Thursday, January 8, 2009

Some Recent Correspondence on the CPSIA

It's late in the evening but I wanted to share some correspondence I have sent to Congress today. I apologize for the length of this entry. We will also post this material on our website www.learningresources.com/CPSIA if you want to check it out in a more convenient format.

Rick

From: Rick WoldenbergSent: Thu 1/8/2009 12:59 AM
To: erik.lieberman@mail.house.gov
Cc: Stephen Lamar (slamar@apparelandfootwear.org); Etienne Veber; Michael Gidding (mjg@brown-gidding.com); Rob Wilson (rob@challengeandfun.com); Patrick Magnuson (patrick.magnuson@mail.house.gov); kathleen@fashion-incubator.com; Nancy Nord (nnord@cpsc.gov); Joe Martyak (jmartyak@cpsc.gov); tmoore@cpsc.gov; cfalvey@cpsc.gov; Mary Toro (MToro@cpsc.gov); Christian Tamotsu Fjeld (Christian.Fjeld@mail.house.gov); Judy Bailey (judith.bailey@mail.house.gov); Robin Appleberry (robin.appleberry@mail.house.gov)
Subject: CPSIA and Small Business

Dear Mr. Lieberman,

I am writing to you about the Consumer Product Safety Improvement Act of 2008 (CPSIA) and its implications for Small Business in the United States. I understand from Steve Lamar of the AAFA that the House Small Business Committee has expressed an interest in the impact of this law. I have been very active in opposing the CPSIA since before its passage last August. I am Chairman of an educational products company named Learning Resources, Inc. located in Vernon Hills, Illinois. We are a small/medium-sized business and sell our products to dealers all over the country (and the world). Most of our customers are small businesses (many single location stores) - and they are justifiably mortified by this law. They are asking me whether they can legally buy our products now and have report a huge drop-off in business from skittish customers. These darkly troubling scenarios are all related to the overly-broad and poorly-conceived CPSIA.

First, I would like to address the number one issue that anyone considering the CPSIA confronts right away - what about safety? Is opposing this law tantamount to opposing safety? Certainly not! In fact, I think you would find that the overwhelming majority of children's product companies are very mission-driven, like our company, devoted to children and the quality of their life. These companies have a terrific record for safety, nothing to be embarrassed about. The narrow lead-related issues involved in the 2007 recalls affected a small number of companies and involved (basically) two circumstances, namely lead-in-paint (illegal for decades) and lead jewelry. These issues could have been easily addressed directly - but instead a massive bill emerged which attacked every conceivable way that any theoretical lead risk could possibly impact children, with little apparent consideration of cost/benefit, level of risk or consequence to affected parties (including Small Business). To my knowledge, there was no comprehensive economic impact assessment prepared on the final version of the bill containing all of its complex restrictions. The truth is that the lead risks which are linked with actual injuries (with names, addresses, descriptions) are still the two from the 2007 recalls, not the laundry list found in the law. Thus, being opposed to this law is not same thing as being "against safety" - instead, the objections are purely related to the waste and damaging diversion of limited resources imposed by this overreaching law. No business can afford to pay for prophylactic protection against health risks that simply don't exist.

The CPSIA will have devastating impact on small businesses in the United States. The damage will not be restricted to one industry. No, in fact, it will be dramatic, widespread and seemingly random. The law regulates ALL products intended for use by children up to 12 year of age and sets a new lead standard called "total lead" which has no precedence in American safety law. The scope goes WELL BEYOND known risks, violates a common sense understanding of childhood risk of injury from consumer products, and unfortunately encompasses a mindboggling array of products like footwear, carpets, clothing, bedding, luggage, lamps, toys, books, consumer electronics, school supplies, office supplies, jewelry, housewares, sports equipment, and so on. Think of the breadth of this list - there is hardly a business catering to children 12 years of age or younger that won't be adversely impacted. I estimate that 60% of the economy will be touched by this law. Not exactly an economic stimulus package.

As if to compound the injury, the General Counsel of the CPSC ruled on September 12 that the new lead standards apply retroactively as of February 10, meaning that any existing product in this category is prohibited from sale after February 10 unless it can be demonstrated to be in compliance with the new standards. This is impossible for used products so all second-hand retailers, like charities, second-hand stores and online merchants like Amazon.com and eBay.com will have to stop selling used children's products from that date forward. See, for instance, https://mail.learningresources.com/exchweb/bin/redir.asp?URL=http://www.myfoxchicago.com/myfox/pages/Home/Detail?contentId=8211690%26version=1%26locale=EN-US%26layoutCode=VSTY%26pageId=1.1.1 and http://www.kvue.com/news/top/stories/010609kvue-kids_lead-me.466a87af.html. For many retailers of first line merchandise, the issue is rather the same - their inventory has no lot markings, so it is impossible as a practical matter to make this determination without destroying their inventory. What can they do? This is why we are seeing major disruption in buying patterns. Our small business customers are literally fearing that February 10 will become National Bankruptcy Day.

For your information, we have created a special website devoted to correspondence, blogs and media relating to the CPSIA: www.learningresources.com/CPSIA. You may find a lot of useful information on our website, especially the record of correspondence with the House Subcommittee responsible for this law. The legislation is quite complex and problematic. I cannot go into every possible issue here - because if I did, you wouldn't read my entire email! If you want to talk or meet to discuss at greater depth, please drop me a note or give me a call.

Thank you for considering the serious issues for Small Business under the CPSIA. We need your help!

