Hello Donklephants! I’m Mark, and I regularly blog at (and run) the site Publius Endures.

Ostensibly I self-identify as a libertarian, although I’m not terribly dogmatic and tend not to write much on the more common libertarian themes, focusing instead on taking a sober look at the relationships between interest groups (which I define broadly) and political parties, the way in which political coalitions are formed, and the way in which laws and regulations are affected by interest group politics.

My most recent piece at Publius Endures dealt with a piece of legislation that largely fell under the radar: the Consumer Product Safety Improvement Act of 2008, which I argued needs significant revisions regardless of your political viewpoint. I have a much better piece (read: actual journalism!) up as of this afternoon at the excellent conservative site Culture11. The act, passed with almost no opposition, appears to represent the confluence of good intentions gone wrong, poor legislative incentives, and bad economics, with the added bonus of being particularly devastating to small and medium-sized domestic businesses. In other words, as enacted, the legislation should offend the sensibilities of almost any ideology.

The basic facts of the legislation appear, at first glance, to be quite reasonable. In essence (and although it also addresses several other subjects), the legislation is a response to the imported toy scandals of 2007, in which several mass-produced toys had to be recalled for containing levels of lead far in excess of the legal limits. As a result, near-unanimous passage of the legislation was almost guaranteed from the start – after all, who wants to be FOR lead in childrens’ toys in an election year?

The problems arise in the actual details of the legislation, which are voluminous and, worse, vague. As I write in the Culture11 piece (please do go read the whole thing!):

The biggest problem, perhaps, is that the law implements a new third party testing requirement on every SKU number of every children’s product (including individual titles of children’s books), testing that can run anywhere from a few hundred dollars to tens of thousands of dollars, depending on the type of product. It is unclear how often this testing will be required; however, the wording of the legislation suggests that it could be as often as every outgoing shipment. What is clear, however, is that large imported shipments will only need to be tested upon their arrival in the U.S.

The new law also requires a new type of labeling on all children’s products, in which these products must be stamped with various information for tracking the product, including the date of production. While seemingly easy to comply with, this will actually require expensive retooling for manufacturing machines. The law further mandates that suppliers provide their distributors with certifications for each shipment of each product, a bureaucratic nightmare that many businesses will likely violate occasionally due to simple human error. Yet punishments for violations of the law are draconian — $100,000 minimum fines for each violation up to $15 million, plus possible criminal sanctions. In addition, it is still possible that the law will be implemented in such a way as to turn some pre-existing inventory into contraband when the law takes effect on February 10, 2009 (unless this changes, existing inventory would have to be discarded, immediately driving many businesses to close and/or default on loans).

The piece goes on to discuss the way in which this legislation was passed, and how free market advocates can prevent legislation such as this in an era where “deregulation” is a four-letter word.

For those answers you’ll have to read the whole thing, but I did want to discuss something here that was not relevant to my point in that piece.

One of the most amazing things that came out during the course of my research was just how little this law is going to do to improve toy safety – indeed, it will most likely make children’s products more dangerous by causing the CPSC to focus on catching paperwork errors instead of finding dangerous products. This is true even though the bill significantly increases the agency’s budget.

Even more amazing was just how easily Congress could have passed legislation that actually would have improved safety. The people I interviewed for the article agreed that one of the best things that could have been done in the wake of the toy scandal was to force the CPSC to better prioritize its enforcement responsibilities. In essence, one of the reasons so many lead-laden toys got through last year was that the agency treats most enforcement issues as being created equal (unless, of course, there’s a death involved). This encourages a focus on finding problems that are easily found, but are usually relatively harmless – things like paperwork errors, for instance. It’s the same type of problem Megan McArdle says faced the SEC with respect to the Madoff case. Instead of fixing this problem, the legislation actively makes it worse by giving CPSC more technicalities to enforce.

Another possible solution that was mentioned to me was the idea of “component testing.” Under component testing (which the CPSC actually is, apparently, considering in some form), you require testing only of individual components instead of the final product. This is less costly on a per-test basis and allows manufacturers to make multiple products using the same components. So, for instance, a small children’s book publisher would only need to test its ink, paper, and coverboard rather than having to test every single title.

Yet neither of these easy solutions was even considered by Congress. Instead, one of my sources told me that Congress’ response to just about any proposed changes or objections was, effectively, “the National Association of Manufacturers is on board, as are Hasbro and Mattel, so we don’t really care what you think.”

