Definition of “Children’s Product:” Whether you’re in, might be in, or still confused...Welcome to the black hole of CPSIA regulation!

Today, the Commission had a golden opportunity to put a fence around those products definitely covered by the CPSIA as well as exclude those products which we know pose no risk and which do not HAVE TO fall under the statute. The comments received by the public on this proposed interpretive rule defining “children’s product” by and large asked for just this type of clarity. They also made the case for how a number of everyday, safe products could be reasonably excluded from the requirements of the CPSIA—given, of course, that the law has nothing to do with risk.

But instead, the Commission went in the opposite direction, adding in more products than required and adding products even beyond what was first proposed to the public.

The consequences for whether a product is “in” or “out” of the definition are tremendous: if you’re in, you must pay to have your product (every piece of it) third-party tested, certified, and have a tracking label—which has led many small businesses to leave the children’s market or simply close their doors. Oh, and if you make a product for ages in the grey area (age 10, 11, 12….and older) and really needed this rule to let you know where you stand, you may just now be realizing that the final answer is “it depends!” –which means, somebody out there (i.e., the CPSC, a state attorney general, a retailer) may consider your product a children’s product. Manufacturers of furniture, clothing, or products made for the “tween” years may be learning for the first time that they’re even subject to the law’s non-risk-based lead-content standards.

So much for trying to reduce unnecessary government regulation, protect jobs, and preserve choices for consumers—so much for common sense.

Click here for my official statement on the Final Interpretive Rule: Interpretation of a Children’s Product

ALSO: Read the AP story and New York Times Front Page story covering this issue

Here It Is: Popular Toys Parents Can No Longer Buy for their Children Because of the CPSIA…

For some time now, we have been worried about the impact of the CPSIA on jobs, cost and fewer choices. We worry about the number of businesses leaving the children’s product market, the increased costs of new testing requirements that are completely unrelated to risk, and global companies that simply stop selling in the United States because the costs are too high. Now you can see for yourself right off of this company’s website: popular toys that are no longer available to parents in the U.S. due to the CPSIA.

Endangered and Extinct Toys

Summer reading:

Thought you might find this editorial in The Washington Times regarding excessive regulation interesting.  The author got it exactly right. Excessive regulations kill jobs.  I have seen it first hand: some businesses just leave the market, small businesses struggle to comply and new startups will never be able to enter our market.  So sad.

EDITORIAL: The red tape stimulus

New costs, no common sense

Even though the safety considerations for mattresses, clothing textiles, carpets, and plastic vinyl are exactly the same for children as for adults, the current successful testing requirements for these products will no longer be enough. Now the Commission’s decision to treat “general product safety rules” as “children’s product safety rules” will require new third-party testing of the children’s versions of these products in CPSC accredited specialty labs. These additional testing costs are being layered on top of testing that has been carefully designed based on science-based protocols that are already known as the “gold standard” in safety.

I do not believe that the Consumer Product Safety Improvement Act requires this new, additional third-party testing that the Commission’s recent string of decisions mandated. These tests will not reduce risk and will ultimately harm productivity, increase cost and limit consumer choice. For instance, government regulation is cited as a major obstacle to new business start-ups or to expansion.

Most Americans will never learn about highly technical regulations that our agency recently passed. But they will be paying the price in higher costs, fewer choices and lost jobs. So, the next time you hear a commentator ask a guest, “What would you do to increase jobs or reduce government spending?”…think about the cost of government regulation…

•Commissioner Northup’s Official Statement on 3rd Party Testing for Flammability of Carpets & Rugs, and Vinyl Plastic Film: Requirements for Accreditation

•Commissioner Northup’s Official Statement on Testing the Flammability of Clothing Textiles, Mattresses and Mattress Pads, and/or Mattress Sets: Requirements for Accreditation of Third-Party Conformity Assessment

ALERT - the Commission needs your feedback regarding moving to 100ppm lead!

As many businesses may not yet know, the CPSIA requires that the lead content limits for children’s products automatically be lowered to 100ppm (from 300ppm) by August 2011. Essentially, all children’s products will have to be “lead-free” by that time, even if becoming lead-free provides zero additional safety benefit for children. The Commission is now asking for industry feedback on the “technological feasibility” of reducing the lead in their products to 100ppm—is it even possible? And what will be the consequences? Please see the link below on our website. I strongly encourage those that are affected to respond!

Draft Federal Register Notice: Request for Comments and Information - Technological Feasibility of 100 ppm Lead Content Limit for Children's Products, July 13, 2010 [PDF]

USA Today reports on the costs of CPSIA

Lead testing can be costly for mom and pop toy shops
USA Today's Money section profiles a family owned business that was booming with safe toys three years ago but now is struggling to keep its doors open because of CPSIA...

To the Class of 2010: Beware of the CPSIA

Successful entrepreneur Phebe Phillips was invited to speak at the Texas Women’s University Commencement in May and shared with the graduates how the Consumer Product Safety Improvement Act has Forced her to close down her business...

