules on third-party testing obligations and the component part testing rule. I did not oppose H.R. 2715, because it does not delay or impede the Commission’s ability to implement those rules–although it may place some increased costs on the Commission due to actions required as a result of new CPSC mandates and authorities–and I urge the Commission to complete its work expeditiously. Mr. ROCKEFELLER. I share the Senator’s concerns about the CPSC’s delay in promulgating its regulations in accordance with the mandates of CPSIA. While I sympathize with the CPSC over its resource constraints, the Commission must accelerate its efforts and complete the important regulations required under CPSIA. The provisions in section 2 of H.R. 2715 were not intended to delay or stop the Commission’s current rulemaking under section 102 (d)(2) of the Consumer Product Safety Improvement Act to implement the critical provision related to the third-party testing of children’s products. I fully expect the Commission to go forward with these important rulemakings with no disruption from the passage of this bill. Given the limited resources of the Commission and recognizing the length of time it has taken to implement the provisions of the Consumer Product Safety Improvement Act, it is intended that most of H.R. 2715′s new mandates on the CPSC are not rulemakings. Some of the new authority, such as the functional purpose exemption and the authority to restrict the scope of the used products exemption, are subject to a notice and hearing requirement, but not to a rulemaking. Others, such as the creation of a new public registry for small batch manufacturers, can be implemented without notice and comment or even a hearing. As such, the Commission should act to effectuate the new mandates of this bill in a most expeditious manner. Mr. PRYOR. I also share the Senator’s view that nothing in H.R. 2715 is intended to delay the Commission’s rulemaking with respect to third party testing and believe that Commission should conclude its testing rulemakings in the next 2 months. I supported H.R. 2715 because it made minor modifications to an important consumer product safety law and supported implementation of important aspect of the Consumer Product Safety Improvement Act such as the consumer product database. This bill will require the CPSC to extend the deadline for posting reports on defective products by 5 days if a business asserts that the information in the report is not accurate. However, this change does not alter the fact that the Commission still must post the report in the database after those 5 days even if it is still reviewing the merits of the complaint. ” So now you know what is going to happen. Tenenbaum is practically broadcasting it. She has received her “instructions”. They’ve heard enough. b. With Thomas Moore’s run at the CPSC ending once and for all in October, and with consumer groups already publicly calling for his replacement ASAP, the Dems will be very anxious to complete as much work as possible before he goes. His replacement’s confirmation through the Senate is not a sure thing at all. Even a recess appointment is not as much an option as in the past (the Senate is running a “pro forma” session right now to head off this step by the President). If Moore is not replaced on a timely basis, the Commission will shrink to just four people which means that Tenenbaum and Adler might actually have to listen to their Republican counterparts and seek COMPROMISE to get things done. Don’t hold your breath – they’d prefer to get it done their way. Expect the worst from the next three months. c. 2012 will be the year of enforcement. In 2012, you will get to find out how well I can predict the future. 2012 won’t be fun for some people, maybe lots of people. Nothing good will be achieved from a safety standpoint but the CPSC will get to strut its stuff. [Does it strike you as ironic that Ms. Tenenbaum brags about falling recall rates under her reign? Is or isn't this the exact reason that Congress got so mad at Nancy Nord? I guess when Dems are in charge, falling recall rates are a good sign. When Republicans are in charge, it's so so bad,] Get ready for some tough times.

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CPSIA – Obama Will Sign HR 2715 CPSIA Amendment Into Law Today

CPSIA – Hey Republicans, You Aren’t Allowed to Think!

