Testimony

• The Honorable Thomas Moore

  Commissioner

  U.S. Consumer Product Safety Commission
  Read statement

  Testimony

  The Honorable Thomas Moore

  Statement of

  Commissioner Thomas H. Moore

  Submitted to the

  Subcommittee on Consumer Affairs, Insurance, and

  Automotive Safety

  Senate Committee on Commerce, Science, and

  Transportation

                 

  Mr. Chairman and members of the Subcommittee, I appreciate the opportunity to appear before you today to provide testimony on the United States Consumer Product Safety Commission (CPSC).  The Commission is charged by Congress with the critical responsibility of protecting the public against unreasonable risk of injury and death associated with consumer products.  This is a crucial responsibility because, often without CPSC’s intervention, the consequences of exposure to the hazards associated with dangerous products may literally be of a life and death nature for individual consumers unknowingly in possession of unsafe consumer products.

   

              As you are aware, CPSC has not been reauthorized since 1992 and has not had a reauthorization hearing before this body since 2003.  Although these proceedings could be an exceedingly intensive undertaking for the CPSC, I welcome this reauthorization process because I believe it presents a unique and much needed opportunity to focus on the Commission’s present and future agenda.

  THE MISSION

              In examining the legislative history of the statute creating the CPSC 30 years ago, we find that Congress, in its wisdom and foresight, was concerned about technological advances creating a variety of new products with greater potential for injury which would be less easily recognized and comprehended by the American consumer.  Congress recognized that the dramatically increasing number of consumer products, and the consumer’s increasing reliance on more complex labor saving and recreational devices, would create increasing risk of injury from their use.  Additionally, continuing product development demonstrated that previously acceptable risk levels were no longer reasonable in light of available safety technology.

             

              Today, the risk of injury and death from unsafe consumer products continues to be enormous and costly.   CPSC’s mission is to protect children and families against unreasonable risk of injury and death from about 15,000 types of consumer products.  Our work has contributed significantly to the substantial decline in the rate of deaths and injuries related to hazardous consumer products since the agency’s inception.  However, despite significant reductions over the years, there remains on average over 27,100 deaths and 33.1 million injuries each year associated with consumer products under CPSC’s jurisdiction. 

             

              Today, our reliance on consumer products in our lives is tremendous and growing.  We rely on manufactured electrical and mechanized devices to assist us in too many of life’s activities to mention—at play, at work, in education, in travel, and particularly inside and outside of the home: in food preparation, in cleaning and making repairs around the home, in child-care, in trimming trees and grass, and on and on and on.  To further complicate matters, we are beginning to see that more and more of these products are being manufactured abroad.

   

              It is suggested in some circles that the modern, sophisticated marketplace of today can effectively regulate itself for product safety.  I strongly submit that the previously discussed justification for governmental involvement in the protection of the consumer’s right to safety is even more compelling today than it was more than 30 years ago.  Simply stated, competition and voluntary actions of today’s businessmen do not always suffice to safeguard the public interest.  Competition does not and will not inevitably take the form of a rivalry to produce the safest product.  The role of the CPSC in today’s consumer product marketplace remains compelling, substantial and relevant.

  CPSC’S BUDGET AND THE IMPACT OF STAFF REDUCTIONS

   For Fiscal Year (FY) 2008, the President’s request for our agency is $63,250,000 which is an increase of $880,000 above our FY 2007 requested funding level and will support the agency at approximately 401 FTEs.  If measured against our FY 2007 authorized FTE level, the request for FY 2008 represents a reduction of 19 FTEs.  As in the previous two years, we estimate that we will again be able to achieve these reductions through attrition, but we have reached a point where we are very concerned about the long-term impact of these continuous staff reductions on our agency.  There are indications that the cumulative three-year staff reduction of 15%, from 471 to 401, is going to make it difficult for us to maintain the broad range of skilled staff we need to address the full scope of the 15,000 products under our jurisdiction.

   

  CPSC is a staff intensive organization with nearly 90% of its funding allocated to staff compensation and staff-related space rental costs.  At the heart of CPSC’s operation is its staff, without question, our greatest and most important asset.  Over the last few years, because we have achieved our budget required staff reductions through non-targeted means such as attrition, early-outs and buy-outs, we have lost some very key staffers.  For example, just to name a few, we have lost key experts in these areas:

   

   

  ·        Poison Prevention,

  ·        Chemical hazards as they relate to the Federal Hazardous Substances Act,

  ·        Compliance of toys,

  ·        Drowning prevention,

  ·        Data collection and analysis,

  ·        Emerging hazards,

  ·        Fire-related hazards, and

  ·        Legal knowledge of CPSC’s regulatory process.

   

               Over time we hope to be able to train replacements, but the experience in these areas that we have lost will take years to recover.  Moreover, our ability to do succession planning is severely limited because of a lack of resources and our inability to have depth of personnel behind our key positions (no bench).  In addition, dwindling resources and staff reductions have had some negative impact on our agency’s ability to attract high level qualified candidates for our critical vacancies as well as our ability to retain some of our own top level employees.

