Thursday, September 30, 2010

CPSIA - Recall the CPSC

778 days have passed since ANY Democrat in Congress did ANYTHING to help us on the CPSIA. There are only 32 days left until Election Day.

In a remarkable demonstration of the anti-business bias of the current CPSC, Chairman Inez Tenenbaum took to the air today to bash toys and to take our old friend Mattel to task for four recalls of more than eleven million units.

Uh-oh, Mattel's at it again. Hope this doesn't mean it's time for another CPSIA. It is Election time, after all.

Some background:

The CPSC Commission hosed us on Wednesday with its decision on the definition of "Children's Products". [Here is the approved definition.] I will write about this in the next few days. In typical Tenenbaum fashion, rather than face intense and negative media attention on the bungled decision in which the agency knowingly effectively banned hands-on science education in the United States (see The New York Times and Associated Press on this issue), announced several high profile recalls and a scary "warning" about popular but apparently deadly infant products to distract the media and possibly you, too.

The four recalls and the warning are each prominently displayed on the CPSC website. Each was announced by press release so as to garner maximum attention. The new definition of "Children's Products" was not announced, although there are three Commissioner's Statements currently up on the website (Adler, Nord and Northup; Northup has also written a blogpost on the topic). The draft of the new rule is nowhere to be found on the CPSC website. There was no press release for the decision and no reference to the decision on the website other than the buried statements of the (warring) Commissioners. Hmmm.

Probably just a little oversight, right Scott??? More on this later.

The five matters released to distract you were:

a. A warning to stop using Infant positioners in cribs. Twelve babies died in 13 years.

b. Fisher-Price recall of 2.925 million inflatables for choking hazard. Sold over NINE YEARS, 14 small parts found in kids' mouths, three kids were "beginning to choke", no injuries.

c. Fisher-Price recall of 1.075 million high chairs for laceration risk. Sold over NINE YEARS, seven injuries requiring stitches and one "tooth injury".

d. Fisher-Price recall of 120,000 "Wheelies" for choking hazard. Each set includes four cars, so the universe of affected "Wheelies" is actually 480,000. Two broken toys discovered among the half million out in the marketplace (wheels fell off). No injuries.

e. Fisher-Price recall of 7.15 million Children's Tricycles for risk of "serious injury". Sold over FOURTEEN YEARS, ten injuries with six requiring medical attention (cuts).

Interestingly, when these recalls were brought to my attention this morning, the CPSC website simply listed the four Fisher-Price recalls as it normally does for recalls. However, by midday the marketing of the "crisis" had begun with a screaming headline in large print on the home page reading "Fisher-Price Recalls More than 10 Million Products". No doubt the presentation was changed as a public service (these products are sooooo dangerous) . . . . The link under the headline leads to a blogpost about the four "grisly" recalls noting the following "information":

"Fisher-Price did the right thing in agreeing to provide consumers with free remedies for these products. But all companies must do better. They must give more attention to building safety into their products. They must work to ensure that they are adhering to safety standards. And if any company finds itself with a defective product or one that is causing injuries, it must report the problem to CPSC immediately. Meanwhile, as moms, dads and caregivers, you, too, have a role. We thank the dozens of you who reported these incidents. Thanks to you, CPSC was able to investigate, work with Fisher-Price on a remedy and recall these products. If a toy breaks in your child’s hands or if your child suffers an injury from a product, tell us so that we can investigate. And if you own one of these recalled products, stop using it and contact Fisher-Price for free repair kits and replacement products." [Emphasis added]

Is this about Fisher-Price (Mattel) or about you and me? Did we do something wrong? Apparently we must have. We were spanked in this blogpost. Was it a "teachable moment" for you? Was it as good for you as it was for me?

There is so much more to say about this:

1. I find it shocking that the CPSC would so shamelessly try to cover its tracks on the approval of the final "Children's Product" definition. It's not only an embarrassment to the agency, but it's an insult to your intelligence. How this reflects the agency's view of the media, I will leave it to you to divine. It ain't a compliment.

2. Inez Tenenbaum went on TV today to stoke fear of toys. She did this on what is essentially the kick-off day for the Xmas toy season, September 30. Yes, our government sent its top safety official on national TV to scare the crap out of consumers and to warn them not to trust the companies making toys right as they were going out to the store to buy Xmas presents. This is a Barack Obama stimulus plan in action! Thanks for ALL the help, guys. Doin' the Lord's work every day . . . .

Here are a few quotes from Tenenbaum's ABC News interview:

ABC: "It's a major recall involving four different products."
ABC: [Re High Chairs] "The problem with the high chair, I understand, is these pegs. What's the problem there?"
Tenenbaum: "There pegs stick out and children have fallen on these pegs. Several have been injured and seven have required stitches."

[Tenenbaum smirks as she neglects to advise that the seven injuries requiring stitches took place over NINE YEARS and were all minor injuries.]

ABC: [Re Trikes] “The hazard is a fake key that protrudes from the bike frame.”
Tenenbaum: “These tricycles have this key which sticks up and little girls have jumped on this key and have had serious cuts.”
ABC: “Serious injuries.”
Tenenbaum: “Serious injuries.”

[Another minor omission - Tenenbaum neglects to mention that the six injuries requiring medical attention affected six children among more than seven million users, took place over 14 years and involved toddlers that were supposed to be under parental supervision. Do you think she was helpful enough to the ambitious reporter who wanted a scary story? At least she took the hint and characterized the injuries as "serious injuries".]

. . . .

ABC: "There's a message in this for all manufacturers."
Tenenbaum: "Manufacturers need to build safety into the product from the very beginning so that we don't have to recall on the back end." [Emphasis added]

[This is my Xmas gift from Tenenbaum. Mattel is the cause of this, and it's Mattel that screwed up if ANYONE screwed up. Still, Ms. Tenenbaum can't miss the opportunity to use TV to tell MY customers to not trust ME. Thanks so much. And this Administration is MYSTIFIED about why we can't get our job market going again. I'm stumped, too. . . .]

ABC: "In a statement this morning, Fisher-Price said it wanted to reassure parents that its products are 'overwhelmingly safe'. But if you have any of THESE products, you SHOULD call the company. They will offer a fix for some of them . . . others will be replaced outright." [Emphasis added]

[Lest anyone mistake this for yet another idiotic and reactive series of recalls, ABC tries to portray Mattel as untrustworthy with the quote about the overwhelming safety of the 11 million recalled toys . . . then tells you to get them out of your house pronto.]

3. The Wall Street Journal was able to put a happy face on this sorry episode. Mattel's 2010 earnings will only shrink by a penny a share because of the massive recalls. Anyone want to organize a telethon to help out a buddy in distress? How will Mattel make up that penny? Oh, the horror of it. . . .

4. I would be remiss if I didn't remind you that Mattel has succeeded in certifying about ten of its corporate labs to test its products. I call on the CPSC to release the Mattel test reports behind these recalled items. I can't wait to see the first recall of a Mattel item tested in a CPSC-certified Mattel lab. You'll never know about it, because the CPSC and Mattel will move heaven and earth to keep you from finding out.

