Politico, “Next front: Selling what Congress did:

Starting Monday, a coalition of progressive groups — from labor unions to health care advocates — will sink millions of dollars into television advertising and sponsor grass-roots events in swing House districts thanking Democrats for passing the law and highlighting its importance for average Americans.

“We’re going to let our friends know we are going to be there for them,” said AFSCME President Gerald McEntee. “We expect in three months, the American people will understand the bill and they will be happy and satisfied with it.”

More on Rep. Henry Waxman demanding companies explain their accounting charges for health care, from Andy McCarthy, a former U.S. prosecutor, at National Review’s The Corner, “Thugocracy Whipsaws Capitalism“:

I worked for many years in the U.S. Attorney’s Office in whose backyard was Wall Street.

If a company like AT&T failed to make a legally mandated restatement of its financial position while continuing to participate in the capital markets, it would be investigated and the responsible management officials would likely find themselves prosecuted while the SEC, concurrently, went after the company and its officials in civil enforcement suits. There are prosecutors and investigators who would salivate at the prospect of doing such a career-making case.

If we are now under a system where disclosure gets you a public whipping and other threats by the Powers That Be while nondisclosure promises the ruinous expenses of defending against criminal investigations and civil enforcement, this is no longer anything but a thugocracy.

If history is any guide, we’ll soon see inventive class action lawyers join in the harassment, suing companies that make the accounting charges.

Chairman Henry Waxman (D-CA) of the House Energy and Commerce Committee is calling major corporate executives to a hearing to challenge the accounting charges their companies have made in response to passage of the health care legislation. (Bloomberg, “AT&T, Deere CEOs Called by Waxman to Back Up Health-Bill Costs.”)

From the committee’s homepage:

The Subcommittee on Oversight and Investigations will hold a hearing on April 21, 2010, regarding claims by Caterpillar, Verizon, and Deere that provisions in the new health care reform law could adversely affect their company’s ability to provide health insurance to their employees. These assertions appear to conflict with independent analyses, which show that the new law will expand coverage and bring down costs.

They’re not “claims,” they are financial and accounting decisions the companies are required by law to make and report. President John Engler of the National Association of Manufacturers addressed the company charges in an interview with Fox News’ Neil Cavuto Friday. Engler:

There was a suggestion, “Oh, these companies are overstating this, they’re making it up.” But, remember, the CEO and the CFO sign …under Sarbanes-Oxley under penalty of law the accuracy of the statements. They cannot make this up. Cannot!

The Administration originally tried to spin the charges as hyped or “irresponsible,” but the White House has obviously decided to change its approach. White House economic advisor Valerie Jarrett was just on ABC’s “This Week,” and she responded to the questions about the company charges as serious ones warranting a serious response.

Jarrett argued the companies will benefit more in the big picture, long run, from the health care legislation even with the charge offs. And, she continued, the White House has talked to the Business Roundtable during the drafting of the health care legislation, and agreed with the group’s request to delay parts of the law’s effects until 2013. So the White House now, after a little hemming and hawing, clearly regards the companies’ actions and businesses’ objections as legitimate.

If there’s anything that’s suspect, it’s the always hyperpoliticized accusations of the Oversight and Investigations panel. As The Wall Street Journal editorialized Saturday in “The ObamaCare Writedown“:

Black-letter financial accounting rules require that corporations immediately restate their earnings to reflect the present value of their long-term health liabilities, including a higher tax burden. Should these companies have played chicken with the Securities and Exchange Commission to avoid this politically inconvenient reality? Democrats don’t like what their bill is doing in the real world, so they now want to intimidate CEOs into keeping quiet.

It’s been a while since we’ve blogged about the unnecessary and extraordinary harm done by the Consumer Product Safety Improvement Act, the 2008 legislation that has driven safe products off the market, effectively banned pre-1985 children’s books, and forced thrift stores to remove toys and winter coats from their shelves.

Hugh Hewitt, in his interview with NAM President John Engler Tuesday, reminds us of the CPSIA’s swath of economic damage, even as the radio host makes a broader point. From the transcript:

HH: Now this brings me to the key question, Governor, because a couple of my law partners, Gary Wolensky and Liz McNulty do a lot of time advising companies about the Consumer Product Safety Improvement Act, I know how botched up that is. I know how it’s ruined manufacturing and destroyed competitiveness, et cetera. A lot of people like me don’t really trust Congress to do any of this well. If they can’t handle something as simple as lead levels and phthalate levels in products, how could they possibly get this right?

