CPSIA - In My Fantasies, the CPSC is Just Like Homeland Security

On Monday, March 15, the Department of Homeland Security did something we probably will never see from this CPSC:

"[Docket No. DHS–2011–0015]

Reducing Regulatory Burden; Retrospective Review Under Executive
Order 13563

AGENCY: Office of the General Counsel, DHS.
ACTION: Notice and request for comments.

SUMMARY: Pursuant to Executive Order 13563, ‘‘Improving Regulation and Regulatory Review,’’ issued by the President on January 18, 2011, the Department of Homeland Security (Department or DHS) must develop a preliminary plan to facilitate the review of existing DHS significant regulations through the use of retrospective analyses. The preliminary plan will include criteria for identifying existing DHS significant rules that might be modified, streamlined, expanded, or repealed, so as to make DHS’s regulatory program more effective or less burdensome in achieving its regulatory objectives. The Department is soliciting views from the public on how best to develop its preliminary plan. The Department is also seeking views from the public on specific existing significant DHS rules that the Department should consider as candidates for modification, streamlining, expansion, or repeal. These efforts will help DHS ensure that its regulations contain necessary, properly tailored, and up-to-date requirements that effectively achieve regulatory objectives without imposing unwarranted costs." [Emphasis added]

Imagine that, an agency that wants to streamline and to avoid imposing unwarranted costs!

Of course, Homeland Security is not facing anything as dreaded as LEAD - have I mentioned that there is NO safe level of lead? - and can probably cut a few corners without any untoward effects. Homeland Security doesn't seem too busy, just checking a few boarding passes, looking serious and so on. I guess when you have an unimportant, almost trivial responsibility in the government, you can afford to review your rules for fat, waste and stupidity. But when CHILDREN'S SAFETY is concerned, and bicycle licking is possibly at stake, well then, you can't take ANY chances.

Damn the cost, man, we have to be SAFE!!!

CPSIA - Congressional Eager Beavers Push Anti-Cadmium Law

Congress' Junior Scientists Club (Senators Klobuchar, Schumer and Nelson) sprung into action Tuesday to solicit co-sponsors for CPSIA knock-off legislation to ban cadmium and various other materials in jewelry. The delicious irony here is their choice of day to launch this effort, namely the day that Massachusetts elected a Republican to replace Ted Kennedy in the Senate, an election result widely interpreted as a firm rejection of this Administration's government intervention, you know, like this bill.

Let's not forget that in 1972 the Federal Government created a little known agency to handle "threats" like this, namely the Consumer Product Safety Commission. Congress gave the CPSC the authority it needed to do its job. Oddly, today our Democratic-dominated government seems to think that only it can solve safety problems and further must LEAP into action to save us. I question this. Perhaps the CPSC even questions this.

Even more remarkable is the Dems persistence in pursuing a CPSIA strategy to "stop this cold". Have these Senators learned nothing from the last 18 months of CPSIA chaos and pain, preferring instead to continue legislating without research, hearings or contemplation? Well, the approach "worked" once before and they did read an AP story about it. . . .

Someday these Senators will be up for reelection. Mark your calendars!

Here's their letter for your reading pleasure:


Sent: Tuesday, January 19, 2010 12:16 PM
Subject: Cosponsor the Safe Kids' Jewelry Act - keep cadmium out of children's jewelry


Senators Schumer, Nelson and Klobuchar are seeking cosponsors of the Safe Kids’ Jewelry Act. A copy of the draft bill is attached. Please let Stacy Ettinger in Senator Schumer’s office know, this week, if your boss would like to cosponsor the bill or if you have any questions about the bill.
Also, appended below, please find the January 10, 2010, by Justin Pritchard on the Associated Press’s investigation into use of cadmium in children’s jewelry and the adverse health effects of cadmium exposure (http://www.msnbc.msn.com/id/34793600/ns/health-kids_and_parenting/print/1/displaymode/1098/ ).

