February 17, 2009, - 10:34 am

If Barack Obama Really Wanted to Help the American Economy & Small Businesses

By Debbie Schlussel
In early January, I wrote on this site about new anti-lead rules–a complete overreaction to the China lead crisis–which would require retailers, second-hand shops, and even garage and yard sale purveyors to spend between $400 and several thousand dollars to test products for lead.
Here’s an excerpt:

The regulations, passed under the Consumer Product Safety Improvement Act in August and set to go into effect Feb. 10, are aimed at eliminating lead-tainted products designed for children 12 and younger. They require all such products – clothes, toys and shoes – be tested for lead and phthalates, the chemicals used to make plastics pliable.

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The main issue for retailers is the costly testing, which can run from about $400 for a small item to thousands of dollars for larger toys with multiple pieces, according to Kathleen McHugh, president of the American Specialty Toy Retailing Association.
Products not tested would be deemed hazardous whether they contain lead or not, under the wording of the law.

I predicted that it would completely hurt small business owners who can’t exactly afford more distress in this sick economy. Since then, I got e-mails from several small business owners about how they had to offer fire sales to get rid of items that might test positive for lead. They simply can’t afford the overbearing, costly tests.
Reader Reuven, a small business owner and Orthodox Jewish immigrant, who cannot believe this is happening in America, wrote:

I have not seen too much written on the new HR 4040 bill signed by President Bush in August ’07 (Consumer Product Safety Commission details here), and it is something that is having major effects in the juvenile product industry. I am glad to hear your take on this stupidity. As a small business owner I am facing ruin just as a result of this bill. The state of the economy is bad enough but this puts things over the edge.
The little guy is getting punished for the criminal (at worst) and mistaken (at best) actions of large corporations who are the ones now able to handle the requirements of this bill. There are so many businesses that are closing as a result of the cost of testing product that inherently does not have these safety issues, but testing is required to prove it.
Shocking that Pres Bush signed this and republicans went along with no amendments. But then what can we expect from gutless politicians and bureaucrats who have no foundation in the real world?
The wider issue is new clothing and, in my case, strollers and US toys that are made on a small scale but still require testing for every batch on every product. This is in addition to everything in inventory must be tested. The problem is also that they have painted a broad range of categories with one standard that does not make sense. In theory, would a mini van or school bus need to be tested as they are primarily designed for a child under 12? No, because they fall under NTSB guidelines but the principles are the same.
My business that was profitable and providing for my family (wife and 4 kids) and has 8 employees relying on me for their living is going to have to let most go or even shut down completely just from this bill. There was never an issue with strollers, and now small manufacturers are going to be closing their doors, next the small retailers and all the things that go with that.
The bill will prevent Americans from inventing or making something in their home to supplement their income and move up in life to chase the American dream. I am a legal resident from overseas and even I know that this is just un-American!
I think I may have to dump my inventory before the February date as I delve into the nitty gritty of the requirements! If you are in the market for a stroller. . . .
As the religious Jewish saying goes, “Think positive and it will be positive.”

Well, in this case, we needed more than positive thoughts. We needed leaders, and we didn’t have them . . . on either side of the aisle. Thank President Bush for signing this big government absurdity into law.
The law went into effect on Tuesday. And it’s forcing retailers who didn’t sell out certain toys and a lot of dirt bikes to store this inventory and take it off the market. It’s inventory people want to buy and sellers want to sell, but the government–big government is telling both they can’t.

