Toy Story

Does the reform of a small agency herald the return of competent government oversight?

In late July, when the presidential race was a dead heat and the countrys banks were not yet nationalized, Congressopposed by just four Republicansquietly voted for the return of big government.

The Consumer Product Safety Improvement Act passed the House and Senate by the sizable margins of 424 to 1 and 89 to 3, respectively, and was signed into law without ceremony by President Bush two weeks later. The lawmakers were goaded into action by a rash of headlines like “Mattel Recalls Chinese Barbie Toys in Lead Scare,” which brought less-than-favorable attention to the federal governments in-house consumer watchdog: the Consumer Product Safety Commission, an oft-neglected agency with an annual budget of less than $80 million, a staff of just 400, and a humble headquarters occupying three floors of a high rise in Bethesda, Maryland.

For most of its thirty-six-year history, the CPSC has been regarded with indifference and occasional outright contempt by political leaders, whose attention to the agency has usually been limited to bashing it when it messes up badly enough to make national headlines. In this respect, the hearings that followed the tainted-toy scandalin which lawmakers threw toys in the trash and declared that they no longer knew what to get their kids for Christmaswere nothing new. But the Chinese-toy recall had exposed the tiny agencys inability to do its big job: policing more than 15,000 consumer products, from sectional couches to action figures. And with the law it passed in July, Congress actually offered more than tough wordsit voted to double the size of the agency and dramatically strengthen its regulatory powers. That response could do more than just rectify a Bush administration embarrassment. It could catapult the dreary and beleaguered work of federal regulatorsthose loathed bureaucratsinto the age of globalization and the Internet.

T he CPSCs origins date back to the late 1960s and, in part, to Ralph Nader. “There was a huge vacuum,” Nader says today of the demand for government consumer protection. “It was clear that there was a big gap in household products.”

Nader worked with President Lyndon Johnson to create a National Commission on Product Safety, which studied what the Washington Post in 1968 called the “new human right” of “the consumer to be protected against reasonable risk of bodily harm from products purchased on the open market for the use of himself and his family.” Citing 30,000 annual deaths from everyday products, the panel successfully recommended the creation of a permanent Consumer Product Safety Commission. For the CPSC to work, however, it would require strong leaders with a strategy for policing everything from coffeemakers to lawnmowers. And those leaders would need money. The CPSC started with neither of these things.

The Democratic Senate wanted $180 million for its first CPSC budget in 1973. It got $34 million from a Nixon administration that had already shelled out start-up money for the Environmental Protection Agency and the Occupational Safety and Health Administration. Richard Simpson, the first CPSC chairman, didnt question Nixons approach, and directed his energy into a series of public relations gimmicks, such as training volunteers as “consumer deputies” who would offer warnings about dangerous products.

The CPSC of the 70s was a study in bureaucratic ineffectiveness. But at least it had resources and, for the most part, well-intentioned political appointees. Then came Ronald Reagan. His administration was skeptical of the agency from the outset; in 1981, Office of Management and Budget Director David Stockman declared that “the public benefits likely to be secured by [the CPSC] are not likely to exceed the costs.” By the time Reagan left office, the CPSC had gone from 900 employees to 500. A budget of $42 million in 1981 had shrunk to $34 million eight years later. These numbers increased modestly during the George H. W. Bush administration, then stagnated during Bill Clintons. Clintons emphasis on a balanced budget, along with the Republican revolution of 1994, meant that the CPSC either had to make its austerity a point of pride or be abolished.

The CPSC reached its nadir, however, when George W. Bush named Harold Stratton agency chairman in 2002. Stratton, a former New Mexico attorney general, was so rarely around CPSC headquarters that some employees swear they wouldnt have recognized him if he had been sitting in the cubicle next to theirs. “There would be an event where the staff would be assembled for some purpose,” says Roy Deppa, a top engineer at the agency from 1976 to 2005, “and Stratton would show up and the staff would say Who is that?” Stratton instead spent his time traveling, making fifty international tripsmostly at the expense of industry lobbying groupsbefore leaving office in the summer of 2006. Lawmakers and journalists began to explore his dubious tenure after the Democratic takeover of Congress later that year and a series of very public toy recalls. Congressional hearings followed, prompted by the tainted toys and Bushs failure to nominate a viable replacement for Stratton (in 2007 Bush had proposed Michael Baroody, until recently a lobbyist for the National Association of Manufacturers, an industry group that had persuaded Stratton to give companies more leeway in reporting product defects). In the hearings, acting CPSC Chairwoman Nancy Nord quickly established herself as a political appointee akin to former Federal Emergency Management Agency head Michael Brown. Brushing aside the agencys inability to prevent dangerous toys from hitting the shelves, Nordwho shared Strattons enthusiasm for industry junkets, according to the Washington Postargued that manufacturers, not the CPSC, should be entrusted with ensuring toy safety. The agencys top position was never permanently filled.