SUPPORT THE SAFE KIDS’ JEWELRY ACT
Protect Children from Exposure to Cadmium and Other Toxic Heavy Metals in Children’s Jewelry

Dear Colleague,

We write to request that you consider cosponsoring the Safe Kids’ Jewelry Act. We believe that this bill is vital to protect children from exposure to cadmium and other toxic heavy metals in children’s jewelry. The legislation would prohibit the manufacture and sale of children’s jewelry – including charms, bracelets, pendants, necklaces, earrings, or rings – containing cadmium, barium or antimony.

Cadmium is a soft, silver-white metal that typically is used to manufacture pigments and batteries and in the metal-plating and plastics industries. Cadmium is a known carcinogen and studies show that direct exposure has adverse developmental and reproductive effects and can lead to kidney disease, among other health problems. Infants and young children are particularly vulnerable to the dangerous effects of cadmium and other toxic heavy metals. Children’s growing bodies absorb these metals at much higher rates than adults and long-term cumulative exposure increases toxicity.

This legislation is needed because test findings show a growing presence of cadmium in children’s jewelry as foreign manufacturers switch from lead – now banned in children’s products – to cheap substitute metals. In lab testing for a recent Associated Press investigation, chemists found significant use of cadmium in a variety of charms, bracelets and pendants sold at several popular retail stores.

In addition to banning children’s jewelry made with cadmium, barium or antimony, the legislation provides for enforcement of the ban, as well as further study on whether other heavy metals should be banned for use in children’s jewelry or other children’s products. Specifically, the bill —

· Protects children. Children are most vulnerable to the health risks from cadmium and other heavy metals. The bill bans the manufacture and sale of children’s jewelry containing cadmium, barium or antimony marketed for children ages 12 and under. Products covered by the ban include charms, bracelets, pendants, necklaces, earrings and rings. The ban would take effect 90 days from enactment of the legislation.

· Gives the CPSC flexibility to designate the most effective testing and certification requirements. The bill gives the Commission authority and flexibility to set stringent, effective testing and certification requirements for manufacturers to ensure the safety of children’s jewelry.

· Sets criminal and civil penalties for violations. Children’s jewelry containing cadmium, barium or antimony would be considered a “banned hazardous substance” under the Federal Hazardous Substances Act (“FHSA”). The bill mandates application of criminal and/or civil penalties under the FHSA for any violations of the Safe Kids’ Jewelry Act. The bill requires the Commission to report annually to Congress on its actions to enforce the Safe Kids’ Jewelry Act, as well as whether the Commission imposed any criminal or civil penalties for violations of the Act.

· Does not preempt State or local law. A significant number of States and localities across the country are now considering enacting laws to ban sales of children’s jewelry containing cadmium and other heavy metals. The bill makes clear that the Safe Kids’ Jewelry Act would not preempt State or local laws relating to regulation of products containing cadmium, barium or antimony. The bill also clarifies that the Safe Kids’ Jewelry Act would not affect any enforcement action or liability of any person under State law.

· Requires CPSC to report to Congress regarding heavy metals which should be banned from children’s products. The bill requires the Commission to study and report to Congress within one year on whether other heavy metals should be banned from use in children’s jewelry or other children’s products.

We hope you will join us in supporting this bill. If you have any questions about the bill or would like to cosponsor the bill, please contact Stacy Ettinger in Senator Schumer’s office (4-7945 or stacy_ettinger@jec.senate.gov); Clint Odom in Senator Nelson’s office (clint_odom@billnelson.senate.gov); or Jonathan Becker in Senator Klobuchar’s office (jonathan_becker@klobuchar.senate.gov).

Sincerely,

/S/
Charles E. Schumer
Bill Nelson
Amy Klobuchar

CPSIA - Regulation by Newspaper Headline

There was once a time when newspaper headlines did not immediately become law. Those golden days are seemingly a hazy memory, to judge from the swift and judgmental reaction to a recent AP story on cadmium in children's jewelry.

PLEASE NOTE - This essay is not a defense of cadmium. That's becoming a tiresome objection, frankly. Cadmium is bad, okay? Back to the story . . . .

