Reasonable people disagree about the reach of the federal government, but there is near-universal consensus that it should protect us from such dangers as bacteria-infested food, harmful drugs, toxic pollution, crumbling bridges, and unsafe toys. And yet, the agencies that shoulder these responsibilities are in shambles; if they continue to decline, lives will be lost and natural resources will be squandered. In this timely book, Rena Steinzor and Sidney Shapiro take a hard look at the tangled web of problems that have led to this dire state of affairs.
It turns out that the agencies are not primarily to blame and that regulatory failure actually stems from a host of overlooked causes. Steinzor and Shapiro discover that unrelenting funding cuts, a breakdown of the legislative process, an increase in the number of political appointees, a concurrent loss of experienced personnel, chaotic White House oversight, and ceaseless political attacks on the bureaucracy all have contributed to the broken system. But while the news is troubling, the authors also propose a host of reforms, including a new model for measuring the success of the agencies and a revitalization of the civil service. The People’s Agents and the Battle to Protect the American Public is an urgent and compelling appeal to renew America’s best traditions of public service.
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The People's Agents and the Battle to Protect the American PublicSpecial Interests, Government, and Threats to Health, Safety, and the Environment
By RENA STEINZOR SIDNEY SHAPIRO
THE UNIVERSITY OF CHICAGO PRESSCopyright © 2010 The University of Chicago
All right reserved.
Chapter OnePublic Interest Lost
When Barack Obama ran for president as what former secretary of state Colin Powell described as a "transformational figure," he defined the role of government as helping people when they cannot help themselves:
Now, understand, I don't believe that government can or should try to solve all our problems. You don't believe that either. But I do believe that government should do that which we cannot do for ourselves—protect us from harm; provide a decent education for all children—invest in new roads and new bridges, in new science and technology.... Look, if we want [to] get through this crisis ... we need to get beyond the old ideological debates and divides between the left and the right. We don't need bigger government or smaller government. We need better government. We need a more competent government. We need a government that upholds the values we hold in common as Americans.
Without further elaboration, this fundamental principle—that government has a vital role to play in protecting people from harm—could lead to endless arguments in the arena of traditional social welfare programs over exactly when individual people cannot help themselves. But in the arena of protecting health, safety, and the environment, it is a serviceable, working proposition: when the threats are polluted urban air, dangerous drugs, and unsafe workplaces, individuals need government because control over the threat lies with someone else.
This book focuses on the five most important federal "protector agencies" created to shoulder these responsibilities—the Consumer Product Safety Commission (CPSC), the Environmental Protection Agency (EPA), the Food and Drug Administration (FDA), the National Highway Traffic Safety Administration (NHTSA), and the Occupational Safety and Health Administration (OSHA). Each agency was established on the premise that the national government must play the primary role in protecting citizens, workers, and natural resources from the negative by-products of industrialization. Congress decided, in partnership with a long line of presidents from both political parties, that the agencies are essential because individual people, acting alone, cannot take care of these problems.
The FDA is the oldest protector, with a birth date in 1906, during the presidency of Theodore Roosevelt, a period of emerging industrialization and caveat emptor mercantilism. At the time, the marketplace was awash in products like Swaim's Panacea, a deadly combination of sarsaparilla, oil of wintergreen, and corrosive sublimate (or medical mercury), which was sold to treat everything from ulcers to venereal disease. In a series of amendments to the original law, Congress extended the FDA's mission beyond policing such dangerous frauds to an affirmative responsibility for ensuring that all drugs and food are safe and that drugs are effective. Following in those footsteps, Congress created the other four protector agencies at the height of the social reform movement spawned by the Vietnam War and the Watergate scandal in the 1960s and 1970s. The problems they were designed to address were more subtle by then, and far more ubiquitous. This period of extraordinary legislative activism marked the largest expansion of federal power since the New Deal.
Despite their idealistic origins, forty-five years later, the five agencies are in shambles. In some instances, they have proved unable to deal with highly publicized threats—consider the FDA and Vioxx or lead paint–coated toys and the CPSC. In other instances, their reputations have been shaken by lower profile yet systemic failures—consider inaction on climate change at the EPA or the dearth of controls on workplace exposure to toxic chemicals at OSHA. "Shambles" is a harsh word, and we use it advisedly. In fact, the agencies fall along a continuum of dysfunction. Two—the CPSC and OSHA—would not make it past any reasonable triage of effective institutions, just managing to stay open for limited business. At the opposite end of the spectrum lies the EPA, the poster child for the deregulatory backlash that dominated national politics for twenty years. Regardless of the negative attention lavished on it by deregulators, the EPA has managed to cut a wider and deeper swath through public affairs than the other agencies combined and has been brought to its knees only with considerable effort. In between, in less dramatic stages of disrepair, are the NHTSA and the FDA, which have clocked substantial achievements at the same time that emerging, important problems slip from their grasp.
