More than two years after the Consumer Product Safety Improvement Act became law, driving children’s bikes off the market, children’s book off library shelves, and home-based craftsmen out of business — to name just a few of its many excesses — a Congressional committee is finally going to vote on an CPSIA fix. From the House Energy and Commerce Subcommittee on Commerce, Manufacturing, and Trade:

Commerce, Manufacturing, and Trade Subcommittee to Vote on Improvements to Consumer Safety Law THURSDAY

May 11, 2011
WASHINGTON, DC – The House Energy and Commerce Subcommittee on Commerce, Manufacturing, and Trade, chaired by Rep. Mary Bono Mack (R-CA), has scheduled a markup of the Discussion Draft of H.R. ___, “Enhancing CPSC Authority and Discretion Act of 2011 (ECADA).” The markup will convene on Thursday, May 12, at 9:00 a.m. in room 2322 of the Rayburn House Office Building.

The draft legislation would revise the Consumer Product Safety Improvement Act of 2008 (CPSIA) and seeks to give Consumer Product Safety Commission greater authority and flexibility to regulate based on risk.

The discussion draft of the legislation is available here. A background memo explains further: “The draft legislation’s objectives are: to reduce the regulatory burdens created by CPSIA where possible to do so without harming consumers; to enhance the Consumer Production Safety Commission’s (CPSC) ability to investigate complaints and to prioritize based on risk; and, to improve the utility and accuracy of information in the CPSC’s public database.” (continue reading…)

Rick Woldenberg of Learning Resources Inc. just refuses to let the Consumer Product Safety Improvement Act beat him into submission, two-and-a-half years after the law began producing all sorts of economic mayhem to the benefit of no one save lawyers and “consumer activists.” In The Hill, Rick writes about last week’s House committee hearing on the draft legislation to repair the fatally flawed law. From “Enough already! It’s time to amend the lead law“:

As directed by Congress, the CPSC has dutifully banned the sale of rhinestones to children, ended the era of youth model ATVs and forbidden the use of brass bushings in toy car wheel assemblies. Why? They might emit a single atom of lead! The supporters of the law justify these extreme actions on the grounds that lead is a poison but somehow overlook that kids are exposed to more lead every day from eating a snack, drinking water or playing outside in the fresh air. The descent into regulation purgatory is down a slippery slope.

Being governed by this law can give you fits. For example, to be able to continue to legally sell our geology kits to schools (featuring real rocks!), we must give this warning: “Caution: Federal law requires us to advise that the rocks in this educational product may contain lead and might be harmful if swallowed.” We don’t relish looking like idiots at the hand of the U.S. government.

We’re certainly not alone in feeling the pain. The law affects many safe products spanning the U.S. economy, like books, t-shirts and shoes, ATVs and dirt bikes, bicycles, donated or resale goods, musical instruments, pens and educational products. The number of companies touched by the CPSIA is in the many thousands.

For more from Rick, a REAL consumer activist, see his AmendtheCPSIA.com blog.

We reported on the House hearing last week here and here. Walter Olson has more at Overlawyered.com, “CPSIA: ‘Toymakers Would Get Relief Under Republican Plan’.”

Twelve witnesses offered testimony at the House Energy and Commerce Subcommittee on Commerce, Manufacturing, and Trade’s hearing Thursday on draft legislation to repair the Consumer Product Safety Improvement Act. A dozen witnesses makes for a wearisome hearing, but it tells you that there’s a lot in the CPSIA that needs to be fixed.

Testifying on behalf of the Association of Home Appliance Manufacturers, Charles A. Samuels expressed support for the draft bill’s fixes to the product safety complaint database. As currently structured by the CPSC, the database encourages the reporting of inaccurate or purposefully false claims, doing damage to a company or a product’s reputation without an opportunity for manufacturers to provide an effective, timely response. Samuels summarized:

The existing database procedures do not comport with the original intent of the CPSIA which is that reports should only be posted from those who are harmed, their family or representatives or actual public safety agencies. Nor do the CPSC procedures require resolution of well-founded claims of material inaccuracy before reports are posted or require sufficient information such that manufacturers can respond to and evaluate the reports. The draft legislation resolution goes a long way to resolve these issues.