Good question. A powerful enemy of economic recovery is uncertainty, the doubts of businesses, investors and the public about government’s intentions. If you’ve followed the impact of the CPSIA — a bill passed with overwhelming Congressional support — then it’s reasonable to fear much larger legislative adventures like health care reform or government control of carbon dioxide.

At least the excesses of the CPSIA have finally — finally! — created a consensus that Congress must act. The Consumer Product Safety Commission on January 15 sent a report to Congress about the law’s implementation, a communication that included a call for a legislative action that embraced. (Congress had requested the commission’s recommendations in the conference report on the CPSC’s appropriations bill, included in the DOT spending bill.)

(continue reading…)

Twenty-seven trade associations yesterday sent a letter to the House Energy and Commerce Committee’s chairman, Rep. Henry Waxman (D-CA), and ranking member, Rep. Joe Barton (R-TX), expressing strong disagreement with provisions of H.R. 2868, the Chemical Facility Anti-Terrorism Act of 2009. (Waxman is a cosponsor.)

The National Association of Manufacturers was one of the signers of the letter, which is available here. The letter was sent in anticipation of Thursday’s subcommittee hearing on the bill.

The context is this:

Our industries recognize and take seriously the need to protect our nation’s chemical plants, storage facilities, and infrastructure against security threats and potential terrorist attacks. Since 2006, businesses have spent approximately $4 billion to enhance the security of our own chemical facilities and systems. Given the importance of these safety issues, we generally have supported the federal government’s efforts to develop and implement reasonable risk-based and performance-oriented security standards that focus on facilities posing the greatest risk to our workers, communities, and national security interests. To that end, we have worked constructively with the U.S. Department of Homeland Security (DHS) in providing valuable input for the Chemical Facility Anti-Terrorism Standards (CFATS) program and are actively working to implement these new standards.

But there are provisions that are actually detrimental to effective security, complicating the implementation of safety measures and adding major new liabilities (that is, costs).

First, Section 2109 is anti-preemption language, meaning it allows states and local governments to create more stringent — or different — standards than federal law. This is a proposed anti-terrorism statute, in great part, so a single national standard should apply; uniformity brings predictable rules, enforcement and costs.  (The letter doesn’t raise this specter, but history suggests we’d also see grandstanding politicians ginning up public fears for political gain.)

Second, the bill’s “citizen suit” provision (Section 2116), allows any person – even those who have not suffered any harm – to sue the facilities or the Department of Homeland Security to enforce the law. As the letter states, allowing laypersons rather than DHS security specialists to challenge a facility’s selection of security measures does nothing to enhance security. There’s also the real possibility that the discovery process in federal litigation could lead to the disclosure of classified or sensitive information to terrorists. Previous versions of the bill have never had this provision: Why is it being added now?

And, “Finally, we strongly oppose the bill’s provision (Section 2111) requiring all covered chemical facilities to assess so-called “inherently safer technologies” (ISTs) and mandating that chemical facilities assigned to “tier 1” or “tier 2” actually implement ISTs, if so ordered by DHS. This provision essentially provides DHS the authority to implement manufacturing process changes, an action that is unnecessary and potentially very disruptive to many chemical facilities.”

The associations are reaffirming the points that the NAM made in a September 11 letter to the committee (available here). Other coverage:

• Oil & Gas Journal, “Business groups ask House panel to modify chemical plant bill,” noting opposition from seven oil and gas industry association.
• Congress Daily, “House Panel Becomes Flash Point For Chemical Bill.”
• Point of Law, “Chemical facility security not aided by ‘citizen suits’“

Earlier Shopfloor.org posts.

Twice this year President Obama has traveled to Elkhart County, Ind., to promote his economic policies, first to the city of Elkhart on February 9 and then the nearby community of Wakarusa on August 5. Northeastern Indiana makes for a good backdrop for speeches on the economy since Elkhart County has 16 percent unemployment, worst in the state.

The region has been especially hard hit because it’s the nation’s center of travel trailer manufacturing, with several major companies doing business there. High fuel prices followed by tight credit and then the recession have just hammered the industry.

With all due respect for the President’s policies, the area just got excellent news on the economic front last week from the U.S. court system. On September 24, a jury in the U.S. District Court, Eastern District of Louisiana, rejected the first of at least 30 lawsuits against trailer manufacturers who sold their products to FEMA in the wake of Hurricane Katrina.

From The Associated Press:

NEW ORLEANS (AP) — A federal jury on Thursday rejected a New Orleans family’s claims that the government-issued trailer they lived in after Hurricane Katrina was defective and exposed them to dangerous [formaldehyde] fumes.