Many of the agencies' problems are attributable to severe shortfalls in funding. They do not have nearly enough money to carry out their statutory mandates to keep air and water clean, prevent the sale of dangerous products, ensure food and drug safety, protect workers from injury and illness, and prevent traffic accidents. And yet, by any measure, the money we spend on them is extraordinarily modest, totaling about $10.3 billion, or 0.29 percent of the $3.5 trillion dollar budget Congress approved on April 2, 2009, and 0.89 percent of the $1.2 trillion deficit projected for fiscal year (FY) 2010. The five agencies also suffer from gaps in legal authority that undercut their ability to take decisive action in the face of urgent threats. Their career staffs are depleted and demoralized, repeatedly denounced for regulating too much or too little. Yet as much as they suffer from this negative attention, they are damaged much more by a chronic lack of attention from the president and Congress, except during the public crises provoked by their regulatory failures.
This chapter introduces readers to the five agencies and their missions. They are presented by the size of their workforces, from smallest to largest. With that framework established, and a clear idea of what they were intended to accomplish, we describe the symptoms that indicate they are gravely disabled. We do not attempt to present a definitive diagnosis of everything that troubles them. Not only would such a discourse bore anyone not working directly within their ambit, it would divert our attention from their cross-cutting problems and possible reforms. Rather, our explanations are intended to give the reader an accurate snapshot of today's regulatory failures. We do our best to avoid the discredited practice of cherry picking isolated examples of agency disgrace, no matter how acute and well publicized. Instead, we choose one or two issues that pose important challenges to the agencies and are illustrative of their inability to fulfill their statutory missions overall. Subsequent chapters examine the multiple causes of their paralysis as a prelude to reforms that might rescue the agencies.
Of course, each agency has its own individual problems, caused by unique historical events, the tactics of the regulated industries, the competence of the public interest groups, and the attitudes of the political appointees who lead them and the judges who sit in judgment on their decisions. Yet we hope to persuade readers that the commonality of their problems is far more meaningful. These themes, which we develop in the rest of the book, can and should be addressed holistically, renewing the rational justification for government intervention: protecting those who cannot help themselves.
Thousands of Categories, Billions of Products
The CPSC was created during the presidency of Richard M. Nixon in 1972, following an exhaustive study by an ad hoc entity called the National Commission on Product Safety. The study estimated that as many as 20 million Americans were injured annually in their homes as a result of accidents involving consumer products, with 110,000 permanently disabled and 30,000 killed, at an annual estimated cost of $5.5 billion. In its early years, the CPSC was identified as having the potential to be the most powerful regulator in the federal constellation. It never came close to realizing that potential.
The CPSC estimates that it has jurisdiction over some 15,000 product categories including everything from backyard barbecues and electric drills to swimming pool slides and baby dolls. Or, to look at this vast jurisdiction another way, the CPSC is responsible for ensuring the safety of every consumer product except automobiles, aircraft, boats, drugs, firearms, food, and tobacco. In its heyday, circa FY 1981, the CPSC employed 891 "full-time equivalents" (FTEs) and had a budget of $41 million. Today, its resource levels are precipitously lower, coming in at approximately 20 FTEs and $80 million for FY 2008, despite a growth of 0 percent in the country's population. (Readers may notice that the budget figures we present vary by fiscal year. The government does not have a central Web site reflecting actual appropriations for all agencies and departments, leaving us dependent on individual agency Web sites that are updated erratically.)
The Consumer Product Safety Act assigns this sharply diminished workforce to "protect the public against unreasonable risks of injury" and to "assist consumers in evaluating the comparative safety" of products. The CPSC is supposed to identify specific "defects" in design or construction that make a product dangerous even when it is used for its intended purpose with normal care. The statute authorizes the issuance of prospective, industry-wide standards for manufacturing safe products, but only if the manufacturers in question do not agree to develop their own "voluntary" standards that are adequate to reduce risks. As a practical matter, the CPSC staff routinely backs off issuing mandatory and enforceable standards if an industrial sector promises to come up with its own guidelines and to do its best to follow them. This approach means that only a handful of products—for example, fireworks, full-size cribs, and bike helmets—are actually covered by enforceable standards. Product-specific, after-sale "recall orders" have played a much larger role in the agency's regulatory history.
Recall orders are only applicable to products that pose a "substantial product hazard" and are typically used to require manufacturers and retailers to take products off shelves and to persuade consumers to return the items to the store. To assist in the implementation of this authority, businesses must self-report instances for which they have information indicating that a product contains a defect that "could create" a substantial hazard. But because they depend heavily on free publicity and persuasion, recalls are notoriously ineffective. In FY 1997, the last year for which official figures are available, the CPSC estimated that the return rate on recalls was 16 percent.
To fulfill its missions of educating the public about hazardous products in the marketplace and highlighting areas in which enforcement action might be necessary, Congress instructed the CPSC to establish a National Electronic Injury Surveillance System. The system gets data from a representative sample of hospital emergency rooms regarding product-related injuries that come through their doors. The CPSC also gathers data from medical examiners and coroners about deaths that involve consumer products. All of this information could be used to project national injury trends and set priorities, especially in an era in which the World Wide Web makes data instantly accessible to individual consumers.