During the July 7th House Energy and Commerce Committee’s Oversight Subcommittee hearing on regulatory reform among independent agencies (a hearing which presumably prompted Obama’s Executive Order two business days later), Ranking Member Diana DeGette (D-CO) trotted out one of the most common arguments against change: “I want to talk . . . about the recent proposals on the other side of the aisle that would undermine the Consumer Product Safety Commission and some of the other good work that they’ve done.  Three years ago, this Committee and this Congress worked hard in a significantly bipartisan manner to put meaningful reforms for consumers into the [CPSIA].  This has yielded unbelievable benefits. . . . So I think it’s important to know this, that these reforms were worked out by this Committee in one of the last great efforts that was completely bipartisan.  We should embrace that.” This is a familiar argument by Dems.  The law passed almost unanimously, guys, so it’s wrong to try to change the law now.  What logical point is DeGette making here?  How is this argument supposed to persuade us? At first, I thought the Dems were simply arguing the infallibility of Congress.  Congress never errs, so how can we doubt something every Congressman voted for?  Congress is all-knowing and cannot pass a bill without doing the right thing.  [And as Obamacare indicates, Congress apparently doesn't even need to read the bills to get them right.] To argue that this law is a product of infallible judgment is quite a leap.  Even the unanimity of the law hardly explains the mental state of Congress at the time.  Congress was ANGRY.  Have you ever said or done anything in anger you later regretted?  ‘Nuf said. No, an infallible Congress cannot be what Ms. DeGette is pushing.  Actually, I think it’s far simpler.  She is saying that the Dems were right and are still right and have no need or interest in changing their position.  She points out that the two parties agreed on the law’s text in 2008 and passed it almost unanimously.  Now the Republicans want to make serious changes.  She says the Republicans should return to their bipartisan brothers, the Dems, and support the work they did three years ago.  She essentially calls into question the motivation of the Republicans in opposing the Dems now, suggesting that this is a by-product of a broken Washington, where partisan posturing is all we can expect from these people. At the heart of her reasoning is the fact that the Dems are holding their course behind the law, and the Republicans have moved, and now she wants the Republicans to be more “bipartisan” by returning dutifully to agreement with the unwavering Dems.  Or is it the intransigent Dems?  A matter of perspective, I suppose.  Come back to the fold with the Dems!  DeGette’s argument relieves the Dems of any obligation to reconsider ANYTHING.  How convenient.  How Waxman-like. Here’s something the Dems won’t tell you – the law was jammed down the throats of the Republicans in both Houses of Congress.  Congress was controlled by Nancy Pelosi at the time (she of San Francisco, of course).  The CPSIA was purpose-built for getting Democrats elected and was not negotiated with the Republicans in any sense you would recognize.  On the national stage, the Obama wave was cresting at that time, too, so what do you think the political calculation was in the Bush White House and in the Minority ranks in either House on the CPSIA?  The Republicans knew that any opposition to any aspect of this law, regardless of how awful, would mean attack TV commercials on support for children’s safety at a time of great electoral vulnerability. Bush agreed to sign the bill to protect his party, not to protect kids.  At least it neutralized a possibly existential political threat.  Each Republican Congressman or Senator had to make a similar political calculation.  Only four people (Ron Paul and three Senators) were politically courageous enough to stand up against this excessive bill.  It is certain that far more than four members of Congress found fault with the CPSIA at the time.  The 2008 “great bipartisan effort” that DeGette romanticizes is an urban legend, a fiction, a fairy tale, a story.  She wants to cow the Republicans into losing their political nerve at this critical juncture when some kind of momentum behind our position may actually be growing.  She wants them to think ballot box. And for those of you who pepper me with defense of Dems or reminders of past Republican “sins”, all I can say is this:  the Republicans have nothing to gain politically from their three-year effort to right this wrong.  They are taking electoral risks to help us, and have been unwavering in their support of our mission. I can only believe that this is because they actually are trying to do the right thing.  This has never been about policy or safety. The Republicans know that this issue has been played for political gain by the Dems with no remorse over the devastation they have wrought to your businesses, your markets or job creation.  For them, it’s just too juicy an opportunity to get reelected.  And if that’s so, it must be the reverse for the Republicans. The Republicans are taking this risk on your behalf, for your benefit. I hope there’s a nice occasion to say “thank you”.  In the meantime, the likes of Diana DeGette must be vanquished.

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CPSIA – Hey Republicans, You Aren’t Allowed to Think!

CPSIA – WSJ’s 8th Editorial Against the CPSIA

Eight WSJ editorials on the same topic. Is it time to get Congress’ hearing checked???

MARCH 11, 2011

Get the Lead Out, Sir
Nutty test standards give Obama a real chance to help business.

President Obama has been on a campaign to shake his antibusiness reputation, so a good place to start would be to revisit the Consumer Product Safety Improvement Act, a mess of a law that has put new burdens on small businesses.

In 2008, Congress passed the law in a rush to do something after a scare over lead in toys imported from China. Its problems were quickly apparent, sweeping products from books to bicycles into the dragnet for lead standards. But while businesses pleaded, Democrats stood behind it as a pinnacle of consumer protection while blaming the Consumer Product Safety Commission for any enforcement problems.