The AP story, backed up by test reports that AP will apparently not release, prompted Senator Chuck Schumer to introduce legislation on Wednesday, two days later, to "stop it cold". After an equally lengthy deliberation and careful consideration of the flimsy facts of this case, Chairman Inez Tenenbaum of the CPSC made this astounding announcement today:

"Because of these recent developments, I have a message for parents, grandparents and caregivers: Do not allow young children to be given or to play with cheap metal jewelry, especially when they are unsupervised."

Whoa! Tenenbaum is saying that consumers should boycott ALL "cheap" metal jewelry now? Is she trying to put Claire's Boutique and countless thousands of other small companies out of business entirely, all because of the unconfirmed accusations of an AP reporter about a handful of pieces of jewelry from a tiny number of sources? Within 48 hours, too? I think that's irresponsible.

Yes, it's irresponsible, but that's the way this populist government of reactive politicians wants to govern. The Obamites are apparently shocked to discover that anything ever goes wrong, and if they ever find a single fly in the ointment, they then assume they are facing a broad scale assault. Hence, the immediate action to implement bans and cessations of trade.

Stop it cold, indeed - but what exactly is being stopped? Trade. Jobs. Futures.

Even worse, frankly, is the notion that this problem must be "solved" by legislation. While Senator Schumer was simply doing the usual, pandering for votes, where is it written that this problem is best resolved by Congressional action? [Let's put aside the niggling detail that some further assessment of the nature of this "dire" threat is appropriate before we take ANY action whatsoever.] Apparently, Mr. Schumer believes it's his job to fix this problem and that in the absence of his decisive action, the rest of the government would fall on its face.

Umm, well, we used to have a federal agency for this very task, the CPSC. Okay kids, gather 'round, let me tell you about a long ago time when the CPSC had actual authority to assess risk and depending on its independent judgment, was entitled to draft and implement rules governing safety in the marketplace. Wasn't that a wonderful time, kids?! Well, not anymore. Nowadays, apparently only Congress can exercise judgment. And that judgment is best exercised without the use of any scientific advice or reliance on the agency charged with the responsibility for safety administration.

Courtesy of the CPSIA, the CPSC is now a bureaucracy designed to serve the will of the politicians - determining what is safe (and what is not) is not their primary job anymore. Congress has no use for Ph.D.s or other people that actually understand science. With folks running the show like Chuck Schumer who apparently believe that an AP story is a perfect substitute for expert advice, there is no need for the CPSC to do anything other than fuel panic for Congress to assuage. Hence Ms. Tenenbaum's shocking announcement today.

This is completely wrongheaded and will damage markets almost immediately. It's all the more amazing because we have been here before, and paid the price with two years of chaos, misery and pain. The lessons of the CPSIA apparently weren't learned, and to judge from the knee-jerk reaction to the AP story, it appears unlikely that this group of politicians (Democrats) and administrators are capable of ever mastering them.

Remember, I think cadmium is bad. But bad is no justification for legislation or rulemaking on the fly. This is not a sudden and life-threatening crisis. This metal, while undesirable, was probably in the market for years, all without poisoning large swaths of American children. The story of the little boy in Minnesota who swallowed a jewerly bangle and died (monotonously repeated by Senator Amy Klobuchar and now by Inez Tenenbaum), sad as it is, should be retired. I have no interest in seeing the children's product industry put out to pasture just because of one accident.

Someday I hope we can restore some sense of proportion and restraint in safety administration. It can be done. . . .

CPSIA - "Bad Optics" or Did Bob Adler Actually Learn His Lesson?

"Bad Optics".

I was thinking of that phase today as I was pondering the astounding mental gymnastics employed by Chairman Inez Tenenbaum and Commissioner Bob Adler to justify keeping private the Commissioners' debate over the agency's recommendations to change the CPSIA until the report is delivered to Congress. Tenenbaum and Adler both asserted yesterday that the private deliberations currently going on were more than sufficient to create the necessary "vigorous debate" all of us Americans hope would occur on a five-person Commission.

You are probably scratching your head. What's the big deal about the Commissioners sitting in one room and discussing an important issue? Well, there's a legal problem here: the Government in the Sunshine Act prohibits meetings of more than two Commissioners without announcing the meeting publicly and making it available to the public. [You owe C-SPAN to this law.] Arguably, three Commissioners can't take a taxi together or gather around the water cooler to resolve issues relating to the Cubs Spring Training line-up without an Internet camera firing away.