   

             There is no doubt that the President’s funding proposal for FY 2008 presents challenges, particularly in light of the fact that this would be our third consecutive year of staff reductions.  As I have indicated, since FY 2005, CPSC has been forced to reduce its funded FTE level by 15% from 471 to the FY 2008 proposed level of 401. This erosion of our most valuable asset comes despite the fact that we still have over 15,000 types of consumer products under our jurisdiction; creative new technologies constantly introduce potentially new product hazard issues (nanotechnology, internet sales); new consumer uses for products originally created for commercial use are being introduced (portable gas powered generators); imports are increasing, many from countries that may not have similar consumer product safety standards (ATVs, cigarette lighters); and, as I previously mentioned, despite the fact that we still face over 27,100 deaths and over 33.1 million injuries each year associated with consumer products under our jurisdiction.

   

    Our Field Division, which was combined with the Office of Compliance in 2005, has probably been the most affected.   Since September of 2003, we have lost 43 people in the Field, 30 of which have not been replaced.   Another 15 people left Compliance, six of whom were not replaced.  One of the important duties of our Field staff was to provide outreach to local communities. We had public affairs specialists throughout the country that would appear on local television and radio shows, getting the Commission’s message out at the local level.  They would network with local affiliates of national organizations, such as Safe Kids, and make presentations to many different types of community groups.  This was in addition to doing work for our Hazard Identification Division and doing work for Compliance (including trying to monitor the growing influx of imports at our port cities).  In other words, they use to serve all three main areas of Commission work.  Now they are primarily an investigative arm of Compliance.  Their ability to do outreach at the State and local level has been largely eliminated.  We lost creative, aggressive public relations specialists in the Field who had developed contacts over many years because they did not want to become mere investigators.    I don’t think we can be effective doing all of our outreach and education and information campaigns from headquarters, over the internet or through our Neighborhood Safety Network.  But, the reality is that we can no longer afford to do all we use to do to serve the American public and this is an area that has suffered greatly.

   

   ADDRESSING PRODUCT SAFETY HAZARDS THROUGH ENFORCEMENT

   

              Aside from using its rulemaking authority, CPSC can act forcefully and quickly to remove dangerous products from the marketplace through two main enforcement activities.  The first is in vigorously enforcing its current regulations; and the second is in utilizing its Section 15 authority to achieve recalls or corrective action plans when it is believed that a product meets the level of a substantial product hazard.  I point out to you that in 2006 alone, the Commission completed 471 cooperative recalls (100% voluntary) involving nearly 124 million consumer product units that either violated mandatory standards or presented a substantial risk of injury to the public.

   

  In addition, CPSC staff, working with the U.S. Customs and Border Protection (CBP), prevented about 2.9 million non-compliant cigarette lighters and fireworks from entering the U.S. and also prevented 434,000 units of toys and other children’s products from entering the country.  Unless interdicted, those goods would have competed with U.S. manufactured products, often undercutting them on price because the foreign manufacturers did not bother complying with our safety regulations.  Our efforts to keep these violative products out of the marketplace protect not only the American consumer, but the American manufacturer as well.

   

  In the future, the problems associated with increasing numbers of possibly dangerous imported products will present the Commission with more and more of a challenge.  Increasing numbers of U.S. companies are either importing finished products or component parts made in other countries or establishing their own production plants outside of the U.S.  In most cases, domestic companies are not going to have the same degree of control over these products as they would have if their products were being made in this country.   This inability to have constant hands-on supervision can result in products entering this country that do not meet U.S. safety standards. 

   

  When products are required to meet a federal mandatory standard, we can try to stop them at their port of entry before they get into the hands of consumers.  CBP is very cooperative in helping us identify and sequester products that are potentially violative.  However, both CBP and CPSC have limited manpower to inspect and test these products, relative to the tens of thousands of shipments that arrive daily at U.S. ports.  Additionally, CBP has a much broader national security mandate that takes much of its resources.  

   

  We currently have five people cleared to use the CBP’s computer system, the Automated Commercial System (ACS) database, and perhaps a total of 15 people to go to various ports around the country to inspect shipments that have been identified as possibly not meeting our safety standards.  These inspectors do this in addition to the many other responsibilities that they have.  CPSC simply doesn’t have the personnel to do more than a cursory look at imports coming into this country.  As I have indicated, in the last several years we have lost 30 Field personnel, largely as a result of budget cuts, who we have not been able to replace.  This has impacted our entire Field operation, including port inspections.  The new CBP computer system will help, but nothing can substitute for actually examining a shipment.  Thus, we are frequently left to deal with products after they are in the stream of commerce, through our recall mechanism, which can often come after the product has already injured consumers.

   

              Requiring a manufacturer, distributor or retailer to recall defective products is a primary mechanism in CPSC’s continuous undertaking to address product safety hazards.  However, announcing the recall is just one step in an overall process of eliminating the hazards presented by unsafe products in consumer’s homes.  We also have some responsibility to take all reasonable steps to ensure the removal of those unsafe products from potential consumer use.  Given the limitations presented by CPSC’s resources, it is tremendously important that the Commission maximize the effectiveness of this particular aspect of the recall process.

   

  Another issue in the enforcement area lies within the civil penalty arena.  I have supported, and continue to support, the elimination of the monetary cap on civil penalties.  While the cap does rise periodically, the reality is that a $1.825 million fine means very little to many of the corporations we regulate.   Why do we need a cap at all?  While Congress may want to take another look at the guidance given to us in the form of factors we shall consider when determining the amount of a civil penalty, we should not have any limit on the amount we can seek.  It is one thing to limit the amount one consumer can recover against a company (and not a position I necessarily support either), but it is quite another to limit the government’s ability to penalize a company on behalf of all consumers, thereby limiting the deterrent effect of civil penalties.  Perhaps some companies would be less likely to try to stall our agency by putting off reporting hazardous products if we had penalties that were more commensurate with the harm they can cause.

