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CPSIA – Let’s Take a Break and Think About Illinois Taxes

Hey, every once in a while it’s worth taking a breather and considering other truly amazing political stories from the big city. Consider this story entitled “Billion Dollar Baby: A Cautionary Tale” published today by Andy Shaw, formerly a local Chicago ABC-TV correspondent and now President of the Better Government Association (good luck there, Andy!).

In this tale, Mr. Shaw recounts how Illinois’ 67% tax increase was passed by a single vote Tuesday evening during a short, one-week lame duck session. You see, the Dems who run this State with an iron fist were facing the loss of several seats to the Republicans when the new legislature was sworn into office on Wednesday, hence the need to pass the tax increase Tuesday in the middle of the night. How to do it, how to do it???

Mr. Shaw:

“She is somebody somebody sent.

In the best—or maybe it’s the worst—tradition of local politics. And she was pressured into voting for a multi-billion dollar hike in the state income tax in the wee hours of Wednesday morning. By her Democratic Party allies in Springfield.

Some of her friends and neighbors may be unhappy with the tax vote but she won’t be facing any political consequences or voter backlash. And here’s why: She stepped down as an Illinois State Representative at noon on Wednesday. After one week on the job. That’s right—one week. She was, in simple terms, the lamest lame duck in a feckless Springfield flock. A billion-dollar baby.

“She” is Kathy Moore, a Lincoln Park friend and former public school teacher who was put in that unenviable position by the stark reality of political hide-and-seek. Or, in this case, seek-and-hide. Her reliably Democratic 11th District, which includes Lincoln Park and Lakeview, elected a brand new state representative, Ann Williams, in November, to replace John Fritchey, a popular long-time rep who won election to a seat on the Cook County Board. Fritchey began his new job in December, so Williams could have been sworn in as a state rep a month ago to represent the district in the lame-duck session going on in Springfield this past week. That was her initial plan.

But there were questions about how she would vote if a tax plan was on the lame-duck agenda. Williams claims that local Democratic leaders, including Fritchey and Senate President John Cullerton, wanted her commitment to support the tax hike before arranging for her to be sworn in. They say she got cold feet and decided not to start early—choosing instead to wait until Wednesday, when the rest of the freshman legislative class was sworn in.

(That, parenthetically, will save the taxpayers a few bucks because Williams won’t qualify for a more generous legislative pension than the one awaiting the new class in Springfield, thanks to a modest pension reform bill that took effect on Jan. 1. But her decision will cost the 11th District politically because, instead of moving to the top of the seniority list of new legislators by starting in December, she will be near the bottom since she’s entering with all of the other newbies, and her last name begins with “W,” a letter near the end of the alphabet. Oh well.)

Meanwhile, back at the raunch—yes, I said raunch and not ranch—Williams’s decision not to be seated early meant the political bosses in the district—Fritchey, Cullerton and the other ward committeemen—had to find someone else to fill the seat for the one-week lame-duck session. So they recruited Kathy Moore, the wife of Tom Moore, a well-known Lincoln Park zoning lawyer—because Kathy had the time and the willingness to “serve.” And down I-55 she went. Admitting sheepishly at a party last week that “they tell me what (voting) button to push and I push it.” Democracy in action.

So when the tax bill passed, without a single vote to spare, our lawmaker-for-a-week was a major reason. She says she’s not happy about voting for a gargantuan tax increase but she doesn’t think that she, or the state, had any other choice. Even though, as of Sunday, she hadn’t seen a bill. Or a press release. Or a fact sheet. Or a list of cuts, accountability measures and streamlining to go along with the increase.

“I hope it works,” she said wistfully in a text message on Wednesday morning. Williams says, for the record, that she would’ve had a hard time supporting the tax bill in its present form.

In any event, Kathy Moore was back home in Chicago by Wednesday night after morphing into a regular resident following her week as a political pumpkin. Kind of like “Cinderella” in reverse. And she may not be the life of the cocktail parties in the neighborhood for awhile, at least among the well-healed wine-and-cheese folks who will have several-thousand fewer dollars in their pockets for each of the next four years.

As for Ann Williams, the newly elected House member, she assumed her duties as the new representative of the 11th district at noon on Wednesday. And my spies at her Springfield welcoming parties report there was no evidence of any dust, dirt or snow from the rock she’s been hiding under.

Don’t you just love the Illinois Way? And can’t you see why we love being civic watchdogs?”

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CPSIA – Let’s Take a Break and Think About Illinois Taxes

CPSIA – 500th Post on CPSIA . . . Now What?

756 days have passed since ANY Democrat in Congress did ANYTHING to help us on the CPSIA. There are only 55 days left until Election Day.