Congress anticipated that dissemination of this data could provide extraordinary disincentives to the manufacture and sale of defective products. But these businesses have worked hard to prevent such disclosures, arguing that because accidents are often caused by consumer negligence, the release of data would be deceptive, ruining the reputation of perfectly acceptable products at the same time that disclosure spotlights defects. They have clearly won this debate. Before the CPSC can release any information that identifies a specific manufacturer, it must submit the information to the company and allow a month for comment on the information's accuracy. Once these comments are received, the CPSC must investigate the manufacturer's concerns to determine whether or not they are accurate.
The CPSC initially interpreted all of these statutory restrictions to apply only to information it affirmatively wished to circulate. If the CPSC had information in its possession and a member of the public asked to see it, the agency would disclose the material without investigating accuracy. In 1980, the Supreme Court disagreed, holding that the CPSC's obligation to investigate before disclosing applied equally to information affirmatively released by the agency as well as citizen requests for information in its possession. As its resources shrank in comparison with the amount of commerce it was assigned to supervise, and large manufacturers fought hard to prevent the release of such data, this burden became unsustainable. As one commentator with extensive experience as a CPSC attorney summarized it, "The Supreme Court's ruling constituted a disaster in terms of the agency's ability to release information either expeditiously or, in some cases, at all."
But the CPSC's constituent industries were not quite finished with their campaign to curtail its disclosure authority. In 1981, at the outset of the first Reagan term, Congress amended the authorizing statute to circumscribe the release of the one set of data that should not have accuracy problems: notices written by the companies themselves explaining potential product defects. The amendments forestalled release of manufacturer- and retailer-authored notifications that a product may cause substantial injury because, according to the Chamber of Commerce, making the information public would discourage companies from telling the government about their problems in the first place. To win authority to release the data, the CPSC must either take the company to court or engage in negotiations for a settlement with the company that would allow release of the information. The result is long delays in giving the public information about dangers the companies themselves acknowledge, including decisions by companies to voluntarily recall specific products. A report by Public Citizen found that even where the agency sued manufacturers for reporting significant defects late, the CPSC's own disclosures were delayed for long periods of time. The report analyzed forty-six late notice cases that ended in product recalls and found that disclosure to consumers of the product hazard was delayed, on average, for 209 days.
As the 1981 amendments curtailing the CPSC's disclosure authority indicate, the agency came under heavy fire at the beginning of the Reagan administration, less than a decade after it was created, with some of its conservative critics proposing that Congress simply abolish it. When Congress would not agree to this radical solution, President Reagan settled for a 25 percent cut in the CPSC budget. The agency functioned in relative obscurity for many years, until 2007, when a tsunami of controversy hit it broadside.
Eighty percent of the toys sold in the United States are manufactured abroad, the vast majority in China. Because China has no effective regulatory structure, these imports cause a raft of new problems for the already weakened CPSC. The leading example is toys coated with lead paint, which were discovered to have flooded the U.S. market in 2007.
Ingestion of lead at very low levels can trigger poisoning serious enough to cause neurological damage in a child. The United States bans the use of lead paint in toys. But on August 1 , 2007, Mattel, the world's largest toy company, announced that it was recalling some 26,000 die-cast toy cars that were coated with lead paint. The Mattel recall followed a spate of smaller recalls in 2007, the majority of which involved lead paint found in products from baby bibs to children's jewelry. Investigative reporting by the New York Times discovered that in China, paint with high lead levels costs one-third as much as paint with low or no lead because China is the largest producer of lead in the world and has increased its mining and processing of the toxic metal by 50 percent since 2001. Chinese executives admitted that their government does not inspect factories and that, although a national standard theoretically limits lead levels in consumer products, no one enforces it. Chinese and CPSC officials ultimately signed an agreement to ban lead in toys entirely, but it is unclear how the ban will be implemented.
Excerpted from The People's Agents and the Battle to Protect the American Public by RENA STEINZOR SIDNEY SHAPIRO Copyright © 2010 by The University of Chicago. Excerpted by permission of THE UNIVERSITY OF CHICAGO PRESS. All rights reserved. No part of this excerpt may be reproduced or reprinted without permission in writing from the publisher.
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Table of ContentsPreface
PART 1. Diagnosis
CHAPTER 1. Public Interest Lost
CHAPTER 2. The People’s Agents
CHAPTER 3. Hollow Government
CHAPTER 4. Cost-Benefit Analysis
PART 2. Institutions
CHAPTER 5. Congress
CHAPTER 6. The White House
CHAPTER 7. The Judiciary
PART 3. Solutions
CHAPTER 8. Positive Metrics
CHAPTER 9. Renewing the Civil Service
CHAPTER 10. The Road Forward