Sincerely,

Richard Woldenberg
Chairman
Learning Resources, Inc.
rwoldenberg@learningresources.com
Tel 847-573-8420


From: Rick WoldenbergSent: Wed 1/7/2009 9:22 PM
To: 'judith.bailey@mail.house.gov'; 'Christian.Fjeld@mail.house.gov'; 'robin.appleberry@mail.house.gov'
Cc: 'brian.mccullough@mail.house.gov'; 'shannon.weinberg@mail.house.gov'; 'william.carty@mail.house.gov'; 'mjg@brown-gidding.com'; Etienne Veber; 'challengeandfun@gmail.com'; 'kathleen@fashion-incubator.com'; Stephen Lamar (slamar@apparelandfootwear.org); Nancy Nord (nnord@cpsc.gov); Joe Martyak (jmartyak@cpsc.gov); Mary Toro (MToro@cpsc.gov); 'tmoore@cpsc.gov'; Patrick Magnuson (patrick.magnuson@mail.house.gov)
Subject: RE: CPSIA - The View from WFLD (Fox Chicago)

Here's another one, same subject: https://mail.learningresources.com/exchweb/bin/redir.asp?URL=http://www.myfoxchicago.com/myfox/pages/Home/Detail?contentId=8211690%26version=1%26locale=EN-US%26layoutCode=VSTY%26pageId=1.1.1 A second TV station is still having trouble finding people happy with the results of the CPSIA. Perhaps they aren't trying hard enough!

Richard Woldenberg
ChairmanLearning Resources, Inc.
From: Rick WoldenbergSent: Wed 1/7/2009 6:44 PM
To: 'judith.bailey@mail.house.gov'; 'Christian.Fjeld@mail.house.gov'; 'robin.appleberry@mail.house.gov'
Cc: 'brian.mccullough@mail.house.gov'; 'shannon.weinberg@mail.house.gov'; 'william.carty@mail.house.gov'; 'mjg@brown-gidding.com'; Etienne Veber; 'challengeandfun@gmail.com'; 'kathleen@fashion-incubator.com'; Stephen Lamar (slamar@apparelandfootwear.org); Nancy Nord (nnord@cpsc.gov); Joe Martyak (jmartyak@cpsc.gov); Mary Toro (MToro@cpsc.gov); 'tmoore@cpsc.gov'; Patrick Magnuson (patrick.magnuson@mail.house.gov)
Subject: CPSIA - The View from KVUE in Austin, Texas

I am sure you are monitoring the media for coverage of the pending implementation of your law and are looking for that groundswell of support from appreciative parents and business owners for your actions to protect them from dangerous lead. With that in mind, I wanted to make sure you saw this news item from Austin, Texas. Apparently your CPSIA law is going to cause second-hand stores and resale shops to go out of business in the next five weeks. Likewise, although this is not mentioned in the article, charities that pick up clothing and other household items will have to stop redistributing children’s merchandise entirely as of February 10. Apparently, many people need these outlets (especially during tough economic times), but unfortunately your law prohibits them from doing business. My, won’t it be wonderful to be so safe in 2009! The funny thing is, no one on the below video seems very happy about it.

Can anyone figure out why?

Sincerely,

Richard Woldenberg
Chairman
Learning Resources, Inc.
rwoldenberg@learningresources.com
Tel 847-573-8420



http://www.kvue.com/news/top/stories/010609kvue-kids_lead-me.466a87af.html

New law restricts re-sale of kid's products
08:53 AM CST on Wednesday, January 7, 2009
By SHELTON GREEN / KVUE News
A new federal law is raising concerns and questions nationwide and here in Austin.
Video
KVUE's Shelton Green reports
1/6/2009


On February 10, 2009 it will be illegal to re-sell any used children's products including toys and clothing. That is according to the U.S. Consumer Protection & Safety Commission who pushed for the new laws after dozens of toys were recalled in 2008 because of lead concerns.
Toys, clothing and other items used by children under 12 will be subjected to lead testing and will have to have labels on them to prove that they have passed inspection.
What is raising the ire of parents and business owners far and wide is what this will mean to clothing, toys and other children products made before February 10, 2009.
Gary Walthall, the owner of Once upon a Child, a resale shop specializing in children's clothing and other items, is afraid that he'll have to close up shop.
Adding to the confusion and frustration is the fact that the U.S. Consumer Products and Safety Commission is not returning calls or e-mails to the countless re-salers and even journalists who have tried in vain to get clarification on what the law means to garage sales and how it will be enforced.

3 comments:

Anonymous said...

Mr. Woldenberg,

I am not a business person, nor a politician, just a concerned American mother who can not believe this law exists. Like you I am very serious about my children's safety. As such, I often choose small businesses to support because of the high quality and safety of the non-toxic products they produce. It is these very businesses that are most threatened by this law.

I really have no idea to whom I should suggest this, but since you have been so active in this issue for so long, I thought you might have an idea if it could be of use.

I recently came across the Regulatory Flexibility Act...

http://www.sba.gov/advo/laws/regflex.html

... and am wondering if portions of the CPSIA violate the provisions in this act? Perhaps, should litigation need to be pursued to get the CPSIA modified, the RFA could be used as support.

Thank you for your tireless efforts. We must all use our rights as American citizens to be heard!

Rick Woldenberg, Chairman - Learning Resources Inc. said...

I hope litigation is not necessary. I don't know if this law will help or not. I have looked at it in the past and didn't feel it could solve the problem in time to make a difference. The most effective method to solve the Perils of Pauline here is to scream at Congress over and over again. Please share your concerns with them loudly and persistently. Thanks. Rick

teri t said...

YOu have an excellent point in that the CPSIA is in violation of the Regulatory Flexibility Act and I strongly believe that a legal case can and should be made to amend this. You would have the support of hundreds of small businesses.