CPSIA - CPSC Says "Ahhh, Don't Worry About It!"

What me worry?!

In a TV piece called "Mom Outraged Over Lead in Baby's Toy" (watch the video here), a Georgia mother found "an ominous warning" on a toy drum she purchased for her 16 month old from Toys R Us (one of the toughest retailers on legal compliance and quality control, btw). The label read: "Warning: contains lead. May be harmful if eaten or chewed. May generate dust containing lead."

Uh-oh.

And I was wondering why anyone would buy a drum for a 16 month old . . . .

Mom was not happy: "Even if it's just a little bit of lead, I think lead in anything for a child is just insane."

When consulted, the CPSC assured her that it didn't mean anything. It's all about a California law that requires labels for lead levels that have nothing to do with safety. Scott Wolfson, who can really turn a phrase, intoned: "We respect California law, but parents should know that the safety of their children is not necessarily at risk if they see that label."

This is so rich on so many levels.

First, the CPSC is prohibited from assessing risk under the CPSIA. How is it that their spokesman is allowed to assess risk? I thought Congress decides what's risky now. The CPSC can't be trusted, right? As usual, particularly when Mr. Wolfson is involved, the CPSC's position is whatever is best for THEM. To heck with you. For purposes of this story, they magically regained the ability to assess risk.

Let's review - as a matter of law, the CPSC's job is to enforce the standards. They are literally prohibited from considering whether compliant products pose a risk. They are just measurers now, the "cop on the beat", determining whether products are inside the circle or outside the circle but never whether the circle is in the right place. So how can they fashion a judgment that lesser levels of lead aren't risky? The best they can say is that Congress didn't apparently think those lead levels deserved attention.

I am thinking of Sargeant Schultz from "Hogan's Heroes" . . . .

Second, the CPSIA is loaded with superfluous labels. The philosophy of warning consumers through labels pasted over labels is central to the precautionary principle that drove this law. How Mr. Wolfson can advise consumers to ignore a warning label without blushing is beyond me.

I believe the reason they try this stuff is because they think we're so stupid that we won't notice. Or that we're so docile we won't say anything. In any event, it hardly matters because they sure aren't going to listen to us.

Third, this situation proves beyond a shadow of a doubt what I have been saying for three years - that lead labels are a tacit ban. I have long resisted lead labels on any of our products. [Please NOTE - this is only happens under technical application of these stupid rules (gotcha's), such as labels for rocks, light bulbs, coated electrical cords, etc., and only on educational products.] If you put a label like the Georgia label on your product, it will die and you will have to drop it. Plain and simple - listen to the Georgia Mom. She's normal and has some common sense - if the company is warning you about lead, don't ask any questions, just don't use the product. Why else would they be warning you? Duh.

A tacit ban.

So the Illinois law and the California law that require these labels are not only violations of Constitutional protection of interstate commerce, but they are also preempted by federal law. The States are not allowed to ban products that are permitted to be sold by Federal law - they are preempted from taking that step. When you put a label on a product that causes consumers to not buy the product, you destroy the economic viability of the product, thereby killing it. This is a tacit ban, a ban in as many words. It is illegal.

Scott Wolfson apparently doesn't see the problem. Consumers should know that this label isn't serious, he says. I assume he thinks consumers should know that the other labels they should know are serious. If they have any questions, perhaps they should call him. He knows-it-all.

Or maybe Moms everywhere should get better at reading Scott's mind. That's the ticket. Fuggedaboutit.

CPSIA - Cadmium Law Rammed Through in California

741 days have passed since ANY Democrat in Congress did ANYTHING to help us on the CPSIA. There are 70 days left until Election Day.

California State Senator Fran Pavley (hope you're sitting down, she's a Dem) rammed through the latest in state cadmium regulations, setting a 300 ppm limit on cadmium in children's jewelry. This law, if signed by the CA Governor, will enable a barrage of lawsuits by consumer groups feeding off this kind of CA legislation. Zero lives will be saved, but plenty of jobs will be lost. We are already hearing of companies that are pulling out of California and more will follow. The craziness in California is basically unbearable at this point.

What really steams me about this law is Pavley's VERY OWN PRESS RELEASE. Consider these quotes:

"Senator Pavley (D-Santa Monica) . . . is seeking a ban on the dangerous metal cadmium after learning that manufacturers are simply replacing lead with cadmium. 'Cadmium is a known cancer causing agent and there is no reason for our most vulnerable citizens - our children - to be exposed to this highly toxic metal,' said Senator Pavley. 'These manufacturers are replacing one toxic metal for another when less toxic alternatives like zinc are available. It’s completely irresponsible to use cadmium in jewelry marketed to children.'"

"As an Assembly member in 2006, Pavley authored a law to ban the use of hazardous levels of lead, a powerful neurotoxin, in children’s jewelry. . . . However, a loophole in the law has allowed jewelry makers to substitute cadmium. Recent laboratory reports in the United States are now showing that the heavy metal cadmium is being used in place of lead. 'It’s a shame that jewelry makers are using a loophole in the law to harm our children,' said Senator Pavley. 'There is absolutely no excuse for manufacturers to use this dangerous agent in products for kids.'"[Emphasis added]

Let's be clear about something - there is absolutely no publicly available information to suggest that anyone is substituting cadmium for lead in jewelry (or in any other children's product). That's pure urban legend. If there is such evidence, someone should put the evidence up for all to see. This is a LIE - during election season. Shocked? I'm not . . . I live in Illinois.

I have already thoroughly covered the fact that there are NO KNOWN CASES of cadmium poisoning in children from any consumer product - EVER. This makes me surmise that Ms. Pavley is either stupid or she's a liar. One thing's for sure, she doesn't know what she's talking about. But I'm sure her message of crisis "averted" is a good seller back in Santa Monica.

Oh, by the way, did you catch her recommendation that zinc be substituted for cadmium because it's so much safer? Certainly we can trust the esteemed Ms. Pavley, a world-renowned toxicologist and metallurgist, right? Ummm, well, what about zinc poisoning? It's pretty icky - here's what you get with Ms. Pavley's preferred way to kill kids:

• Body pain
• Burning sensations
• Chills
• Collapse
• Convulsions
• Cough
• Fever
• Low blood pressure
• Metallic taste in mouth
• No urine output
• Rash
• Shock
• Shortness of breath
• Vomiting
• Watery or bloody diarrhea
• Yellow eyes or yellow skin

Hey, this sounds much better than cadmium poisoning. Of course, neither will ever occur in children because of their contact with children's products. After all, no one's ever had the cadmium poisoning California wants to prevent. If no one's ever had it . . . do we need to change anything to prevent it in the future? Do we need to know anything to make this judgment?

Nahhhh - besides I love zinc convulsions!

CPSIA - Perpetrators of CPSIA Feel the Heat

Could we get this lucky? One of the Senators responsible for the penal phthalates ban in the CPSIA and a big CPSIA advocate, Barbara Boxer, seems to be fading in her effort to hold her "safe" seat in California. See "Poll: Fiorina beating Boxer in California". In another CA race involving a featured performer in this space, Jerry Brown (Democratic candidate for governor) is in a dead heat with Meg Whitman. Mr. Brown has already occupied the CA governor's mansion once before. This race is all about whether California voters learned their lesson last time.

Mr. Brown distinguished himself this week by suing bouncy house operators for lead-in-vinyl at the urging of the offensive Center for Environmental Health, bringing yet more prestige to the Golden State: "Jerry Brown: California's top bouncy house cop saves the day" ("L'Affaire Bouncy partially explains why Jerry has been slowly unveiling his gubernatorial campaign and positions: He's been busy investigating this insidious scourge of California's families. Fight on, Attorney General, fight on! UPDATE: Spotting the hanging curve ball out over the plate, Team Whitman has quickly assembled and lawyered a response to the L'Affaire Bouncy, as if it needed one: 'There's something very ironic about Jerry Brown, of all people, investigating the combination of hot-air and make-believe,' says Whitman spokesperson Sarah Pompei said.").

I hate to be out-quipped but gotta hand it to the Whitman folks, that's solid.

Of course, our dear Democratic leaders from California are also the innovative developers of the "Green Chemistry" initiative that will require that we all send in chemical analysis of all of our products for the state's approval and remediation. This bonanza for safety has the potential to drive our company out of the CA market for good. California is the fifth largest economy in the world - we don't want to leave it. The LA Times has consoled me with their assurance that we will all save money in medical expenses. We have descended into LaLa Land.

I remain stunned over this succession of deadly legislation all in a row. Even more shocking is how the Dems puzzle over WHY people are so angry about persistent unemployment or a lack of investment by business. Go figure.

Personally, I am cheering in all the races involving the principals behind the CPSIA, hoping for some additional unemployment in those districts (one job loss per district). In some cases, I am doing more than cheering. If you are also fed up and can't go forward this way any longer, I URGE you to take dynamic steps to take back YOUR nation. These folks don't own the place - you do.

Stay tuned!

CPSIA - Turns Out that the Government CAN Assert Preemption

And you thought state regulation of children's products was a fait accompli, nothing we can do about it. The proliferation of state safety regulations is a major hindrance to interstate commerce and puts small and medium-sized businesses in a very risky position. Who can possibly master the federal system of safety laws and regulations plus 38 states' own unique versions (plus the EU, plus Canada, plus Japan, plus . . . plus . . . plus)? No one.

The CPSIA addressed this mess by ENCOURAGING IT. The law does not preempt a variety of state laws relating to the safety of children's products. Among the notable laws so exempted, California's Proposition 65 is especially troubling. That said, I cannot recall a single word of a single state children's product safety law that has been preempted by the federal government. It's the Wild West out there.

Worse yet, this subject is among the many that are "off limits". In other words, we are advised to keep our opinions on preemption to ourselves for risk of "offending" the controlling Democratic party. The non-preemption of state laws that conflict with the CPSIA, CPSA and policy and regulations of the CPSC are to be tolerated, I guess. We have no say in this. Like so many things nowadays . . . .