5. The recall of the Mattel "Wheelies" will be known as the original "broken toy standard" recall. Please consider the ominous nature of this development. The Mattel toy cars were reported by eager and enthusiastic consumers because they found a broken toy. The CPSC is calling for this kind of "help" so you can expect a LOT more of this in the future. To be precise, two broken toys were found in this case. No one was hurt. No allegation has been made public that any child was even possibly in danger. No disclosure was made about how the toys broke.

The CPSC apparently intervened to "investigate". These investigations often begin with a warning to the manufactuerer - you can participate in the CPSC's Fast Track Voluntary Recall program and avoid a formal investigation and possible penalty, or you can take your chances on what determination we will make months or years later. This kind "offer" is generally a short-lived one, possibly allowing only a few hours to decide. [This dirty secret is certainly true - ask around . . . or wait for the call.] The facts may be just like this one - a broken toy has been discovered (horrors), do you want to recall (today)? Mattel decided to recall in the case of the "Wheelies", based on two broken toys and perhaps on a conversation with the kind folks at the CPSC.

Do you get this one? If a consumer reports a single broken toy to the CPSC, the agency may investigate you and you may be forced to recall the item immediately. No injuries are required, just the POSSIBILITY of injury. Do you see ANY problems with that standard? Do you think the possibility of injury is the same as the certainty of injury??? Are your products indestructible? Is this a standard for recalls you are prepared to meet? And how do you plan to blunt this regulatory attack?

Having fun yet?

You heard it here first. The "broken toy" standard - that's the rule now. I'm not kidding.

For those of us idiots who persist in making children's products, these recalls are chilling, particularly in light of the decision on "Children's Products". The CPSC is busily engaged in shrinking our market through scare tactics and reactive regulation of the markets. They are also building barriers to entry that protect mass market companies and ensure the demise of small business. How many of you can withstand the cost, damage and disruption of a 11 million piece recall? None of you. This will cost Mattel ONE PENNY. Aw, poor Mattel. Who will be left to compete with them? Hasbro. And you? You're screwed. The CPSC doesn't even bother with lip service on this one anymore.

The new definition of what constitutes a " substantial product hazard" under the CPSA is now . . . everything. Anything that might possibly cause injuries is implicitly an "imminent threat" and must be recalled. There is no defense to the possibility of injury. Heaven forbid that there may have been injuries of any kind. Then you are dead. You'll find out your penalties in a few years but right now, the recalls must proceed. Doesn't matter what percentage of the items cause injury. Doesn't matter how many years it took to accumulate the injuries. Doesn't matter if the consumer was at fault or if there was dereliction of duty on the part of adults. The company is always at fault.

We are aiming for a Utopian society now, guys. Do you doubt this? Read this article carefully from the top a second time. The message is clear: Manufacturers, get out of Dodge, unless you are Mattel.

RECALL THE CPSC! This madness will kill us all. This is all about a mania and political leadership hired to foment this change in approach. There is little reason to believe these people will change - it's time to start over.

Wednesday, September 29, 2010

CPSIA - Besides THAT, Mrs. Lincoln, How was the Play?

776 days have passed since ANY Democrat in Congress did ANYTHING to help us on the CPSIA. There are only 34 days left until Election Day.

The Cato Institute published its study of the Foreign Manufacturers Legal Accountability Act yesterday entitled: "'Consumer Safety' Bill Could Boomerang Against U.S. Manufacturers". I have written about this latest self-destructive attack by Congress on our economy many times in the past.

[I am beginning to think of this Congress as some form of national auto-immune disease. Is there a pill we can take to get rid of it? If only . . . . The "pill" is called voting on November 2nd.]

Here's the conservative think tank's take on this legislation in a nutshell:

"Americans damaged by faulty products, whether made abroad or domestically, should be able to seek compensation through the courts. But the approach advocated by supporters of the FMLAA would not solve the problem. It would create a false hope of collection for damages while bypassing existing procedures that have proven to work in most cases. The approach would potentially violate constitutional protections available to citizens and non-citizens alike as well as existing commercial agreements with other nations. It could potentially disrupt global manufacturing supply chains, putting American production and employment in jeopardy."

Now that's a good reason to vote sponsor Betty Sutton (D-OH) back into office, isn't it?

But then there's the inflamed EU, Canada, WTO, importers, blah blah blah. Who cares? Not this Congress. I am told now that the FMLAA will not be addressed before the Election, but watch out for the lame duck session.

Nice of Congress to keep us on our toes with threatening legislation pending all the time. Really nice. I wonder if there's time to send out another solicitation for funds for the Republicans tonight . . . .

Monday, September 27, 2010

CPSIA - My Comment Letter on 100 ppmLead Standard

774 days have passed since ANY Democrat in Congress did ANYTHING to help us on the CPSIA. There are only 36 days left until Election Day.

My comment letter submitted today on the proposed 100 ppm lead standard due to be inflicted on August 14, 2011:

September 27, 2010

Todd A. Stevenson
Director, Office of the Secretary
Room 502
U.S. Consumer Product Safety Commission
4330 East West Highway
Bethesda, Maryland 20814

Agency: Consumer Product Safety Commission (CPSC)

Re: Docket No. CPSC–2010-0080 Children’s Products Containing Lead; Technological Feasibility of 100 ppm for Lead Content

Dear Mr. Stevenson:

I am hereby submitting comments in response to the Solicitation of Comments on Children’s Products Containing Lead; Technological Feasibility of 100 ppm for Lead Content (Docket No. CPSC–2010–0080) published in the Federal Register on July 27, 2010 (the “Proposed Rule”).

You have requested feedback and additional information on several topics relating to the prospect of a new lower 100 ppm lead-in-substrate standard. I will attempt to respond to your specific queries at the end of this letter. I find that the questions you have articulated are basically irrelevant to our company’s situation. Your questions seem to presume that the standard will be implemented. If you take the step of implementing the new standard, you will be inflicting needless and extension damage to our company with absolutely no corresponding benefit to consumers or the general public. This is terrible and irresponsible public policy. The new standard is not based on science but rather phobia and fear of the unknown. Our business will suffer for no purpose. The jobs lost will at your hand.

I want to comment on process. The agency appears to be in a race to complete its CPSIA rulemakings before year end, damn the consequences. According to, the CPSC received 73 comment letters on the Proposed Interpretative Rule for “Children’s Product” (CPSC-2010-0029 due June 21, 2010). Nevertheless, as has been widely reported, the agency ignored or glossed over the vast majority of those comments (including all of mine) and pronounced the draft rule to be “final” with virtually no changes. This flagrant disregard of public comments turned the CPSC’s rulemaking process into a sham if not an outright breach of law. I believe the agency intends to pass through rulemaking this year to avoid the embarrassment of further extending the CPSIA testing stay due to expire on February 10, 2011. The incentive to give short shrift to our comments grows daily.

