Monday, July 5, 2010

CPSIA - What?! Too Many Recalls - That CAN'T Be!

The Washington Post stated the obvious this week in an article Friday entitled "Officials Worry about Consumers Lost Among the Recalls". Apparently, the surge in recalls has caused consumers to increasingly ignore them. Apparently, many consumers choose to continue to use recalled items or even to eat recalled food. Among the issues, the swelling number of recalls encourages consumers to assume that they are not serious. In addition, the onslaught of recalls is numbing to consumers. Prominent recalls that appear to be based on junk science or Regulatory Multiple Personality Disorder (RMPD), like my personal favorite McDonald's Shrek glasses which were recalled despite the CPSC's admissin that they were perfectly safe, only amplifiwa the sense of a system is out of control.

Among the useless advice offered in the article is the recommendation that all merchants should do as Costco does, which is to call every customer who has ever bought a recalled item in its stores. What Costco does is admirable, but it is entirely dependent on being a multi-billion dollar, high tech mass market retailer. I think it would be great if I could hit my nine iron 205 yards like Tiger Woods, but then again, it ain't happenin'. It's about as realistic to advise (or require) me to match Mr. Woods distance and accuracy with his golf clubs as it is to require all U.S. merchants to match the achievements of ONE of them, namely Costco in this case. Unfortunately, the article's suggestion is utterly out of touch with reality. Bad news - the world's imperfect. . . .

Whatever we do, we certainly shouldn't address the standards for how recalls are determined, staged or publicized. We may disagree about many things, but we all have to acknowledge that our government COULDN'T be at fault. Certainly not, their every choice and execution is perfection by definition. It's obviously the fault of industry.

Editor's Note: In case you were wondering, I was being sarcastic in the paragraph above.

The Post article also clucks about the implementation of registration cards for durable infant products like cribs and bassinets. I have consistently pointed out that durable infant products are in a different category because they are useful for a long time (hence the word "durable") and tend to be handed down from one generation to another, often being used over decades. On this basis, having a way to reach consumers is a good idea. BUT we need to acknowledge an important consequence of this idealistic solution - the new rules tend to make it very difficult or even illegal as a practical matter to START a business catering to these markets. For those companies crazy enough to remain in the durable infant products market, the new rules on registration cards and data retention is a Gift from Above. The infrastructure and overhead burden of this requirement will be unbearable for any except the most well-capitalized companies.

I am glad I don't need a crib now. Considering how many companies have been crushed by recalls, the penal attitude of the agency (with huge penalties possible LONG after recalls are announced), tough new standards and regulations on the product class, and the new registration cards, I cannot imagine many companies remaining in this market for much longer. The ensuing lack of competition will likely mean fewer products, much higher prices, less innovation, fewer available imports. The CPSIA is a protectionist regime for those few companies not already bankrupt at the hands of the government.

I am not in this business and my kids are older - for once, this is someone else's problem. I think the government's approach to fixing this problem is completely wrong. They seem to be taking their instructions from a very small and insular group of consumer advocates whose judgment on these matters is largely unchallenged by industry or an inquisitive media. [Media is only inquisitive these days if they can portray a crisis, it seems to me.] Having bought into these harsh concepts at the hands of consumer groups, the government today is busy patting itself on the back for a job well-done. We'll see . . . .

In the meantime, with the CPSC announcing micro-recalls like Daiso's latest (190 pieces recalled - total, including inventory on the shelf - of five items selling for $1.50 at retail), the consumer is left wondering if anything is safe or everything is safe (and the government has lost its mind). I can't tell you but my guess is closer to the latter. And the Washington Post says you are all checking out. Good job, regulators!

Thursday, July 1, 2010

CPSIA - CPSC Jumps Into Action to Solve Pool Deaths

As the CPSC announced when it kicked off Pool Safety Week in late May, deaths and injuries to children from pools and spas are breathtaking in scale. CPSC statistics indicate that deaths from pools and spas average more than ONE PER DAY and serious injuries requiring emergency room treatment average more than 11.5 PER DAY. Now THAT'S a serious problem.

By contrast, lead accounted for one death and three unverified injuries over eleven years. So in one day, pools injure more kids than lead did in eleven years.

And how does the CPSC respond to these two threats? Well, for lead, they force industry to spend more than $5.6 billion per year in compliance costs (this doesn't even count aggravation costs).

And pools? The agency runs some PSA commercials. Here's a new one:



Love that sense of balance and proportionality. Of course, whacking innocent companies over lead gets good headlines and makes the regulators look valiant. No one wants the agency to crack down on pools. Perhaps it's only cynics like me that think this lame approach reveals a lack of commitment to safety by both the agency and Congress. Perhaps our regulators think Public Service Announcements are PERFECT to reduce the scourge of pool deaths and injuries, but only asphyxiation of the children's product industry will address the lead "threat".

Particularly amusing, then, is the response of municipalities to the Pool Safety Initiative. Who remembers Chairman Inez Tenenbaum's hearty self-congratulation on February 17, 2010 for conducting inspections of 1200 pools? Her words: "We've carried out my principle of firm but fair enforcement of product safety laws by inspecting 1200 public pools and spas for compliance with the Virginia Graeme Baker Pool and Spa Safety Act - the results gave us good reason to believe that the law is working". She made a similar assertion in Congressional testimony in September 2009: "In addition, CPSC investigators have inspected over 1200 pools and spas in 38 states as part of a recently launched enforcement initiative. The good news is that CPSC’s public outreach and education efforts seem to be having a positive impact in this area. Recent inspections show that most public pools and spas have installed or have plans to install the new, compliant drains covers and safety equipment in the near future. Let me state again, contrary to some reports, there are many more public pools and spas that have been made safer because of this important law."