Here's some background on the Sunshine Act:

"The Government in the Sunshine Act was passed by the Congress of the United States in 1976. It required for the first time that all multithreaded federal agencies (meaning those which have units that work independent of each other) hold their meetings regularly in public session. The bill explicitly defined meetings as essentially any gathering, formal or informal, of agency members, stretching so far as to include conference calls.

Many federal agencies, most notably the independent regulatory agencies, are headed by collegial bodies. A clear example of this setup can be found in the five commissioners of the Federal Trade Commission. These agencies make most of their decisions through discussions and voting by the board or commissions members. This law was created so that these meetings would be in the public domain for all of us to review, so that if we wish, we can investigate the procedures and decisions of any multithreaded federal agency.

This bill was conceived and passed in the wake of the Watergate scandal, when American mistrust of government was running very high. The government responded by creating various committees to open the meetings of the government, but without a legal backbone to stand on, these groups were wholly ineffective. After some pressure from the public, the act was passed in order to provide a legal backbone for the opening of meeting records to the public."

So the Commissioners are not allowed to meet as a group unless you (the general public) are invited. As the above link attests, this means Commissioners may be constrained in what they choose to say - because you are peering in. Mr. Adler noted this issue yesterday and also expressed his frustration that as soon as he says something in a public meeting, "it's all over the blogosphere". You know, like in this column. Aside from the fact that the Sunshine Act is MEANT to facilitate precisely that, it also fosters accountability. I believe these same concepts underlie the Freedom of Speech, something we are all dependent on.

Ms. Nord pointed out that the purpose of a five-person Commission is to meet and work as a group. I would note (the obvious) that the debate proposed by Ms. Northup would occur AFTER all the private deliberations, and thus might occur at a very productive time. Whatever, Mr. Adler said he was satisfied with the current process, notwithstanding Ms. Northup's point that if meetings involved more than two Commissioners or were exposed to the light of day, errors might get corrected.

Errors - that's an interesting point, isn't it? Correcting erroneous information, probably a good thing, right? Bad information could lead to bad decisions. . . .

This leads us back to "bad optics". As you may recall, the Commission held a hearing on November 4th to decide the fate of Learning Curve and its famous brass bushings. Despite conceding that the brass bushings were perfectly safe, Mr. Adler voted against the exemption petition. Along the way (at about 25:00 in the video of the hearing), Mr. Adler launched into an unprompted and rather condescending bashing of Learning Curve, accusing them of "bad optics". Why did he do this? As I explained in a blogpost on November 5, Mr. Adler had received erroneous information about the company's sales practices from a member of another Commissioner's staff. Taking this information as fact, he gratuitously offered the company some coaching on managing appearances in Washington: "If I had to give any advice to [Learning Curve] on 'optics', I don't think it's such a good idea to come in and say 'We admit we're breaking the law, we'd like an exclusion but oh, by the way, we're going to continue selling this product during the pendency of the proceeding.' I would urge them at least as a matter of courtesy to withhold sale and distribution during the pendency of this proceeding." [Emphasis added] Of course, Learning Curve never said any of this.

You can imagine how Learning Curve must have felt about this - they were later to get whacked with a massive penalty for lead-in-paint, and those negotiations must have been going on at that very moment. When I wrote about this on November 4, Learning Curve's lawyer read my blog and contacted Mr. Adler, who then urgently called me (as I sat down to dinner while on vacation) to ask that I publish his retraction right away. You will find the retraction in the November 5 blogpost above and on the CPSC website.

Presumably this kind of experience leaves scars but now two months later, Mr. Adler appears to have forgotten it all. In early November, he was left exposed and embarrassed by erroneous information passed along in a private meeting. He was not protected by checks-and-balances because the Commissioners are unable to meet in groups and as a result, laid an egg in a very important hearing. To judge by the urgency of his appeal in November (and his remarks in yesterday's meeting), Mr. Adler does not like to be wrong nor be exposed as wrong. YET he now defends the very system that caused his own demise.