I have lost faith in the sincerity of the agency’s interest in public comments after two years of being completely ignored. To judge by the agency’s disregard of my numerous comment letters, I must add little to your deliberations – in which case I do not understand why you ask me to waste hours on letters like this. After all, if you have no interest in my views, why not let me spend my time on other more productive activities? Unfortunately, I have also learned that any silence by stakeholders will be interpreted as “approval” by the powers-that-be. Thus, we are left with no option but to write these letters. With those thoughts in mind, I hereby submit my comments on the 100 ppm lead standard, fully anticipating that I will be ignored yet again.

I am aware that the agency contends that it is “compelled” to implement this new standard without regard to economics. The extremely rigid legislative language governing the implementation of the 100 ppm standard is thus portrayed as insurmountable. Is the agency truly powerless to resist? I might take that position more seriously if the agency was equally committed to following the law in other aspects of its daily affairs. However, the CPSC exhibits no such self-restraint. CPSC recalls initiated in flagrant disregard for the “substantial product hazard” standard in Section 15 of the CPSA demonstrates that the agency can invent legal flexibility wherever it wants. For instance, the CPSC pressed for a recall of McDonald’s Shrek glasses (signifying that the glasses were a “substantial product hazard”) despite this June 4th acknowledgement by the agency’s Director of Public Affairs in a tweet: "Scott_Wolfson: Note to reporters: the recalled McDonald's glasses are not toxic." Safe glasses do not constitute a “substantial product hazard” by any definition – yet the agency proceeded anyhow.

So when does the law actually matter, precisely? If safe drinking glasses may be labeled a “substantial product hazard”, then I guess anything goes. I find it worrisome to be regulated by a federal agency which does not abide by a disciplined interpretation of law but instead caters to prevailing political whims. If the law means nothing, then the agency should not presume to assert its inability to resist this provision. I think that’s just too convenient to be believable.

My comments on the proposed 100 ppm standard are informed by my view that the agency can do as it pleases. I have not restricted myself by the fiction that economics don’t matter.

The problems with the 100 ppm Lead Standard:

a. The new standard will have NO impact on human health. There is simply no evidence of injuries from lead at levels between 100 ppm and 300 ppm in substrate. It is notable that no other federal agency (NIH, CDC, EPA, FDA, etc.) has identified lead-in-substrate as a human health hazard. Without evidence of injuries at these barely measurable lead levels, the new standard cannot be justified economically or otherwise. It is worth noting that if the “cost” of lead-in-substrate levels of 100-300 ppm cannot be measured, the “benefit” of the new standard will be equally elusive. Given the known costs of this initiative, the new standard fails any conceivable cost-benefit analysis.

I published a study of CPSC recall data from 1999-2010 in my blog ( in May 2010, revealing that only one death has been documented in association with lead in children’s products in the last 11 years, and only three (unverified) lead injuries in the same period. This is substantially fewer childhood fatalities and serious injuries than swimming pools and spas cause in an average day according to CPSC statistics. Given the trillions of daily interactions between children and Children’s Products in the course of a year, these meager 11-year lead injury totals are the statistical equivalent of no injuries. Thus, it will be impossible to prove statistically that any reduction in injuries flows from the change in standard. Troubling? Fear of lead-in-substrate is nothing more than a Congressionally-endorsed fear of cooties.

b. The new standard will substantially raise our product costs. The new standard means we will need to implement much tighter manufacturing tolerances for materials and for our processes. The many extra man-hours needed to implement and maintain these tighter tolerances will be expensive. It is difficult to estimate the cost, but we project a 10-20% increase in cost for finished goods subject to the new standard. Subcontractors who manufacture our goods will charge us for the risk of waste, plus the additional overhead required by the new standard. That is, they will charge us more if they are still willing to remain a vendor of Children’s Products subject to this standard. We are a small business, so many of our factories may feel our short runs are simply not worth the risk. That’s how I would look at it if I were them. Loss of vendors (manufacturing capacity) is yet another cost we would bear under the new standard.

It is worth noting that based on the results of our last two years of testing (thousands of testing line items), we estimate that less than 2% of our testing line items fall between 100 ppm and 300 ppm in lead as of today. The cost of trolling for those few affected components will be excessive and the waste associated with replacing “defective” materials will be a tax on our entire production and fulfillment processes. Not exactly a stimulus program. . . .

c. Our ability to control lead levels is unknown because test result variances are so wide. We have found that testing multiple samples from the same lot can show variances of up to 67% in lead content. It doesn’t take much variance to produce wild percentage swings at such trace lead levels. As an illustration, I have attached hereto a test report on a SINGLE PIECE OF PLASTIC STRING used to fasten a mesh bag. The string was tested in ten places, resulting in lead levels of 239 -275 ppm. In another case, we found three test results of the same yellow plastic substrate varied from 23 -139 ppm. None of this matters from a safety standpoint but from a regulatory standpoint, it’s a crisis in the making.

These small variances potentially endanger our business. How are we supposed to run our business selling inexpensive children’s products burdened by such an inflexible physical standard? The CPSC needs to recognize that substrates in the real world are not pure, consistent and invariable. The tight tolerances in this new standard will likely have us retesting several items a month at considerable expense and strain. [And G-d knows what standard the CPSC will inflict on us to govern retesting.] Each retest would presumably interfere with our ability to deliver on time and would stress our system and our people. Out-of-pocket costs would be high, perhaps over $100,000 per annum for our product portfolio of 1500 items; labor and other frictional costs would no doubt add to this total substantially.

d. It will be impossible to predict which components will fail. As test results tend to vary significantly for components from the same lot, it is difficult to control or predict problems. We have found violative results for many different materials used in our business – there is no pattern. Defects found in certain components might render the entire finished good worthless, potentially greatly increasing our losses. For example, an inexpensive backpack might be found to have a zipper that violates the new standard upon completion of the production run. This could happen even after extensive pre-manufacturing testing because physical goods tend to vary in composition. Perhaps only a tiny percentage of the zippers violate the new standard by a few ppm, but given the cost to repair and rehab the item and the practical inability to identify violative zippers, the entire lot of backpacks might have to be scrapped. There would be an increased incentive to substitute components across entire product lines, not because of any health or safety concern but simply to avoid regulatory compliance risk. Differences in utility would be a secondary consideration to avoidance of CPSC recalls or scrapping finished goods inventory. This situation would not be stable because consumers would not likely accept lower standards for our products just to mollify the CPSC – other seismic market changes could be anticipated.

e. The legal risks implicit in the new standard are simply intolerable. Let me ask you a question: how would you attempt to manage a major risk to your business caused by less than 2% of your activity? What if you had no idea WHICH 2% it was? What could you do? I think you might reevaluate your business model. Most people don’t roll the dice on their family wealth or their regular income. By imposing a standard for lead-in-substrate that is barely above measurable levels, the agency would be imposing EXACTLY this risk on us.