Problem solved? According to the Fresno Bee, it's hardly a closed book: "About half of the 1,300 public pools and hot tubs in Fresno County do not comply with new state safety standards designed to prevent swimmers from being caught by suction on drains, county officials say." [This is the Virginia Graeme Baker law.] What explains the hold-up? The repairs are costly and then there's the sense of urgency: "Mary Jo Quintero, water safety program coordinator for Children's Hospital Central California, said she is not aware of any entrapment injuries occurring in the Merced-to-Bakersfield region during her 30-year tenure at the hospital."

Perhaps you have heard of the financial problems in California and in municipalities in general. Think of the impact of this law when money is in short supply: "The city of Fresno retrofitted its four large pools more than a year ago, costing about $60,000, said city spokeswoman Heather Heinks. 'We are totally compliant. It's been county-inspected,' she said." So a few public pools have been fixed . . . and as for the rest of the public pools - no one is in much of a hurry. "Although many pools are not yet up to code, officials say they have no plans to immediately shut them down."

So the local government is blowing this off. What about private owners? Are they just as bold, or are they afraid to defy government agencies armed with heavy penalties? "However, some apartment owners are closing pools on their own because they can't afford the upgrades, said Bob Waterston, a former Fresno County supervisor who owns a pool company that specializes in the retrofits."

The CPSC is running Public Service Announcements telling you to watch your kid in the pool (duh) in response to a childhood activity that is wildly popular and scandalously dangerous. The agency is also bragging about its enforcement of this high-profile law, asserting results that seem to be untrue. Hmmm. And as for the lead "problem" that produced one death and three unverified injuries in more than a decade, the CPSC has been actively developing rules that will lead to business death by compliance.

I just love our government!

CPSIA - What Will CPSC Hit Daiso With This Time - Nukes?

Dastardly Daiso, the hapless Japanese chain of dollar stores that probably regrets the day it first heard of the U.S., has been forced to recall yet more items. This recall, their sixth in recent years, involves five items for excessive lead. They are currently under injunction by the CPSC and the U.S. Attorney. Uh-oh.

Excessive lead in kids' products - that sounds AWFUL, doesn't it? In the tradition of most modern commentators, I thought I'd write this blogpost without reading the recall notice. After all, I know what it says without reading it, right? Well, at THIS blog, we have standards, you know. My editor INSISTED that I read it.

So I read it, and here are the details. You better sit down . . . the horror of it all . . . there are five items involved: one cloth purse, two pairs of earrings and two necklaces. The total number of units, across all five items, is 190 pieces, or less than 40 per item. And how did dastardly Daiso endanger kids THIS time? "The surface paint on the zippers of the coin purses and the clasps on the jewelry contain high levels of lead." Whoa! The retail price of these items is about $1.50 each, so the total value of this recall is $285. There were no injuries reported. The CPSC put out a press release so all of America could know how safe they were.

SCIENCE TIME: The presence of lead in the zipper paint and in the clasp does not itself cause any harm. Lead is a neurotoxin, true, but lead must enter your bloodstream to do harm. And if it does manage to get in there (through inhalation of dust or through ingestion of bio-available lead), blood lead levels must rise to a certain point before any harm can possibly occur. Since we all consume lead every day in our food, water and air, the human body clearly can process some lead without harm - it does not simply accumulate. The amount (mass) of lead in these items is probably close to nil. I assert that if you chose to have a meal comprised of only the zippers and clasps from the 190 recalled units (ALL of them), you could not raise your blood lead levels high enough to do damage. AND the impact of lead in blood varies by the age of child. As the child ages, the impact from lead dramatically diminished. This is why Congress chose not to protect my blog readers - they are all adults and out of harm's way. Lead is principally a problem for the "under 3's". The Daiso items are not for children under three, so the odds of harm are excruciating low. And it is utterly inconceivable that one person would eat all of the zipper paint and clasps in this minuscule recall. So, is this a public health crisis? You decide!

Back to Blog Time: Now, let's think of Daiso and its sorry tale. They have previously been the subject of five recalls of 19 items, totally 698 units, over two years. For this series of "transgressions", they were whacked with an injunction by the U.S. Attorney against further importing of toys (Tenenbaum: "Now the fine was large, but that wasn’t the big news . . . . We worked closely with the Justice Department on this case, and Daiso has a very high hurdle to jump over to EVER get back in the import business again"). Daiso also was hit with a "get the message" penalty of $2.05 million. This is about $1,000 per unit in penalties for items with a retail value of between $1 and $4 each. That's gotta get your attention.

So now that Daiso has stepped across the line again, what will the CPSC do? This kind of transgression can't go unpunished, right? Don't we live in a society based on retribution today? [We learned it from the Taliban.] Having hit Daiso with a $2.05 million penalty last time, the agency has to set this penalty higher since Daiso obviously is so incorrigible. If the last penalty was $1,000 per unit, maybe the agency should hit them with a penalty of $100,000 per unit to get them to take our laws seriously. Darnit, they CAN'T - that exceeds the maximum penalty of $15 million. Now what?

There's always jail time. Somebody needs to pay, of course. How can the agency ignore an offense of this scale? 190 units is unforgivable. That's almost $300 in value! That's like one iPhone (with a two-year phone contract). We can't let the people be endangered like that!

They were really good at torture in the Middle Ages - maybe something gory would get Daiso's attention this time. Capture a manager and have him/her drawn-and-quartered in the public square? The agency could webcast it! There are so many options. The agency needs to do whatever is necessary to keep American kids safe, so I certainly hope they will use their entire arsenal. Waterboarding?

Personally, I am grateful to Congress for not giving the CPSC nukes.