   

  CPSC’S IMPORTANT SAFETY WORK MUST CONTINUE

   

         By most current measures, CPSC still provides both tremendous service and tremendous value to the American people and we are very proud of our staff’s accomplishments.  Our agency is the major factor in the substantial decline in the rate of deaths and injuries related to consumer products since 1974.  During that time, through our standards work, compliance efforts, industry partnerships, and consumer information, there has been a 45% reduction in residential fire deaths, a 74% reduction in consumer product-related electrocutions, a 47% reduction in consumer product-related carbon monoxide deaths, an 82% reduction in poisoning deaths of children younger than 5 years of age, an 84% reduction in baby walker injuries and a 89% reduction in crib-related deaths.

   

        Moreover, in FY 2006, we informed the public of hazardous products through 435 press releases, 12 video news releases and more than 1 million distributed publications while conducting about 500 television and radio interviews.  CPSC also warned the public about product–related hazards through our hotline and consumer product safety information websites (www.cpsc.gov, www.recalls.gov, www.atvsafety.gov ), which reached over 21 million consumers in 2006, and other outreach activities such as the Neighborhood Safety Network (NSN).  The NSN outreach goal is to reach underserved consumers who may not routinely receive important safety information due to lack of access or exposure to the general means that we use to disseminate our safety messages and warnings.

   

        Additionally, in FY 2006, the Office of Management and Budget (OMB) reviewed CPSC using their Program Assessment Rating Tool (PART) and assigned us a rating of “Effective.” This is the highest rating a program can achieve and signifies that, based upon OMB’s criteria; CPSC sets ambitious goals, achieves results, is well-managed and improves efficiency. 

        These numbers and activities by themselves demonstrate the indisputable consumer product safety role that the Commission continues to perform for the American consumer despite our shrinking resources.  However, we have to be mindful of the fact that resource limitations and staff reductions have challenged and will impact our ability to fully respond to consumer product safety issues presented by the broad range of products under our jurisdiction.  For example, with respect to FY 2008, although we will continue our work in reducing child drowning deaths at the annual project level, we will no longer address this area at the level of a strategic goal because resource limitations is a factor.  At some point in the future, the Commission will make the ultimate determination but additional projects that could be delayed/deferred in the FY 2008 budget include:

  • Bedclothes flammability,
  • Development of projects dealing with emerging hazards such as consumer electronics,
  • Support for voluntary standards and code revisions for fire sprinklers, lighting, ladders and ride-on mowers,
  • Data analysis and technical review activities for smoke alarms, extension cords, temperature controls, glass top furniture, children’s scald burns, child gate latch durability, and toy impact resistance guidance.

              We at the Commission strongly feel that many, many deaths and injuries have been prevented as a result of the heightened attention given to safety issues by manufacturers and consumers due to CPSC’s leadership.  The product safety landscape is ever evolving because of more technologically complex products as well as a greater emphasis on imports.  The results of our activities clearly illustrate the benefits of CPSC’s federal presence in today’s consumer product marketplace and therefore provide substantial justification for present and future consideration for keeping our safety programs intact.

   

  EMERGING TECHNOLOGIES

   

   

  The American consumer wants everything electronic to be smaller, faster, longer-lasting and more powerful.  Nowhere is this more evident than in energy storage devices for cell phones, laptops, PDAs and other portable electronic devices.  One result of this trend is the lithium ion battery which first appeared commercially in 1991.  Over time we have seen problems develop with the use of these batteries when, for example, they are put into too small a space or the device they are in is dropped.   CPSC, in conjunction with several companies, recalled more than four million laptop batteries last year because of overheating which either did, or could, lead to a fire.  The chemical configuration of the lithium ion battery is constantly evolving, with changes being made every few months.  It is challenging for the battery manufacturers themselves to keep up with the developing technology, let alone the CPSC.

   

  Another innovation finding its way into batteries and thousands of other products is nanotechnology.  This is the ability to alter and create materials at the sub-atomic level.  The physical properties of materials can change as they shrink to nanometer size.  How to determine what human health and safety risks these changed materials may pose when used in consumer products will be a major challenge for our agency.  I do not pretend to understand nanotechnology and our agency does not pretend to have a grasp on this complicated subject either.  For fiscal year 2007, we were only able to devote $20,000 in funds to do a literature review on nanotechnology.  Other agencies are asking for, and getting, millions of dollars for research in this area.  Given the many products already on the market using nanotechnology, from computer chips to Dockers© pants, I do not think it will be too long before the agency is asked to assess the risks of nanotechnology use in some consumer product under our jurisdiction.  At this point in time we would be hard-pressed to make such an assessment.  We simply do not have the resources to get up to speed in this area.  We are forced to devote our limited resources to the hazards with which we have experience, such as fires, carbon monoxide poisoning and electrocutions.

