Lead Toy Law May Have Hurt Small Business

See Small Crafts vs. Big Government by Virninia Postrel, WSJ, page C12, 1-29-11.

"Frightened by news that toys made in China contained unsafe levels of lead, customers were looking for alternatives to the usual big-box offerings. Just as organic farmers gain market share whenever there's a food-safety panic, the lead scare boosted sales of artisanal children's goods."

"In response to the lead panic, Congress passed the Consumer Product Safety Improvement Act, or CPSIA, by an overwhelming majority. The law mandates third-party testing and detailed labels not only for toys but for every single product aimed at children 12 and under."

"Although big companies like Mattel could spread the extra costs over millions of toys, Mr. Marshall's small-scale suppliers couldn't. Unable to afford thousands of dollars in testing per product, some went out of business. Others moved production to China to cut costs. Many slashed their product lines, reserving the expensive new tests for only their top sellers. The European companies that used to sell Peapods such specialty items as wooden swords and shields or beeswax-finished cherry-wood rattles simply abandoned the U.S. market. The survivors jacked up prices."

""I'm a lot more cynical than I was," says Cecilia Leibovitz, who owns Craftsbury Kids, an online shop selling handmade toys and children's clothes, and also leads the CPSIA discussion group among Etsy.com's online sellers. Mostly individuals producing one-of-a-kind items, Etsy crafters find it especially hard to comply with, or even interpret, the law's requirements."

"By contrast, consider the recently enacted Food and Drug Administration Food Safety Modernization Act. Like the CPSIA, it establishes expensive new labeling, record-keeping, inspection and reporting requirements. But, unlike the CPSIA, it carves out an exception for small operations."

"Buying handmade toys may be nice, but eating produce from the farmer's market is a quasi-religious ritual of group identity."