Aha, but when the liberals don't like the action of the states, well then preemption is apparently a viable option. So today the federal government decided to take action against the Arizona immigration law. [I am a minority and am generally fearful of government rules that encroach on protections for minorities. Of course, like most of the media and America at large, I haven't read the Arizona law. So while I am directionally in favor of knocking it out, I freely admit I don't know much about this controversy other than the things I have gleaned from other people's analysis.] So I guess preemption is a viable option . . . if the motivation is there.

The federal complaint makes many compelling assertions about the value and importance of preemption in the case of immigration law . . . and many of these assertions could just as easily be levied against state regulation of children's products. It will never happen, of course, because that might offend the "public interest groups" behind the CPSIA. Besides, who can trust companies anyhow . . . .

Some pertinent quotes (emphasis added):

"In our constitutional system, the federal government has preeminent authority to regulate immigration matters. This authority derives from the United States Constitution and numerous acts of Congress. . . . The Constitution and the federal immigration laws do not permit the development of a patchwork of state and local immigration policies throughout the country."

"The federal government, moreover, welcomes cooperative efforts by states and localities to aid in the enforcement of the nation’s immigration laws. But the United States Constitution forbids Arizona from supplanting the federal government’s immigration regime with its own state-specific immigration policy – a policy that, in purpose and effect, interferes with the numerous interests the federal government must balance when enforcing and administering the immigration laws and disrupts the balance actually established by the federal government."

"In crafting federal immigration law and policy, Congress has necessarily taken into account multiple and often competing national interests. . . . The laws also take into account other uniquely national interests, including facilitating trade and commerce . . . ."

"Because S.B. 1070, in both its singularly stated purpose and necessary operation, conflicts with the federal government’s balance of competing objectives in the enforcement of the federal immigration laws, its passage already has had foreign policy implications for U.S. diplomatic relations with other countries, including Mexico and many others. S.B. 1070 has also had foreign policy implications concerning specific national interests regarding national security, drug enforcement, tourism, trade, and a variety of other issues. . . . Numerous other states are contemplating passing legislation similar to S.B. 1070."

The Feds have noted that the patchwork of local laws would likely prove highly disruptive to efforts to coordinate a national policy on this topic. They are apparently fearful that the Arizona law will lead to many more just like it in other states. Among other reasons to fear the new immigration laws, local laws can have international implications and can hurt trade. I think I know what they are getting at . . . . Consider the market effects of the noxious Proposition 65 and the truly awful and frightening Green Chemistry initiative oozing forth from California in our direction. The case for this preemption lawsuit is eerily similar to the case for preemption of local safety laws. Unfortunately, we will never get this help unless the Feds decide that the system is so out-of-whack that a lawsuit must be filed. With Dems in charge of Congress who are the blood brothers of consumer groups, this will NEVER happen. Too bad for us.

I feel the federal government's pain on the Arizona law. Too bad they don't feel mine.

CPSIA - Phthalates and Lead Limits in Waxman Amendment

Two minor but important points in the new Waxman Amendment relate to the ban on phthalates and the 100 ppm lead standard looming in August 2011.

Phthalates: The phthalates ban has been clarified to exclude "inaccessible" components, thus reducing the cost of testing for victims of this poorly-conceived law. The definition of "inaccessible" is based on foreseeable use and abuse by children. The term "reasonably foreseeable use and abuse" is defined, lest anyone misconstrue what the Waxmanis want it to mean, and hence new concepts have been incorporated: "breaking" as well as "the aging of the product". In the past, "reasonably foreseeable use and abuse" has been interpreted to exclude intentional misuse. The term did not typically include aging since most worn-out products are either handled differently or discarded. The changes wrought by this amendment fundamentally alter the common meaning of "reasonably foreseeable" in quirky ways, making a confusing law all the more difficult to understand or apply.

If "reasonably foreseeable use and abuse" includes breaking the toy, it's hard to know which parts will ever be considered "inaccessible". Reading this language by its plain English meaning, I cannot imagine what might survive this legislative test. Worthless. I sense another rulemaking process for the long-suffering CPSC.

The amendment also clarifies that the CPSC can revoke this exception to protect the public health and safety. Remember, we are talking about a rule affecting mandatory testing of internal components that may or may not contain phthalates. Can anyone tell me what threats to the public health and safety could POSSIBLY result from an internal component made with phthalates? Phthalates have been in use in this country for more than 50 years - wouldn't we know about "leaping phthalates" by now? Oh yeah, I'm sorry, i forgot that reasoning and science don't matter anymore. . . .

Perhaps concerned that the CPSC was running out of things to do, the authors added yet another rulemaking on "inaccessibility" for this new exception. They are free to adopt the definition already set for lead. It's up to them. Study up, guys! Can't wait to give comments . . . .

Can you say . . . mania?

It is worth noting that in taking this route to "resolve" the pain points on phthalates, the Dems have chosen to NOT address a pending issue between the CPSC and California. Attorney General Jerry Brown of California sent a hot letter to the CPSC last year indicating his unwillingness to accept testing of the entire product for phthalates ban purposes. In the wake of his letter, the agency reversed course and rescinded its rule permitting a single test on the entire product. This would have been inexpensive for manufacturers.

It is pure fantasy that the Dems would take on Jerry Brown since our Congressional overlords are largely from CA (Waxman, Pelosi, Boxer, Feinstein) and are busy trying to California-ize the rest of the country. Henry Waxman would certainly never preempt Jerry Brown for the national good. Hence the half-a-loaf approach here.

Lead: The Waxman Amendment makes the pending 100 ppm lead standard prospective. This is a tiny bone thrown in our direction. You may consider it a nod of acknowledgement of your pain from the retroactive application of the lead standards and phthalates ban. Nonetheless, this is all you will get.

Again, this is only half-a-loaf. A more thoughtful and helpful change would have been to draw a FIRM LINE under the 300 ppm standard, eliminating the 100 ppm standard altogether as well as the rule ratcheting down the lead standard in the future (forgot about that one, right?). They could have said that the CPSC would be free to lower the lead standard in the future if necessary to protect public health and safety (taking into account the cost and benefit of any such new rules). But they didn't.

The Waxmanis have no interest in such concessions. Whether out of zealotry or pride of authorship, no amendments will emerge if they reflect any concession of error or misjudgment in the Perfect Legislative Process. Thus, the 100 ppm standard can't be removed because they put it there for a reason. We must live with it . . . so they say.

Rumorville has it that the Waxmanis are about to deliver a message to leaders of the business community to fall in line behind this "wonderful" amendment or else . . . they'll get NOTHING. Don't you love this? And I used to think THEY worked for US. What an idiot I am!

And on that note, I encourage you to read ONE more blogpost about this toxic amendment. I still need to show you how the authors are trying to deceive you and gut the system that regulates safety of safeguards against governmental abuse. That is, abuse of the interests of your businesses. It's really something to see.

CPSIA - Still Steaming Over Mr. Waxman and His Unilateral CPSIA Amendment

I am still trying to unpack what happened late Friday when the Waxman amendment to the CPSIA leaked out. Since the news is so fresh and so few of the actors have come forward to account for themselves, let's be conservative and analyze only the most positive possible scenario:

• Mr. Waxman now accepts that some aspects of the CPSIA need to be fixed.
• Mr. Waxman now accepts that the CPSC cannot fix the law through rulemaking alone.
• Mr. Waxman is being a "good guy" and showing his "good faith" by allowing a change to the law.
• Ms. Tenenbaum believed that something is better than nothing and made a practical judgment to support the Waxman amendment as a step in the right direction.
• Ms. Tenenbaum concluded that fighting with Ms. Waxman might worsen the situation for the agency and for the victims of the law.
• Ms. Tenenbaum thought that getting an amendment now might open the door to more amendments later.
• Ms. Tenenbaum thought the Commission could use this "loophole" to ease pressure on at least some victims of the law.
• None of this affects the good vibrations that emerged in recent weeks with the CPSC who has noticeably softened its rhetoric and reached out to the regulated community to find amicable solutions to the perplexing issues caused by the CPSIA.

I think that's about as sympathetic a portrayal as I can paint of the Waxman amendment and the way it was generated. With that sunny scenario in mind, how would I now interpret the events?