The CPSC has done what it can to allay the fiasco of unintended costs and disruptions for small businesses, including staying large portions of the law. But as Commissioner Nancy Nord told House Democrats last year, the language of the bill is drafted in such a way that fixing all the problems is impossible because the “exclusions and exemptions process is not workable.”

Instead of being able to focus energy on products that present real risks to kids, the CPSC’s staff has had to regulate products that pose no harm. The likelihood of a toddler swallowing an all-terrain vehicle, for instance, didn’t stop that product from being swept into the maw.

The law also requires the CPSC to propose the parameters of a third-party lead testing regime, but the issue is so mired in complexity that the commission has yet to set those standards. Under the proposed version of this so-called “15 Month Rule,” Learning Resources Chairman Rick Woldenberg has estimated that supplying multiple testing samples on each of his company’s toys and products will cost his company some $15 million per year.

It gets worse. In August, the lead standard is set to go down to 100 parts per million from the current level of 300 parts per million. Like the earlier step down, the new standard is supposed to be retroactive when it goes into effect, meaning that it will apply to toys and children’s products manufactured before that date, which were perfectly legal when they were made. All five CPSC commissioners have said they don’t believe the new standards should be retroactive when they go into effect this summer.

At a hearing in the House Energy and Commerce Committee in February, California Democrat Henry Waxman defended the law as “necessary to protect kids and families across the country.” We wonder how he figures that, since the incidence of lead poisoning from toys made by domestic manufacturers is nil.

Energy and Commerce Chairman Fred Upton and Subcommittee Chair Mary Bono-Mack have said they will soon introduce a bill that would finally end a regime that has clobbered small businesses with ill-conceived regulations. If Mr. Obama wants to help small business job creation, he could agree that the government doesn’t need to mandate a lead testing protocol for every product known to man.

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CPSIA – WSJ’s 8th Editorial Against the CPSIA

CPSIA – Report Abusive Database Rule to Eric Cantor!

Today, Republican CPSC Commissioners Nancy Nord and Anne Northup, noting the stifled debate orchestrated by Democratic CPSC Commissioners on the final public database rule (up for a vote on November 17th) and the toxic impact of that rule on the business community, have proposed their own alternative rule on the database.

I will provide a link HERE as soon as it is available. I believe the CPSC is currently mud wrestling over whether the Nord/Northup alternative proposal can be shown to you . . . the public. I think the Dems don’t think you are mature enough to be able to read it. Perhaps when you’re older . . . .

Here is Nancy Nord’s blogpost and Anne Northup’s blogpost relating to their proposed new rule. I also want to commend Ms. Northup’s three other blogposts on this topic, beginning on October 27. It is gratifying to see Commissioners taking political risk to do the right thing. Both Ms. Nord and Ms. Northup are taking a stand here. Let’s hope that fighting breaks out on other issues, too. We need the help.

This proposal by two Republican Commissioners is yet more shocking evidence that at today’s CPSC, safety and market integrity is an entirely partisan issue. Frankly, I don’t understand this and find it all so outrageous. In my view, this cartoonish standoff is ENTIRELY the fault of the Democrats who are stone deaf to the legitimate concerns of the business community. The hollow words of Inez Tenenbaum committing to “dialogue” with stakeholders makes me want to scream.

Consider, for instance, that I testified at the hearing on the database on November 10, 2009 at the personal request of Matt Howsare, Tenenbaum’s then counsel (now her Chief of Staff). Ms. Tenenbaum purportedly wanted my feedback on this critical proposal, and as it was related to me, the agency needed more comments from the business community. Naively, I spent our company’s money to fly to Washington to accommodate this seemingly reasonable request. I am accepting Fool of the Year nominations at this time. . . .

This hearing took place almost exactly ONE YEAR AGO – plenty of time for Ms. Tenenbaum to absorb my testimony. Listen to my testimony – did the majority take ANY of my points seriously? According to Nancy Nord, she was not allowed to ask at the October 20th Commission meeting about CPSC Staff’s conclusion that the rule would have an insignificant impact on small business – the ENTIRE focus of my testimony in November 2009. Don’t kid yourself, staff conclusions like this are are driven from ABOVE – from Ms. Tenenbaum and her political patrons. Ms. Nord was gaveled silent by the majority party – they had heard enough, I guess. Other issues impacting business interests from a fairness standpoint were also ignored or blunted.