We believe we would be exposed to a daily risk of assault by consumer groups and other do-gooders bent on our destruction. This combat would be divorced from considerations of safety – it would be all about regulatory compliance. Our business purpose is not to pay fees to CPSC Bar attorneys, write up Section 15 reports or perform recalls. We do not have the profit margins to finance this kind of wasteful activity and do not have the spare capacity to deal with the regulatory “crisis of the day”. The legal risks of such conflict can quickly get out of control – and insurance is simply not a viable option economically. If we must bear these heightened risks, we will have to revisit our business model.

I hope the agency will not dare the children’s product industry to go belly up just to prove this point.

f. Companies, acting in good faith, are generally INCAPABLE of adopting the new standard as a practical matter. Everything can be made of low lead materials. Zippers can be made of platinum, alphabet blocks can be made of wood, cotton fibers or rhodium. Use of recycled materials can be discontinued (the anti-green movement). Durable and inexpensive materials used for years without incident can be discarded in favor of “purer” materials. All of these things are possible. But they are not practical and they are not economic. If we are to indulge the fantasy of the money-oblivious CPSIA, then whatever we can imagine is possible and money doesn’t matter. This is regrettably unrealistic – businesses exist in the real world and money DOES matter. Thus, companies operating in good faith can’t adopt the new standard if their business model is scrambled.

g. Dealers in our goods can be expected to adopt their own standards to create a regulatory “cushion”. Distributors and retailers have been building their own safe harbors to provide CPSIA protection over the last two years. We have many customers with unique and wildly variant compliance requirements despite the crafting of thousands of pages of rules from the CPSC under the CPSIA. Our dealers can always beat the CPSC in a game of “Can you top this?” If the agency implements a 100 ppm standard, we fully expect a new outbreak of “regulatory compliance exuberance” among retailers. What will happen to us under those circumstances? With a CPSC-fed mania, we will incur yet more costs and bear yet more risks. Our markets will shrink.

h. We believe these rules will so demoralize and de-motivate our staff that we will face high turnover rates among our employees who know all of your rules. Our regulatory compliance team is not on “work release” from jail. Their jobs are not intended as a form of societal punishment. If, however, compliance with the CPSC’s bureaucratic rules becomes too tedious or risky, or the stress of managing a string of crises and a blizzard of conflicting rules becomes overwhelming, our trusted associates will seek less stressful employment elsewhere. They don’t HAVE TO do this for a living. What is the CPSC planning to do to help small businesses who find themselves back at square one after a costly investment of thousands of dollars in specialized training? Is the new CPSC Small Business Ombudsman going to wave a magic wand to make our problems go away? I think we all know the answer – too bad for us.

Here are the answers to your questions:

1. Materials that are consistently under 100 ppm in lead content. You have previously provided a list of such materials for the 300 ppm standard. This list included some useful concessions, such as wood and cotton fibers, but also included useless and irritating examples like gold and platinum, gemstones and various byproducts of nuclear decay. In our experience, the common substrate materials used in educational products have varying (trace) levels of lead. As noted above, we have seen significant variances in lead content in a single string, and in substrates taken from the same lot. I have no confidence that any material we use can be proven to ALWAYS contain than 100 ppm lead.

2. Strategies or Devices to comply with the new 100 ppm standard. The only strategy we could employ is pre-manufacturing testing on materials with substantially increased testing frequency. As noted above, natural variances among many materials prevent us from creating any reliable safe harbor and cost increases from such testing activity (and the cost of scrapping otherwise acceptable raw materials) will greatly shrink our product line. As a consequence, we would likely have to sharply reduce our product line or go out of business – all thanks to the CPSC and our Congress!

3. Consequences of use of compliant materials meeting the needs of the product. We have not spent any resources evaluating the market demand for educational products made of platinum. We do not intend to switch over to osmium or ruthenium for their purported lead-free properties (we find toxicity to be a greater concern). We have not spent our time figuring out if gold is a suitable material for pattern blocks or our Reading Rods. There is no answer to this ridiculous question. As I mentioned above, more than 98% of our test line items complies with the new standard. The materials and components that fail do not fit a pattern. Tests are inconsistent, too.

4. For products that meet the 300 ppm standard but not the 100 ppm standard, provide data on compliance. As noted, we find that we are already 98%+ compliant with the new standard. The components that fail do so unpredictably and inconsistently. Even the same material out of the same lot produces varying test results, as do multiple tests of the same piece of string. We cannot run a business based on junk science intolerance of the world that G-d created. The crazy new 100 ppm lead standard is incompatible with variances found in the physical world.

I want to reiterate that the 100 ppm standard is entirely arbitrary and will save no lives and will preserve no IQ points.

5. Can such items be made compliant through use of other materials? Sure, of course they could. They would be unsalable because the products were rendered too expensive either by the engineering cost or the new materials cost. Is creating products that no one will buy an acceptable solution to this dilemma? Whether by economics (too costly to buy) or re-jiggering of business models (discontinued products), children will be purportedly “safer” because they will lose access to needed products. What a wonderful result! Does the CPSC advocate that American schools teach physical science with photos of magnets, paper clips and rocks? Perhaps we should revert to rote-and-repetition math education rather than modern techniques of hands-on learning. No doubt the CPSC would singlehandedly solve our national education crisis. Bring on pointless material substitutions and let the fun begin.

6. Best practices to be used to always comply with the new standard. I recommend dropping most products and only making items that are CERTAIN to be compliant. This in practical terms may be impossible, and as noted above, is completely uneconomic. Another good practice to discard everything that isn’t virgin material. I know that’s not “green” but we have to be really, really safe, right? Another super idea is to substantially increase our testing, but of course, we cannot afford the current level of testing as it is. That seems somehow unrealistic. Other strict controls on manufacturing seem equally out of reach. There are so many variables to manage to achieve the new standards – we must control the factory environment as though it were a hospital ICU. That’s just not possible at current cost levels. Our factories would have to be “restructured”. I bet the Small Business Ombudsman can coach us on this!!!

Please note: we don’t have to reorganize our factories because we don’t have to stay in the children’s product market. If the CPSC expects us to reorganize our entire way of doing business to accommodate a phobic standard not based on any observable public health problem, we may opt out. Is this really the purpose of the CPSC – to micromanage markets, to restructure the economy, to substitute for market forces? I think not. Please check the CPSA to see why your agency exists. I hope a Republican-controlled Congress will do exactly the same thing in a few weeks’ time.

7. The lowest technologically feasible lead level below 300 ppm in our products. We can achieve anything for a cost. There are no “lowest” levels. Why not specify entirely lead-free? We can make everything out of gold and osmium! Lay in a few gemstones and diamonds, and you will have a sparkling new toy that cannot poison anyone with lead. It may have other problems (choking hazards? Sharp points?) but at least no one will die from lead poisoning. Not that anyone did previously . . . .