I have been blocked for a little while on the occasion of my 500th post in this blog. I have been prattling on the subject of the CPSIA for almost two years now. To be perfectly honest, this is a sad occasion for me. I have invested a great deal of time and money attempting to do my citizen’s duty to help our government govern better. Now, after 500 posts, an appearance before a House subcommittee, several appearances on the CPSC panels, numerous comment letters, personal meetings and phone calls, a historic rally, and literally countless media appearances, it appears that we have reached a dead end. It appears that Democrats are unable to understand or accept anything I have ever said on virtually any subject.

As I have been noting, and as I will continue to note, the Democrats have been resolute and united in ignoring our pleas, our evidence and our data, all documenting the CPSIA’s fatal flaws. Even with a stagnant economy, there is scant recognition among Dems that this law is a cause of any ills. It’s not like they haven’t been warned of the economic impact of the CPSIA. They have been warned repeatedly but determinedly stood still, insensitive to our needs and to the harm our OWN GOVERNMENT is inflicting on us.

I must say the entire experience leaves me slack-jawed. For example, I was recently reviewing my experiences with Illinois State legislators about the noxious and stupid Illinois lead labeling law. I met with our State Rep in May 2008 and complained about both the then pending Illinois law as well as the then pending CPSIA. Our Rep for Vernon Hills chose to write Jan Schakowsky of all people to help us gain relief. [I didn't realize at the time what a sick joke it was.] Anyhow, I also met with the State Rep for my hometown, and reached out to our State Senator. I explained how many jobs could be imperiled. I explained the cost and the disruption. I explained how ineffective these laws would be to protect anyone from anything. Some of my Illinois State representatives and their staff gave me the impression they thought I might be some kind of serial killer, but offered to consider my views. So this week I checked and lo-and-behold, they were ALL THREE OF THEM co-sponsors of the bill! Nice.

And some people call this representative government. Does it surprise you that they were all Democrats?

On the occasion of my 500th post, I want to tell you how I feel and what I think happens next. First, I am morose over the likely impact of this law on our business and our industry. If others may be numb to this death by a thousand cuts, I am not. I am outraged that this damage is being inflicted by my own government on our business and on our employees. This is clearly wrong – but it’s happening. I also feel that the CPSC has become a rogue agency which makes up the law and no longer cares what any of its corporate constituents think. I feel the agency is worn out and sick of making rules – CPSC leadership wants to enforce the law, not write it. The Children’s Product definition recently implemented is a case in point – they basically rejected or ignored all comments. The concept of dialogue at the agency has morphed into some sort of public facility for manufacturer venting. But forget about influencing. That door is closed, slammed shut in our faces.

Perhaps most significantly, in the wake of the Children’s Product final interpretative rule, I now expect the worst and am only waiting for the inevitable. I predict the awful and irresponsible rules on Component Testing and Testing Frequency/Reasonable Testing Program to soon “go final” with modest or no changes. Think about what this means – I have stated that the rules by their specific terms will force our company to spend $15 million per year on testing and require destruction of as many as 81,000 units for testing purposes. We don’t have the resources for this. That’s a doomsday scenario for us.

I have previously noted that one effective way to solve the recall “problem” is to eliminate all products. After all, killing the patient ALSO cures his cancer. [I guess that's the silver lining.] Still think this is all hypothetical? I suggest you reread the rule on testing frequency and imagine that the agency will be enforcing this rule against YOU. Imagine that they audit you. I know they don’t do that now, but nothing will stop them from asserting a right to do so in the future. Hmmm. Get your checkbook out . . . or sell your company.

This is not such a farfetched scenario. Remember, the testing stay is due to expire on February 10, 2011. It’s September 8, 2010 now. That’s only five months away. There is no hint that the agency intends to extend the testing stay again. This means they MUST go to final on those rules soon, and to do so procedurally, the rules really need to remain unchanged. The Commission’s inaction on the stay means the jig is up. They will hardly bother to read your comments. They don’t care – they’ve moved on.

And the by-product of this demoralizing state of affairs is business paralysis. What kind of government idiot thinks we will be spending big money on investing in our business with this Sword of Damocles hanging over our heads? That’s absurd, a fantasy borne of ignorance of the real world. Consider the old saying: The value of the sword is not that it fall, but rather, that it hangs. Hmmm. Perhaps a nice investment tax incentive will get me out of my funk. GREAT idea, Dems. What insight – handouts solve all problems. . . .