Wally Olson at Overlawyered.com brought this story to my atention and I wanted to be sure to share it with you.

Click here to read Phebe Phillips' speech

Anyone noticing a pattern here?

I thought you may be interested in Hugh Hewitt's recent article, "Regulation costs jobs, slows growth" in the Washington Times...

Hugh Hewitt: Regulation costs jobs, slows growth

Survival of the fewest...

Why save a few and let the rest drown?

That’s what the Waxman proposal (CPSEA) would do since it only helps relieve some thrift stores and possibly ATVs and bikes from the burdensome costs of complying with the CPSIA.

It’s not that I disagree with relief for these few – but why not craft a proposal that fixes the problems with the CPSIA for everyone who makes safe products? One criteria in this proposal for granting relief is that it cause no “measureable adverse effect” on a child’s health. Well, of course. In reality, the only criteria that should ever matter when it comes to the CPSC regulating a consumer product is whether it poses a risk!

I don’t really want to beat up those getting relief, but I do want to point out the ridiculousness of letting off a few and not everyone. The fact is, if these children’s products were actually unsafe, there would be relief for no one.

Careful what you wish for!

Imagine my surprise when I logged into my personal Facebook account and the first item on my “news feed” was from my friends at the Handmade Toy Alliance encouraging people to call their Representative in support of the Waxman proposal to “fix” the CPSIA!

Even CPSC staff has expressed concern that the small batch provisions will require the Commission to approve any “alternative” test methods on a product by product, rule by rule, basis (How long will HTA members wait on the Commission for all these new regulations?)…and there’s a degree of uncertainty about what an alternative test could even mean (and will it “assure compliance”?) ...and of course, a majority of Commissioners likely will have to vote to approve each of these alternative test methods (can anyone read the tea leaves on those votes?)…

Turns out, it may not be the gift you were wishing for...

Don't confuse me with the facts...

Despite the high costs of compliance, loss of jobs and declining product selection due to CPSIA, Chairman Waxman is pursuing his amendment to provide a very narrow exception to only two groups while small businesses are being driven from the children's product market even though their products do not pose genuine risks to children.

As Congress debates ‘too big to fail’ here’s what the government is doing to Main Street…

As a Kentuckian who knows how badly we need more jobs, it's a shame to hear from a local hometown business who is genuinely trying to comply with the CPSIA, but finding that the costs are so great that they simply cannot afford the testing. Please read the letter I received below and if you have a similar story, email it to me at Commissioner_Northup@cpsc.gov.

"Last week we selected several more products to eliminate from our product offerings. The products are safe, do not violate any of the CPSIA standards and have been around for over 50 years, but they are too complicated and have too many different parts. Therefore they are too costly to have tested and retested over and over again to prove they are safe. I hope some small companies and some decent product selection can survive in this new world where all products are presumed to be guilty. The only survivors will be the ones that are safe and can also afford to prove they are safe.

The group of items that we decided to discontinue are several kinds of dolls that have lots of different colors and accessories and some plastic to test for phthalates. We would have an average about $1500/doll each time we had to test due to a batch change. If we order them 3 times per year it would be $4500/doll in testing costs to be certain that nothing had changed from any of the suppliers that provide the raw materials that make up the doll parts and/or colors and accessories. With 26 different types of dolls, that would come out to $117,000 per year we would spend on testing. Based upon our sales volume we would lose money every time we order the doll.

This week we are dealing with another toy item that had a piece of PVC pipe as part of the toy. We tested the pipe which is a common pvc pipe like millions of people have in their homes and drink water from each day. We found that the pvc is slightly over the minimum acceptable for one of the phthalates. We are now spending $12,000 (more than doubling the cost of the toy) to replace the pipe components and to expedite shipping so we minimize the amount of money and customers we lose to competitors for this item. If phthalates in water pipes aren't hurting anyone, then how can the pipe in this toy cause a problem? We are spending the money, delivering a revised toy at a loss and complying with the law because we fear being put out of business with a large fine, not because we are saving some child from a dangerous encounter with this product.

I guess we and other small companies will continue to shut down product offerings, reduce employees, reduce our income taxes and eventually there may not be enough money to fund the wasteful efforts from Washington. Nature has a way of correcting problems even if we aren't clever enough to do it on our own. I hope somehow we can find a way to curb this monster and get back to focusing on safety issues.”

Are we seeing a pattern here?

The Product Safety Letter summarizes last week's public meetings of the US Association of Importers of Textiles and Apparel's (USA-ITA), sharing how they are affected by the excessive costs of the CPSIA…

“Several representatives of USA-ITA companies told Northup that they have quit selling certain items to avoid the rigors of CPSIA testing. ‘We completely got out of children’s jewelry.’”

“Said another, representing a company that sells t-shirts, the shirts’ designs now feature less colors to cut down on testing costs.”