8. The date by which our products can meet the 100 ppm standard. In my opinion, the date is NEVER, because we have no practical ability to control quality to the level you require. Even at our current 98%+ compliance with the new standard, it would be extraordinarily disruptive to attempt to be 100% compliant. After a few episodes of being shut down by the CPSC or sued by some lunatic consumer group over nothing, we would exit the market. If you intend to deprive us of the meaning and pleasure of our work to make children’s lives better, we’ll leave the well-being and education of our nation’s children to you. That would be a very sad day for us.

Thank you for considering my views on this important subject. This letter took me all day; I hope you won’t completely ignore it as you have all my other letters.


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

CPSIA - Mourning in America

774 days have passed since ANY Democrat in Congress did ANYTHING to help us on the CPSIA. There are only 36 days left until Election Day.

The WSJ had a fascinating commentary on the national nature of this midterm election. You need to check out the two commercials displayed in this WSJ blogpost. It's a sad commentary on the national state of mind fomented by two years of assault on our traditional beliefs by this Administration.

CPSIA - Regulations Are Killing Us

774 days have passed since ANY Democrat in Congress did ANYTHING to help us on the CPSIA. There are only 36 days left until Election Day.

The headline in the WSJ says it all (thanks, Jennifer):

"The Regulation Tax Keeps Growing. Blame Washington, not China, for the decline of American manufacturing." [Emphasis added]

I have written endlessly on this topic in relation to the poisonous CPSIA. You know the drill.

Of course, it can hardly be surprising that this is happening under the "too little government, too little regulation" administration of Barack Obama. It is a rich irony that the supervisor of regulations appointed by Mr. Obama is Cass Sunstein, my former law school professor. As the cognoscenti know, Sunstein is known for his aversion to uneconomic regulations. Consider this prediction from February 2009:

"Even his detractors recognize Sunstein, 54, as an amazingly prolific legal scholar with a keen intellect. But they worry about his insistence on tying regulations to cost-benefit analysis, the bedrock principle of his Bush-era predecessor, John Graham. They're also concerned about his prediction last year that Obama will be a deregulator. 'He is off on the wrong track,' says Rena Steinzor, a progressive University of Maryland law professor." [Emphasis added]

Either Sunstein was given a sham of a job, or the appointment was a sham, or the administration subverted a purportedly sensible initiative, reining in regulations using a cost-benefit philosophy. Whatever happened, it is clear that Mr. Sunstein has been utterly ineffective in any purported efforts to control the beast. As noted, we have covered this topic repeatedly in this space.

The WSJ notes:

"In a report released last week for the Office of Advocacy of the U.S. Small Business Administration, we find that small businesses bear a disproportionately large share of regulatory costs. The portion of these costs that falls initially on businesses overall was $8,086 per employee in 2008. But these costs are not borne equally by businesses of all sizes. Larger firms benefit from economies of scale in compliance; small businesses do not have that advantage . . . . Small manufacturers bear compliance costs that are 110% higher than those of medium-sized firms and 125% higher than large firms' costs. As much as it is fashionable to blame China for the demise of small manufacturing in America, the evidence suggests that looking for some reasons closer to home is warranted." [Emphasis added]

What-a-shock! Who could have seen this coming?

The WSJ article is full of useful quotes, check it out. All roads lead to Rome - the regulatory monster is choking us to DEATH. And as usual, there is little motivation to do anything about this self-induced disaster until the bodies pile up the sky.

Sadly, my arguments fail simply because of the offense of not being dead yet.

Hey, CPSC, keep your head in the sand. Can't see it, must not be there. . . .

Sunday, September 26, 2010

CPSIA - Congressional Terror Campaign Continues (FMLA)

773 days have passed since ANY Democrat in Congress did ANYTHING to help us on the CPSIA. There are only 37 days left until Election Day.

Don't worry, your Congressional tormentors haven't tabled their latest effort to terrorize you, the Foreign Manufacturers Legal Accountability Act. We understand that the Congressional Democrats are still trying to make a "deal" on this terrible law. It's not going away even if you have put it out of your mind.

It doesn't matter that that this law violates WTO rules. it doesn't matter that it is flagrantly protectionist legislation that may trigger a trade war. It doesn't matter that it pissed off the EU, as previously reported in this space. It doesn't matter that we will lose critical vendors. It doesn't matter that we will face retaliatory legislation in other districts, effectively cutting off foreign markets for our export efforts.

All that matters is that Rep. Betty Sutton needs to look heroic to her constituents - the bill is a gift to her. She is fighting for her political life in this Midterm election and your petty concerns pale compared to the needs of the Congressional Democratic majority position. And you thought the politicians worked for you. It may be the other way 'round.

The latest sign of the cost of this self-destructive act is the inflamed outrage of our closed trading partner, Canada. For some reason, Canadians aren't too psyched up about being subject to class action lawsuits in this country. Weird, you'd think they would LOVE it. . . .

" . . . Canadian Trade Minister Peter Van Loan says the 'badly crafted' bill could end up side-swiping Canadian exporters, even though U.S. officials insist Canada isn't the intended target. 'There are enough thinking people that realize that this is a badly crafted bill that causes harm to a whole bunch of people,' Van Loan said Thursday."

No sense of humor up north, eh? How can those Canadians act so superior, criticizing the handiwork of our very own Democrat-dominated Congress? Badly crafted legislation? Please! Never heard of such a thing.

"Van Loan says the Canadian government is holding out hope the bill won't reach a vote before Congress adjourns in the coming weeks. 'If it gets voted on, the charged political environment means it will almost certainly pass, because you can't be seen voting to protect people dumping toxic drywall from China and stuff like that in your country,' said the minister. The [Canadian] government is keeping 'all options' open if the bill passes, but would likely seek a waiver similar to the Buy American exemption, he said." [Emphasis added]

Congress giving a gift to itself with self-destructive legislation, and a major trading partner implicitly threatening retaliatory legislation. Wow, we have a great government, don't we?

Is anyone besides me TIRED of being the object of continuing terrorist attacks by our OWN government?

When can I start to vote? Someone please help me . . . .

Thursday, September 23, 2010

CPSIA - "Children's Product" Means Whatever They Want

770 days have passed since ANY Democrat in Congress did ANYTHING to help us on the CPSIA. There are only 40 days left until Election Day.

As the Commission privately dithers, or squabbles, for weeks over passing the final interpretative rule on the meaning of "Children's Product" under the CPSIA, a recent recall illustrates the uncertainty and capriciousness of the draft rule currently in use by the Compliance staff. Or, should I say, the uncertainty and capriciousness of the current administration running the CPSC shop?

On Tuesday of this week, the CPSC announced the recall of mood rings. No, they weren't recalled because the CPSC inspector's mood ring always turned black, but good guess! The agency cited "high levels of lead". Oooo, scary lead!

Ahem, doesn't the CPSIA only apply to "Children's Products", and if so, don't the mood rings need to be "Children's Products" to be subject to the new lead standards? Right and right, careful reader! You have been paying attention, unlike certain regulators. The CPSC says this is a product intended for children under 12, so they were just doing the Lord's work to recall them, right? Save the Children! Who could oppose that?