1. Waxman is in control, and will not relent. Both minority members of Congress and minority Commissioners have been largely disenfranchised for the future of this law. His need for control made impossible redress of the many other issues documented by the likes of resale shops, education companies and apparel-makers.
2. Waxman will dictate precisely the speed and dimension of fixes to the CPSIA. The pain and disruption in the market does not influence him. As the terms of the original law indicate, he does not regard economics as a factor in setting safety policy. [An economist would characterize this outlook as irrational.] Political pressure does influence him, hence the meager effort to appease the ATV and publishing industries. This amendment is consistent with the longstanding position of his staff - so there is little to indicate further flexibility. If you believe the "one bite at the apple" crowd, this is grim news and contradicts the concept above that one amendment might lead to other amendments.
3. Waxman has no intention to publicly debate the issues under the law. Likewise, he has no intention of possibly losing control of the discussion or the message. Given his stated interest in reforming the Toxic Substances Control Act, it remains critical to portray the CPSIA as a success and as an advance in regulatory "theory". The Waxman amendment makes clear that the legitimate concerns of the regulated community are taking a permanent back seat to a political agenda set by consumer groups and the California contingent. Again, not good for us. . . .
4. The CPSIA is now clearly the Democrats' law. Republicans have been exiled from the safety debate. It is shocking that party lines now define the children's product safety debate since injuring children is not a political issue. Yet, any notion of bipartisanship has been crushed.
5. Whether for political gain, sympathy with the original design of the legislation or for practical reasons, the Democrats on the Commission have fallen in line with the Waxmanites. The teamwork on this amendment makes them appear to be allies. If this means that the Waxman views on implementation will also hold sway, it forecasts grim developments ahead for regulated companies.
6. The appearance of appeasement or even complicity by Ms. Tenenbaum is inescapable. Even in the friendliest interpretation of events, Tenenbaum comes out as a weak defender of the legitimate interests and concerns of the regulated community. And "common sense" seems forgotten. What kind of partner does that make her? Do her statements on consulting with stakeholders and open dialogue seem somehow self-serving now? Right now, it is very hard to know when or whether she will toss regulated companies overboard. This makes partnership with her difficult because you must give to get . . . now that the "get" is in doubt, how can the regulated community become comfortable with the "give"? I also think it's reasonable to ask why Ms. Tenenbaum allowed this provision to be negotiated in the dead of night. That's not how a partner behaves.
7. There is a BIG issue of trust within the Commission here. The very public way in which the Republican Commissioners received notice of their irrelevance will cause lasting injury to relationships. It is hard to see collegiality restored quickly on the Commission after this betrayal. Of course, I can't help but recall the mantra repeated by many pro-CPSIA advocates - that the CPSC needs a five-person Commission. Doesn't the amendment "process" expose this as a joke? If Tenenbaum and Waxman are going to ignore the Republicans, was Congress really saying that the CPSC desperately needed three Democrats in a majority position? Gosh, I think the Republicans that voted for the law might take issue with this . . . .
8. The inclusion of lead labeling for excluded items confirms the zealotry of the Waxmanites, the impotence of the resistance movement and the persistent disregard for the needs of innocent victims of this law. Of course, difficult-to-obtain exclusions are quite anti-small business, as are the lead labels. The labeling is even more incredible if you take into account that exclusions will only be granted in circumstances where the inclusion of lead will have virtually no conceivable health impact. So if the Chairman would sell us down the river with a useless and extraordinarily-limited amendment without addressing ANY of the other pressing issues or demanding the right of the Commission to assess risk, then what else can we reasonably expect from here on out?

That's the $64,000 question, isn't it? Frankly, this amendment and the behind-closed-doors process which excluded all corporate stakeholders and many political stakeholders, sharply erodes trust in all directions. Doing this behind everyone's backs - during a two-day workshop purportedly designed to solicit stakeholder feedback and get everyone on the same page - seems remarkably disingenuous. You can safely assume many recent conversations in retrospect seem less than candid or straightforward.

To work out the difficulties with this law, leadership on the Commission (Democrats) and in Congress (Democrats) need to come to grips with the fact that the law is incredibly misconceived and destructive. The dream that the Precautionary Principle actually works to anyone's benefit has been debunked. To cram down this noxious law despite the legitimate concerns of the regulated community will NOT snuff out opposition - but instead will inflame it. The problems won't go away, and cannot be buried. The issues will fester and rot until addressed.

If the issues marbling the law are allowed to linger long enough, the Democrats can ensure lasting damage to the agency and market catastrophe. I will repeat myself: there is a legacy issue for Tenenbaum and the Dems - and having jettisoned the Republicans, it's all theirs now. The CPSC can be rendered ineffective and wholly bureaucratic, with all the attendant damage that entails, or it can be restored to glory. The choice is theirs and the stakes are high. Interestingly, the regulated community will support an effort to restore effectiveness at the agency, but that will necessarily involve restoration of risk assessment and political independence at the agency. Hard to see Waxman going along with that.

Do we have the leaders for this effort on the Commission? Time will tell. Like everyone else, they will be judged by their results. You and I are along for the ride, whether we like it or not.

CPSIA - Waxman To Amend the CPSIA . . . Who Can We Trust?

In a remarkably-timed event, an amendment to the CPSIA was unveiled right on the heels of the two-day CPSC workshop on the "15 Month Rule". The amendment, expected to be attached shortly to the Defense Appropriations Bill (believed to be S. 1390 National Defense Authorization Act for Fiscal Year 2010), was developed by the House Committee on Energy and Commerce Democratic majority (Waxman and his staff) WITHOUT consulting with the Republicans on the Committee. Attaching the amendment to a moving bill in another committee is a procedural way for the Democrats to amend the law without hearings or discussion by the committee that drafted the CPSIA - and thus never lose control of the process. This maneuver is particularly outrageous given that Rep. Joe Barton, the Ranking Republican on the Committee, has a bill pending to amend the CPSIA (H.R. 1815, co-sponsored by 29 Representatives) and also has requested hearings on the CPSIA (which requests were ignored).

The outrages of this new bill extend beyond discourtesies in Congress. Equally remarkable is Waxman's apparent consultation of the General Counsel of the CPSC on the text of the amendment without informing certain of the Commissioners. This shocker to the Commissioners is quite extraordinary and possibly poisons the well for Inez Tenenbaum's CPSC Commission. There seem to be big issues of trust here. It is not known how many Commissioners knew of the existence or terms of this amendment, but it is strongly believed that this language was drafted in consultation with and perhaps under the supervision of Ms. Tenenbaum and her staff. It is also known that the Republican Commissioners were entirely in the dark as recently as 3 PM EST today. The apparently schism in the Commission has now broken into the open with the exclusion of Commissioners from this critical collaborative process along strictly party lines. Apparently safety IS a partisan issue.

The amendment tracks the little-publicized admission by Chairman Tenenbaum in response to the written questions of Rep. George Radanovich (R-CA) that a "functional" exception to the CPSIA lead restrictions is needed. [See paragraph 16(b) of the attached document.] This amendment is primarily focused on her request. The subject of a "functional" exception to the law has been discussed behind closed doors by many stakeholders but no common vision of such language emerged. As recently as a few days ago, Congressional staffers were denying that language would be attached to the new appropriations bill. Ah, truth in politics!

The draft language, said to be "final", can be summarized as follows:

• Redesigns Section 101(b)(1) by adding a VERY limited "functional" exclusion.
• The new language now permits a component to be excluded.
• Gives the Commission the power to exclude WITHOUT a hearing. Evidence no longer needs to be "peer-reviewed".
• Preserves the loathed "result in the absorption of any lead into the human body" language in the exclusion provision.
• Allows exclusion for product, component part or material "by reason of its functional purpose because it is highly impracticable or not technologically feasible to remove or make inaccessible the lead in such product, component part, or material" if "contact by a child with the lead . . . may reasonably be expected to be infrequent" and it is not expected to be mouthed.
• Each product, component part or material excluded must be labeled to indicate the presence of "accessible lead".
• The Commission may by regulation require the reduction of lead in the excluded item or material and/or establish a schedule for full compliance.
• The new amendment restricts the ability of the Commission to exclude "an entire product" if ANY part of the product does not meet the foregoing requirements. This provision is entitled "NARROWEST POSSIBLE SCOPE OF EXCLUSION".
• "Ordinary books" and "ordinary paper-based printed materials" are excluded from the lead restrictions under the CPSIA. This exception seems to include "quick copy" print materials, too. Materials not meeting the strict definitions of these terms are NOT excluded.

This language is not likely to make anyone particularly happy other than publishers and the library people:

The Pro's:

1. Waxman acknowledges, finally, that the law produced by a "perfect legislative process" needs some tweaks.
2. There is no denying now that the CPSC can't fix all the problems, and Waxman apparently concedes this point.
3. The Commission can now grant exclusions without a hearing.
4. Books were inadvertent inclusions in the CPSIA, and libraries were unfair victims. That has been corrected.
5. An awkward path for fixing ATVs, bikes and perhaps pens now exists. It is also possible that even rhinestones can be addressed, at least in part, under this language.

The Con's:

1. The amendment leaves in place the terrible "any lead" language, making exemption requests a (bad) joke.
2. Exclusions will be hard to get and require a great deal of expense to obtain.
3. ALL exclusions come with a Proposition 65-like "consumer right to know" label, making the sales of the product highly unlikely. Few products can carry an accessible lead label and still be sold in volume.
4. The narrowness of the exclusion inherently limits the freedom of the Commission to act according to common sense.
5. The Commission and the CPSC are still not empowered to assess risk.
6. Small business issues were completely ignored, as were testing cost, liability and labeling issues.

Some additional observations:

• The approach of Waxman to fixing this law demonstrates that the CPSIA is now a House Democrats' law. I will spit every time someone mentions the original 424-1 vote - the illusion of bipartisanship has been snuffed out once and for all. The exclusion of Republican Congressmen and Republican CPSC Commissioners from this process speaks volumes about how Washington intends to administer this law.
• Ms. Tenenbaum's technique in obtaining this "relief" makes her look like Mr. Waxman's bag man. The close alignment of Bob Adler and Ms. Tenenbaum on the Commission puts Mr. Adler into this camp, too. [When this subject comes up, Mr. Adler's prior job on Waxman's staff always has heads nodding.] The quiet development of this language breaks the illusion that talking to the Democrats on the Commission will somehow bring changes independent of Mr. Waxman. This bill makes it look like he maintains staffers on the Commission.
• The exclusion of books is nice, but smells a bit funny to me. The American Association of Publishers appointed Tom Allen as its CEO in April. Mr. Allen, a Democrat, served under Henry Waxman on the Energy and Commerce Committee and often followed his lead as a Congressman. Small wonder he got this job, right? It wasn't a real shock then that books were excluded in this amendment. Despite the holier-than-thou rhetoric, it's "business as usual" in Washington under Obama and Pelosi. A friend in need is a friend indeed.
• The narrowness of the exclusion process and the requirement of labeling despite the apparent admission that such exclusions pose few health risks strongly suggests that the legislative process is being controlled by zealots who will not yield to reason. The "true believers" who now dominate Washington have a world view that you need to take on board - Californiziation. There is no compromise on these issues, regardless of common sense or hard reality. Given the exposure of the axis between these Congressional leaders and the control block on the Commission, there seems little reason to be especially optimistic of serious advances in implementation of the CPSIA by the agency.
• The Chairman and Democratic majority on the Commission lack the political will to take on Waxman in an effort to fix the CPSIA. This potentially sacrifices the long term effectiveness of the agency in its stated purpose to protect consumer safety and possibly also the vigor and competitiveness of the American children's product industry, all to avoid the unpleasantness of a contentious job. Complaints at the CPSC that it should be renamed the "Children's Product Safety Commission" or the "Consumer Product Compliance Commission" will likely gain traction. The lack of political will to fight the good fight and to stand up for common sense create the conditions for a terrible legacy. Will these Commissioners be able to say they left the agency better off than they found it? An interesting question. Guys, there are no free moves in this game . . . .