I have committed myself to exacting revenge at the ballot box on Election Day for the Dems’ offenses over the past two years. If you feel as I do, I URGE you to take up your rights as citizens and put DIFFERENT PEOPLE in Congress. If we are successful in reconstituting Congress, we can then begin the urgent process of working to unwind the damage inflicted by the CPSIA and by current leadership at the CPSC.

There is no time to lose. GET INVOLVED WITH LOCAL RACES – NOW. Help them raise money, help them spread the word, ask difficult questions, hold the Dems accountable. They have refused to help YOU for two years. MAKE THEM PAY!

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CPSIA – 500th Post on CPSIA . . . Now What?

CPSIA – Deaf Congress Makes Up Its Own Justifications for New Law

The recently approved H.R. 4678 Foreign Manufacturers Legal Accountability Act of 2010 is based on testimony given by several of the usual suspects. Consumer groups filed testimony portraying the need for this law as rather “obvious”:

Consumers Union (June 16, 2010): “While [the CPSIA] has made great strides in improving product safety, and will continue to do so as its implementation continues, the CPSIA focuses on improving safety by requiring that children’s products subject to mandatory standards be tested to ensure compliance with the standard. The law does not address bringing foreign manufacturers into our civil justice system. However, to fully protect consumers from unsafe products, wherever they are made, American consumers must be able to hold manufacturers accountable when they are harmed – no matter where the products are made.”

Consumers Union goes on to assert: “If a foreign manufacturer knows that they cannot be held responsible in U.S. courts for the products they sell, this knowledge has a likely significant impact upon their manufacturing decisions. Do they use the stronger, more expensive component? Do they ensure that the product meets the safety standards? Do they prioritize safety if they know they are not accountable to U.S. consumers in U.S. courts? Holding manufacturing entities accountable in our civil justice system acts as an important deterrent to unethical and potentially harmful business conduct.”

The Briefing Memo for the mark-up (prepared by the Dems) takes up the anti-business, leftist consumer group cause, namely that we need to change the rules to allow consumers to sue foreign manufacturers to protect our way of life. The new law is intended to overcome a little legal wrinkle preventing true consumer justice – the U.S. Constitution:

“In addition, even if a victim successfully serves process on a foreign manufacturer, the manufacturer will likely challenge the exercise of personal jurisdiction over it by a U.S. court. Under well-established constitutional due process principles, before a U.S. court can exercise personal jurisdiction over a defendant it must consider: (1) the defendant’s purposeful minimum contacts with the state in which the court sits, and (2) fairness to the defendant of being subjected to jurisdiction in that state’s courts. . . . H.R. 4678 requires foreign manufacturers and producers that import products into the United States to designate a registered agent who is authorized to accept service of process here in the United States. . . . Registering an agent consistent with the Act constitutes acceptance by the manufacturer of personal jurisdiction of the state and federal courts of the state in which the agent is located.”

Problem solved! Congress found a way to circumvent the framers’ intent. That darned Constitution gets in the way of good government, you know.

Notably, the “urgent” need to go around the Constitution was not echoed in the CPSC’s own testimony:

“Additional authority allowing the CPSC to require foreign manufacturers designate a U.S. registered agent for service of process could be helpful in some cases – particularly those involving administrative requests for documents or information.”

In a few cases, however, the lack of a registered agent for service of process has hindered the Commission’s ability to develop information that would help us to provide relief to consumers.”

“The lack of a registered agent for service of process has also been recognized by Chinese industry groups, and some local lawyers in China have provided legal advice seeking to exploit this situation . . . . This type of sentiment appears rare.” [Emphasis added]

Opponents to the bill made arguments similar to those previously highlighted in this space (see above and here): American Association of Importers and Exporters and National Customs Brokers & Forwarders Association of America.

I estimate that our business will lose 25-50% of our foreign suppliers and untold numbers of component factories if they are required to have a registered agent under this new law. Most of these sources are irreplaceable in our business (for a variety of reasons). That means that the products we make at these factories will have to be discontinued. Too bad for us, I guess. This could happen quickly, too.

I wish that were the only problem. The lame-brained notion that foreign countries will allow U.S. citizens to cross borders to take domestic assets to settle foreign disputes will prove to be delustional. U.S. companies will soon be greeted by reciprocal registration requirements or even harsher laws exposing them to onerous trade barriers and significant new legal risks. Again, our business is squarely in the bullseye of this maelstrom. We have worked tirelessly for more than 20 years to build an international network of dealers for our products. That creates JOBS here. Anyhow, it is inevitable that a law like this will spawn a need to register our company in dozens of countries abroad, meaning we would need to hire a law firm for each country, translate all the laws, decide if we want to bear the expense and risk of registration. Our foreign business would evaporate quickly and efficiently.