Perhaps we should hear the company's side of the story (courtesy of one of my readers, thank you, Anonymous!):

"September 21, 2010,

To Whom It May Concern:

From: D&D Distributing-Wholesale, Inc.

To Whom It May Concern:

We are writing in response to the Love Tester items that were found by CPSC staff to contain lead in excess of the current CPSIA limits. These items were originally purchased in 2005, and intended as a teenage to adult novelty, and not for children 12 and under. This is evidenced by the novelty of this item being to measure the sexual performance of the bearer with the results ranging from clammy to naughty, passionate and hot stuff. These words were specifically chosen to target a more mature market.

Nonetheless, due to our awareness potential future legislation, we instructed the factory to make these items using lead-free metal to avoid any problems. The factory confirmed that these goods would be made out of lead-free material and adjusted the prices to reflect this. In 2005, we felt that this effort was appropriate for the time. By the second half of 2007, D&D Distributing had started the process of testing new items as well as taking steps necessary to ensure that older items were lead safe. We had contacted the factory of the Love Testers again in 2007, and they responded that they had done their own testing to confirm that these items used lead-free metal.

We believed that this was enough evidence to make a reasonable assumption that the Love Tester items did not contain lead.

In early 2009, we were visited by CPSC Officer Marcus Morris. Officer Morris randomly selected items for x-ray testing, as well as several items offered by D&D staff, and a few items did have lead content in excess of the new limits. These items were ordered to stop sale. It was our intention to evaluate every questionable item imported previous to new federal law (CPSIA act of 2008), and test them using CPSC’s x-ray gun. Unfortunately, the Love Tester items were missed during this time. Since early 2009, we have had several other visits from Officer Morris, and many other items were offered by D&D to be tested.

CPSC has determined that the Love Tester items are for children 12 and under, and D&D agrees to comply with the CPSC’s decision to recall the items.

Best regards,

D&D Distributing-Wholesale, Inc."

[Emphasis added.]

So the CPSC just decided that this sex toy was for kids 12 and under. Perhaps kids grow up faster in Bethesda, I don't know, but the action of the CPSC seems to ignore the clear intent of the manufacturer, not to mention the rather obvious fact that this product is not suitable for Middle School children (or younger). Feeling "clammy" yet?

Okay, zealots of the world, you ask - how dare you defend icky LEAD? Don't you Rick know how dangerous lead is for the CHILDREN? Let's not forget the children . . . .

Lead's capacity to harm has never been in doubt, but of course, I believe facts and circumstances are important in determining WHEN lead is a worry. In this case, however, I think the issue is different.

As a manufacturer subject to the awful CPSIA and the unrelenting pressure of the manic CPSC, I object to rules "on wheels". If the CPSC can move the rule from here or there to justify whatever it wants to do today without restraint, how can I protect myself? How can I plan? Please TELL ME what a "Children's Product" is. I have to figure out what my legal obligations are. Do I have to test, or not? Do I need to be lead-free, or not? What about phthalates? I also sell to thousands of distributors and stores. They are as confused as me, or more. What if they disagree with my judgment? Who decides what's right? And what if the CPSC disagrees with both of us? What is our recourse? [You know the answer to that one.]

Will regulators at the CPSC ever understand how this kind of case absolutely SCREWS me and everyone else that stupidly remains in the children's market? Will someone PLEASE tell me how to run my business? PLEASE!

We seek meaning in what we do. We produce educational products for a reason - we want to change the world for the better, we want to make a better future for children in dozens of countries. It is our privilege to do this for a living. The CPSC ruins the fun and meaning we find in our work. They poison the well by doing damage to a mood ring company. They have attacked me directly, too - but I am prohibited from telling you in this space what they are doing. I want to, but I cannot (yet). And you're next.

This has to end. I am working on it, but you have to help, too. Do you want to be the next "mood ring" company? I don't. Please HELP me. Please HELP yourself. We (you) cannot sit on our hands at a terrible time like this.

CPSIA - "Children's Product" Final Rule Vote Delayed . . . Again

770 days have passed since ANY Democrat in Congress did ANYTHING to help us on the CPSIA. There are only 40 days left until Election Day.

The CPSC Commission pushed back the date to consider this "final" interpretative rule on "Children's Products" for another week, to September 29th. These delays are unexplained. I guess we can't be trusted to understand their debate. Too fancy for us? Perhaps too explosive. This Dem-dominated Commission DOES NOT WANT to initiate ANY new rulemaking processes. That makes it imperative to keep the final interpretative rule on "Children's Products" very similar to the draft form - to avoid another comment period. Thus, they want to go with what they have, damn the consequences, to preserve their plan to be done with rulemaking by February 10, 2011, the date when the testing stay is set to expire.

Hope you have taken on board the pending expiration of the testing stay. You need to prepare - sell your business, close it, pile up the money to give to the testing companies or your lawyers, or your other creative plans to deal with it.

All kinds of things spin out of control for the Dems running the shop if they fall further behind in their schedule. The pending loss of their third vote (Moore's term ends in a few days and he cannot serve beyond the end of the year) means they face stalemate and frustration soon if they aren't done when he goes. To prevent you the voter from running "their" agency, they need to finish their dirty work NOW.

If things don't work out as planned, I am sure you are prepared to coach the Dems on how to deal with frustration and stalemate. By now you should be an expert!

The delay in taking this rule to "final" signals a real and profound disagreement within the agency. Somebody's agenda is going to get dented. So far, they haven't found a way out of this paper bag.

Based on their track record, whatever they decide, you'll be the loser. And no one will be the winner, either.

November 2nd can't come too soon for me.

Monday, September 20, 2010

CPSIA - REMINDER, Comments due on 100 ppm soon!

767 days have passed since ANY Democrat in Congress did ANYTHING to help us on the CPSIA. There are only 43 days left until Election Day.

I wanted to remind you that comments are due on the latest effort of your government and your CPSC to put us all out of business, namely the reduction of the lead standard to 100 ppm. I have previously analyzed this call for comments in this space and have nothing new to add.

As I noted in my last post, the call for comments rules out most sensible replies to the proposed reduction such as
  • The cost is unaffordable and will render our products too expensive to produce
  • The new limit is suitable for mass market products but will make specialty market products impossible to manufacture (too bad for us, I guess).
  • The new limit is needlessly disruptive.
  • The new limit substantially increases our liability exposure.
  • The new limit creates yet more ways for the CPSC to interfere with our businesses.
  • The new limit creates more externalities and randomness in our business results (another "profit prevention" initiative).
  • The new limit will have absolutely no impact on human health but will have tremendous implications for business health.

All irrelevant.

If you can't come up with anything to say to save your business under this provision, I still encourage you to send in a comment. Perhaps if we drown them with comments about the unfairness to small business, they might at least pause for a moment before sending us into business oblivion. You can always just thank them for putting you out of business. A "thank you" always goes a long way, just like your Mom used to tell you.

Yeah, thanks CPSC. It's been a great ride . . . .