The jury decided that a trailer made by Gulf Stream Coach Inc. and occupied after the 2005 hurricane by Alana Alexander and her son, Christopher Cooper, 12, was not “unreasonably dangerous” in its construction.

The jury also concluded that Fluor Enterprises, which had a contract to install trailers for the Federal Emergency Management Agency, was not negligent in doing so. The government was not a defendant in this first of several “bellwether” trials.

Last year the House Oversight and Investigations Committee, then chaired by Rep. Henry Waxman (D-CA), held a hearing to drag the trailer manufacturers into the mud for supposedly dangerous manufacturing practices — charges the manufacturers have always forcefully rejected. The hearing built upon already one-sided media coverage that also served the interests of the trial lawyers suing the businesses.

This is just one jury verdict, but the message must be very, very encouraging to the people of Elkhart County, and especially those involved in the trailer industry: The companies built safe products that met consumers’ demand, and when responding to the Katrina disaster, they maintained their high standards.

Now that would be a good topic for a nationally televised speech.

Note: The RV trade industry publication/website “RV Business” did a thorough job covering the trial, and kudos to them.

• “Jury Clears Gulf Stream Coach in FEMA Trailer Case” (Sept. 25)
• “Federal Jury Deliberating Gulf Stream Coach Fate” (Sept. 24)
• “FEMA Suspected Sierra Club Bias in Gulf Stream Matter” (Sept. 23)
• “Gulf Stream Coach Inc. Trial Ends First Week” (Sept. 21)
• “Witness: Welding Fumes Caused FEMA Trailer Illness”(Sept. 17)
• “Lawyers Present Cases in First Day of FEMA Trial” (Sept. 15)
• “First Trial on FEMA Trailer Suit Starts Today” (Sept. 14)

Walter Olson of the Manhattan Institute summarizes the many deleterious affects of the Consumer Product Safety Improvement Act in the prime editorial spot, the Wall Street Journal’s opinion pages. The news peg is last Thursday’s hearing by a subcommittee of the House Energy and Commerce committee, where only Inez Tenenbaum, chairman of the Consumer Product Safety Commission, was invited to testify.

From “A Destructive Toy Story Made in Washington“:

This law has saddled businesses with billions of dollars in losses on T-shirts, bath toys and other items that were lawful to sell one day and unlawful the next. It has induced thrift and secondhand stores to trash mountains of outgrown blue jeans, bicycles and board games for fear there might be trivial, harmless—but suddenly illegal—quantities of lead in their zippers and valves or phthalates in their plastic spinners. (Phthalates are substances that add flexibility to plastic.) Even classic children’s books are at risk: Because lead was not definitively removed from printing inks until 1985, the CPSC has advised that only kids’ books printed after that date should be considered safe to resell.

Olson also follows up on the underreported angle of the law’s depredations, the product label requirements.

(The) law’s latest shock hit businesses on Aug. 14. That’s when the law’s tracking-label mandate went into effect, requiring that makers of childrens’ goods “place permanent, distinguishing marks on the product and its packaging, to the extent practicable.” The idea is to facilitate recalls and make it easier to trace safety problems. The result will be to capsize yet more small businesses.

In an opening statement at the committee hearing, Chairman Henry Waxman (D-CA) could only bring himself to say that implementation of the CPSIA had been “uneven”:

Now that we are a year away from the recalls, and the most dramatic stories have left the front pages, some suggest that we didn’t really need to enact such a strong law. But the fact remains that the system we had in place was a failure. This law was necessary to protect kids and families across the country.

To retreat now from the proven consumer protections achieved under this law would be a huge mistake.

Is there any wonder that the public is suspicious of other major “reforms” a la health care? In the case of the CPSIA, we have members of Congress and their allies among the “consumer activists” who are so ideologically attached to the legislation that they refuse to countenance any changes to fix the law’s overrreach or to save businesses.

From the House Energy and Commerce Committee:

Consumer Product Safety Commission Oversight: Current Issues and a Vision for the Future
Publications
Friday, 04 September 2009 12:52

The Subcommittee on Commerce, Trade, and Consumer Protection will hold a hearing titled, “Consumer Product Safety Commission Oversight: Current Issues and a Vision for the Future” on Thursday, September 10, 2009, in 2322 Rayburn House Office Building.