   

  Our main challenge, no matter whether it is keeping up with imports or understanding new technologies, is resources.  When forced to make hard choices we have to opt for what it is possible for us to accomplish, given the personnel we have and the limited dollars we have to spend.   We do not have the luxury of getting ahead of a problem, we have to wait until one develops and then try to solve it, usually after it has killed or injured consumers.   This dilemma is causing many sleepless nights for some CPSC staffers.  With the help of the administration and Congress, we have to get beyond our present posture of thinking of how we can do without and move to the position of thinking of what more we can do.

   

   PRESENT AND FUTURE ACTIVITIES

        I strongly feel that the role of the Commission is essential to the U.S. marketplace in an increasingly competitive international marketplace.  The Consumer Product Safety Commission and the marketplace must work together to develop international consumer product safety standards and enforcement compatibility so we can enhance international trade and export opportunities without lowering U.S. safety standards.

   

          With approximately three-quarters of our recalls comprised of foreign manufactured products and over half of total recalled products originating in China, CPSC must establish a definitive strategy for increasing compliance of foreign manufactured products with U.S. safety standards.  With that goal in mind, the Commission established the Office of International Programs and Intergovernmental Affairs.  Through the efforts of this office, CPSC has signed 12 Memoranda of Understanding with its government counterparts abroad, including China.  These agreements seek to establish closer working relationships between the signatories, as well as provide a formal mechanism for exchange of information.  Interdisciplinary technical teams have also been established to determine in what areas Chinese manufacturers are more consistently non-compliant and to develop strategies for increasing compliance in those areas.  In addition, other strategies for increasing the compliance of imported products with U.S. safety standards are being evaluated. 

   

                         

  CONCLUSION

   

   

              In closing, while I believe that consumers must take responsibility for their own safety, there clearly is a role for the CPSC to assure that products are designed safely and recalled where there is a problem.  I think that consumers should be informed about the products they purchase and take reasonable care in using them.  Mr. Chairman, I believe that our government is now attempting to move into a new era of accountability.  It is my hope that this will be an era where well reasoned, and I emphasize the word reasoned, government action will be the rule, and not the exception.

   

              I also think that reasoned Commission action reflects a pragmatic approach to resolving safety problems and recognizes that regulation is only one of many options that can be employed to address safety issues.  We will work actively to achieve safety goals, and I expect, as is often the case, industry will respond reasonably.  But, if safety is not the goal of a certain industry or manufacturer, the Commission stands ready to protect the consumer expeditiously and without compromise.

   

                As Congress envisioned more than 30 years ago, the Commission should have the capability to handle increasingly technologically complex products as well as the capability to uncover high injury risks and defective products using today’s sophisticated data sources.   To successfully continue the mission of the agency, the Commission must have the resources and the flexibility to respond quickly and effectively to critical situations where the lives and health of the American public are at risk.

   

              I would like to thank the Subcommittee for allowing me to address my concerns at this hearing and I look forward to working with the Members of the Committee and its staff in this reauthorization process.

   

  Thank you.

• The Honorable Nancy A. Nord

  Acting Chairman

  U.S. Consumer Product Safety Commission
  Read statement

  Testimony

  The Honorable Nancy A. Nord

  Mr. Chairman, Senator Sununu, and distinguished Senators.

  Thank you for your invitation, to my colleague Commissioner Moore and me, to come before the Subcommittee on Consumer Affairs, Insurance, and Automotive Safety, this morning to give you an overview of the U.S. Consumer Product Safety Commission (CPSC) and to answer your questions regarding our mission, our goals, our resources and our activities on behalf of the American consumer. 

  The CPSC is an independent, bipartisan federal commission established by Congress and charged with protecting the public from unreasonable risks of injury and death associated with more than 15,000 types of consumer products under the agency’s jurisdiction. 

  Since its inception in 1973, CPSC’s work has contributed substantially to the decline in the rates of death and injury related to the use of consumer products.  We estimate that overall, injuries and deaths associated with the use of products under our jurisdiction have declined by almost one-third since the agency’s inception.  These reductions include:

                          A 45 percent reduction in consumer-related residential fire deaths;

                          An 89 percent reduction in crib-related deaths;

                          A 74 percent reduction in product-related electrocutions;

                          A 47 percent reduction in consumer-related carbon monoxide deaths; and

                          An 82 percent reduction in poisoning deaths of children from drugs and household chemicals. 

  These are absolute reductions—when the increase in the U.S. population is considered, the rate of these and many other categories of product-related injuries we have targeted have declined even more substantially. 

  While we are proud of these and the agency’s many other achievements over the years, there is still much work to be done.  Ever more technologically complex products, like those utilizing nano materials, and an unprecedented surge of imports (especially from China) continue to present the agency with new challenges.  Consumer safety is never a completed task but always an ongoing process of research, standards development, enforcement and public education.

  We accomplish our mission by executing five federal statutes:  The Consumer Product Safety Act, the Federal Hazardous Substances Act, the Flammable Fabrics Act, the Poison Prevention Packaging Act, and the Refrigerator Safety Act.

  Within the purview of these statutes, the CPSC has three core missions: 

  1.                        To identify existing and emerging product hazards that create an unreasonable risk of injury and to address those hazards by developing mandatory safety standards when consensus standards fail to do so.  We do this through our Office of Hazard Identification and Reduction;

  2.                        To conduct product recalls and to investigate and respond to product-related incidents which we accomplish through our Office of Compliance and Field Operations; and

  3.                        To alert and educate consumers about product-related safety issues, done by our Office of Information and Public Affairs.