"Bad optics", indeed. Mr. Adler, what is the message here?

CPSIA - Transparency, Tenenbaum/Adler-style!

In a truly creepy decision today, the Democrat-dominated CPSC Commission today voted down Anne Northup's motion to have a public debate of the agency's recommended changes to the CPSIA. The vote was 2-2 along party lines. [Party affiliation should NEVER be predictive of positions on safety.] By this vote, the Commission ensures that there will be no public airing of views on the agency's recommendations for amending the awful CPSIA before their report to Congress is due on January 15 (see below). Apparently, the general public's interest in understanding this critical debate was deemed by the Democrats to be a low priority.

It is ironic that the Democrats would choose to spurn the Government in the Sunshine Act ("Sunshine Act") so brazenly. The decision to leave Northup's item off the upcoming meeting agenda is not technically a violation of the Sunshine Act, but then again it is certainly NOT on the list of exceptions to the public meeting rule (5 U.S.C. 552(b)(c)). In my humble opinion, it is a clear violation of the spirit of the Sunshine Act and can hardly be characterized as "transparent" government. As Ms. Northup noted, the sponsors of the Sunshine Act would be appalled. So why did the Dems do it?

Before I recap and analyze of this incredible event, I would like to quote Inez Tenenbaum on the importance of "transparency" (emphasis added):

• CPSC Press Release (July 9, 2009): "Ms. Tenenbaum identified three major areas of focus for her common sense approach to serving as Chairman. 'First, I want CPSC to be more accessible and transparent to parents and consumers. By creating an electronic database of product incident reports that consumers can search and by collaborating with state and local agencies and consumer groups, we can give the public confidence that CPSC is working openly and in their best interest,' she stated."
• APEC Conference Keynote Address (August 1, 2009): "My regulatory philosophy embraces open dialogue, information sharing with all stakeholders, and a commitment to finding mutual interests. . . . Enforcement is actually one of my three top priorities as Chairman, along with government transparency and consumer education and advocacy."
• Statement Before the Subcommittee on Commerce, Trade, and Consumer Protection (September 10, 2009): "In my first two months leading the CPSC, I have focused on three key goals: transparency and openness to those we serve . . . ."
• Keynote Address, 3rd CPSC-AQSIQ Safety Summit (October 21, 2009): "I embrace open government, information sharing with all stakeholders, and a commitment to finding mutual interests."

With Ms. Tenenbaum's apparent commitment to "transparency", it should not be surprising that she originally moved to add an agenda item to discuss this very topic (apparently for today's brief meeting), and then somehow the decision was voted down 3-1, presumably Tenenbaum, Moore and Adler voting against, Northup voting for, and Nord on leave (she's back now). [I cannot find any record of this vote on the "wonderful" CPSC website and gave up, sorry.] So at one time at least, Tenenbaum was publicly calling for a public discussion of five Commissioners on this critical subject.

One must wonder who spoke to whom to get this flip flop accomplished. Assuming Ms. Tenenbaum meant what she said publicly about the need for "transparency", someone must have really put a wet blanket on the idea of publicly discussing this subject. I wonder who might have strong views on the wisdom of an unstaged, open discussion of these issues . . . .

Consider Ms. Northup's argument: This is one of the most critical issues to come before the Commission. The CPSIA has been controversial and difficult to work with two years now. The Appropriations Committee has asked us to give recommendations on how to change to the law. [See this link, pp. 33-34 for the actual instructions.] There is no disagreement that blood lead levels need to be a top priority in children's safety but none of the CDC, NIH or EPA point to children's products as a serious lead threat. The Sunshine Act prevents the Commissioners from meeting other than one-on-one without calling a public meeting, which means we can never sit down together to discuss these issues. The issues are too important to relegate to a game of "telephone". A hearing is the only way for the five of us to discuss this issue at one time.

Tenenbaum's response was telling: The Staff has been working night and day on this and everyone has had a chance to put in their comments. Each Commissioner has had some drafting responsibility. Each Commissioner has the right to submit their own statement to Congress and likewise to request to testify to present their own personal views. Given our ability to have "extensive discussions" one-on-one, this debate is best held in private. We should NOT have a public hearing on this subject.