INVITED WITNESS:

* The Honorable Inez Moore Tenenbaum, Chairman, Consumer Product Safety Commission

The Consumer Product Safety Improvement Act became law on August 14, 2008, and this is the first hearing on the law from a committee of jurisdiction.

Many of the individuals, groups and industries who have been severely harmed by the CPSIA are furious at the hearing being limited to just one witness, Chairman Tenenbaum, believing the lack of business and especially small business testimony will frustrate an open discussion of the law’s excesses.

Here’s the American Motorcyclist Association: “Congressional hearing set for Thursday to get information on the law that bans the sale of dirtbikes and ATVs for kids”

And a letter from the Handmade Toy Alliance.

The Washington Times editorialized today, chiding Chairman Henry Waxman (D-CA), who has repeatedly rejected an open debate of the law’s deleterious impact on manufacturers and consumers. From “Waxman stifles dissent.”

On Sept. 8, the two congressmen wrote to the chairman again: “We are concerned, however, that a hearing presenting only the opinions of Chairman Tenenbaum, without a second panel of witnesses representing family-owned retailers, tribal stores, toymakers and other affected parties, is very unlikely to cover the surprising and distressing practical problems that have arisen in connection with the implementation of the new law.”

Mr. Waxman never responded to that letter. “The Energy and Commerce Committee is aware of the letter and is taking the request under consideration,” a committee spokesman e-mailed The Washington Times yesterday.

Somehow, we doubt an invitation to outside parties will be issued by the meeting’s 10 a.m. start. A follow-up hearing is warranted. As the old expression goes, the committee ought to “get the lead out” by holding that hearing soon.

We’re a bit more optimistic about there being a worthwhile discussion of the issues today, but if Congress is going to pass laws that cause such harmful unintended consequences, it should hear from the people.

UPDATE (1:30 p.m.): More than 100 small businesses sent letters to the committee, an effort organized by Rick Woldenberg and the Alliance for Children’s Product Safety. From the news release:

Whether or not the Subcommittee wants to hear about it, the evidence to date demonstrates that the CPSIA has created chaos and losses for businesses, limiting choices for consumers and creating bureaucratic nightmare for companies trying to comply with the law – all without improving product safety. It’s time for Congress to fix this law.

President Obama’s political arm, Organizing for America — a “project” of the DNC — is hosting a National Health Care Forum with the President this afternoon to rally the activist troops. The AFL-CIO is among the organizers of a Capitol Hill rally in conjunction with the campaign for health care campaigns.

The public option remains this week’s focal point of debate.

The Washington Post editorializes in “No Longer an Option“: “[The] reality is that, if the Obama administration wants to get health reform done, it’s going to have to back away from the public option sooner or later — and it’s getting awfully late.”

At Kausfiles, “Thinking Through the ‘Public Option’,” Mickey Kaus explores the arguments for the public option as a cost-savings measure versus the public option as as a mechanism to ensure personal security for individuals: “At bottom, there clearly still seems to be an uneasy, ongoing tension between a public plan’s cost-cutting purpose and it’s security-for-those-who-get-sick purpose. Hard to see how it can do 100% of both at the same time.”

Well, what about co-ops? Or coops? Or coöps? You know, cooperatives. Like rural electric cooperatives, or the Berkeley Food Co-Op, or Cenex (the Farmer’s Union gas stations/convenience stores in the Great Plains). Cooperatives!

The Huffington Post’s political writer, Jason Linkins, at The Huffington Post sarcastically assesses the media’s coverage and policy discussions of the co-option in “Health Care Co-Op Supporters Don’t Know What They’re Talking About”: “In the case of co-ops, the discussion has been even more inane than usual because nobody seems able to consistently describe what a “health care co-op” is. This does not dissuade the media, however. They’re perfectly happy allowing a bunch of idiots talk about how magical (or how destructive) co-ops are based purely on the totally screwed-up political calculus.”

Or more factually put, here’s Heritage’s take, “Morning Bell: Public Option Is Not Dead Yet”:

Co-operatives do have a long and proud tradition in many sectors of the U.S. economy, but details matter. Conrad says these health co-ops will not be “government-run and government-controlled” but instead “membership-run and membership controlled.” But others in Conrad’s caucus have a starkly different co-op goal. Sen. Chuck Schumer (D-NY) is pushing a vision of co-ops that are: 1) run by the government, preferably the federal government; 2) funded or subsidized by the government; or 3) includes plans chosen by the government.

If the language that comes out of the Senate looks anything like what Schumer is proposing, then there is no real difference between co-ops and the public plan. If, on the other hand, the Senate produces something that; 1) is not funded by the federal government 2) is not “government-run and government-controlled”; but instead 3) is “membership-run and membership controlled” then co-ops would be acceptable.

