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Obama Team To Boost CPSC, Give Companies Less Discretion in Recalls

Posted on November 24 2008.

The recent statement by President-elect Obama’s transition team in a Wall Street Journal article on strengthening the CPSC includes needed steps to address product recalls. The current government grants companies enormous latitude in how to handle recalls, including how, and even whether, to advertise the recall to customers so they know to turn in the product. Of course, it's no surprise that Wal-Mart has led the industry in negligence in this area, including allowing tainted food, defective products from China and dangerous toys to remain on its shelves. Lee Scott's and Wal-Mart's publicized fight to prevent Obama’s election was driven by the company's ruthless attempts to avoid any kind of regulation, including over product safety. So the incoming Administration is right to call for giving companies less discretion and independence over how recalls take place. This is a  good idea, considering last month, Wal-Mart's “taking the recall into its own hands” for lead-tainted toy animals proved inadequate since the retailer failed to communicate crucial information to consumers such as how many toys were sold, when, and where.

Obama Signals Tougher Regulations at Federal Agencies

President-elect Barack Obama is signaling by a combination of words and deeds that his administration will toughen regulations at federal agencies that oversee consumer products, environmental policy and workplace safety.
Mr. Obama has named a number of people to his transition teams for regulatory agencies who favor a firmer government hand in overseeing industry behavior. In addition, Mr. Obama has indicated in a series of pre-election letters to a big federal employee union that he intends to take a more pro-union approach on labor questions than his predecessor, and give agencies such as the Environmental Protection Agency more money.

"I think the agenda is going to be bold," said Rep. Jan Schakowsky of Illinois, who co-chaired Mr. Obama's national presidential campaign and is on the short list to take his Senate seat. The transition team is looking at a number of "activists and advocates" to lead key agencies, including the Consumer Product Safety Commission, the EPA and the Department of Labor, she said. Rep. Schakowsky noted that addressing the worsening economy would take precedence over regulatory overhauls. Business groups in Washington have warned Mr. Obama that imposing increased regulatory burdens on already suffering industries could exacerbate the economic slump. Still, Mr. Obama has put himself on record in favor of a more robust government approach to a variety of regulatory issues in a series of letters to members of the American Federation of Government Employees in the weeks prior to the election. The AFGE has placed six people on the transition team, and is recommending overhauls of the EPA and Department of Labor, among other agencies, said AFGE President John Gage. "We've been in contact with the transition team...on specific agencies, whenever we request it. They'll be open to some ideas we have, and I hope we would receive a little notice before a particular assistant secretary or so is put in," Mr. Gage said. He would not disclose the names of the transition-team members recommended by the union. Mr. Gage did mention Linda Chavez-Thompson, a former executive vice president of the AFL-CIO, who is on the transition team. She has been discussed as a possible secretary of Labor. Obama policy director Karen Kornbluh and spokesman Tommy Vietor declined to answer questions about the administration's regulatory plans on Tuesday. Rep. Schakowsky said EPA regulation of carbon dioxide and other greenhouse gases as pollutants under the Clean Air Act was a strong possibility in the Obama Administration. The new administration will bring "much more emphasis on renewable energy and less emphasis on [effective] subsidies for Big Oil," she said. Many business groups, including the U.S. Chamber of Commerce, oppose EPA regulation of CO2. "They're [EPA officials] willing to regulate everything from the industrial sector to warehouses, offices, schools and churches," says William Kovacs, vice president of the Chamber of Commerce. One potential candidate to head the EPA is California Air Resources Board Chairman Mary Nichols, who led her state's effort to implement a state law calling for a 30% cut in greenhouse-gas emissions from new cars by 2016. Last December, the EPA's current administrator, Stephen Johnson, denied California permission to go ahead with its greenhouse-gas rules. His decision was opposed by many EPA career staffers. California is now suing the EPA in federal court in Washington, D.C., to overturn that decision. Ms. Nichols has frequently sparred with the nation's auto makers, who oppose state-level regulation of such emissions as tantamount to letting states regulate fuel economy, traditionally a federal responsibility. She confirmed in an interview that she has had discussions with the Obama transition team, but declined to list her priorities should she be appointed, beyond "restoring confidence [in] EPA science and that EPA is a science-based agency." Workplace-safety regulations and employee family-leave policies will be up for an overhaul, Mr. Obama and his advisers have suggested. In the letters to AFGE union employees at federal agencies, Mr. Obama promises a series of regulatory specifics. "In my Department of Labor, the Administrator of Mine Safety and Health will be an advocate for miners' safety and health, not for the mining companies' bottom lines," Mr. Obama wrote to agency employees. "We've seen a more mature and prudent view of how important coal is to the economy, and what the consequences would be if the industry is seriously damaged," said Luke Popovich, spokesman for the National Mining Association. "How the safety issue will play out is anyone's guess right now." At the Consumer Product Safety Commission, the new administration has said it favors doubling of the agency's budget, a streamlining of the nation's product-recall system that reduces companies' say in the process, and higher fines for safety violations. Mr. Obama's home state of Illinois has the highest lead-poisoning rate of any state. The Illinois congressional delegation -- from which several of his closest advisers are drawn -- pioneered the toughest children's product lead standards in a generation. Mr. Obama backed such controls both in Illinois and at the federal level. Pam Gilbert, a product-safety lawyer on the Obama transition team, is on the short list to chair the agency, where she was executive director in the Clinton era. She favors working with industry on enforcement, while pressing for the toughest possible standards. "By design, the Bush administration slashed positions, [so] there is a crying need to staff up with experts. The agency isn't going to be able to accomplish its mission until that happens," Ms. Gilbert said in an interview before joining the transition team. 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