Okay, are you persuaded? This is coming from Ms. Transparency, to judge from her many uses of that old chestnut in various speeches and testimony.

Nancy Nord made the point that the reason to have a Commission is to meet publicly and have discussions openly and transparently. Apparently this didn't persuade the Dems. Bob Adler amplified the "argument" against trusting the American public to listen in to the debate: After conceding that he would sound like the "Prince of Darkness", he stated that an open Commission hearing should involve give-and-take but a hearing on this topic would not involve deliberation but instead speeches telling him why he's wrong and the others are right. He said he was very comfortable with the current process because he knows everyone's views quite well and besides, so does the public via blogs, tweets, statements and so on. The minority Commissioners are not being "squelched". He said that a public meeting removes the ability to think out loud. "As soon as you say it [in a public meeting], it's all over the blogosphere." [Thanks for the plug, Bob.]

So what does this MEAN? A few thoughts:

- The Dems don't want to allow an unruly public debate of the issues - why? There are several possible reasons - (a) they have been told a public debate is "not a good idea" by Congressional Dems who have consistently refused to hold public hearings, (b) they have been told that many/most changes are "non-starters" by Guess Who so don't even think about suggesting them, or (c) they don't want to defend their views publicly because . . . there is no way to put a good face on their views.

- The Dems were outfoxed today. By putting up the request to discuss this subject publicly, the Republicans forced their fellow Democratic Commissions to stand up publicly - before you, the general public - and try to defend "smoke filled room" politics. Now that's "Change We Can Believe In!" In other words, they were caught between a rock and a hard place - their Congressional handlers said "no way" and to get this result, they had to publicly wave their arms and try to convince us that secrecy is somehow openness. The Dems can NEVER again say they are all about transparency. If they do, they will expose themselves as being all about . . . something else.

- The "commitment" of the Commission to find middle ground and vote more cohesively as a group, which they achieved after considerable effort on the recent Stay decision (lead testing and certification), is apparently paper-thin. Ms. Tenenbaum obviously knew of Ms. Northup's motion ahead of the meeting today (she had her response drafted in advance). [Did anyone else catch the chill in the air during the meeting?] So, if they all knew this was coming, where was that commitment to work together? To consider everyone's views? Forget it. It's also hardly an advertisement for the ability of the Chairman to steer this group.

- The illusion that this government cares about the mess it made or is making any reasonable effort to fix it has been blown up. The game is fixed and has been fixed from the get-go. You need only read the Appropriations conferee report (link above). The Democrats control both Houses of Congress - so this statement was written by Democrats: "The CPSIA was signed into law on August 14,2008 and is considered to be the most significant piece of consumer protection legislation enacted since the CPSC was established in the early 1970s. The legislation received nearly unanimous bipartisan support in Congress. Congress passed this legislation in the wake of a massive number of consumer product recalls in 2007 and 2008--more than 20 million-many of which involved toys manufactured in China. The conferees strongly support this legislation but are aware of concerns surrounding implementation of certain aspects of the law." Of course, I have already documented that 43 Senators and 96 Members of the House have either sponsored or voted for CPSIA amendment legislation. It's a complete mischaracterization of the current reality - but when read by Ms. Tenenbaum into the record during the meeting today, it almost sounded true . . . .

This process is some sort of Kabuki Theater for your amusement. Having fun yet?

Today's decision is par for the course in a twisted, bass-ackwards debate over safety characterized by ideologues out to steal our legal system, bureaucrats devastating markets that they simply do not understand, regulators witnessing the destruction of their agency to serve a small number of Congressional "masters" with a broad, world-changing agenda. To propel it along, the Dems now propose to shield their work under the cloak of darkness. Does it really matter? Well, Bob Adler already knows what everyone thinks and doesn't care to be told he is wrong (and others are right). So I guess it really doesn't matter. His mind is made up, Waxman's mind is made up - and no one cares what you think.

