Sunday, November 21, 2010

CPSIA - Database Questions Tell the Tale

We know that the Dems aren't listening to our concerns about the public database and we know they fully intend to move forward with their proposal this Wednesday. The outcome is so certain that the consumer groups can't resist clucking about it to the press BEFORE it happens. It's a set-up. Too bad for us . . . .

We also know that behind closed doors, the Dems are expressing little confidence that the database has any safety utility. Apparently, they have not acted to hire a SINGLE new employee to process or check the filings in the database project. "Post it and Forget it" is said to be their attitude. It is hard to see how this constitutes even the slightest effort to address the legitimate concerns of manufacturers in the database. Notwithstanding the assurances by consumer groups that we regulated companies have participated "fully" in the process of creating the rules of the database, this laissez-faire approach is hardly comforting.

Late last week, the agency released answers to Anne Northup's follow-up questions on the database. These answers give further perspective on what's at stake here.

A few nuggets:

a. To get some perspective on how many complaints might be posted, please consider the following annual postings:

National Electronic Injury Surveillance System (NEISS): 395,700 Injury or Potential Injury Incident Database (IPII) (misc filings to CPSC): 51,400 Death Certificates (data purchased from State governments): 3,600

Just a reminder, the CPSC hasn't hired anyone to process entries into the database. And don't forget, the CPSC plans a big marketing blitz on the database, encouraging consumer submissions. The foregoing data sources do not enjoy marketing support and still produce massive data submissions. Considering the liberal definition of who can file under the Dem proposal, the submission numbers could easily swell into the many tens of thousands per year.

The agency also concedes that the filings in the database may be much more detail-rich than the foregoing filings, only compounding the obvious issue. Garbage in, garbage out.

Too bad for us . . . .

b. The agency currently investigates less than 20% of "incidents" filed with the CPSC (2009 statistics). The pool of incidents totalled 16,000 in the most recent fiscal year, resulting in a 14% investigation rate.

NEISS is not investigated. IPII is investigated at a lower rate, with 51,541 reports in 2009 and 4,915 investigations.

The plans for the new database call for a 0% investigation rate (of accuracy). I am sure the CSPC will troll the database aggressively to investigate YOU but not to investigate the validity of the claims. Remember, manufacturers are always suspect, the submitters never are suspect.

Too bad for us . . . .

c. The CPSC has no idea how much time it will have to spend to investigate a claim of inaccuracy by a manufacturer. Of course, the odds of such an inaccuracy claim are reduced sharply by the limited data disclosure to manufacturers, making a rational claim of inaccuracy rather difficult. And as more consumers come to believe that filing with the database is a substitute for direct communication with manufacturers (or perhaps an even better form of communication, informing the manufacturer and the "cops" at the same time), the flow of information to manufacturers will degrade, making accurate and insightful assessments increasingly more difficult. No doubt trust between consumers and manufacturers will erode, too.

Too bad for us. . . .

d. Current database entry QC by the agency does not make "any judgment on the validity of concerns expressed by the submitter". Screening seems to be entirely comprised of searches for inconsistencies. They look for coding errors, among other errors. Some randomized checking against the original documentation is also conducted. Only about 4% of the data is bounced (of which, 40% are rejected as duplicates). The rest are bounced principally for being out of scope (beyond the CPSC's jurisdiction) or because no product type is identified.

In other words, the CPSC hardly ever catches any errors or fraud in database entries. Hmmm. Sounds very thorough to me.

The plans of the agency to review the data being included in the database does not include, as far as I can tell, ANY effort to verify accuracy - just to focus on the criteria for inclusion.

Too bad for us . . . .

e. NHTSA database provides contact information of the submitter to the manufacturer. The CPSIA database will NOT - because the CPSIA explicitly forbids it. That's call the "will of Congress".

It's also called stupid legislative drafting and a boneheaded idea.

Too bad for us . . . .

And the net effect of all these little problems? Will the Dems pause to consider the impact on markets? On small businesses? On safety in general? Perform a more open-minded cost/benefit analysis? Trim the database concept back until its value is better understood?

As Public Citizen tell us, we can scream from the rooftops all we want, but the Dems are marching forward. Who can complain, since we have participated "fully" in this process?!

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