I continue to shake my head over the timing of this development. Were I Chairman Tenenbaum, I might have told Mr. Waxman that I didn't need this kind of help. Consider what may have been lost: (a) the bonhomie and trust built in the last couple days at the workshop as CPSC Staff and all sorts of stakeholders mingled in good faith and with open dialogue, (b) the goodwill generated by the CPSC efforts to protect Cepia LLC and their Zhu Zhu Pets from unfair consumer group attacks, goodwill that now must be reevaluated, and (c) the general appearance of a new cooperative, open-minded wind blowing through the CPSC in the last six weeks. I now have my doubts about the candor of discussions and the legitimacy of stated intentions to "fix" the system. The good intentions and well-meaning of the CPSC Staff is not really in question here - but the leadership must be held accountable. You can't ask for trust and then expect this kind of thing to be ignored. You are either a partner . . . or you aren't.

The Stay is now on the table. The CPSC Commission has been meeting behind closed doors with a sense of purpose and urgency to figure out what to do with it. Your letters and emails are being read . . . but the open question is whether enough Commissioners care. The Republicans on the Commission have been open in their support for extending the Stay, but the three Dems are unaccounted for. One is said to feel strongly that the Stay needs to go away, on the grounds that Congress wants it gone. Let's not make any bones over this - it's not Congress, it's Henry Waxman. If it were Congress (in other words, a bipartisan movement supporting the existing CPSIA), then perhaps Mr. Waxman wouldn't have to sneak around to get a CPSIA amendment through Congress without hearings or discussion. So when you hear that "Congress" wants something with this law, connect the dots.

A very disappointing way to wrap up a promising week.

CPSIA - Proposition 65 Provides Funding Mechanism for CEH Crusaders

Has the Center for Environmental Health (CEH) gone into the business of finding violations of law for profit? You gotta wonder.

This past week, CEH capped off a six-week investigation of 250 children's items at the request of or in partnership with the CA Attorney General's office, finding seven mildly offending items. As detailed in my blogpost last Wednesday, this rogue's gallery of offenders include a pair of shoes (soles), sandals (insoles), a poncho, a small patch of material on a bicycle accessory and the like. The CA AG issued cease-and-desist orders on his own, cutting the CPSC out of the picture, and a media feeding frenzy ensued. Presumably to the delight of the CEH troublemakers, Oregon followed up with its own action. [To Oregon's credit, they indicate they would inform the CPSC of their concerns, not take a direct recall action like the CA AG.] Perhaps other States plan to follow the CA lead and jump down the retailers' throats for these trivial defects.

How did this come to pass? It turns out that the starting point was a tip by CEH on another lead case, this one involving Mattel. As you know, Mattel was responsible for some major lead-in-paint recalls in 2007/8. These recalls were a result of a violation of longstanding federal law, and the authority for the recall was found in the CPSA (before its amendment by the CPSIA). [In other words, the new law was not required to force Mattel to recall these items.] It turns out that California's Proposition 65, its notorious consumer-right-to-know law, was also violated by those recalls. The insidious Prop. 65 (explicitly exempted from preemption under the CPSIA by the powerful California Congressional delegation including Senators Boxer and Feinstein and Reps. Pelosi and Waxman) requires that products exceeding (in this case) its lead standard be labeled to "inform" the consumer. Prop. 65 lead standards now match the federal standards. By violating the federal standards, Mattel also violated the Prop. 65 label requirements, thus giving California the chance to extend its palm for penalties and other concessions.

In the first of many settlements relating to its recalls, Mattel and other companies settled
a Prop. 65 lawsuit and paid a collective $1.56 million in penalties and fees. [The CA AG extracted similar penalties from Target, TRU and KMart for lead violations earlier this month.] It turns out that this $550,000 penalty case stemmed from a rat out by CEH: "This agreement settles a lawsuit filed by the State of California and the LA City Attorney in November 2007, after receiving notices of violation from the Center for Environmental Health, As you Sow, and the Environmental Law Foundation." Part of the money extracted ($550,000) was applied to a fund "to test toys for lead and improve outreach about future recalls."

So how did Mattel's misery pay off for CEH? The CA AG's press release tells all: "In 2008, Brown's office reached a settlement with several major toy companies over excessive levels of lead in their products. The settlement allocated $548,000 in funding for consumer safety groups to monitor lead levels in consumer goods and to provide outreach about product recalls. The Center for Environmental Health discovered the current violations with a grant from the Public Health Trust, which administers the settlement fund."

So, here's the game - CEH finds violations of the law, and then puts in for grants to find more violations, all funded by the violators. CEH is a not-for-profit - it is not a business, does not make or sell products or services for a profit and its officers and employees have no source of funding other than contributions . . . until now. Proposition 65 is their new funding source. Shaking down corporations under the auspices of Prop. 65 to provide funds for new hires, salaries, raises, perhaps even bonuses. Thus, the unholy alliance of plaintiff lawyers and consumer groups is made even more cozy. Consumer protection as a plaintiff lawyer's dream. Job well done, CEH!

CEH and its ilk want you to believe that they are simply out there to protect your interests, which is the reason presented to explain their "passionate" search for "scofflaws". But does that explanation hold water when the consumer group is essentially working on a commission for pay? Can you really be sure these violations are actually dangerous when it is clear that CEH must find them to pay its rent or keep its officers on the job? And what about the interests of the local politicians in this dynamic? Jerry Brown wants to be California's governor - what are his incentives in this case, being egged on by the pay-by-the-violation consumer group?

Does anyone see the possibility of conflicts of interest here? What is that odor I smell?

Aside from the OUTRAGE of CEH taking money for its escapades, the entire Proposition 65 gambit seems to be a parallel safety law allowing a local politician to upstage and trump federal regulation, all the while shaking down companies with duplicative penalties for the same offense. Mattel, no particular object of sympathy in my book, was hit with Prop. 65 penalties (collectively with others, $1.56 million), a "consumer fraud" settlement with 38 states for $12 million, a CPSC fine of $2.3 million and a class action settlement said to be worth more than $50 million. Since Proposition 65 is exempted from preemption by our wise Congress, this liability bonanza will continue to plague the toy industry for a long time to come (forever?).

What is the consequences of the long term, relentless, pointless (from a social good standpoint) assault on our industry under Proposition 65? A poisoned well. What do you think will happen to small business vendors to retailers who have been hounded and hunted under this law? The ultimate in skittishness. It is just not possible to satisfy their hunger for safety mania. As an example, a large national retailer has been demanding that our company test every product for lead-in-paint . . . regardless of whether it has any paint on it. That can only make sense in a world where the consequences of violations are too horrible to contemplate.

Is a violation of this law really worse than mass murder? I think not. This week's CEH violations are innocent and have not and will not harm anyone. They are minor manufacturing defects and can be corrected easily and inexpensively. By making each such trivial violation into a capital case, the cost of doing business skyrockets, profit incentive crashes and many players exit. We have already seen one offering memorandum for a customer of ours who can't take it anymore. Most of the exits are quieter and harder to detect. See my post about Whimsical Walney. If we allow regulators to run roughshod over our industry this way, there won't be anything left to protect. That would be terrible for all Americans. Sometimes you don't know what you have until you lose it.

This is your country. Think about the corruption of fee-driven consumer groups and marauding State AGs who don't answer to the CPSC. What are you going to do about it???

CPSIA - Let's Count the Reasons to be Outraged by CEH

Perhaps like me, you felt a surge of fear and loathing today over the Center for Environmental Health's effort hand-in-hand with CA Attorney General Jerry Brown to find products with "high levels of lead". CEH announced to great fanfare that it had found seven items that violated the law, and Jerry Brown plowed right in behind with a cease and desist order, demanding that these items be removed from shelves immediately. Several of the affected companies denied categorically that there were violations of law. I assume that Proposition 65 lawsuits are being prepared, and suitable penalties will rain down from the heavens in due course (you know, in three years) to properly punish the "scofflaws". Nice work, CEH.

CEH justifies its actions to destroy the children's product industry with misleading facts about lead. Here's how they describe the dreaded danger they are "protecting us" against:

"Lead is a stunningly toxic metal. A long list of problems has been linked to lead exposure: lowered intelligence, behavior problems, cancer, strokes, high blood pressure, kidney problems, anemia, cavities, and delayed puberty. While exposure to lead paint in old houses remains the most significant source of children’s lead exposure, about 30 percent of children with high blood lead levels are exposed to other sources of lead, including toys and other children’s products."

They go on to list a parade of horribles, such as "University of Cincinnati researchers found that arrest rates of young adults (both for violent crimes and all arrests) were linked to the blood lead levels of these adults when they were children. Higher childhood lead exposure was associated with higher arrest rates."

The interesting thing about these assertions about lead is that they are TRUE . . . and they are also IRRELEVANT in this case. There is absolutely no way to prove or even assert in any reasonable fashion that the products cited here could EVER poison children in this way or are responsible for ANY of the cited lead horrors. The CEH is just using plain vanilla scare tactics - did it work on you? Unfortunately, some newspapers bought it, hook line and sinker.