This kind of treatment is completely outrageous. This example of government-out-of-control explains why the public spoke so profoundly last Tuesday. Nevertheless, the people running the shop at the CPSC didn’t hear you on Election Day. We MUST stop the Dem’s plan – unless you want to be eaten alive by trial lawyers. Listen to my testimony – it’s a road map to litigation doom.

Eric Cantor has called for substantially increasing Congressional oversight of the activities of federal agencies which he says are “now actively working to enact [President Obama's] agenda through agency regulations”. Could Tenenbaum, Adler and Co. be doing JUST THAT at the CPSC right now? Hmmm.

Please WRITE ERIC CANTOR to tell him what you think. His fax number is 202-225-0011. Please post your letter as a comment to this blog.

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CPSIA – Report Abusive Database Rule to Eric Cantor!

CPSIA – WSJ Profiles RW in Article on Business Backlash

OCTOBER 12, 2010

Business Backlash Grows


VERNON HILLS, Ill.—Rick Woldenberg runs an educational-products company from a suburban Chicago office stacked with brightly colored toys. He supported President Barack Obama in 2008. But he has turned on Democrats this year.

Sally Ryan for The Wall Street Journal

Rick Woldenberg, chairman of Learning Resources in Chicago, backed President Barack Obama in 2008 but is now raising money for Republicans.

Mr. Woldenberg is angry that Congress and the Obama administration won’t revise expansive new rules on lead testing in children’s products that he says will kill his business, Learning Resources Inc. So he is raising money for Republicans among Chicago business owners to help the GOP—so much money that he is rattling the incumbent in what has been one of the safest Democratic seats in Mr. Obama’s home state.

“If Democrats are going to put me out of business, I’m going to put them out of business first,” he said.

Disaffected business owners like Mr. Woldenberg have emerged as a potent force in the 2010 campaign. The U.S. Chamber of Commerce, which plans to spend $75 million in this election cycle, says it has exceeded its targets for raising money from small businesses every quarter this year, despite the poor economy. More small-business candidates are running for public office than at any time in a generation, say officials at the National Federation of Independent Business, the capital’s chief small-business lobby.

Business contributions are fueling campaign efforts by conservative and business groups, which are gearing up to spend as much as $300 million to help Republicans this fall.

Mr. Obama and Congressional Democrats have wooed small-business owners with a series of tax breaks and a $30 billion lending program that was the centerpiece of a Small Business Jobs Act Mr. Obama signed last week at a White House ceremony attended by a group of supportive entrepreneurs.

But many small-business owners still fault Mr. Obama and Congressional Democrats for what they see as a costly explosion of new rules and regulations.

“I think Obama ran as more of a moderate, and business people here are now realizing that this huge expansion of government is not sustainable,” said Leo Dombrowski, an attorney at Wildman, Harrold, Allen & Dixon LLP in Chicago, whose clients are fighting new environmental rules.

Mr. Woldenberg has helped raise more than $470,000 for Joel Pollak, a 32-year old Harvard Law School graduate who is challenging Rep. Jan Schakowsky in Chicago’s 9th district, a friend of Mr. Obama who is an author and ardent defender of the new children’s-product lead law. That’s 20 times more than any Republican has ever raised for a run against Ms. Schakowsky, who won 75% of the vote in the last election and is vying for a 7th term.

“This is a war,” he said. “Individuals can make a difference, and I want my kids to see it.”

Over the past few months, Mr. Pollak said, he and Mr. Woldenberg have been trying to tap into “donors residing outside the district with a strong business or personal motivation.” The Pollak campaign scored a fundraising appearance by Republican economic policy star Rep. Paul Ryan of Wisconsin. Mr. Pollak took the podium and pointed out Schakowsky campaign manager Alex Armour, who was in the crowd videotaping the event.

Ms. Schakowsky is polling at slightly more than 60%, according to her internal polls, a solid lead but narrower than in the past. The campaign has hired four field staffers for the first time, and is sending less money to Democrats in closer races.

“I’m not worried about it, but I’m taking it seriously,” she said. Ms. Schakowsky said Mr. Woldenberg’s success as a fundraiser, is proof that “very cynical … special interests are highly engaged in the campaign.”

As for the lead law, she said she was proud of it. “The goal is to save children from toys that are toxic.”

Mr. Woldenberg’s efforts include addressing 130 people in a Holiday Inn ballroom in suburban Skokie, Ill., during Mr. Pollak’s “Chicagoland Business Breakfast” in late September.