But does it really matter? Any of these varieties of coops would likely wind up government controlled, that is, regulated and prescribed and monitored and mau-maued into submission to statism.

From CQ Politics, “House Dems Blitz Insurers With Demands for Data on Profits, Perks“:

Three key Democrats on the House Energy and Commerce Committee have launched a barrage of letters targeting dozens of insurers with requests for information on salaries, board compensation, entertainment expenses and profits in what industry sources describe as an attempt at intimidation.

An Aug. 17 letter to 52 insurers from Reps. Henry A. Waxman of California and Bart Stupak of Michigan seeks information on executive salaries, bonuses, stock options, company perks, amounts spent on entertainment and company retreats, and sums spent on board compensation. It asks for four years’ worth of data on company and product line profits, payouts for claims and administrative expenses, and premium revenues.

See, this model ostensibly continues private insurance but effectively renders it the government-run public option, in this case government being Henry Waxman.

Writing at Law.com’s Legal Blog Watch, Robert J. Ambrogi finds himself unimpressed with the American Association for Justice’s excuses for not opening its summer convention in San Francisco to the media. From “The AAJ’s Misguided Media Ban“:

Ray De Lorenzi, the AAJ’s associate director of communications, said the event was open only to members of the national plaintiff-lawyers’ group, according to Legal Newsline. “No media have ever been allowed at our conventions,” he said. “This is for members only.”

Unfortunately for Mr. De Lorenzi, it is simply not true to say that media have never been allowed at AAJ’s conventions. I can say that unequivocally because I attended a number of the organization’s conventions as a credentialed member of the news media and also arranged for other reporters at my publications to attend. On more than one occasion, I conducted face-to-face interviews with the association’s president during the annual convention, usually with the organization’s director of media relations sitting in, so I have no doubt they knew I was there.

Ambrogi suggests the AAJ is making a PR mistake by hiding itself away. Seems to us they’ve actually succeeded in their goals of controlling the message. Here are several stories and blog posts on health care lobbying:

• Washington Post, Daily Dose, July 21, “Lobbyists Spend Millions to Influence Health Care“
• CQ Politics, Trail Mix, July 21, “Here Come the Lobbyists“
• Salt Lake Tribune, July 27, “Industry lobbying intensifies alongside health reform debate“
• National Journal, Rules of the Game, July 27, “Health Care Industry Unleashing Big Money“

The lobbying efforts of the American Association for Justice are not mentioned once in any of these articles. Apparently if you’re the special interest of the plaintiffs’ bar, you can escape stories about health-care lobbying just by keeping your head down and banning reporters from the AAJ convention addresses of Speaker of the House Nancy Pelosi or Energy and Commerce Chairman Henry Waxman.

On July 17th we posted at the Point of Law blog a list of the health-care provisions the AAJ lobbied on in the second quarter of 2009 – a period in which the AAJ reported $1.15 million in lobbying expenditures. We’ll just cut and paste the list below. (continue reading…)

• Today’s Washington Post, page A19, a story on the Speaker of the House and health care legislation, “Pelosi Puts Onus on Industry,” with the subhed, “Deals Aside, She Says, Hospital and Drug Firms Can Do More.”

• From the American Association for Justice’s summer convention brochure, the schedule for Saturday, July 25:

• On page 16, American Association for Justice’s 2nd Quarter 2009 House lobbying disclosure report, a list of the health care provisions and legislation the AAJ lobbied on. The disclosure category is “torts,” and the unifying theme is the trial lawyers’ opposition to any limits on legal liability.

Our point, which we’ve made before, is that the influence of the American Association for Justice, trial lawyers and their campaign contributions has escaped the journalistic examination given to industries like pharmaceuticals, hospitals and doctors.

As has the fact that Speaker of the House Nancy Pelosi, a pivotal figure in Congress’ health care debate, is speaking Saturday to thousands of the litigation industry’s members. Indeed, the AAJ convention in San Francisco features other prominent elected officials, including House Energy and Commerce Chairman Henry Waxman (speaking at a PAC fundraising event) and DNC Chairman Tim Kaine, governor of Virginia. These people will shape any health care law that Congress enacts, and they’re speaking in front of thousands of lawyers with a pecuniary interest in the outcome. But, so far….next to nothing.

It’s a conspicuous oversight by the media and a gaping hole in the national debate over whether to restructure the U.S. health care system.