Leadership is only one of the CPSCs problems. The agency hasnt adapted to the challenges of a global marketplace, challenges far different from those it faced in Ralph Naders heyday. The CPSC was founded a year before the United States posted its last trade surplus. Now theres a trade deficit of about $731 billion, including $256 billion from China alone. From microwave ovens to toy soldiers, a large and growing proportion of the goods we consume are made in hard-to-monitor workshops and factories far from our shores. Policymakers are not always aware of the implications of this fact. Capitalizing on the toy recall scandal in a campaign stump speech, Barack Obama vowed to eliminate all toys imported from Chinaonly to later acknowledge that would mean banning 80 percent of all toys on the market. Deploying inspectors to follow the labyrinthine overseas production and supply chain is also a nonstarter.

The CPSC has similarly failed to make much use of the Internet to encourage consumer safety and education, offering instead a basically random assortment of reports with large gaps. If youre looking for, say, data on trampoline-related injuries from 1990 to 1999, youre in luck. If you want more current numbers, youd better get started on a Freedom of Information Act request. A report concerning nail gun injuries up to 2001 is on the site, but when the Sacramento Bee filed a FOIA request last year to get more recent statistics, the agency refused, relenting only after the Bee threatened legal action. The CPSC, it turned out, was obscuring the kind of trend it should have been warning people about: while 12,000 people went to the hospital emergency room with nail gun injuries in 1995, 42,000 emergency-room visits were reported in 2005.

The biggest issue, however, has always been whether the president and Congress even want the CPSC to succeed. With the passage of this summers legislation, it seems they finally do. The new law offers a realistic approach to oversight, mandating third-party lab testing for all childrens productsa reasonable alternative to keeping tabs on the vast network of foreign supply chains or simply handing responsibility over to the companies themselves. Under the acts provisions, CPSC regulators dont need to travel around the world, just to several universities where they can ensure that testing laboratories are looking for lead in childrens toys, not getting briefcases of cash from Mattel or Wal-Mart. And if this approach to testing toys works, federal regulators will have a strong argument to expand it to other consumer goods. The CPSC improvement bill also calls for the creation of a consumer complaint database on the CPSC Web site. A functioning database would catalog all product complaints by consumers, health care professionals, and law enforcement. It would also give industry a chance to respond to all complaints.

If the CPSC is serious about protecting consumers, it also needs to reorient its approach to educating the public about product dangers when it does encounter themsomething it currently does reluctantly, as if finding problems indicates that the regulatory cop is off his beat. The agency should make a greater commitment to clearly publicizing risks because doing so would show the public, journalists, and lawmakers how critical and difficult their mission is. And why shouldnt the bureaucracy promote its work? Clinton administration CPSC Chairwoman Ann Brown brought fleeting respectability to the agency by talking up product recalls on Good Morning America. Imagine the power of that approach applied to the world of RSS feeds, blogs, aggregators, and YouTube videos. Rachel Weintraub, director of product safety for the Consumer Federation of America, suggests a good first step would be a searchable database of hazardous products.

Of course, vigorous product testing and consumer information are not radical ideas. They draw on fundamental principles that date back to the rise of the consumer movement and the birth of the CPSCand those principles may be enjoying a renaissance. “The bulking up of the CPSC,” says Paul Light, professor of public service at New York University, “reflects an acknowledgment by Congress that something is woefully wrong with the execution of the federal government.” The public apparently agrees. A 1995 NBC/Wall Street Journal poll found that 70 percent of Americans wanted government to do less. In 2008 that poll found that 53 percent of Americans want a “more active government to solve their problems.”

There are, of course, still plenty of problems. But Congresss attempt to restore the CPSC suggests that, for the first time in years, its at least willing to try to solve them. Over the last four decades, the agency has become a cautionary tale of what happens when politicians build their careers bashing the government. It would be a happy twist of fate if, in 2009, the agency became a success story of what can happen when they decide to make government work instead.

This site and all contents within are Copyright 1969-2009 Washington Monthly
Editorial offices: 1200 18th Street NW, Suite 330, Washington, DC 20036