He held up a “box of rocks,” the company’s igneous rock collection kit, and read its new consumer warning.

“Caution: federal law requires us to advise that the rocks in this educational product may contain lead and might be harmful if swallowed,’” he read, to laughter.

“This is humiliating,” he said, ticking off the costs of the law. “I’m hoping Joel can help us.”

Two dozen attendees took the microphone, voicing concerns with health-care, tax, environmental and workplace rules. They included Jay Stieber, vice president of restaurant chain Lettuce Entertain You Enterprises Inc., and chairman of the Illinois Restaurant Association, who has his headquarters in the 9th district. He and his family have contributed the maximum $4,800 to Mr. Pollak.

“The hospitality industry is the biggest employer in Illinois, and my partners and I have been lifelong Democrats,” he said, but changed sides because “I can’t stand here and tell you what health-care is going to cost.”

Write to Elizabeth Williamson at

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CPSIA – WSJ Profiles RW in Article on Business Backlash

CPSIA – Something’s Cooking on "Children’s Product" Definition

763 days have passed since ANY Democrat in Congress did ANYTHING to help us on the CPSIA. There are only 47 days left until Election Day.

I have written in this space about the recent shocking release by the CPSC of the final rule on the interpretation of the term “Children’s Product” under the CPSIA. The agency’s official interpretation of this defined term will dictate the creeping scope of the awful CPSIA and likewise has the potential to trim its sails. Many people gave detailed comments on the agency’s troubling initial draft of the interpretative rule, including me. I bashed the rule for its many problematic flaws.

The release of the final rule was stunning because, as I have noted again and again, the agency basically ignored or dismissed ALL comments on its draft rule and more or less installed the draft law as “final”. I interpreted this move as signalling the end of the CPSC’s rulemaking phase under the CPSIA. I assert that this came about as a result of a directive “from the top” to stop dithering and finalize the rules NOW, damn the consequences.

Why stop writing rules now? The CPSIA rulemaking process has left the agency and its Dem leadership exhausted and impatient. The Dems do not want to spend any more time writing rules – it wants to start catching “crooks”. The remarkably small number of consumer injuries by products regulated under the CPSIA is no deterrent to these people – the Dems were given their jobs to catch bad guys, and catch (and perhaps manufacture) bad guys they will. As Ms. Tenenbaum has promised time and again, 2011 will be the year of enforcement. This promise implies a couple things: CPSIA rules need to be finalized quickly AND the testing stay must be lifted in February 2011. Oh yeah, the testing stay, almost forgot about that little guy . . . . Thus, time is running out on rulemaking and hence the agency’s need to ignore our comments – no matter that their rules are shamelessly fouled-up and defective.

Congress “wants” it this way, or at least Mr. Waxman and his staffers insist on it. The Dems on the Commission are there to play ball.

In case you doubt my “paranoid” theory, check out the CPSC website today. Anyone notice that something is missing? Where’s the CPSIA banner today? The law is now listed below in small type. The CPSIA is over, it’s so yesterday . . . .

And if you buy the foregoing, then the pending rulemakings on component testing and reasonable testing programs/testing frequency should have you fouling your pants. Those two “bad boys” have pushed me into politics. I am trying to stave off disaster – I believe the agency will turn those deadly draft rules into final rules simply to avoid extending the testing stay and further to avoid delivering a very unwelcome message to Mr. Waxman that his masterwork law is thoroughly defective. And if the Dems rush it, they can inflict all this damage before Republicans can save the day after retaking the House and Senate. Tea Partiers, please take note.

But wait . . . there’s something up at the CPSC. The rule on Children’s Product was originally scheduled for a rubber stamp vote on September 9th. Then it was rescheduled for September 15 and then pushed forward to September 22. What’s up with this?

Normally, the delay of a rubber stamp action means there is a big disagreement behind closed doors and Commissioners are duking it out in private shuttle diplomacy between staffers. [Sunshine Act rules prohibit a meeting of more than two Commissioners without holding a public meeting that you can witness - so disputes are resolved using intermediaries. Just like in the Middle East, working through third parties is a great way to work out disputes . . . .] In other words, somebody on the Commission may actually know how shameless it is to ignore legitimate and fair comments in a public rulemaking process, even if those darned comments are so inconvenient. And, ouch!, if they must remodel the rule, they might have to release it subject to another comment period. Another comment period could pose BIG problems for the testing stay, creating a real dilemma for our Dem friends. If they push out the stay AGAIN, that more or less seals it – they clearly need infinite years to implement the CPSIA, which confirms that it is a thoroughly defective law.