  I will explain each of these in a bit more detail. 

  Standards Activities:

  In the United States, there is a very well established and vibrant system of voluntary—or what we prefer to call consensus—product safety standards.  Under the guidance of groups like the American National Standards Institute, ASTM International, and Underwriters Laboratories, who work to bring all stakeholders into the process, literally thousands of such product safety standards have been written and are continuously being revised.  These standards cover everything from the wiring in your toaster to the performance of baby walkers. 

  Thus, when Congress created the CPSC, there was a strong preference in our statutes for deference to such consensus standards over the promulgation of mandatory CPSC-drafted regulations.  Indeed, CPSC staff serves on many of the committees and participates in writing these standards and routinely contributes to many more. 

  This system has worked well, and most U.S. product manufacturers adhere to these standards.  However, in those instances where we find that consensus standards do not exist or are not adequate to address a risk, the Commission will initiate rulemaking to develop a mandatory product safety standard. 

  At the current time we have 14 rulemakings underway, including one on all-terrain vehicle (ATV) safety, a product in which I know Chairman Pryor, as well as Chairman Inouye, Senator Stevens and other Senators, have been very interested.  In fact, as the Chairman knows, the Subcommittee held an important hearing last year on ATV safety. 

  Another of our current rulemakings relates to portable generator safety, a subject in which Senator Bill Nelson has been very active, as well as has Senator Cantwell.  The CPSC has been aggressive in disseminating our safety message on portable generators in states like Florida and Washington during their severe weather over the past couple of years, and we certainly appreciate the Senators’ interest, support and encouragement with these efforts as we proceed on both of these rulemakings. 

  Product Recalls:

  Recalls occur for products that contain a defect that poses a substantial product hazard or for products that violate CPSC-issued mandatory safety regulations. 

  In Fiscal Year 2006, the CPSC announced 471 product recalls (representing over 120 million individual products), an all-time record for the agency.  These recalls represented a wide range of consumer products and product hazards.   Two-thirds of these recalls were of imported products, primarily from China.

  Products that may be subject to a recall are identified through reports from consumers, through our own investigations and through reports from companies. 

  Under Section 15 of the Consumer Product Safety Act, companies are required to report to the CPSC whenever they obtain information that any one of their products fails to comply with an applicable consumer product safety rule, contains a defect which could create a substantial product hazard, or creates an unreasonable risk of serious injury or death.  If the Commission determines that notification is required to protect the public, CPSC staff contacts the manufacturer, distributor or retailer and works closely with the company to give notice and undertake a recall or other corrective action voluntarily.   CPSC staff works to make certain that the notice and the corrective action are executed in a manner that optimizes consumer safety as expeditiously as possible.

  If necessary, the Commission may order a company to undertake a recall, after affording the interested party an opportunity for a hearing as required by CPSC’s governing statute.   CPSC’s experience shows this to be a time-consuming and resource-intensive action; voluntary recalls are preferred because they can be conducted more quickly and offer more immediate protection to the public.  

  In addition to monitoring compliance with safety standards by conducting field inspections of manufacturing facilities and distribution centers, CPSC staff also conducts surveillance in retail establishments and via the Internet to assure ourselves that recalls have been effective in getting defective products off retail shelves. 

  Finally, because most of our recalls involve imported products, we undertake both routine and targeted surveillance and sampling of imported products at U.S. ports of entry, working in conjunction with the Bureau of Customs and Border Protection. 

  Information and Education:

  Recalls are announced and other important product safety information is disseminated through all forms of media to warn the public of specific product hazards and advise consumers on more general product use issues. 

  In addition, the agency maintains three Web sites that give consumers and others access to all manner of product safety information.  Those sites are:  www.cpsc.gov, www.recalls.gov, and our newest Web site, www.atvsafety.gov, which is part of a very significant information and education campaign now underway to advise consumers about a number of ATV safety issues.  Visits to CPSC’s Web sites have grown rapidly over the past few years from 200,000 in 1997 to over 20 million last year.

  In an effort to communicate with hard to reach populations, the CPSC initiated the Neighborhood Safety Network, a grassroots outreach program that provides timely lifesaving information to 5,000 organizations and individuals who in turn share our safety message with hard-to-target consumers.

  Our outreach efforts include making our product safety information available in Spanish.  In fact, the CPSC maintains a Spanish language Web site.  We are also active in signing up Hispanic groups to our Neighborhood Safety Network and reaching out through Spanish language media outlets like Telemundo and Univision. 

  Our staff is also able to reach out to consumers to warn of emerging hazards or when emergencies strike.  For example, in response to the devastating hurricanes along our nation’s Gulf Coast, the CPSC partnered with the Florida, Mississippi, Alabama and Louisiana Departments of Health, federal disaster agencies, the Red Cross and local emergency management agencies.  We warned residents of the carbon monoxide hazards associated with improper portable generator use and also the dangers that consumers may encounter when returning to their property, including electrical, gas and standing water hazards. 