Sunday, September 19, 2010

CPSIA - Small Business Desperation

766 days have passed since ANY Democrat in Congress did ANYTHING to help us on the CPSIA. There are only 44 days left until Election Day.

Here is a window sign found in a neighboring community here in Northern Illinois. I don't think it's a children's product business but I feel their pain. How much can you ask of a small business person these days?

I am sure there's a form we can fill out to get the answer . . . .

CPSIA - Republican Strategy MAY Benefit CPSIA Sufferers

766 days have passed since ANY Democrat in Congress did ANYTHING to help us on the CPSIA. There are only 44 days left until Election Day.

The strategy of the resurgent Republicans to deal with over-regulation under Obama is becoming clearer. The Wall Street Journal today broke a story about "de-funding", a strategy employed by Republicans in the 1994 Congress to address bad regulations and bad legislation after the Congress "flipped" at the Midterm elections.

This appropriations maneuver can take away the funds to enforce legislation or even regulations at the agency level. Thus, the Dems' entire effort to build a durable business death machine at the CPSC can be subverted. By making it illegal for the agency to spend one red cent to enforce the rules, all de-funded legislation and every regulation is essentially rendered moot.

This is a hopeful sign - and another reason for you to RALLY support for Republicans this Fall. Reach out and make your needs KNOWN. Work for these candidates, give money and do what it takes to help them WIN. Believe me, based on my work over the past three years, there is not one living Democrat prepared to help us in any way - the Republicans are our only chance. If a Democrat wishes to prove me wrong, I will gladly publicize their activities. I am not holding my breath.

If we are lucky and our well-documented problems are not forgotten post-election, we can still be saved.

Thursday, September 16, 2010

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 - they want 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. . . .

Tuesday, September 14, 2010

CPSIA - WARNING: Spine Alert!

761 days have passed since ANY Democrat in Congress did ANYTHING to help us on the CPSIA. There are only 50 days left until Election Day.

Imagine pushing back on a regulatory agency. Imagine protesting demands for a knee-jerk recall of an item without a demonstrated (as opposed to asserted) substantial product hazard. Imagine someone standing up to the CPSC. Imagine . . . .

Okay, it didn't happen here. But Elfe Juvenile Products did zing the CPSC in its letter resisting a mimic recall of strollers by Health Canada. It even took them to task for a crib recall - wow! Without coming out and using pejorative terms, only implying them, Elfe accused Health Canada of "blindly" following the CPSC and conceding the authority of the U.S. agency. That can't be a compliment . . . .

“'My review of the applicable Canadian legislation does not reveal any mandate given to Health Canada to blindly accept decisions made by an administrative agency in a foreign jurisdiction. To do so, would, of course, be an unacceptable submission to the sovereignty of another country,' Ivan Bern, Elfe’s general counsel, wrote to Health Canada on Jan. 19."

Ouch. The next day our highly reactive agency announced a recall of 1.5 million strollers for laceration hazards and fingertip amputations.

Have you ever scratched your head and asked why the stroller and crib folks aren't pushing back? Well, confronting a federal agency that has already sic'ced the U.S. Attorney on some of its hapless victims (notably, Daiso) and rabid State Attorneys General like Illinois' Lisa Madigan is to tempt a deluge of litigation all over the country, merited or not. And they are certainly not above manipulating the press for the kind of hysterical headlnes certain to kill your business. Look at baby slings. Bankruptcy is your likely fate if you try to defend yourself. Never litigate with someone who has a printing press, as they say.

Well, one of them finally spoke up. The day after the U.S. stroller recall, Health Canada posted a recall for the Elfe-distributed stroller for the same hazard. "'In our opinion, there is no ‘trend’ to be discerned, unless it is that of 1,499,993 consumers acting responsibly, and possible seven instances where the goal of perfection in human behaviour was demonstrated to be unattainable,' Elfe’s general counsel told Health Canada." Not that it mattered what they thought - Health Canada proceeded with a recall immediately anyhow.

To add to the strangeness of this interaction, Elfe was also a distributor of Simplicity cribs at the time. Those cribs started crib mania at the CPSC and also created a craze over "responsible parties" after Simplicity was driven into bankruptcy. The CPSC busily talked down Simplicity cribs, labeling them "dangerous". No statistical analysis of the use of these cribs was released to my knowledge, just an injury count over many years. [I raised three children with dropside cribs without incident. I was also raised in a dropside crib to my knowledge. Although some people think I was dropped on my head as a child, that's not the crib's fault.]

Consider what happened next in Canada: "Following these statements, Elfe, the former distributor of Simplicity products in Canada, provided different advice to Canadian parents, telling them to make sure the crib was assembled properly. And 'if the drop-side is installed upside down or not securely attached,' Elfe recommended parents reinstall the drop-side the proper way with new hardware, to be provided free of charge by the company. A few days later, Health Canada posted Elfe’s voluntary recall on its website, saying the department had assessed Elfe’s metal retrofit kit and determined that it did not adequately correct the hazard posed by the drop-side crib. The newly released private correspondence reveals Elfe didn’t think this course of action was needed, accusing Health Canada again 'deferring to the CPSC’s unilateral actions' in the face of negative press." [Emphasis added]

Frankly, this is the closest the press has come to reporting the truth about the CPSC and the mania spawned by the CPSIA. The CPSC is feeding public perceptions of danger where the agency formerly took the view that consumers bore some responsibility to use their equipment properly and to maintain it in good condition. Nowadays, these issues are twisted into asserted "substantial product hazards" and are accompanied by a government-sponsored negative publicity campaign (think of all the Good Morning America appearances you have seen Tenenbaum make). The agency almost blatantly dares companies to push back - with Lisa Madigan, Jerry Brown and other State Attorney General thugs waiting to pounce. The toxic commercial environment in the U.S. is not enough to satiate them - they must cross borders to spread ill will and poisonous markets to other countries.

There is no way to argue with this kind of tyranny. Their assertions are considered "findings". The political nature of such "findings" is rarely outed. Even when the company itself initiates a recall, the agency implicitly claims it as its own (like a skin on the wall) and announces it as one of its consumer "triumphs". These recalls exist on the CPSC website as precedent undistinguished from other recalls - influencing the decision-making of other companies and eroding the confidence of consumers. With the CPSC imprimatur, recalls are taken as signs of further corporate bad behavior.

Hats off to Elfe for at least trying to push back. I wish they had more company. The only way to end this kind of regulatory tyranny is to expose it and to resist corporate slander at the hands of a rogue agency.

Monday, September 13, 2010

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.

CPSIA - What Lead Threat, says EPA.

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.

I know Congress told us that lead is a major health threat in children's products. Far be it from me to doubt the Junior Scientists Club that the Dems have fashioned in Congress. I am sure they know what they're talking about.

Unfortunately, the Junior Scientists forgot to coordinate with the EPA. Well, why would we think the Environmental Protection Agency would know anything about neurotoxins in the environment or in the home? Strangely, the EPA happens to be very concerned about the presence of lead in the home. In fact, they published a brochure entitled "Protect Your Family From Lead in Your Home". A friend recently signed an apartment lease and was handed this brochure for his safety.