And there is also the looming possibility of a Commission quorum problem. What?! Well, Commissioner Thomas Moore’s term ends in late October and he can only serve until year end. Then things get very complicated. If he is not replaced promptly, OMG, it’s a deadlocked Commission again! Tenenbaum and Adler won’t be able to get their way anymore – AW SHUCKS! – they MIGHT actually have to listen to Nord and Northup at least until another Obama puppet is put in place. And if the Senate goes to the Republicans, it might be pretty hard to confirm the usual zealot. Hmmm.

See the reason for the urgency yet???

The whole situation makes me want to tear my hair out. I have a business to run – can you IMAGINE being held hostage by this kind of idiocy in your own government? Well, we ARE being held hostage by our own dysfunctional government.

Tea Partiers, and anyone with a reawakened sense of OUTRAGE, take note. Election day is November 2nd, in case you didn’t hear. . . .

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CPSIA – Something’s Cooking on "Children’s Product" Definition

CPSIA – More Hypocritical Small Business "Help"

760 days have passed since ANY Democrat in Congress did ANYTHING to help us on the CPSIA. There are only 51 days left until Election Day.

Today we heard more blather from our Fearless Leader lecturing Congressional Republicans on an asserted lack of commitment to small business. He’s totally on the side of small business. or so he contends. Here’s his take of the status of the so-called “embargoed” small business bill that he wants to pass to solve all our economic problems:

“And you hear some of my friends on the Republican side complaining that, well, we’d get more business investment if we had more certainty. Well, here’s an example where we could give some certainty right away. Pass this bill. I will sign it into law the day after it’s passed or the day it is passed. And then right away I think a lot of small businesses around the country will feel more comfortable about hiring and making investments.”

The problem, according to Mr. Obama, is Republicans. Aha. And what about all the other things we know? I have documented in this space for two solid years the deafness of Congressional Democrats to our pleas. We have basically grovelled for scraps and been totally stuffed. Even the micro-businesses (as represented by the well-known HTA) have been spurned cruelly by the CPSC and by Congress. We are being asphyxiated and no Dem can be bothered to notice.

Of course, I think it’s RICH to be lectured by Obama over “certainty”. He says he has a quick fix to “certainty” – just pass his bill and magically everything’s okay again. Ummm, that may be just a tad over-simplified. In the children’s product industry right now, we have a ten-ton anvil dangling over our heads with the pending testing frequency and component testing rules at the CPSC, all with the potential (likelihood?) to squish small businesses. This Dem-run agency has begun to ignore public comments, as evidenced by its ridiculous dismissal of comments on the definition of “Children’s Product”. Taking comments is a pain in the neck, especially if the draft rules make no sense. You keep having to rewrite everything . . . . Is it any wonder why people are not investing in this market? Given that we must also deal with the pending cost deluge of the health care bill and unspecified tax hikes – for many people, the fetal position is the new work posture.

And what is happening right now, simultaneously with Mr. Obama’s lectures about how to make life better for small businesses? Well, Mr. O and his Dems are cynically opposing rescission of the penal 1099 provision in the Obamacare bill. Know about this small business killer yet? You will now have to file 1099 forms with the IRS for all merchandise your business buys (over $600 per year per supplier). The paper blizzard won’t just affect your suppliers, but also your customers (to whom you are a supplier). Try to estimate the number of forms flying back and forth every year courtesy of this new rule. How will you handle this new paper pushing exercise? We estimate that these forms will cost us $50-$100 to prepare and file (more than a P.O. because of demanding record keeping requirements and possible liability for errant filings) – for our thousands of suppliers and customers. Do the math – this will slaughter small business. Death by a thousand (paper) cuts.

The Republicans want to kill it. The Dems admit it was a mistake (they say they were “blindsided” – everything bad is “unintentional”, rather than poorly-conceived or simply incompetent). Nonetheless, the Dems don’t want to delete it. Why? Well, amending this provision “opens the door” to amending other parts of Obamacare. Whoa! Can’t do that . . . even if their stupid provision will kill your business. Too bad for you (and me), I guess. See this article from today’s Wall Street Journal.