It became illegal Tuesday to sell off-road machines geared for children younger than 12 because parts in them contain lead at levels greater than 600 parts per million. Most motor vehicles have such parts.
“I think they took this law a little too far,” said Margie Hicklin-Krsul, the owner of Redline Sports, a sports bike dealership in Butte. “I’ve never had anyone come in and say, ‘My child keeps putting parts of his motorcycle into his mouth.'”
About 100,000 of the bikes – popular for trails, zipping around backyards and racing on motocross tracks – sold last year for $1,500 or more, according to industry estimates. The ban, not yet permanent, is a blow to motocross racers of any age who want a small bike and now won’t be able to get new equipment or repair what they have.
Dealerships – where sales already were sputtering due to the recession – received notices over the last month that they must pull the bikes off showroom floors. Industry leaders say some 13,000 dealers are now stuck with $100 million worth of inventory that may end up worthless.
Congress tightened lead limits on children’s products last summer after a series of discoveries of dangerous lead levels in toys, and the rules took partial effect last week when a judge nixed a 12-month reprieve while the Consumer Products Safety Commission finalizes them.
The law won’t be enforced for a year, but retailers can no longer sell products that contain materials in question. And they may find once the rules are clarified that the inventory now filling their storage rooms is worthless. . . .
Renton Motorcycle Co. outside Seattle moved 169 dirt bikes and ATVs off its sales floor last Tuesday. After selling about 600 starter bikes and ATVs in 2008, the shop now may not be able to service them or accept them in trade for a bigger bike, said sales manager Mike Dunaway. . . .
Dealers have been warned that a single violation of the law carries a fine of $1,825 and penalties could run to $1.8 million with repeated offenses. . . .
“We’re going to park them in the back room and wait for the government to decide what to do,” said Wayne Gabbert, owner of Outdoor Motor Sports Inc. in Helena. “It’s another one of these good-government deals where they try to save everybody.”

Yeah, and ruin everybody.
If I were Barack Obama, I’d, TODAY (or actually, last week), issue an executive order halting the enforcement of this rule (the government has already put off until the summer enforcing the rule against second-hand retailers). It would enable businesses to take their toys and dirt-bikes out of storage and sell them before they go out of style or become anachronistic due to new styles and fads.
And he’d gain the support and appreciation of so many small business owners for reversing the horrible behavior on this from President Bush. If ever there was a time for the supposedly pro-business Bush to veto a bill, it was this statist law. He failed.
But I’m not Barack Obama. And he’s not a capitalist. And he hasn’t shown an iota of concern for saving America’s small businesses. Nor did the Democrats AND Republicans who helped make this law.
Don’t hold your breath for him to do away with these ridiculous anti-lead toy laws. They go overboard.
We’re from the government. And we’re here to help you.

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6 Responses

What’s the old expression: “In order to save this villiage we’re gonna have to destroy it”. We’ve been living this kind of do-good philosophy here on the Left Coast for years. Now look at what’s happening in Kalifornia today – 20,000 government employees are out of work as of now. IOU’s for tax returns. No state budget. Business leaving in droves. Thank you Sacramento. You have destroyed the villiage.

Rich B on February 17, 2009 at 11:44 am

This is another example of laws and regulations being written by pencil pushers in cubicles that have no real world experience with the procucts they regulate.
It is just like the thousands of regulation heaped on the auto industry by cubicle beuarecrats in DC. I talked to an engineer working at Ford Motor Company that told me that the purchase price of our cars are increased by 5 to $10,000 because of useless Government regulations.
People that work in our Government have become the enemy of industry and the people of the USA.
…and people wonder why our economy is in the shitter.

ScottyDog on February 17, 2009 at 1:27 pm

Obama bama hes our man if he can’t screw it up the democrates in the house and congress can. If you don’t want to work and have your cake then leave it too obama and dem’s to feed you cake. If you work and pay your bills then obama and the dem’s will eat you too!

ohboyohboy on February 17, 2009 at 2:04 pm

Another important point that the CPSIA covered was BOOKS. Any children’s books published after 1985 are considered okay. All others would need to be tested before sale.
I’m sure I’m not the only person who grew up healthy reading great old musty books, but I’m NOT sure that our children will know the same joy, as no store — be it online, thrift, or used — can afford to check every volume on their shelf. (Meaning many are being thrown away…) Gordon Olson at City Journal recently wrote about how the CPSIA applies to books as well. Worth checking out.
Does any lawmaker read these bloated bills before they sign our lives and livelihoods away?

kitty ballou on February 17, 2009 at 2:53 pm

Out of 433 Representatives in the House, only one Congressman voted against the despicable HR 4040 (Consumer Product Safety Improvement Act): Ron Paul – see http://clerk.house.gov/evs/2008/roll543.xml
Dr. Ron Paul is the one who should have been the the Republican nominee for President if only the Republicans did not abandon their conservative and constitutional principles.

ramjordan on February 17, 2009 at 4:27 pm

A bonanza for the trial lawyers.

lexi on February 17, 2009 at 9:25 pm

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