They are “hard-hit by having to meet the dual requirements of federal standards and those set by U.S. states”

(Product Safety Letter, March 15, Northup Says riders May Be Best Chance for CPSIA Change)

Ever wonder how the IRS Tax Code got so complicated???

Congressman Henry Waxman’s proposed fix to the CPSIA has been released to the public. Now is the time to weigh in on how this would work for you. Specifically, these are my questions:

- Could your company (or anyone you know) afford to petition the agency in order to prove that the lead in their product serves a “functional purpose,” that it’s “not practicable” to remove, and the other new requirements?

- Note the further limitations under sections entitled: “burden of proof;” “admissible evidence;” “limitation on exception,” and; “narrowest possible scope of exception.” Do these requirements set a bar that you can reach? Would the cost to apply for such an exemption exceed the benefits?

- Does this proposal do more to discourage companies from the hope of an exemption, rather than provide a hope of flexibility?

- How many small businesses could qualify for the “relief for small manufacturers” on testing costs with such a narrow definition of “low-volume”?

- And a rhetorical question: Why would we ask companies (and our own agency staff) to do all of this new work for perfectly safe products to begin with?

If the expansion of the tax code is any reminder….a fix that’s not necessarily a complete fix, yet adds loads of paperwork and time-consuming, complex, costly, new requirements—is probably not a fix.

Please email me at Commissioner_Northup@cpsc.gov

Oops there goes another rubber tree...

You may have seen last week’s article in the Product Safety Letter in which the CEO of American Home Furnishings Alliance told Commissioner Northup that “…some of the member-companies, many of them small businesses, were leaving the youth furniture market because of fears of increased costs due to the new CPSIA requirements.” (Product Safety Letter, March 1, Commissioners Open to Exemption Request from Furniture Makers)

So the next time you are wondering why there are fewer choices in the children’s furniture market…

Report to Congress - Starring YOU

CPSIA Update: So We All Agree, Then? Congress Must Act!

In this blog post, The National Association of Manufacturers recognizes how important your stories are to show the Congress the impact of the CPSIA!

"[Northup] attached written comments from trade association and individuals — including people who have their own crafts and small businesses — that effectively buttress her recommendations. (Northup’s Dec. 24th opinion column in The Wall Street Journal, “There Is No Joy in Toyland,” helped move the debate in the right direction.)"

The U.S. Isn't as Free as It Used to Be

The U.S. Isn't as Free as It Used to Be

I know you will especially appreciate the above article from the Wall Street Journal.

It reports that America has dropped in regard to being “economically free” according to the new 2010 Index of Economic Freedom. We could fix this if we can find a way to help our nations entrepreneurs and small businesses without over-burdening them with unnecessary compliance costs!

My Recommendations to Congress

I believe that the CPSIA should be amended to reflect the real risks associated with lead absorption. I wholeheartedly supported the consensus recommendations in the agency’s report to Congress, however, my statement suggested several additional amendments that were not included in the Commission’s consensus report:

1. Focus CPSC resources on what we know may actually harm children: Only require third-party testing and certification for products that may contain more than a de minimis amount of absorbable lead (i.e., an amount that could meaningfully raise a child’s blood lead level)

2. Provide the agency flexibility in treating products for 12-month-olds and products for 12-year-olds differently, according to risk: An 8-year-old is not going to suck on a bicycle tire valve stem, and it makes no sense to ban lead in such a component where there is no risk of harm to a child.

3. Give the Commission flexibility to provide relief to small businesses: We have been informed by agency staff that the current statute does not allow this.

4. Avoid adding new exclusions to the statute that would be arbitrary, subjective, unreliable, and only available to companies that can afford to petition the agency: For example, a so-called functional purpose exemption would be all of these things—and it would also radically transform the CPSC into a product pre-approval agency. Statutory exemptions should be written in such a way that those who qualify for them can take advantage of them without agency sign-off.

5. Allow thrift stores, garage sales, and other resellers to sell second-hand goods: Under the CPSIA, the statutory limits for lead and phthalate content prohibit resale, even where the agency has never found these items to be unsafe. This policy threatens to put an end to the second-hand children’s clothing market.


To read my statement that accompanied the CPSC report, click here

To read the CPSC's report, click here

My appearance on Stossel

John Stossel on CPSIA

Last night, I was honored to be a guest on John Stossel's new show, Stossel, on Fox Business. As we discussed the CPSIA and it's testing and certification requirements, I tried to convey to him the HUGE cost it is imparting on already safe toys - especially those made by small businesses and crafters. You should have heard the audience's reactions! When they learned that the Goodwill and other charitable organizations were not able to sell products that are NOT a real threat to children, they were outraged! Please watch and let me know what you think!

My Op-Ed in The Wall Street Journal

There is No Joy in Toyland

Today, the Wall Street Journal printed my op-ed on the CPSIA's disastrous unintended consequences. I could not have written this without your stories and experiences and I hope you will keep sending me more so we can usher in some common sense with the New Year!