The legislation’s tightening of the definitions of who may report on the database will improve and focus the database while retaining the important roles of consumer groups, trial attorneys, and industry representatives on CPSC matters. The legislation’s requirements for resolution of claims of material inaccuracy before posting on the internet will add quality and fairness to the database, and the procedure for ascertaining specific models will enhance the value of the program to consumers, manufacturers and CPSC.

A database full of bad information does not serve the interests of consumers or manufacturers.

The House Energy and Commerce Subcommittee on Commerce, Manufacturing, and Trade held a hearing Thursday on the much-needed draft bill to revise the Consumer Product Safety Improvement Act, the 2008 law that has rolled a wrecking ball through businesses as diverse as motorcycle and bicycle manufacturers, bookstores, the fashion industry, ball-point pen companies, thrift stores, and home-based toy- and doll-makers.

The committee’s background memo lays out the provisions of the draft bill. Subcommittee Chairman Mary Bono Mack discussed the legislation’s goals in her opening statement. Excerpt:

The discussion draft aims to reduce the regulatory burdens of the law without undercutting consumer protection. A fundamental premise is that the Commission can actually protect consumers far better when it is allowed to set priorities and regulate based on risk. Where possible, we should spare the Commission from having to make time-consuming, case-by-case determinations, and let it spend more time on bigger problems. This is especially true in our current budget climate, where we have to make the most of scarce agency resources.

That emphasis on risk-based analysis is very important. The current CPSIA has forced the Consumer Product Safety Commission to enforce regulations on lead content, for example, that have no relation to risk — that is, no risk to consumer safety — causing the CPSC to misallocate personnel and resources that could be more effectively used in other areas.

It was gratifying to hear Robert Jay Howell, the CPSC’s assistant executive director on hazard identification and reduction, endorse the risk-based approach toward regulation during Q&A. (Although, as he made clear in his prepared statement, he was testifying in his personal capacity.)

From the House Energy and Commerce Committee:

Discussion Draft of H.R. ___, a bill that would revise the Consumer Product Safety Improvement Act

April 7, 2011

The Subcommittee on Commerce, Manufacturing, and Trade will hold a hearing on Thursday, April 7, 2011, at 9:00 a.m. in 2123 Rayburn House Office Building.  This will be a legislative hearing on the Discussion Draft of H.R. ___, a bill that would revise the Consumer Product Safety Improvement Act.  Witnesses to be announced.

Click here to view text of discussion draft.

And from AutoBlog, “U.S. Senate introduces amendment to keep youth motorbikes legal“:

In February 2009, it became illegal to sell children’s motorbikes in the United States. The reason? The amount of lead they contained exceeded the maximum allowance established by the Consumer Product Safety Improvement Act of 2008 (CPSIA). This law wasn’t aimed at the motorcycle industry and its youth products, but they became caught up in the issue.

Shortly thereafter, policymakers and the motorcycle industry came to a temporary agreement that put a stay of enforcement in place through the end of 2011. This workaround bought motorbike manufacturers and Capitol Hill extra time so that they could come up with a more elegant solution.

Now, that potential solution has been introduced to the floor in the form of Senate Amendment 264. Co-sponsored by Senators Amy Klobuchar (D – MN) and John Tester (D – MT), SA 264 would amend CPSIA to exclude youth off-highway vehicles from the lead law provisions.

More from the American Motorcyclist Association, “Senate Lead Ban Amendment Introduced.”

The House Appropriations Subcommittee on Financial and General Government on Thursday held a budget hearing on the Consumer Product Safety Commission, with testimony from CPSC Chairman Inez Tenenbaum and Commissioner Anne Northup.