I hardly know where to start. Here are a few reasons to be flippin' mad about this stunt:

I. The Seven Items Present Little or No Risk. Consider this list of "frightening" product defects:

a. Disney Tinkerbell Water Lily necklace - Connector on pixie dust charm contains 22,000 parts per million lead. [I believe this connector is perhaps 3 mm in diameter.]

b. Barbie Bike Flair Accessory Kit - Pink star fabric contains 6196 parts per million lead. [This is an item used on a bicycle.]

c. Dora the Explorer Activity Tote - Orange fabric on back of tote contains 2348 parts per million lead. [I believe his fabric is not detachable and cannot be chewed.]

d. [This one's my favorite] TKS girl’s sandals - Orange insole contains 3957 parts per million lead. [To access this lead, you must lick or chew on the INSOLE of a pair of sandals. Yum!]

e. Kids poncho - Yellow fabric contains 677 parts per million lead. [Gotta chew on your poncho.]

f. [This is a close second] Faded Glory girl’s shoes - Sole contains 1331 parts per million lead. [It's like my old joke about licking the soles of your shoes after walking to school. Happens all the time . . . .]

g. Cherokee boys belt - Surface of belt contains 4270 parts per million lead. [I have no idea what the problem is here. Still, belt chewing is exceptionally rare and not foreseeable in my opinion.]

I hope you haven't begun rioting in the streets over these tragic "violations of law". Let's recap - this rogue's gallery includes a CONNECTOR, the fabric of a decorative star on a bike accessory, backing on a tote, the INSOLE OF A SHOE, the SOLE OF A SHOE, a poncho and a belt.

Let me be blunt - how brain-damaged must someone be to actually believe these things are dangerous?

II. Cassandra Here, Have I Mentioned My Concern about State AGs? Ahem, I believe I have noted my strong concerns about State AG enforcement of the CPSIA in the past (note, especially my April 4 post about Mr. Brown). In fact, I made a big point of this issue in my unread letters sent to the Congressional conferees in July 2008 . . . to no avail. Obviously, I was way off in my thinking. Worrywart . . . .

How outrageous is Mr. Brown's enforcement action? Well, he worked in concert with CEH apparently without talking to the CPSC. CEH practically brags about this ("In collaboration with the California Attorney General the Center for Environmental Health has spent the last six weeks monitoring compliance with the new law. . . . In October and November 2009 we purchased about 250 children’s products from major retailers in the Bay Area and San Diego. . . . We provided information about all of the violations to the California attorney general for enforcement action."). The CPSC seems to be irrelevant to CEH and Mr. Brown.

Ahem, CPSC - what do you think about being rendered irrelevant by a grandstanding State AG and an even more disruptive consumer group? Welcome to my world. Ms. Tenenbaum, in your continuing efforts to cultivate a positive relationship with the State AGs, you may wish to reflect on the behavior of Mr. Brown and his apparent commitment to you and your efforts to calm the markets and implement the new law. Yes, commitment, that's a nice word for it, don't you think?

Here's a word to ponder: "preemption".

III. Publicity-Hungry Consumer Groups Have Proven Their Own Corruption. Stirring up this kind of public shame and panic may be good for raising contributions to CEH, but it is nothing more than a shameful demonstration of anti-social behavior. REAL JOBS and REAL LIVELIHOODS are impacted by CEH grandstanding and NO possible public good was accomplished by the latest losses inflicted by the new toy safety laws. Even CEH concedes things are much better these days (on CBS News, Executive Director Michael Green noted "It is definitely a safer Christmas than it was two years ago."). Thanks, Mike, you have really reassured the American consumer!

CEH's grandstanding over ridiculous assertions of danger is irresponsible and in light of Green's concession of the safety of the marketplace, morally corrupt. Consider that in a six-week effort to find something "bad", the CEH schemers examined 250 products, and all they could find is a connector to a charm, the sole of a shoe and the INSOLE of a shoe. Wow, what a smoking gun! However, with a hepped-up State AG perhaps preparing a gubernatorial bid, even these pathetic findings are the perfect makings for a publicity event.

As if these acts of desperation, self-interest or moral degradation were not enough, both CEH and State AG Brown then attempt to convince the public that these products actually constitute a danger. "'Private testing uncovered a number of products designed for children that contain dangerous and illegal levels of lead,' Brown said in a prepared statement. 'These products must be removed from store shelves at once to protect our kids from toxic lead exposure.'" In the quote above, CEH contends that the presence of lead in products like this can be connected to "lowered intelligence, behavior problems, cancer, strokes, high blood pressure, kidney problems, anemia, cavities, and delayed puberty". Oooh, sounds AWFUL - now prove it! CEH and their merry band of anti-commerce loonies can only assert these harms - NO data exists that can link lead in these manifestations to ANY physical harm. But what's a good consumer group publicity event without unaccountable fear mongering?

Any sane adult or experienced parent knows that all this is baloney. This sad state of affairs confirms that the consumer groups do NOT deserve a leading role in setting the rules of the road in safety. They gave up the moral high ground when they decided to sell fear rather than advocate for safety.

Final Words: I was recently sent a blogpost link written by a consumer group about my testimony at the CPSC on November 10 about the CPSIA public database. Of course, since I am apparently a force from the Heart of Darkness (as you know), the consumer group blogpost scorned my testimony and painted the usual conspiracy theories that the wingnuts tend to favor. What was particularly notable about this post was the following note at the bottom of the page: "Comments are closed."

Get it? The consumer groups like having the last word. They like spreading the news that best suits their interests but don't want to answer to anyone else. [We have seen this before.] The consumer groups depend on the kindness of strangers - they need your contributions to pay their salaries. What better way to do this than sell their souls for some headlines? If you are the ones paying into their coffers with the thinking that they are looking out for you, I think you should carefully ponder the "good work" of Mike Green and his gang this week. Is this good for America? Is anyone safer now or better off? Or . . . are CEH and the other aligned consumer groups a bigger part of the problem than previously recognized?

After this stunt, I certainly hope no one will stick a microphone in Mike Green's face again.

CPSIA - Do-Gooder Congress Ends The Green Toy Movement

For those of you hoping to see toys become "greener" this year, forget it. Mr. Waxman and Ms. Pelosi have different ideas. Having California-ized the country and made phthalates and lead illegal at virtually any perceptible level under the noxious CPSIA, Congress made the possibility of using recycled materials too risky. Clearly, using recycled plastic is good for our planet- there is less waste and less damage to the environment. It is also thrifty and sensitive to our limited resources. Unfortunately, when using recycled materials, there is virtually no control possible over the presence of phthalates or lead contamination. Ah, the inviting prospect of a CPSIA violation! Importantly, this also means that each batch will be different and subject to random failures. Contaminants cannot be controlled.

It's a shame that toys and educational materials won't be able to be recycled. Given the CPSC's recent Resale Roundup initiative, they won't be resold either. Landfills will bulge courtesy of the CPSIA and Congress. The charm of the toy business is going away . . . fast.

The reduction in product innovation and the premature death of safe products under the CPSIA is costing money, jobs and economic vitality right now. The weakened state of the economy has not left the Small Business community feeling flush. It's time to acknowledge that the factors affecting Big Business are worlds apart from those affecting Small Business. Big Toy may be prospering right now (Mattel 3rd Quarter earnings were $230 million and Hasbro's 3rd Quarter earnings were $150 million), but the little guys are getting killed. The consequences of fear of random (and sometimes unsolvable) legal problems can be felt in the chill running through the industry. I cannot explain why so few people take this seriously.

It is all the more puzzling because of the absence of victims. We are seeing our businesses dismantled before our eyes to make people "safer" yet who is being saved? The hysterical consumer groups and rabid media behind the CPSIA banged drums over the "dangers" of lead-in-substrate and phthalates. If phthalates and lead-in-substrate were so terrible, where are all the victims from years past? I want names, addresses, photos and case histories. Rather than insist that the "danger" is unbearable, advocates for this law failed to prove that people are being hurt. The consumer advocates punted with a non-answer, namely that there is no "safe level" for lead. This hand waving seems to give the advocates some sort of pass on presenting actual data. Likewise with phthalates, the advocates trade on fear but do not present real data demonstrating real harm. Those chemicals have been in the market for decades so if they cause such dreaded injuries, why don't I know about a single victim? Why haven't the newspapers presented case histories - gore sells papers, as everyone knows. The absence of data is data. Congress, where are you?

Again, no one seems to care about these niceties. As long as people "feel safe", then the costs we are incurring must be worth it . . . right?

It's your world, I guess you get to decide.

CPSIA - Scary Brass!

In anticipation of the Learning Curve decision about "dangerous" brass bushings, I thought I would provide some information about the uses of brass in society and its current restrictions.

According to Wikipedia, brass has been widely used since prehistoric times. Of course, brass is used in many places: "Brass is a substitutional alloy. It is used for decoration for its bright gold-like appearance; for applications where low friction is required such as locks, gears, bearings, doorknobs, ammunition, and valves; for plumbing and electrical applications; and extensively in musical instruments such as horns and bells for its acoustic properties. It is also used in zippers. Because it is softer than most other metals in general use, brass is often used in situations where it is important that sparks not be struck, as in fittings and tools around explosive gases. Brass has a muted yellow color, somewhat similar to gold. It is relatively resistant to tarnishing, and is often used as decoration and for coins. In antiquity, polished brass was often used as a mirror." Other sites tout brass for its utility for plumbing, its most ubiquitous use.

It's obvious that children will encounter brass regularly in their daily lives, like when they handle doorknobs or handle keys. The even-handed CPSIA, as administered by the new "common sense" CPSC, seems nonetheless to place an unusual burden on those knuckleheads like me still left in the children's market. WE are not allowed to use brass with more than 0.03% lead content by weight (300 ppm), falling inevitably to 0.01% lead by weight (100 ppm) in two years. Here are a couple more "fun facts" about brass: brass typically has 2% lead by weight AND 90% of brass alloys (including bronze) are recycled. In other words, it is hard to control the lead content of this environmentally-friendly metal. Hmmm.