  Information Technology and Data Collection:

  All of these activities require collecting reliable data on product-related incidents and issues.  And the CPSC collects a lot of data, most notably through our National Electronic Injury Surveillance System, or NEISS.  NEISS is a statistical hospital-based product injury reporting system widely regarded as the best such system in the world, and which the Centers for Disease Control and Prevention and many other federal, state, local, and even international government agencies rely upon to carry out their missions.  We also collect data through our Web site, www.cpsc.gov, our consumer hotline, medical examiner and coroner reports, and a variety of media source reports.  As mentioned earlier, manufacturers and retailers are also required to report to us on certain product-related incidents.

  Obviously, CPSC’s IT systems are central to the agency’s safety mission.  As veteran CPSC employees retire, the IT infrastructure has become increasingly essential to tracking and identifying emerging hazards at a state-of-the-art level.  Accordingly, to keep existing systems operating and current, we are reallocating agency resources to maintain, and where necessary replace, aging network infrastructure and security features. 

  This reallocation will help the CPSC in collecting the quality data that is essential to the agency’s mission and that facilitates the early identification of product hazards.  Quality data is critical to the agency’s decision-making process as it relates to voluntary standards development, compliance, consumer education, product labeling, and rulemaking initiatives. 

  International Activities:

  Two-thirds of our recalled products are imports, and two-thirds of those come from China.  Recognizing the continuous and significant increase in the number of imported consumer products entering the American marketplace, the CPSC established the Office of International Programs and Intergovernmental Affairs to provide a comprehensive and coordinated effort to ensure greater import compliance with recognized American safety standards.  The CPSC is determined to make certain that imports meet the same high safety standards that products manufactured in America must meet.

  However, we have found that many overseas manufacturers, particularly those from the developing world, are either ignorant of existing consensus and CPSC mandatory standards or simply choose not to design and manufacture their products to those standards.  While a violation of a consensus standard does not, in itself, indicate a product is unsafe, the growing number of imported products that do not meet voluntary standards has strained our resources and challenged us to find new ways to work to ensure the safety of products in the stream of commerce. 

  To address the issues presented by imported products, the CPSC has negotiated memoranda of understanding with a number of foreign countries.  These agreements generally call for close consultation on product safety issues.  We are also anticipating our second U.S.-Sino Product Safety Summit this Fall, and in preparation for that, we have established several bilateral product-specific working groups that are developing concrete strategies for addressing the issue of unsafe imports.  We are also working with various associations and standards groups to assure that a strong safety message is being delivered to Chinese manufacturers and exporters.  

  Management Efficiencies:

  Despite its relatively small size throughout its history, the CPSC has been highly effective and efficient at reducing product-related injuries and deaths.  Within the parameters of its available resources, the challenge at the CPSC has always been to establish the highest safety priorities among the 15,000 product types under the agency’s jurisdiction.  The agency bears a broad responsibility, but with few exceptions, the record shows that the CPSC has performed effectively and efficiently in assuring the safety of the tens of thousands of consumer products that enter American homes every year.

  To keep the focus of our resources on our safety mission, we have worked arduously to generate savings and implement efficiencies to offset the cost increases that we confront annually.  For example, the agency has saved over $1 million dollars per year because IT investments have allowed us to close field offices and support teleworking.  Additionally, the agency foresees savings in rent at our headquarters in suburban Maryland as we begin to consolidate space to accommodate lower staff levels.

  I know that the Senators are aware of our staff levels, and as with any organization, the challenge with fewer staff is to continue to maintain the agency’s high standards and to achieve the agency’s mission.  With the help of management efficiencies and information technology, we at CPSC are doing that, and we will continue to strive to accomplish that because CPSC’s safety mission is so critically important to the health and well-being of America’s families.

  Mr. Chairman, the CPSC logo represents the gold standard of consumer product safety, and I am proud of what the agency has accomplished and of the many fine professionals at the CPSC who work to keep hazardous products off the market.  The staff at the CPSC is talented and resourceful.  They include epidemiologists, toxicologists, engineers, chemists, and many others whose skills are highly sought and highly rewarded by the private sector.  However, like you, they have chosen public service and serve no interest but the public interest.  I am pleased and proud to serve the American people with them.

  Thank you for your support, and I look forward to answering your questions.

   

Witness Panel 2

• Mr. Frederick Locker

  General Counsel, Toy Industry Association (TIA)

  on behalf of TIA and the National Association of Manufacturers' Consumer Product Safety Commission Coalition
  Read statement

  Witness Panel 2

  Mr. Frederick Locker

   

  TESTIMONY OF 

  FREDERICK LOCKER, ESQ.

  Hearing on

  CPSC REAUTHORIZATION

  Before the

  U.S. SENATE COMMITTEE ON

  COMMERCE, SCIENCE AND TRANSPORTATION

  SUBCOMMITTEE ON CONSUMER AFFAIRS,

  INSURANCE AND AUTOMOTIVE SAFETY

  March 21, 2007

   

           Mr. Chairman and members of the Committee, I’m Frederick Locker, General Counsel to the Toy Industry Association and Juvenile Products Manufacturers Association, not-for-profit trade Association members of the Council of Manufacturing Associations of the National Association of Manufacturers (NAM), and a member of the NAM CPSC Coalition. Thank you for providing me the opportunity to testify on the reauthorization of the U.S. Consumer Product Safety Commission (“Commission”). Our Coalition represents approximately 65 consumer product manufacturers and manufacturing associations. It has functioned for many decades as a forum to address common issues related to the operation of the Commission and policies initiated pursuant to the Consumer Product Safety Act and related sister acts. The mission of the Coalition is to promote product safety policy in a fair, balanced and effective manner. The Coalition does not involve itself in pending product specific regulatory or adjudicative matters.  Similar to the other witnesses on this panel, we support the important and essential mission of the Commission.