I will hand it to the Dems – they have created their own cruel kind of certainty. I am absolutely certain they don’t care what I think or what happens to the jobs our company provides. That seems quite certain nowadays.

This can’t continue . . . . PLEASE help on Election Day.

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CPSIA – More Hypocritical Small Business "Help"

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.

Read more here:
CPSIA – Obama Doesn’t Get It . . . .

CPSIA – Your Partner in Mischief, Congress

Never content to leave an economy merely in tatters, Henry Waxman and Bobby Rush jumped into action this week to create an international trade war, all in the name of “protecting” you. In fact, their troubling new legislation includes a sneak amendment of the CPSIA. It also takes an idea dropped from the CPSIA (submission to U.S. jurisdiction) and applies it across several new industries. Sounds promising, right?

Nominally introduced by Rep. Betty Sutton (D-OH), a wobbly Democrat said to need propping up in her faltering reelection campaign, the new bill (called “H.R.4678 — Foreign Manufacturers Legal Accountability Act of 2010″) is scheduled for mark-up tomorrow (in Rush’s subcommittee. This innocuous and technical sounding bill is packed with trouble for you and for our country. In Sutton’s blue collar industrial district, that kind of work is prized. Or so the Dems must think.

Here is the GovTrack version of the bill. In fact, I have obtained a more recent version of the bill, a “manager’s mark-up” , which includes many new provisions. The revised version of the bill packs quite a punch, right to the gut. I discuss the newer version of the bill below.

The purpose of this bill is to make foreign manufacturers of finished goods and parts intended to be used as components in those finished goods register for service of process in this country. In other words, foreign manufacturers must register here so our plaintiff’s bar and the government can sue them with ease. The new law prohibits trade with foreign manufacturers unless they are registered, and enlists the aid of the federal government’s snarling dog, the U.S. Customs and Border Patrol, to enforce this law.

This means that every factory we use outside the U.S. will have to register for service of process in the U.S. if we want to continue to import our products from them. The law goes even FURTHER, asking that each agency involved to study ways to force manufacturers of components to register here, too. So, for example, if you make a toy in China and your factory buys boxes from a local printer who has NO contractual relationship with you, this law asks the agencies to study the feasibility of getting such box printers to register for service of process in this country. To accomplish that lofty goal, of course, you have to know their identity. Our customers do not know our vendors’ names and we aren’t telling. It’s none of their business. Do you think it’s any different for our factories relative to us? Will they ever disclose that information to our Mother Government (to them, a foreign government)? Please – would you disclose your sources to the Chinese government? And who pays the administrative and out-of-pocket costs of this exercise? And what about the consequences of the fear factor and the costs of new litigation on markets?

What-a-stimulus program! Naturally, those groups most linked to your future business health and ability to create jobs, the plaintiff’s bar and consumer groups, think this legislation is long overdue!

The scope of this law covers the EPA, the CPSC, the FDA and NHTSA, and applies to drugs, cosmetics, medical devices, “biological products”, consumer products, chemicals and chemical mixtures under TSCA (the coming storm), pesticides, motor vehicles or “motor vehicle equipment”, plus components for the foregoing. That’s pretty much everything and everyone.

Oh, by the way, the manager’s mark-up adds a little provision that gives you five working days to inform the CPSC if you have “a safety recall or other safety campaign” in any country, whether initiated by the company or by the foreign government. Just thought they’d slip that one in, just in case you weren’t watching!

So, who cares? Doesn’t this “solve” the Chinese drywall problem? In fact, it’s going to make things a lot worse. This is Major League trade war material. It is not entirely unlike Smoot-Hawley, the bill that precipitated the Depression. None of our factories will be willing to accept exposure to our ravenous tort system and out-of-control invasive government regulators as a condition of doing business with us. To most of them, this will be too risky and too hard to understand. Our suppliers are small businesses like us – they will NEVER have the resources or skills to master the minute details of our legal system and myriad risks and rules. It will also be breathtakingly expensive for them, and they run very low margin businesses with no ability to absorb those costs.

Even if some of our factories will take this risk, many will not. As with Smoot-Hawley’s tariffs, this kind of rule will spur quick responses by foreign governments. If the U.S. wants the right to reach across borders and take the assets of foreign companies without a legal presence in this country, then foreign governments will extend the same “privilege” to U.S. companies selling products inside their borders. Won’t that be nice?! Learning Resources sells its products in dozens of countries. Will we have to register in each country to continue to do so? Will we be exposed to lawsuits all over the world as a result? Will we have to pay to settle “strike suits” in dozens of new jurisdictions? If the answer is yes, I cannot imagine staying in business across borders.