We know that brass pipes are used for plumbing everywhere, even in Mr. Waxman's house. Children will come in contact with brass when they wash their hands in warm water that travelled through brass pipes or drink from the drinking fountain at school. Oops, did I mention high levels of lead in drinking fountains? Like the 92% in LA Unified School District Schools that remain unrepaired to this day? Sad but true. The LAUSD situation is apparently not NEARLY the crisis presented by brass bushings or brass connectors in toys, clothing or shoes. The CPSIA in its infinite wisdom has determined that children's businesses should close or their owners should go to jail if they use such things - but other uses of brass in daily life are fine, just fine.

But what about brass in those other uses - are they restricted at all? According to Wikipedia, keys must now contain less than 1.5% lead by weight in California to avoid Proposition 65 labeling. To clarify, keys with greater content than 1.5% are still legal to sell in CA but would need to be labeled under Prop. 65. The approved lead content in keys is 50x the legal limit on lead content in brass in children's products. Yeah, that makes sense. And in California and in Vermont, brass plumbing fixtures and pipes used to convey water for human consumption must have not more than 0.25% lead by weight by January 1, 2010 - 9x the legal limit on lead in brass in children's products. [The CA limit is a weighted average, so individual components can exceed this limit.] I do not believe this law requires retrofitting existing California's pipes. The current limit on lead in California pipes is 8% by weight, a mere 267x the legal limit on lead content in brass used in children's products.

I cannot find any other restrictions on brass in any products in our country. I probably missed something but no restriction will exceed the zeal of the CPSIA. It is unique as a regulation, both for its sense of sanctity and its overreaching, penal ineffectiveness. Trumpets don't have legal lead limits, despite being made of brass and intended to be mouthed. Leaded fountains remain in schools across the country, and bad plumbing is everywhere. Nonetheless it is the children's product industry alone that must endure upheaval from the loss of brass as a basic material. Need I mention that brass was at the heart of the pens crisis earlier this year?

When the CPSC makes its inevitable decision to shut down Learning Curve's business over its use of brass bushings, they will intone that it's not their fault, the darned law made 'em do it. The leadership will then later issue some press releases about vigorously enforcing the law and making everyone safe. There will be no acknowledgement of their role as a tool in the wanton destruction of a valued industry. Not their fault. . . .

Wake me when the nightmare is over.

CPSIA - Californization Continues

On September 29, the EPA's top administrator announced that the Obama Administration would announce the long-awaited amendment of the Toxic Substances Control Act. This announcement came in a speech in San Francisco, the home of all good regulations. The Scientific American states: "As a result, she said the Obama Administration will promote a new chemical law in Congress in the coming months that puts the responsibility on industry to prove that its compounds are safe." Sound familiar? The EPA also announced a new investigation of phthalates, perhaps attempting to blunt any effort to discredit the ban in the CPSIA.

In another "Brave New World" quote from the article featuring the not-enough-government, not-enough-regulation official: "'As more and more chemicals are found in our bodies and the environment, the public is understandably anxious and confused. Many are turning to government for assurance that chemicals have been assessed using the best available science, and that unacceptable risks haven’t been ignored,' Jackson told an audience of several hundred people during a speech at the Commonwealth Club in San Francisco on Tuesday night. An audience member asked if the EPA would add the right of citizens to sue for non-compliance of the law, a provision that lies within the Clean Water Act. 'That’s a great idea,' she said, and 'it was certainly something to consider.'” [Emphasis added]

Hey, Chemical Industry - welcome to our misery! Why don't you embrace this change with enthusiasm - appeasement really worked wonders in the case of the CPSIA.

CPSIA - Fashion Jewelry Loses a BIG One

With morbid anticipation, I just read the statements of the three CPSC Commissioners on the Fashion Jewelry industry petition to exclude crystals and glass beads from the overbearing strictures of the CPSIA. On a day when I was a bit emotionally damaged by Tom Watson's failure to win the British Open, these statements more or less finished me off. Should we laugh or cry over this decision? Cry, because it bodes terribly for all of us.

The jewelry industry made all the usual arguments for excluding these non-controversial items from the law. The items in question have no history of causing injury, they are infrequently abused, the amount of lead possibly ingested is absurdly low, etc. Been there, done that. The staff recommended against the petition, per form, because the law clearly states that nothing can be exempt unless it either is always within the law's lead limits (in other words, it already complies) or else it cannot emit so much as an atom of lead into the body. The CPSC staff has previously opined that it has yet to identify a single Earthly material which meets this "common sense" standard which is why it has recommended denial of each and every stay.

The two Democrat Commissioners voted to deny the request on the grounds that the law does not permit exceptions. They then said they would direct the enforcement activities of the agency toward the class of children they deemed most "at risk" (a relative term, if there ever was one). Republican Nord also voted against the exclusion as required by law, but recommended a stay, mainly to allow Congress to fix the law.

Seems like "same old, same old", right? Not in this author's opinion. Here's what I take away:

a. The Days of Easy Stays are Over. The ATV'rs and bike industry can take some (limited) pleasure in their short stays. The window seems closed. Of course, it also means that when their stays are up, they are likely in big trouble. Chairman Tenenbaum took a strict constructionist view of the law: "[Having concluded that swallowing crystals and beads is foreseeable as required under Section 101(b)(1)(A),] the question turns to whether the ingestion or mouthing of these beads would result in the absorption of any lead by a child. In making a determination, I was mindful that the statute does not use the term "harmful" amount or another term which would allow staff to utilize a risk based approach." [She later explicitly rejects a risk based approach as not permitted under the CPSIA.] In other words, true to her word at her confirmation hearing, Ms. Tenenbaum is committed to enforcing the laws handed down by Congress without judgment. She read the law faithfully and did what it instructed. There was no consideration of consequences of the decision or of the relative risk posed by these materials.

Commissioner Moore chimed in with his own analysis of Congress' instructions on the narrow question of crystals. In quoting from the House Report behind HR 4040 (CPSIA), Moore noted that "Paragraph (4) authorizes the CPSC, in very narrow circumstances, to exclude, by rule, certain materials and products from the total lead weight limits. The lead content of these materials must be in a form that will not result in absorption of any lead whatsoever into the human body. . . ." [Emphasis added.] There you go.

Mr. Moore also notes that this decision of the Commission effectively overrules a Proposition 65 settlement applying to crystals. Not sure how the Commission's decision could be made more disruptive or commercially devastating. Even the over-the-top Proposition 65 is outdone by the CPSIA. The reliance of jewelry companies on this California settlement was seemingly not taken into account by Commissioners Moore or Tenenbaum. I believe the effect of this decision is to render the industry's inventory prepared in compliance with various states laws like California and Minnesota instantly WORTHLESS. To continue to sell these items on Monday is an intentional violation and we all know what misery that might bring. More gratuitous business risk and economic losses from your friends in Congress. . . .

I believe the Commission's stay decision on pens needs to be read very, very narrowly in light of the jewelry decision. It is hard for me to believe that the logic of the pens decision will be utilized again. Until it is, I believe that decision should be regarded as limited to the specific facts and circumstances of pens.

b. Economics Will Not Be Considered in Exclusion Decisions. Commissioner Nord produced a laundry list of immediate economic harm from the decision to reject a stay. It is shocking. Presumably, this data was available to the entire Commission but notably neither Tenenbaum nor Moore mentioned it. This makes sense because the CPSIA does not make financial impact relevant in these decisions. The Commission's decision is driven by the law's definition of the interest of consumers (note, I do NOT mean the ACTUAL interest of consumers), namely that "any lead is too much lead" and thus, financial impact is outside the decision matrix. I do not think this is right, because the law is really just a bundle of economic incentives, and in making this decision, the Commission is changing the rules of the market which will change behavior. Products will be killed, choice reduced and companies will exit. The widespread elimination of children's departments in the resale industry is a pertinent example of this effect. By narrowly defining consumer interests in this way, the CPSC ensures maximum economic damage to everyone.

Here's a glimpse of the future: In two years, the Commission will make a decision on whether the new 100 ppm lead limit is technologically feasible. This term is defined in the CPSIA in Section 101(d) - and nowhere will you find a reference to economics. Thus, my new pet saying can be taken as LAW now: If Rolex CAN do it, Timex MUST do it. Put that in your pipe and smoke it.

[There will be a Congressional election before this determination is made, please note. Some careful consideration of your voting choices could have a significant effect on this law, for those of us still in business by then.]

c. The Commission Seems to Think that Enforcement Discretion Makes Violations Go Away. The statements make clear that the CPSC won't be enforcing this rule outside of the market for children six years of age and under. What they do not address is the fact that they have clearly stated that these materials violate the law for all children 12 years of age and under. Thus, to "knowingly" import or sell these items into their no-enforcement zone is to take the chance that a shift in regulatory wind could mean BIGGGG trouble. The CPSC is unable to restrict the 50 State AGs either, so it leaves everyone WIDE OPEN to nastiness on the State level. Sound good? Who would take this chance?

The gerry rigging of this law in this way does not replicate the law that preceded the CPSIA (if that was the goal). In other words, this construct simply does NOT work to lessen risk or financial harm. By saying that the CPSC will only enforce in certain circumstances does NOTHING to make it easier to do business. We are not allowed to violate the law, whether the CPSC wants to enforce it or not. Read the penalties section and think about how penalties have been handed out so far (with lots of imputed "knowing" conduct). In the olde days, the decision on where to enforce or not was completely effective to demarcate the part of the market that needed to tighten its legal belt because back then, everything wasn't illegal. Now it is. The policy to only enforce in part of the market doesn't relieve any responsibility under the law - it only gives the appearance of shifting risk to that part of the market. Remember your 15(b) obligation to report - it still applies to ANY violation. Remember your whistleblower risk - you can't discuss using violative materials in the no-enforcement zone or risk "problems". Remember that any intentional violation of the law, whether the CPSC intends to enforce or not, could be grounds for a felony charge. Hey, it's not my idea - read the law. Do you want to run your business feloniously, even if the Commission says it's okay (today)?

d. Forget "Common Sense". The Commissioners in avoiding the obvious conclusion that glass beads and crystals can be safely sold and sticking closely to the ridiculous language on exemptions (notwithstanding the encouragement of the CPSC by a "primary sponsor" of the CPSIA to grant exclusions for "materials that can be shown to pose no [risk of a] measurable increase in a child's blood lead level", as noted by Ms. Nord) clearly breaks with the tentative baby steps of the Commission under Nord and Moore to introduce a semblance of common sense into the implementation of the CPSIA. Those days seem to be over. The new attitude appears to be that the law as written is to be enforced and that blunting the edges with "common sense" is inappropriate.

