Once again, Congress has failed to differentiate between local and industrial.  I’m talking about the Consumer Product Safety Improvement Act (CPSIA), designed in the wake of the product safety scares to protect our children from lead, phthalates, and other harmful things that “oops,” accidentally end up in products when we’re not paying attention.

I know that I’m a little late on this one.  After all, this legislation was passed in 2008.  I heard about it then as the bill that was going to kill second-hand and consignment stores.  I am ashamed to say that I grieved briefly, and then resigned myself to eventually scouring Freecycle for second-hand products for my as yet unborn children.  What I didn’t realize was that it was also going to be devastating to thousands of other small businesses around the country.  I didn’t connect the dots.  And, apparently, neither did Congress.  Or they did and decided they just didn’t care.  Or it was going to be too much trouble to fix it.

Like NAIS, CPSIA places the financial burden for complying with federal standards on the producers, defined as manufacturers for CPSIA purposes.  Here is why this regulation is such a problem.  I’ll extract the really bad part:

“Anyone who makes, produces or assembles a product is considered to be a manufacturer.  If what you make is sold or donated, something as simple as adding ribbons to hair clips, knitting hats, or stringing beads into necklaces makes you a manufacturer.”

I spoke with a small business owner this afternoon regarding the impact CPSIA may have on his company in the next year.  He and his wife have developed educational adventure programs for children — the kind of business that truly benefits a community on so many levels.  They use a collection of toys and props that are assembled by their company and sold for additional revenue.  Like many small businesses, they are operating with a very small margin of profit.  Right now, the products they sell account for one third of their total business revenue.  In order to continue selling them, they will have to pay thousands of dollars per item to have their products tested and certified, in spite of the fact that they are not creating original materials, even if the materials they are using have been tested and certified.

Many small farmers across the country meet and exceed the standards for organic farming.  However, most small farmers who meet these standards are not USDA certified as organic.  Why?  Because the certification process is too expensive.  But small farmers who are unable to afford organic certification can operate without this certification.

Unlike these farmers, small business owners and craftspeople classified as manufactures of toys, clothing, and other products for children who cannot afford the testing and certification process under CPSIA will not legally be allowed to sell their products.  CPSIA has the potential to put thousands of small business owners and employees out of work at the end of the year.

Everyone loves safe food.  And I think you would be hard pressed to find someone who thinks lead in toys is a good idea.  But Congress needs to figure out how to distinguish local from industrial, and develop legislation or provide guidance to regulatory bodies accordingly.  I hope to see some movement in that direction on April 1st.