So, when you have to let a few more people go to cover ridiculous testing costs or to pay your lawyer extortionate fees to keep you on the straight and narrow, or when you cut your product line or drop some customers to find profit elsewhere, just remember: the Democrats on the Commission thought it would be best to have the debate on the CPSIA one-on-one in private, rather than let you understand their views or participate in an open hearing.

Just remember that . . . on November 2, 2010.

CPSIA - Something Else . . . Again?

Sometimes I feel the assault never ends. Today is such a day. I just heard about the latest innovation of our very own Congress. The new morsel is the Foreign Manufacturers Legal Accountability Act of 2009 (S. 1606), introduced last week by Senators Whitehouse (D-RI), Sessions (R-AL) and Durbin (D-IL). In this "long awaited" legislation, the three gallant Senators provide a way for Americans to sue foreign manufacturers by forcing the foreign manufacturers to accept service of process in this country and further, to accept personal jurisdiction in our courts. In order to spread the love, the bill specifically includes products subject to the Consumer Product Safety Act.

If this legal jargon has not put you to sleep yet, it means that you can sue a foreign manufacturer in U.S. courts under this legislation without a hassle. Previously, to pull a foreigner into the jurisdiction of our courts was difficult or impossible. The law ostensibly was inspired by evil Chinese drywall, and naturally our Senators need to jump into action by pointing the finger overseas. [Couldn't be the fault of the unaware importer, naturally - he's American.] Sound good?

Let's hope this goes NOWHERE. Here are a few reasons to be more than a little suspicious:

a. Mr. Durbin thought the CPSIA was a great idea (and still does). That's enough for me, personally. Other CPSIA rabble-rousers supporting this brave new world include the Consumers Union and Consumer Federation of America, as well as the "American Association of Justice" (formerly known as the Association of Trial Lawyers of America). Let me just say, what's good for trial lawyers is not good for us. Period. Take a close look at the links above - how many are sponsored by plaintiff lawyers? Worried yet?


b. If you make foreign manufacturers subject to our courts, what do you think will change for THEM? Do you think they will experience a greater or lesser incentive to enter our markets? Okay, maybe we won't miss the drywall guy, I'll grant you that. But what about the incentives felt by other factories? Some, perhaps like the factories that makes your iPod or iPhone, have enough capital and are sufficiently international in their reach that this law will little effect on them. Others, particularly the small, private family-owned factories supporting much of our middle market and small business importers, cannot take on the U.S. legal system. This law cooks their goose.

Trying to find new factories to custom manufacture products will be much harder if lawsuit exposure comes with your purchase orders. Right now, foreign factories do not have to add legal exposure to U.S. consumers into their importers' costs. All American consumers benefit from the resulting lower prices (one reason for our high standard of living). It is up to us to select and supervise our supply chain properly - that's our job. If something goes wrong, we believe you are going to come looking for us. Most (if not all) U.S. companies maintain liability insurance for this very purpose. This shifts the liability (contingent risk) to insurance companies at an affordable cost to everyone. As long as you deal with a creditworthy supplier, you will have recourse if there's a problem. This phenomenon is nothing new and if anything, this allocation of risk between U.S. businesses, their insurers and their factories is simply a matter of contract and no concern to their customers. If this law goes through, however, the entire system breaks down. Expect many market dropouts - and expect prices to go WAY up.


c. This bill is jingoistic and is intended to create a trade barrier to hurt foreign companies attempting to sell here. Trade barriers are fundamentally misguided. What happens when we put up a big trade barrier? A trade war, perhaps? In fact, a typical response (besides punitive tariffs on our products overseas) would be reciprocal laws. In other words, our principal trading partners might pass similar rules aimed at U.S. businesses, meaning that we would become subject to lawsuits all of the world. Do you know what it costs to defend a lawsuit in a foreign jurisdiction? The number isn't small. Will that provide a positive incentive for American businesses to branch out and find customers overseas? I know that it would be a viable option for us to leave a market (a country), simply to avoid lawsuits. The grass is definitely greener overseas right now. This law is a "solution" to all that.

Connect the dots, guys.

The tyranny of these new looney laws must be stopped. The damage keeps piling up. This is not my imagination - yet it definitely is your government. We better take it back before it's too late.