The provision about foreign “safety campaigns” is intended to make sure that we don’t miss a trick here. The Waxmanis want a worldwide recall system. Does ANYONE IN CONGRESS know what this will cost? Congress must want to terminate small businesses in our economy.

Rumor has it that Ways and Means wants to take this bill out of the hands of the Energy and Commerce Committee. Of course. Speaker Pelosi can skip that step if she wants. Ways and Means purportedly knows there are BIG problems here and I am assured the Republicans on that committee will fight to restrain this bill. Still, it is in keeping with recent House practice to pass something irresponsible and dangerous like this bill, relying on the Senate to stop it. It’s a “message” bill, unless it somehow gets passed into law . . . . Then there’s the rumor that the Dems intend to stick it into a moving bill, like a jobs bill, to make it impossible to stop. You know, because it’s for our own good.

This is an example of how I learned to HATE Congress and Democrats. These rules descend on our business in suffocating waves, adding no value but creating major distractions and feeding fear. On the other hand, perhaps I will be eating crow when Obama’s recently announced master plan to reduce the deficit by two-thirds in three years through increased spending, increased entitlements, increased taxes and increased regulation works like a charm. Maybe this law is part of the implementation of that great plan.

It must be me.

It must be me. . . right?

Read more here:
CPSIA – Your Partner in Mischief, Congress

CPSIA – McDonalds Recall Urged by CPSC – WHY?

The CPSC has put in writing that the Shrek glasses recalled by McDonald’s last week are “non-toxic”. Nonetheless, the CPSC (perhaps the commission itself, as noted in certain press reports) “urged” the company to make the recall.

So now it appears that the CPSC thinks it’s okay to ask a company to recall a product for reasons that it acknowledges pose no safety issue. Why?

Let’s not forget all the expense that this move imposes on the company coerced into making the recall. The law restrict the power of the agency to take this step, in part to preserve the incentive to make “at risk” investments in new products. There’s also that small detail called “due process”. My previous post noted that the CPSC does not have the authority to make recalls of products absent a “substantial product hazard”. This suggests that the CPSC was exceeding its authority in the McDonald’s case. By almost any measure, the CPSC’s actions were inexplicable. Why demand a recall of a safe product?

I cannot answer this question for the CPSC or its Chairman, Inez Tenenbaum. However, here’s a few salient facts to chew on:

  1. The Member of Congress (Jackie Speier) that “tipped off” the CPSC about this matter is a Democrat.
  2. Jackie Speier represents a California Congressional district (12th) that abuts Nancy Pelosi’s district (8th).
  3. Shortly after first being elected to Congress in a 2008 by-election, Speier was appointed by Pelosi to serve as a member of the House Oversight and Government Reform Committee, then chaired by none other than Henry Waxman. Waxman resigned this chairmanship to take over as Chairman of the House Committee on Energy and Commerce.
  4. Ms. Speier has publicly endorsed the “black box” requirement for cars that Mr. Waxman supports. She also wants to create a federal law restricting cadmium in jewelry. Her concept of Congressional activism is very closely aligned with Mr. Waxman, another California Democrat and patron of the Democratic majority on the Commission.
  5. Today, Speier is a member of three committees. Besides Oversight, the other two committees are chaired by Edward Markey and Barney Frank, two close allies of Waxman and Pelosi.
  6. Jackie Speier is running for reelection in one of the most phobic of states, California. The Democrats need every seat they can get in this Mid-Term election.
  7. One of the three Democrat Commissioners appointed by Obama was a member of Henry Waxman’s staff for several years (Adler).

And can anyone imagine a Democrat-controlled CPSC telling a Democratic Member of Congress from the San Francisco area that her highly-publicized call for investigation of Shrek glasses because of cadmium was, in fact, unmerited, that the product was perfectly safe and the large corporation responsible for the glasses had protected consumers very well? In an election year with Nancy Pelosi in charge of the House and Henry Waxman directly overseeing the agency?

Nope, can’t think of a single reason why the leadership of the CPSC would urge McDonald’s to recall the safe glasses.

At least the CPSC won’t have to pay the costs of the recall. That’s McDonald’s problem.

Read more here:
CPSIA – McDonalds Recall Urged by CPSC – WHY?

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