The Tenenbaum Commission's approach to statutory construction makes a lot of sense to me. I have long asked the Commission to enforce the written law and not make it up as they go along. Unwritten laws are even worse than bad written laws. I am glad the Commission is showing it can read. Congress remains in denial. I don't know if the jewelry decision is more of a message for Mr. Waxman or for you and me. If we or anyone wants a different way to administer safety, it will require a change in federal law. This is the reality of our situation, like it or not. This Commission apparently intends to enforce the law as written, and that won't change even if the law is foolish on its face. "Common sense" is no longer part of the calculus in interpreting this law strictly.

e. Don't Hold Your Breath for Relief on Tracking Labels. The narrow reading of the law by the Commission here, where almost nothing (other than money) was at stake, suggests grim tidings in the super-secret tracking labels guidance due to be voted into effectiveness without your comments on July 20. I can only speculate on why the Commission didn't think we should read the guidance before they voted on it. I think we could have handled it. The jewelry decision suggests that it is highly likely that the many problems created by the tracking labels provision will be left in place. As previously noted, the CPSC has not deigned to respond to ANY questions on the noxious tracking labels provision in the last 11-and-a-half months. We have no idea where they stand on anything.

Let me give you a great example - I think the guidance is going to require you to disclose your sources on your packaging and on your product directly. This was forecast by Gib Mullan and Cheryl Falvey at ICPHSO in February (we were told to "get over the mourning process"). This term alone will kill many companies and many products. All high volume customers will now have the option to go direct, courtesy of Congress. While this may seem like a zero sum game at first glance, what it really means is that the incentive to innovate or take financial risk on any item that you cannot protect will end. Private labeling will become much harder or impossible. Trading among competitors will end. The net result will be shrunken markets and withered companies. Serious consequences will follow. Again, the Commission has more or less indicated that economic consequences are not its concern, as Congress in its infinite wisdom has determined this provision is best for all of us. Brace for it.

I have long stated that tracking labels is the absolute worst part of this law. The emergency posed by this law is drawing near. If tracking labels becomes law on August 14 without delay and if this law isn't revised significantly in the very near future, the outlook appears very, very grim for all of us. The posture of this Commission suggests that we might be facing a worst case scenario soon. This is disappointing, to say the least. It is Congress' fault. The CPSC is doing what has been asked of it, ridiculous or not.

If you are still sitting on your hands, you might want to call your lawyer soon.

CPSIA - Do-Gooders Playing a Role in Train Crashes?

Consumer Groups, media and panicky politicians led a feeding frenzy last year over toy recalls that resulted in remarkably broad legislation restricting the presence of lead in children's products, yes our old friend the CPSIA. Of course, the determined "do-gooders" in the consumer group corner have asserted that there is "no safe level" for lead and thus, it makes "sense" to eliminate it totally from children's products (and the world at large, if possible). Remember, you can't be too safe . . . . A leader of this charge was a staff person at the American Academy of Pediatrics who presented unchallenged statistics in September 2007 to a House Subcommittee. With the lilly-white AAP backing of this notion, Congress swung into action and outlawed lead effectively from all children's products. Sounds good, right? Well, as with most manias, the "unintended consequences" have been terrible. This has been well-documented in this space.

Interestingly, I found an article recently that suggested that elimination of lead from circuitry (solder), courtesy of our friends in EU bureaucracy, may have played a role in the recent terrible Washington, D.C. Metro train crash. [Lest we forget, it is worth noting that the motivation behind the EU's elimination of lead from solder was protection of the environment, not a fear over direct human poisoning, the basis of the current U.S. mania.] This article points out something that the amateur scientist fear mongers may not have known, which is that lead plays a useful role in solder, and in its absence . . . more "unintended consequences". In this case, the consequence is something called "tin whiskers", a phenomenon created by "untamed" tin in solder. Tin behaves differently in the absence of lead, and will grow "whiskers" that create electrical shorts. The article suggests that this explains the intermittent electrical failures of the crash detection system on the Washington Metro. Other deadly accidents have been linked to tin whiskers. Precautionary, indeed.

Among the many things that disgust me about the lead mania is the illusion (delusion) that controlling lead-in-substrate in children's products will have any material impact on exposure to lead. In fact, it's just a way to put blinders on. By publicly and notoriously addressing the "lead problem" - problem solved!! This is absurd, of course, but has only encouraged the maniacs. Take, for example, the recent hubbub over the Obama's "lead-contaminated" vegetable garden. Incredibly, the lead levels detected in the White House garden (presumably by people with too much time on their hands) was 93 ppm. Our dear friends at the AAP assert that background lead levels in dirt is 40 ppm. This was the rationale behind the recent Illinois lead labeling legislation profiled in this space. As the Obama article makes clear, the controversy over lead in dirt is just politics, not science, and is WAY out of proportion to both the health threat and the presence of lead all around us. Dr. Kimberly Gray, Director of the Environmental Sciences Program at Northwestern University comments: "It’s inflammatory. 93 ppm is well below background lead for an urban environment. It’s what you’d expect just from atmospheric deposition." The article continues: "Atmospheric deposition is lead particles that fall out of the sky, from things like auto emissions." You mean there's lead in the air, too - oh, no!

The do-gooders have infinite justifications for their bans of lead in children's products, their current obsession, but (other than economic devastation) what has actually been accomplished for the American public by their handiwork? Only the illusion of "better safety". The legislation markets the idea that elimination of insoluble lead from substrate makes a marginal, incremental difference to health, as though it were the only (or principal) source of lead in our bodies. This flawed logic also underlies the dangerous Proposition 65 in California. The labels required by Proposition 65 sounds sensible, intended to advise consumers of the presence of "toxins" in their products (even if legally there) so they can decide whether to expose themselves or their families to the "deadly" substances. Who could object to that? Well . . . the selective presence of these labels gives false comfort to consumers who may believe that the labels highlight the ONLY places where the noted risk occurs. The implicit reasoning goes like this . . . why would the government require lead labels on lip gloss if the government knows that this risk is miniscule compared to MANY other sources of lead in daily life? Aren't they requiring labels on EVERYTHING with lead? And, if so (the government wouldn't let us down!), isn't this buying decision critical, a highlighted choice that might make the difference between good health and some form of miserable, painful, lingering death?! That's the implication, however erroneous.

I do not accept that this is the only way to run a sensible society. Canada has attempted to truncate our fancy new safety system, by tailoring it to a narrow and specific class of products or situations. That seems like a good place to start. It's time for all concerned to acknowledge that the "perfect legislative process" had a faulty outcome. Real leaders are prepared to admit error and to do the right thing for their troops. Congress???

CPSIA - Lead Labels, Who Cares?

Some laws, like California's Proposition 65 and the infamous Illinois Lead Poisoning Protection Law (see my previous post) include labeling provisions to "inform the public" of the presence of various unwanted substances, even trace amounts. After all, it's the public's "right to know" that motivates these consumer protection laws. Sounds good, right? Well, if you are on the receiving end of this good work, it feels like business death. For instance, in the Illinois law (Section 6(b)), labeling is required if lead-in-paint on a toy exceeds 40 ppm. This is intentionally lower than the federal lead-in-paint standards of 90 ppm (as of August 14, 2009, that is) since Illinois is competing to win in the Race to the Bottom as the national leader in "being safe". The Illinois standard is also equivalent to national average of lead levels in DIRT. Yes, dirt (see the report of the American Academy of Pediatrics). Thus, the Illinois law does not make lead-in-paint levels above trace background lead levels illegal but does require that consumers be informed of these "elevated" lead levels in a helpful product label.

So, if you are the lucky manufacturer who has to label his/her products for lead levels that conform to the excessively precautionary federal standards in order to satisfy Illinois or California laws, will you survive the experience to tell the tale? I have argued in testimony to an Illinois House subcommittee that the answer is "no". Consumers will not ignore these labels and will treat your product as though it were poisonous or radioactive. This would not be good for business - to say the least. I, in fact, told the Attorney General's office in Illinois that this might prompt Illinois companies to relocate across the border into saner States like Wisconsin or Iowa.

My vivid imagination, right? Can you imagine the voices I must hear in my head?? Well, perhaps not. Read about the story of lip gloss at Target in Indiana where a recall of a legal, safe product was incited by a panicked consumer reading a Proposition 65 label in Indiana. You can't say you haven't heard it before. Feeling safer already?

Hey Congress - what if some of my other predictions come true, too? Are you ready to stand up before America and tell them that these terrible problems were your handiwork? Is that the Obama Revolution you want to foment?

CPSIA - The Significance of the ATV Exemption Decision

As you may know by now, the CPSC as anticipated denied the ATV Exemption request on Friday on the grounds that the law does not permit exemption of ATVs from the noxious CPSIA. On this point, both Commissioners agree. The Commissioners voted 2-0 to extend a retroactive and permanent enforcement ban on ATVs made on or before May 1, 2011, thus permitting the continued manufacture and sale of child-sized ATVs for at least two more years, and directed their staff to prepare an official enforcement ban for publication in the Federal Register. What does this all signify?

