The Impact of the Consumer Product Safety Improvement Act of 2008

Hugh Hewitt has an article at The Politico today that outlines how the Consumers Product Safety Improvement Act of 2008 is devastating small and medium manufacturers all over this country, yet the Democrats are doing nothing about it. This bill requires that all products that come into contact with children under the age of 12 be certified as being lead and phthalate free. I know that sounds good on its face, but for manufacturers both small and large to be in compliance, they have to test every piece of material that is used to produce their final product, a cost that could run into the tens of thousands of dollars in some cases.  This law was created in response to all the toys coming in from China that were riddled with lead; however, this law is devastating American toy manufacturers:

Then Congress ordered all untested goods off the shelves by Feb. 19 and imposed criminal penalties for noncompliance. And, for good measure, it allowed for private plaintiffs’ attorneys to bring lawsuits. Finally, the understaffed and overwhelmed Consumer Product Safety Commission was assigned to enforce the law.

The result has been chaos — wildly expensive, job-killing chaos — but of a nearly invisible type.

After I learned of the law’s devastating sweep — encompassing disparate products ranging from all-terrain vehicles to teething rings, baseball gloves to fishing lures — as well as the huge toll it exacted on thrift shops and small manufacturers marketing on the Web, I began to investigate more closely.

I have conducted two radio interviews with Gary Wolensky, a lawyer who represents many different major manufacturers who are struggling to comply. (The podcasts of those interviews are here and here.)

On Monday, I interviewed Sen. Jim DeMint (R-S.C.), who is trying to get his colleagues to vote for a one-year extension of the law’s effective dates to prevent the destruction of what might become a billion dollars’ worth of wasted — and very safe — inventory. (The transcript of that interview is here.) And on my blog, I began to link to accounts from across the country of the awful cost of the unintended consequences of CPSIA’s rollout, as noted in Minneapolis’ Star Tribune on Sunday.

Hugh mentions in a post at his blog that Amazon announced that it will no longer carry 2,500 children’s products because they don’t meet the new certification standards even though there was nothing to indicate there was anything wrong with them, to begin with.

Also, this law affects families whose kids enjoy motocross and ATV’s because it is now illegal to sell all youth motorcycles and ATV’s in the United States. Unfortunately, due to the way the bill was written, there’s virtually no wiggle room:

Normally, we assess risks and exposure,” [ Joe Martyak, CPSC’s acting director of public affairs] continues. “But the law is so narrow we can’t do much in this case. We were up there [on Capitol Hill] last year and explained this to Congressional staffs, and now we’ve got senators contacting us, asking us to be practical and use some common-sense. But our hands are tied pretty tightly because of the language.

In other words, Congress is trying to pass the buck on the very law they wrote.

Republican Senator Jim DeMint of South Carolina is trying to get the effective dates for the law extended by one year so as to “prevent the destruction of what might become a billion dollars’ worth of wasted — and very safe — inventory.” Unfortunately, he doesn’t appear to be getting any traction.  Even this may not help the youth motorcycle and ATV industry. In that case, they need an exception.

This whole thing reminds me of the stupid luxury tax that Democrats created and convinced former president George H.W. Bush to sign, resulting in his shirking of his “no new taxes” pledge. That tax decimated the luxury car and yacht industry resulting in thousands of layoffs.  The law was such a disaster, in fact, that Congress repealed it the following year.

Will Congress have to be embarrassed again by another foolish and short-sighted law before it repeals it or at least changes it so it doesn’t devastate US businesses and its employees? Don’t wait and see. Call your representatives and senators.

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