Commissioner Northup’s statement highlights all the problems that can occur when regulatory agencies abandon risk-based analysis, forced in this case by the Consumer Product Safety Improvement Act. Very good statement:

In both 2009 and 2010, the CPSC focused its time and resources principally on implementing the CPSIA. Although the Commission is a relatively small agency (FY 2010 funding of $118.2 million), its budget has grown by nearly 48 percent since the law’s passage in 2008, with both old and new resources shifted away from risk-based priorities to implement the arbitrary, non risk-based mandates of the CPSIA, including the lead content and phthalates bans, the Public Database, and the third-party testing, certification and labeling requirements. Over the past two and one-half years, the Commission has issued an estimated 3,500 pages of regulations and guidance documents as a result of the CPSIA—a large portion of which must be read and understood by every affected company in order for them to grasp the law’s complex requirements.

The diversion of the Commission’s resources to CPSIA implementation reduces our focus on genuine safety hazards. Our agency is charged with “protecting the public from unreasonable risks of serious injury or death” from consumer products—but we cannot fulfill this mission if our time is spent primarily enforcing the CPSIA, including its non-risk-based lead content and testing requirements.

The House Energy and Commerce Committee this morning released a discussion draft of legislation to amend the Consumer Product Safety Improvement Act. Congress passed the CPSIA in 2008 with overwhelming support only to discover that the law’s ham-handed approach to regulating children’s products did enormous damage to businesses and consumers alike, driving ATVs and kids bikes off the market, pre-1985 children’s books out libraries, warm jackets out of thrift stores and small craftspeople — like knitters and hand-made toy manufacturers — out of business.

Grossly expensive testing requirements also increase costs of manufactured goods to consumers with no discernible safety benefits.

In many cases, the Consumer Product Safety Commission sought to minimize the harm of the law’s overreach by granting stays of enforcement. However, the CPSC’s discretion is limited by the clear — if unreasonable — language of the statute. It’s up to Congress to reform and repair the law.

(In one prominent case, however, the CPSC far exceeded its authority, developing a product safety complaint database with loosey-goosey reporting standards that invite the filing of false and inaccurate complaints. Trial lawyers and their “consumer activist” allies are delighted, but the CPSC’s overreach puts companies’ reputation at risk. We’re glad to see the draft bill include a section that could correct the CPSC’s bad decision.)

Two entire years, 2009 and 2010, passed without Congress doing much of anything to fix the Consumer Product Safety Improvement Act, despite the law’s many, serious excesses. Jobs were destroyed for no good reason, yet the 111th Congress failed to act.

It’s still early, but the draft legislation from the Energy and Commerce Committee represents the most significant progress made to improve the CPSIA. With a legislative vehicle to work on, the House can move forward with hearings and intensive work with industry groups and individuals affected by the law’s excesses. (continue reading…)

The Consumer Product Safety Commission is scheduled to take its product safety complaint database online Friday, doing a real disservice to consumers who want accurate information and to companies that will have their reputations harmed by false, inaccurate and even malign reports about their products.

CPSC promotes its database

The National Association of Manufacturers this week filed a petition for reconsideration of the final rule implementing the database under the Consumer Product Safety Improvement Act (CPSIA). The NAM also requested an extension of the CPSC’s “soft launch” for three months to prevent the database from going “live” before fixing a number of administrative and policy challenges yet to be resolved. (NAM letter.)

We’ve seen many claims that the test phase of the database produced few of the false complaints that the manufacturers and others have been so concerned about. The advocates for the regulatory state at OMB Watch, for example, reported:

Manufacturers and business associations like the National Association of Manufacturers have targeted the database for fear that inaccurate data will be reported by consumers and, as a result, profits could be hurt. In CPSC’s testing of the site during the soft launch, however, “of the 900 complaints that were logged, four were determined to be inaccurate,” according to a March 3 BNA article (subscription required).

Curse you, business owners, for caring about profits!

This isn’t the full story, but even if it were, that’s four wrong complaints that could harm a company or product’s reputation. Multiply the number of complaints tens of thousands of times once the database starts operating, and the 0.44 percent inaccuracy rate starts to look seriously damaging. (We can also speculate about the trial lawyers and “consumer activists” holding back submissions during the trial run, waiting for the database to get up and running before salting it with inflammatory reports.)