The basic idea that our country actually needs this law is hard to comprehend. Where are all the hungry plaintiffs’ attorneys who can’t put food on the table? Which rights aren’t being satisfied? For each product imported into this country, there must a U.S. importer. Why isn’t that pool of assets enough to satisfy this need, as it has been for years and years? Why doesn’t importers’ exposure under the U.S. tort system provide enough incentive to address Consumers Union’s parade of horribles above? I thought that’s why we have our crazy tort system in the first place. No answer has been provided by Congress to these questions. They just gave us a wonderful new law to worry about.

Thanks so much, Democrats in Congress. We love ya! And we can’t wait to vote AGAINST you! See you at the polls.

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CPSIA – Deaf Congress Makes Up Its Own Justifications for New Law

CPSIA – ICPHSO Stay Tuned

From a CPSC Media Alert:

“CPSC Chairman Inez Tenenbaum will be giving a major address on the state of product safety, including a strong message to industry about meeting their responsibilities to consumers when it comes to recalls. Tenenbaum will also detail her consumer agenda for 2010, unveil a new Web site being launched and talk about crib safety.”

This will take place at lunch today.

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CPSIA – ICPHSO Stay Tuned

CPSIA – Let’s Count the Reasons to be Outraged by CEH

Perhaps like me, you felt a surge of fear and loathing today over the Center for Environmental Health’s effort hand-in-hand with CA Attorney General Jerry Brown to find products with “high levels of lead”. CEH announced to great fanfare that it had found seven items that violated the law, and Jerry Brown plowed right in behind with a cease and desist order, demanding that these items be removed from shelves immediately. Several of the affected companies denied categorically that there were violations of law. I assume that Proposition 65 lawsuits are being prepared, and suitable penalties will rain down from the heavens in due course (you know, in three years) to properly punish the “scofflaws”. Nice work, CEH.

CEH justifies its actions to destroy the children’s product industry with misleading facts about lead. Here’s how they describe the dreaded danger they are “protecting us” against:

“Lead is a stunningly toxic metal. A long list of problems has been linked to lead exposure: lowered intelligence, behavior problems, cancer, strokes, high blood pressure, kidney problems, anemia, cavities, and delayed puberty. While exposure to lead paint in old houses remains the most significant source of children’s lead exposure, about 30 percent of children with high blood lead levels are exposed to other sources of lead, including toys and other children’s products.”

They go on to list a parade of horribles, such as “University of Cincinnati researchers found that arrest rates of young adults (both for violent crimes and all arrests) were linked to the blood lead levels of these adults when they were children. Higher childhood lead exposure was associated with higher arrest rates.”

The interesting thing about these assertions about lead is that they are TRUE . . . and they are also IRRELEVANT in this case. There is absolutely no way to prove or even assert in any reasonable fashion that the products cited here could EVER poison children in this way or are responsible for ANY of the cited lead horrors. The CEH is just using plain vanilla scare tactics – did it work on you? Unfortunately, some newspapers bought it, hook line and sinker.

I hardly know where to start. Here are a few reasons to be flippin’ mad about this stunt:

I. The Seven Items Present Little or No Risk. Consider this list of “frightening” product defects:

a. Disney Tinkerbell Water Lily necklace – Connector on pixie dust charm contains 22,000 parts per million lead. [I believe this connector is perhaps 3 mm in diameter.]

b. Barbie Bike Flair Accessory Kit – Pink star fabric contains 6196 parts per million lead. [This is an item used on a bicycle.]

c. Dora the Explorer Activity Tote – Orange fabric on back of tote contains 2348 parts per million lead. [I believe his fabric is not detachable and cannot be chewed.]

d. [This one's my favorite] TKS girl’s sandals – Orange insole contains 3957 parts per million lead. [To access this lead, you must lick or chew on the INSOLE of a pair of sandals. Yum!]

e. Kids poncho – Yellow fabric contains 677 parts per million lead. [Gotta chew on your poncho.]

f. [This is a close second] Faded Glory girl’s shoes – Sole contains 1331 parts per million lead. [It's like my old joke about licking the soles of your shoes after walking to school. Happens all the time . . . .]

g. Cherokee boys belt – Surface of belt contains 4270 parts per million lead. [I have no idea what the problem is here. Still, belt chewing is exceptionally rare and not foreseeable in my opinion.]

I hope you haven’t begun rioting in the streets over these tragic “violations of law”. Let’s recap – this rogue’s gallery includes a CONNECTOR, the fabric of a decorative star on a bike accessory, backing on a tote, the INSOLE OF A SHOE, the SOLE OF A SHOE, a poncho and a belt.