   

  CPSC Performs a Vital Function

   

              CPSC’s mission is to protect children and families against an unreasonable risk of injury and death from more than 15,000 types of consumer products from a wide range of product hazards.  Their work is vital in that it addresses consumer product hazards through a framework of mandatory product safety standards; engagement in the voluntary or consensus standard-setting process; compilation of consumer injury data; issuance of safety guidelines; implementation of information and education programs in an effort to proactively avoid injuries; and product recalls and corrective actions when necessary.  The agency is operating on a relatively modest budget, with a request of $63,250,000 for fiscal year 2008.  We believe that their budget request should be granted with increases earmarked for retention of staff, upgrades to their testing laboratory and support of increased coordination with other countries regarding harmonization of standards with better inspection and enforcement coordination.

   

  With respect to reauthorization of the Commission, we ask this Committee to act thoughtfully in any review of a regulatory structure that has served the American public well for the more than 30 years. In these exceedingly difficult economic times a vibrant healthy manufacturing sector is critical to our nation’s prosperity.  U.S. manufacturers in the consumer product industry presently face increasing global competition that is more intense than ever before. In such an economic environment, U.S. manufacturers should not be disadvantaged by an unnecessarily intrusive and inefficient domestic regulatory regime.[1]

   

  CPSC Has Effectively Marshaled Resources

   

              The Commission works well with and understands the needs of manufacturers, retailers and the consumers. Whenever appropriate, they have encouraged voluntary collaborative actions among stakeholders to address safety requirements. During the past decade, they have worked cooperatively with industry to conduct more than 5,000 recalls and needed to resort to litigation to compel recalls only several times.  In 2006, CPSC completed 471 product recalls involving nearly 124 million product units that either violated mandatory standards or presented a potential risk of injury to the public and negotiated civil penalties of approximately $2.3 million.  In addition, the CPSC compliance staff has continued to refine its Retailer Reporting Model implemented in 2005 and used by two of the nation’s largest retailers.  This provides additional trending complaint data for evaluation by the staff, which supplements manufacturer and consumer reporting.  With shrinking resources, leveraged collaborative action is preferable to mandatory regulations provided it can be implemented in a timely fashion and adequately addresses an unreasonable risk of injury.[2]  

   

              Today’s U.S. economy is consumer-driven.  An enormous number and variety of consumer products are designed, manufactured, imported and sold in the United States. With that in mind, industry, standards organizations and internal safety requirements developed in cooperation with manufacturers result in some of the best hazard-based standards that ensure that    American consumers may be comfortably secure in the safe use of their consumer products. Many companies also increasingly recognize the value of taking responsible corrective action to address patterns of injuries or misuse that may indicate a problem with their product. This accounts for the vast majority of product recalls conducted in cooperation with the Commission. Of course, there are still occasions where the Commission justifiably acts to remove unsafe products from the marketplace and to set standards where private standards either do not exist or are clearly inadequate. Consumer product manufacturers are committed to working with the Commission to achieve these objectives. We have consistently supported Commission efforts, along with the U.S. Customs Service, to monitor imported products to ensure that they meet mandatory federal safety standards. We recognize that this has been an efficient leveraging of resources to enhance enforcement related to product imports. In addition, we note that the Commission has played an increasingly significant role in educating consumers about safety concerns and practices.

   

  CPSC Has Shown Marked Improvement in Its Openness

   

              U.S. Industry has made no secret of its discomfort with certain past Commission practices, policies and procedures over the years. We have expressed concern in the past when cooperation with industry was minimized while a public-relations campaign to tarnish a company was launched in the media. We have objected in the past to proposed mandates when education, research and innovative private initiatives were not encouraged or leveraged. We have expressed concern when due process has not been accorded companies.

   

              We have also lauded the Commissions efforts at affording public comment, of all interested parties without predisposition on important matters. We appreciate the Commission hearings and outreach workshops to improve recall efficiency. This affords experts from a variety of disciplines to share information. In particular we have noted and applaud the Commission’s growing emphasis on sound hazard research and data, including its focus on more rigorous risk-benefit analyses, as the basis for regulatory action. We note that they employ capable high-level and well-experienced Epidemiologists, Toxicologists, Physiologists, Chemists, Engineers, Statisticians, and Economists to inform their decision-making. They have performed well in OMB assessments of their overall regulatory policies.

                          

              Along those lines, we believe that there are ways to make the Commission more effective and at the same time more efficient. As I noted, in these difficult economic times complexities and confusion in the regulatory process are an unnecessary burden on consumer product companies. Allow me to share a few proposals on ways the Commission can increase its effectiveness in protecting consumers while minimizing burdens on the manufacturing sector of this country.