Worse, NAM and its members have identified six serious problems with the database that would make it a font of bad information, the erratabase we write about. Consider this one:

Manufacturers, importers or private labelers have indicated that they have received reports of harm identifying an incident as involving their product that did not in fact involve their product, so were materially inaccurate, and advised CPSC of this fact. They have not received return affirmative confirmation that CPSC staff will not post such false claims in the database. CPSC staffers have indicated they may not possess the resources to adequately scrub the database to avoid posting upon such notification. This is contrary to the express direction of Congress that materially inaccurate information with the potential for irreparable reputational harm be vetted prior to posting.

Rep. Mike Pompeo (R-KS) won passage of an amendment in H.R. 1, the continuing resolution, to block funding for the database until Congress had conducted a thorough review. (See Shopfloor, “CPSC Erratabase and the Interests of Trial Lawyers.“) The amendment has brought Pompeo the expected obloquy from the left, and Sen. Jay Rockefeller (D-WV), chairman of the Senate Commerce Committee, issued a news release denouncing it. (continue reading…)

It appears the Consumer Product Safety Commission’s product safety complaint database could actually kick into operation this month, inviting attacks against manufacturers and confusion for consumers encountering false reports.

The two-week spending resolution passed by the U.S. House on Tuesday, H.J. Res. 44, omits the many amendments to block funding for Executive Branch programs previously approved in H.R 1, the 2011 continuing appropriations bill. That means that the amendment sponsored by Rep. Mike Pompeo (R-KS) to block funding for the CPSC database until Congress further examines it  — which the House approved by a vote of 234-187 — will not go into effect before the database does on March 11.

A Washington Times editorial today identified the dangers behind the potential manipulation of the database and who stands to benefit. From “Leash law for lawyers“:

On March 11, the CPSC is set to launch a new online database publishing thousands of outside complaints about allegedly unsafe products. These attacks would be publicized before any investigation and without independent evidence that complaints are legitimate. It’s an open invitation for competitors or interest groups to destroy a product’s reputation – and sales – without proof. It’s also a major come-on to trial lawyers eager to file class-action suits. Attorneys could tell juries that publication on an official government website is evidence that allegations have weight.

Even without this new database, it’s too easy to force products off the market. Previous bogus consumer scares – such as worries about the chemical Alar on apples and the purportedly cancer-causing properties of silicone breast implants – show the dangers of letting unsubstantiated allegations gain premature credibility. The CPSC database would add to the mischief trial lawyers could cause with spurious lawsuits.

Rep. Pompeo’s CPSC funding amendment fits well with the 112th Congress’ priority of job creation. It should be obvious that manufacturers under attack by trial lawyers exploiting bogus product complaints are less likely to hire new employees.

Rep. Pompeo’s floor statement and the House debate on the amendment are here. For the National Association of Manfacturers’ further views on the database, see this post.

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From The Washington Post, “Publicly accessible product safety database hits House roadblock“:

As part of the spending bill that passed the House on Feb. 19, Rep. Mike Pompeo (R-Kan.) won support for a measure to withhold money to implement the system, which is set to launch March 11. The database, which was welcomed by consumer advocates, would make public thousands of complaints received by the Consumer Product Safety Commission each year about safety problems with products, from table lamps to baby strollers.

Pompeo, backed by groups representing manufacturers, said the database would be filled with fictitious or inaccurate claims and place new financial burdens on U.S. businesses.

“This will drive jobs overseas,” Pompeo said during floor debate on his amendment. “It will increase the cost for manufacturers and consumers.”

We’ve uploaded Pompeo’s floor statement and the debate on the amendment here. For the National Association of Manfacturers’ views on the database, see this post.

The New York Times, the most irresponsible media outlet in uncritically cheering on the Consumer Product Safety Improvement Act, fumed editorialy about manufacturers’ objections, claiming, “The concern about frivolous lawsuits is a predictable canard. The database was designed with safeguards to avoid bogus claims and keep lawyers from trawling for clients.” Right, because no trial lawyer would ever gin up bogus product complaints to shake down manufacturers.

And even if Congress intended the database to operate with safeguards, the Consumer Product Safety Commission ignored congressional intent and instead wrote a rule favored by the (often indistinguishable) litigation interests and “consumer advocates.” As CPSC Commissioner Anne Northup testified in the House recently:
(continue reading…)