Let me be blunt – how brain-damaged must someone be to actually believe these things are dangerous?

II. Cassandra Here, Have I Mentioned My Concern about State AGs? Ahem, I believe I have noted my strong concerns about State AG enforcement of the CPSIA in the past (note, especially my April 4 post about Mr. Brown). In fact, I made a big point of this issue in my unread letters sent to the Congressional conferees in July 2008 . . . to no avail. Obviously, I was way off in my thinking. Worrywart . . . .

How outrageous is Mr. Brown’s enforcement action? Well, he worked in concert with CEH apparently without talking to the CPSC. CEH practically brags about this (“In collaboration with the California Attorney General the Center for Environmental Health has spent the last six weeks monitoring compliance with the new law. . . . In October and November 2009 we purchased about 250 children’s products from major retailers in the Bay Area and San Diego. . . . We provided information about all of the violations to the California attorney general for enforcement action.”). The CPSC seems to be irrelevant to CEH and Mr. Brown.

Ahem, CPSC – what do you think about being rendered irrelevant by a grandstanding State AG and an even more disruptive consumer group? Welcome to my world. Ms. Tenenbaum, in your continuing efforts to cultivate a positive relationship with the State AGs, you may wish to reflect on the behavior of Mr. Brown and his apparent commitment to you and your efforts to calm the markets and implement the new law. Yes, commitment, that’s a nice word for it, don’t you think?

Here’s a word to ponder: “preemption”.

III. Publicity-Hungry Consumer Groups Have Proven Their Own Corruption. Stirring up this kind of public shame and panic may be good for raising contributions to CEH, but it is nothing more than a shameful demonstration of anti-social behavior. REAL JOBS and REAL LIVELIHOODS are impacted by CEH grandstanding and NO possible public good was accomplished by the latest losses inflicted by the new toy safety laws. Even CEH concedes things are much better these days (on CBS News, Executive Director Michael Green noted “It is definitely a safer Christmas than it was two years ago.”). Thanks, Mike, you have really reassured the American consumer!

CEH’s grandstanding over ridiculous assertions of danger is irresponsible and in light of Green’s concession of the safety of the marketplace, morally corrupt. Consider that in a six-week effort to find something “bad”, the CEH schemers examined 250 products, and all they could find is a connector to a charm, the sole of a shoe and the INSOLE of a shoe. Wow, what a smoking gun! However, with a hepped-up State AG perhaps preparing a gubernatorial bid, even these pathetic findings are the perfect makings for a publicity event.

As if these acts of desperation, self-interest or moral degradation were not enough, both CEH and State AG Brown then attempt to convince the public that these products actually constitute a danger. “‘Private testing uncovered a number of products designed for children that contain dangerous and illegal levels of lead,’ Brown said in a prepared statement. ‘These products must be removed from store shelves at once to protect our kids from toxic lead exposure.’” In the quote above, CEH contends that the presence of lead in products like this can be connected to “lowered intelligence, behavior problems, cancer, strokes, high blood pressure, kidney problems, anemia, cavities, and delayed puberty”. Oooh, sounds AWFUL – now prove it! CEH and their merry band of anti-commerce loonies can only assert these harms – NO data exists that can link lead in these manifestations to ANY physical harm. But what’s a good consumer group publicity event without unaccountable fear mongering?

Any sane adult or experienced parent knows that all this is baloney. This sad state of affairs confirms that the consumer groups do NOT deserve a leading role in setting the rules of the road in safety. They gave up the moral high ground when they decided to sell fear rather than advocate for safety.

Final Words: I was recently sent a blogpost link written by a consumer group about my testimony at the CPSC on November 10 about the CPSIA public database. Of course, since I am apparently a force from the Heart of Darkness (as you know), the consumer group blogpost scorned my testimony and painted the usual conspiracy theories that the wingnuts tend to favor. What was particularly notable about this post was the following note at the bottom of the page: “Comments are closed.”

Get it? The consumer groups like having the last word. They like spreading the news that best suits their interests but don’t want to answer to anyone else. [We have seen this before.] The consumer groups depend on the kindness of strangers – they need your contributions to pay their salaries. What better way to do this than sell their souls for some headlines? If you are the ones paying into their coffers with the thinking that they are looking out for you, I think you should carefully ponder the “good work” of Mike Green and his gang this week. Is this good for America? Is anyone safer now or better off? Or . . . are CEH and the other aligned consumer groups a bigger part of the problem than previously recognized?

After this stunt, I certainly hope no one will stick a microphone in Mike Green’s face again.

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CPSIA – Let’s Count the Reasons to be Outraged by CEH