   

  Recommendations

   

  Collaborative Information and Education Programs

              First, we support dynamic new partnerships between stakeholders and the Commission to promote safety and safe consumer practices. Consumer information and education does not substitute for the essential responsibility of manufacturers to provide safe products, but it can help with a large percentage of accidents due to improper or irresponsible conduct or lack of supervision of minors. The Commission is fully authorized to embark on such programs, but encouragement from Congress should be provided.[3]

   

  Continued Involvement in Consensus Safety Standards and Activities

              Second, we are supportive of the Commission’s involvement in private standards activities as authorized in the current statute. These standards are the bulwark of our national and even international safety system, and the Commission plays an important role in providing comments and proposals.[4]  However, we believe the Commission needs to better manage and supervise its internal process, particularly staff input to standards organizations, to ensure an opportunity for public comment and to prevent proposals which lack technical merit or otherwise cannot be justified as federal standards.  This is why we support the Commission’s stated strategic goal to improve the quality of CPSC’s data collection through 2009 by improving the accuracy, consistency and completeness of the data.  For an agency such as the CPSC, it is essential to maintain and use accurate data as a valuable tool to allocate staff time and resources to address emerging real world hazards.

   

  Continued Efforts to Engage and Educate Small Manufacturers

              Third, there is a need for better guidance and education from the Commission on the implementation of the Section 15 Substantial Product Hazard Reporting provisions. Manufacturers with defective products that could create substantial product hazards are obliged to report to the Commission and, if needed, to take corrective action including recalls. However, the law and implementing regulations are vague and ambiguous. It is difficult for manufacturers, especially small businesses, to determine when reporting and corrective action is necessary. Likewise, it is difficult for them to comprehend how the penalty for the failure to report in a timely fashion is justified by the agency. We support the Commission’s efforts to clarify guidance on reporting and penalty computation by issuance of guidelines, which were subject to prior publication, comment and review prior to adoption.[5]

   

  A Strong Role in Setting and Enforcing Safety Standards in a Global Economy

              Fourth, in a global economy, we note the importance of the agency’s international engagement to ensure greater import compliance with U.S. safety standards and harmonization of standards to promote export opportunities for American businesses and the elimination of non-tariff trade barriers.  CPSC has entered into Memorandums of Understanding (MOU) with a number of foreign governments to provide for a greater exchange of information regarding consumer product safety.  We note by the end of 2008, CPSC expects to have MOUs with 17 countries.  These activities are becoming increasingly important in helping to ensure consistent hazard-based, harmonized global safety standards.

   

  Existing Regulatory Framework is Effective, But More Resources are Needed

              Finally, we believe that the existing authority granted to the Commission under the Consumer Product Safety Act and related Acts, together with existing implementing regulations, are sufficient for the CPSC to execute its mission in an effective manner.  The CPSC does not lack the requisite authority to implement fully its congressional mandate “to protect the public against unreasonable risks of injury associated with consumer products.”  However, it requires greater resources to implement such authority.

   

              Thank you for providing me the opportunity to testify. The Commission is an important agency and we fully support its mission. It can and should, have the funding and resources it needs to effectively function and we look forward to working with the Commission and the Committee to this end.

   

  
  

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  [1]           It is interesting to note that the European Union recently announced that it wants to boost trade between EU countries by making it more difficult for member states to block imports of specific products on the basis that they do not meet a national product safety standard. The EU wants member states to bear the cost and burden of demonstrating that a product is unsafe if they wish to remove it from their market.  Procedures Relating to the Application of Certain National Technical Rules to Products Lawfully Marketed in Another Member State and Repealing Decision 3052/95/EC.

   

  [2]           An excellent example is their work with industry to revise the ASTM consensus baby walker safety standard to address injuries from stair falls. New walkers with safety features are now on the market. There has been a decrease in injuries of over 84 percent since 1995, likely due in large part to the effectiveness of such standard requirements. The commission projected societal costs decreased by about $600 million annually from this one action.  Similarly, there was an 89 percent reduction in crib-related deaths from an estimated 200 in 1973 and an 82 percent reduction in poisoning deaths of children younger than 5 from drugs and household chemicals from 216 in 1972.

   

  [3]           CPSC has been increasingly effective at using electronic media and websites.  The creation of www.recalls.gov and enhancements to their website has resulted in a rapid growth from 200,000 visits in 1997 to what is expected to be almost 25 million visits by the end of the year. Product safety information is increasingly available in Spanish and other languages.  In addition, outreach activities such as the Neighborhood Safety Network; collaborative efforts with FEMA and public information education initiatives with NGOs and industries have resulted in increasingly effective communication about fire and carbon monoxide hazards, disaster preparedness, hazards associated with recreational vehicles, proactive holiday safety messaging, poison prevention, pool drowning risks and back to school safety programs.

   

  [4]               CPSC has worked with stakeholders to develop effective consensus standards completing approximately 10 times as many voluntary standards as mandatory standards (CPSC assisted in completing and developing 352 voluntary safety standards while issuing 36 mandatory standards from 1990 through 2006).

   

  [5]     Federal Register, Vol. 71, No. 142, pages 42028-42031 and proposed interpretive rule, Federal Register, Vol. 71, No. 133, pages 39248-39249

   

• Ms. Sally Greenberg

  Senior Product Safety Counsel

  Consumers Union
  Download Testimony (158.97 KB)

• Ms. Rachel Weintraub

  Director of Product Safety and Senior Counsel

  Consumer Federation of America
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• Mr. John Dean

  President

  National Association of State Fire Marshals
  Download Testimony (33.87 KB)