1. The Continuing Issuance of Stays is an Acknowledgement of the Flaws in the CPSIA. This is essentially the third stay of the CPSIA, and perhaps not the last. [Look for a stay of the tracking labels requirement as chaos is again building in the marketplace.] Having stayed the testing and certification requirements for a year, and deferred enforcement of the law against certain products and materials previously, the Commissioners have again put the law on hold. Why would "landmark" legislation need to be stayed again and again, and may need to be stayed some more? Let me suggest an obvious reason - the law makes no sense and the CPSC cannot make it make sense. Not only does the CPSC recognize that the law is toxic to commerce, which is not the desired purpose of well-crafted safety legislation, but it is also turning many safe and valued products into endangered species. As the Commissioners note, the law is so restrictive that a stay is the only means they have available to avoid the most terrible consequences of this overreaching law.

PLEASE NOTE the absence of howls of protests from Congressional "leaders" and consumer groups over the gutting of the retroactive feature of the CPSIA for the benefit of the ATV'rs. I thought these luminaries told us the standards were intended by Congress to be retroactive and that (evil) American industry had enough time to get the old product off the shelf. If so, why aren't our Mother Protectors screaming about the terrible CPSC Commission selectively letting the ATV industry off the hook??? That darned Nancy Nord again . . . oh yeah, it was Thomas Moore, too. Perhaps the screamers' principles aren't quite so rock hard, and retroactive effect of the lead and phthalate standards weren't actually essential to preserve our way of life after all. Hmmm. Senators???

What does that say about the law itself?

2. The CPSIA Puts the CPSC in Gridlock (not Nancy Nord). The Commissioners continue to struggle with the straitjacket imposed by Congress. In the case of the ATV Exemption request, the staff indicated that the law compelled them to deny the application despite absurdly low lead intake from ATVs (far below daily lead intake from food, water and breathing, ah but details like this are the hobgoblin of the small mind . . .). Likewise, BOTH Commissioners came to the same conclusion. Nancy Nord: "It is clear that the law does not give the Commission the flexibility to grant an exclusion for the petitioners' products." Thomas Moore: "Given the extremely restrictive language of the law, the only avenue I can see is for the Commission to establish an enforcement plan that follows, to the greatest extent possible, the Act's intention for future production. . . ." The Commissioners are stuck and make no bones about it.

Okay, so no exemptions are possible. [Senators, there's some "common sense" for you.] How about the future? Can manufacturers ever find a way to wriggle out of the ridiculous restrictions or will the entire Children's Products industry be slave to these inflexible restrictions going forward? Ummm, we're slaves. The enforcement stay proposed by the Commissioners after considerable delay to study their legal options states that the standard for relief in the future will be "technical feasibility". This sounds like a logical standard, something that reasonable people exercising "common sense" could administer capably, right? I don't know how to tell you this [Senators] but . . . no, not right.

The term "technological feasibility" is defined in Section 101(d) of the CPSIA specifically to tie the hands of the CPSC. Among other things, no consideration of economics is allowed. Notably, something is considered technologically feasible if "a product that complies with the limit is commercially available in the product category . . . or . . . alternative practices, best practices, or other operational changes would allow the manufacturer to comply with the limit." In other words, if Rolex can do it, Timex MUST do it. Mr. Moore, whose enthusiasm for this law seems to approach the pathological, gloats: "The evidence considered is strictly limited to technological feasibility, not on the higher cost of a viable substitute. The guiding principle of this agency's determinations has to be the safety of the children . . . ." Notwithstanding the non sequitur of Mr. Moore's second sentence, his statement is a clear admission that the CPSC has no way to exercise that famous "common sense" recommended by Senator Pryor and his flock.

3. The Notion that a New Chairman Would Impact Outcomes Has Been Exposed as Nonsense. This is the 24th consecutive CPSIA decision of the two person CPSC Commission which has been decided 2-0. There are NO examples of 1-1 votes on the CPSIA. The two Commissioners read the law EXACTLY the same. My heavens, if the Commissioners under this kind of pressure read the law as similarly as they do, is it POSSIBLE that they read the law correctly and are working in concert, exercising similar sound if constrained judgment and in fact, are doing their jobs responsibly? The new Chairman is supposed to clean this up by instituting a new policy at the CPSC to . . . what? Break the law? The demand for a new Chairman to "resolve" the issues under the CPSIA insults the public's intelligence. The Members of Congress and consumer groups that stand in line to bash Nancy Nord and blame her for these decisions and the direction of the agency shame themselves with their mischaracterization of the facts.

4. Fairness and Equity in Safety Regulation or Application of Rules across Industry Lines is Another Casualty of the CPSIA. I am happy for the ATV'rs that they got a break on the unfair retroactive application of the lead standards to their products and inventory. Our suffering need not be their suffering. It is worth noting, however, that they are not alone in their need for relief from the retroactive impact of the law or its harsh disruption of their marketplace. The rippling impact of this law on many industry groups has been well-documented. At a minimum, I simply cannot understand how the CPSC could justify giving a PERMANENT pass on retroactive effect for ATVs through May 1, 2011, but not do the same for all other industries affected by this law. This is shocking, irresponsible, oblivious, unfair and unkind. Had Congress or the CPSC actually given a two-year pass to everyone on retroactivity (preferably several months ago), the transition time alone would have cured many ills, including the need to sort out how to administer the new rules. Likewise, a big chunk of the problem for resellers of used or donated goods would be resolved or at least tabled for further study. Instead, justice will apparently be meted out slowly and unevenly, and will be governed by economics. You can safely anticipate that there will be justice for the rich only. Only rich industries or companies will be able to afford to mount the multi-million dollar effort to appeal for these exemptions. Crafters, for instance, will be sacrificed unless a Sugar Daddy saves them. Don't count on it.

5. The Future of Safety Regulation is Bureaucracy and Complexity without Benefit. The decision in the ATV case makes it clear that unless the law is changed, regulation of safety in children's products will be by exception only. Having mandated that regulating by risk assessment is no longer permitted, Congress' great new scheme is to make everything illegal unless the Commission decides it isn't illegal. It will be years, if not forever, before a coherent, settled law emerges. In the meantime, we will live in the grey zone.

As I have written in the past, there will be significant costs to a regulatory system based on exceptions. For one thing, it will be exceptionally difficult to clearly understand the rules if you must first find and understand all the exceptions. While this might sound achievable, it is not. Neither the law nor its exceptions are clear or entirely black-and-white. Case law or a body of other regulatory decisions will slowly and expensively clarify the law - provided you can find, understand and utilize those decisions. And. . . the body of decisions may not (likely will not) set out the answers applicable to you. It is typically clear as mud.

What will life under this kind of legal system look like?

• You will need to hire counsel. You will not feel comfortable making the legal analysis yourself. You will also become accustomed to weighing legal risks in the normal, everyday conduct of your business.
• Easy things will become hard. There will be a need for vast paperwork that does not contribute to the development of your business or the satisfaction of your customers.
• Your costs will rise to cover the bureaucracy. This will not make your products more valuable or raise the price you will receive for them in the market.
• Increasingly, your focus will be on paper, not building your business. Regulatory paper will become the medium of trade and owing to the blizzard of paper will lose its meaning. Your business processes will feel Dickensian. [Ah consumer groups, thank you so much for all you are doing to make America great!]
• You will learn to fear the CPSC and State regulators in your bones for the randomness and pettiness of their rule administration. Rules, NOT common sense, will dominate in a world of forbidden risk assessment, and random seizure of your profits (through fines and technically-driven recalls) will become commonplace. If this sounds apocalyptic, talk to anyone who has dealt with Customs. Get used to it.

6. Small Business is the CPSIA's Sacrificial Lamb. Who survives in a world defined by the ATV decision? This decision makes clear that a serious and expensive legal campaign is required to get permission to sell known safe products that give off about as much lead as four cups of water from your kitchen tap. [You know, the water you feed to your children and grandchildren, and drink yourself.] This is unaffordable and well-beyond the capabilities of 99% of all regulated companies and is thus a closed door (effectively) for small business. We have seen a recent letter by Senator Durbin's staff practically clucking at the nobility of sacrificing small business to the need for pre-market testing. As an Illinois resident, I find this indescribably infuriating. I understand the importance of small business to the marketplace and to local communities. I work at a small business and fear what will happen to us if this law is not gutted quickly. If we really must accommodate these rules, our business will become unrecognizable. That would be a very sad day for me, for our associates, for our marketplace and for our valued customers.

7. The CPSC Has Been Neutered as a Regulator. Ms. Nord sums it up in her April 17 letter: "I hope the state attorneys general will follow our lead in [the enforcement ban on ATVs.]" I hope so, too. That being said, in an orderly legal system, there is one policymaker, one decision-maker. The U.S. Supreme Court doesn't close all of its decisions by saying "We sure hope the Supreme Courts of California, Arizona and the other 48 States will follow our lead on this one." In our business, we say "Hope is not a strategy." Uh-oh.

The CPSC knows it has been cuckolded by the law since it is now subject to oversight by 50 SAGs. If you get yourself a nice two-year enforcement stay from the CPSC, are you going to take a chance to continue to sell your products when Lisa Madigan (SAG-IL) or Edmund Brown (SAG-CA) or others might choose to read the law differently than the CPSC? Does the Federal stay actually mean ANYTHING? According to my 15-year-old daughter, who has more common sense than at least 28 Senators I can name, the answer is NO. And, yes, these SAGs are not above telling the CPSC that they read the CPSIA wrong (see my recent blogpost on this topic). There is no longer a law of the land.

Final Thoughts. With the ATV decision in the books, we now must wait for the enforcement stay to be written up and published. Don't expect any surprises as the Commissioners have published their expectations already (again, one list from the 2-0 Commission vote). Will other industries raise their voices in protest? Questionable, in my opinion. If the past few months has not been enough to get people over their (irrational and misplaced) animal fears, I don't know how the current situation will add much motivation. There aren't enough motivated and persistent protestors out there, and frankly, it's understandable. The economy's still a wreck so everyone needs sales, not new hobbies. Advantage, lead fear mongers.

Time will tell. I hope some of you will answer the call.

Rick