I couldn't help but be curious. The EPA wants to protect against lead in the home. SURELY they would mention lead in children's products. Children, our most vulnerable consumers, blah blah blah. Right?

Ummm, no. There is no mention of children's products, much less lead-in-substrate. The focus is on lead-in-paint ON THE WALLS.

A few "shocking" revelations from the dumb ole' EPA:

a. "People can get lead in their bodies by breathing or swallowing lead dust, or by eating soil or paint chips containing lead."

b. "In most cases, lead-based paint that is in good condition is not a hazard." [Think of all the CPSC recalls for a dot of lead-in-paint.]

c. "Lead is even more dangerous to children under the age of 6." [Waxman has refused categorically to compromise on this fix for the ridiculous and unsupportable age range of the CSPIA.]

d. "Where Lead-Based Paint is Found" [No mention of anything other than paint found on walls, or in the soil around a home which can pick up dust from interior paint or air pollution.]

e. "Identifying Lead Hazards"
  • Lead-based paints
  • Deteriorating lead-based paint (peeling, chipping, chalking, crackling or damaged).
  • Lead dust
  • Lead in soil

No mention of consumer products of any kind. Not even ATVs or bicycle seats!

f. "Other Sources of Lead"

  • Drinking water
  • The job
  • Old painted toys and furniture
  • Food and liquids stored in leaded crystal or lead-glazed pottery or porcelain
  • Lead smelters
  • Hobbies that use lead
  • Folk remedies

Hmmm. Lead paint was illegal for YEARS before the CPSIA. Apparently, the EPA was totally asleep at the switch until Congress discovered the mortal hazard of lead lurking in every conceivable consumer product and reengineered the CPSC in its paranoid image. As we know, under Congress' direction, Inez Tenenbaum assures us that the CPSC "[looks] at what the danger is". And that danger is the lead bogeyman. Odd, isn't it, that the EPA continues to circulate this document so out of touch with Congress' and the CPSC's insights?

Gotta love good government!

Sunday, September 12, 2010

CPSIA - Double-Speak Patrol

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.

Consider the following two events:

a. August 2, 2010: The CPSC Commission voted to authorize yet more Mattel firewalled labs (2) and a lab operated by Hanesbrands, a $2.3 billion market cap maker of underwear. [Oooo, lead in underwear! Is this a sick joke or does the CPSC really think kids are chewing on their dirty underwear? Ew!] I believe, without checking, that Mattel now has nine approved firewalled labs, enabling it to save lots of money which is well beyond the practical reach of any small business. The only parties who have thusfar achieved this relief are mass market companies.

b. August 15, 2010: CPSC Chairman Inez Tenenbaum gave an interview with the Baltimore Sun featuring the following exchange:

"Q: How do you respond to some critics of the Consumer Product Safety Improvement Act who say the law puts heavy testing burdens on manufacturers, especially smaller producers?

A: We have to have high standards to protect the consumer. So regardless if you're a large business or a small business, we can't let you put lead in children's products, or cadmium. Or overlook flammability laws or use other toxic chemicals. We look at what the danger is. We think if we had a small-business ombudsman who was out there regularly educating small businesses, we could help them prevent problems in terms of compliance. Large corporations have a whole office full of lawyers and engineers and chemists and toxicologists. Small businesses do not. And we don't want to put anyone out of business. We want to help them learn how to comply and sell safe products." [Emphasis added]

Put side-by-side, these two events separated by only a few days, make clear the utter insensitivity of our government to our plight. The dismissive condescension of Tenenbaum in daring to suggest that an ombudsman would make the problems disappear for small businesses is infuriating. The necessary implication is that we small businesses are just too stupid to understand their complicated rules - I guess she thinks only Mattel can read the English language. Of course, the pending testing frequency rule (which I believe will be implemented in the coming weeks, get ready for it) will cause our company to spend $15 million per annum on testing. This sum far exceeds our profits. Perhaps the ombudsman will help us terminate our people to pay for testing, or provide a shoulder to cry on. And we'll be crying alright.

At the same time, Tenenbaum is actively feathering the nest of the VERY Big Business that caused the CPSIA, Mattel. How ironic, isn't it? The fact that she is tilting the children's market fatally in favor of Big Business doesn't seem to be a source of guilt for Ms. Tenenbaum. Empty words are the solution.

Please keep this in mind the next time you suffer through the dark intonations of our Fearless Leader laying the blame for the economic problems of the small business community at the feet of the Republicans. The problems in our market won't be solved with yet another handout - the Dems should try loosening the garrote they are busily tightening around our air passages. Tax relief won't provide much help when the new regulations makes profit impossible.

Let's stipulate that the Dems in Congress and at the CPSC are fully aware of the inequities and other problems embedded in the CPSIA. In the face of a continuous and vigorous public debate for two years+, this seems beyond dispute. I am also aware that this blog is widely and loyally read by these people. Ignorance is not a possible explanation. Stubbornness, self-preservation, zealotry, a lack of political will, exhaustion - any of those make more sense to me as an explanation.

I have no outlet for my anger over this. I just hope you are not a sucker for the Dems' baloney and spinning. Our ONLY hope is a Republican-led Congress that will act to make these people accountable for the damage they are inflicting. The Dems have proven their stripes - to hope they will come to their senses is simply wishful thinking without any basis in reality or fact.

Can you take two more years of this? I cannot and I will not. I need your help, however - you need to vote the scoundrels out of office on November 2. Here is a list of Democrats on the House Energy and Commerce Committee:

Henry A. Waxman, CA
John D. Dingell, MI
Edward J. Markey, MA
Rick Boucher, VA
Frank Pallone, Jr., NJ
Bart Gordon, TN
Bobby L. Rush, IL
Anna G. Eshoo, CA
Bart Stupak, MI
Eliot L. Engel, NY
Gene Green, TX
Diana DeGette, CO
Lois Capps, CA
Mike Doyle, PA
Jane Harman, CA
Jan Schakowsky, IL
Charles A. Gonzalez, TX
Jay Inslee, WA
Tammy Baldwin, WI
Mike Ross, AR
Anthony D. Weiner, NY
Jim Matheson, UT
G. K. Butterfield, NC
Charlie Melancon, LA
John Barrow, GA
Baron P. Hill, IN
Doris O. Matsui, CA
Donna M. Christensen, VI
Kathy Castor, FL
John P. Sarbanes, MD
Christopher S. Murphy, CT
Zachary T. Space, OH
Jerry McNerney CA
Betty Sutton, OH
Bruce L. Braley, IA
Peter Welch, VT

Please help their opponents with cash and labor, and votes. My guy is Joel Pollak, running against Jan Schakowsky. Can you imagine Congress without her? Oh, to dream. . . . His website is - please consider supporting his candidacy generously.

Tuesday, September 7, 2010

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!