This presents a major problem for small business (unless one of the major parties adopts something akin to the position I advocated in my Culture11 piece), to wit: How do small businesses defend themselves against onerous laws and regs when they can’t get a seat at the table?

One obvious answer is to organize into a more focused advocacy group, but even this doesn’t always get you a seat at the table. For instance, so far as I can tell (though I’m not 100% certain), the Apparel and Footwear Association (which, unlike other advocacy groups, is not dominated by its biggest members) did spend a substantial amount of effort pushing for changes to the legislation. Yet none of those changes made it through, suggesting they received essentially the same response.

And, finally, some breaking news. I just now found out that the National Association of Manufacturers (which supported the legislation) is petitioning the CPSC to implement regs that would eliminate a lot of the hardship to be caused by this law. I have to think about what this means…but I don’t think it’s inconsistent with the explanation I gave in my C11 piece.

(Excerpts cross-posted at Publius Endures)

Barack Obama has already heavily restricted lobbyists from his transition team. Now he’s also rejecting their money for inaugural festivities:

Mr. Obama’s newly formed inaugural committee said Tuesday that it would not accept money from corporations, political action committees, people who are currently registered with the federal government as lobbyists, those who are not citizens of the United States or registered foreign agents.

Campaign finance experts said that to their knowledge, the limits were tighter than for any previous inauguration [$50,000 for individuals], both in dollar amounts and in who will be permitted to give. Donations for earlier inaugurations have carried dollar limits, but they were higher — up to $250,000 for individuals in the case of George W. Bush, who allowed corporations to give more than that.

I’m sure Obama’s wealthy donors will pony up (and receive an invitation to a ball). But I wonder if Obama’s smaller donors will be moved to give money so other people can hold a party. And I wonder how much less Obama will spend than the record $42.3 million George W. Bush spent on his inaugural events in 2005.

However much money Obama can raise and however scaled down his inauguration will have to be, I’m glad to see he’s sticking to his pledge to limit the power of lobbyists and large corporations. He is certainly establishing the right tone in the lead-up to his presidency.

During the campaign, Barack Obama promised to curtail the power of lobbyists if he was elected president. Now, he’s apparently tyring to live up to that promise:

President-elect Barack Obama will bar lobbyists from helping to pay the costs of his transition to power or working for it in any area in which they have represented clients in the last year, his transition team said Tuesday.

Obama’s people would also like to bar lobbyists from paying for the inauguration events, but they have not made a final decision on that matter.

The revolving doorway between government positions and lobbying firms moves fast and both parties have a long history of shuttling their industry experts between the public and private sectors. It’ll be interesting to see if Obama can live up to his promise and/or whether the decision will create any transition complications.

Nevertheless, I’m glad to hear Obama is making this move. Reforming government requires reforming the level of access and influence granted lobbyists and the companies they represent. Everyone and every organization has a right to petition the government. But they do not have a right to place people next to the ear of the President. Hopefully this decision by Obama is the first step in making some real changes.

Who is the real William Timmons?

Okay, that’s a bit dramatic, but this is yet another reason why you want to get as far away from lobbyists as you can. Because if Timmons really is involved with this and had knowledge of what was going on, that’s bad news for McCain.

Murray Waas has more:

William Timmons, the Washington lobbyist who John McCain has named to head his presidential transition team, aided an influence effort on behalf of Iraqi dictator Saddam Hussein to ease international sanctions against his regime.

The two lobbyists who Timmons worked closely with over a five year period on the lobbying campaign later either pleaded guilty to or were convicted of federal criminal charges that they had acted as unregistered agents of Saddam Hussein’s government.

During the same period beginning in 1992, Timmons worked closely with the two lobbyists, Samir Vincent and Tongsun Park, on a previously unreported prospective deal with the Iraqis in which they hoped to be awarded a contract to purchase and resell Iraqi oil. Timmons, Vincent, and Park stood to share at least $45 million if the business deal went through.

Timmons’ activities occurred in the years following the first Gulf War, when Washington considered Iraq to be a rogue enemy state and a sponsor of terrorism. His dealings on behalf of the deceased Iraqi leader stand in stark contrast to the views his current employer held at the time.

Will Obama bring this up if McCain brings up Ayers? Seems appropriate enough.

This is contrary to what the campaign said earlier this week about Rick Davis’ ties to the lobbying firm he owns.

From Newsweek:

Rick Davis, John McCain’s campaign manager, has remained the treasurer and a corporate director of his lobbying firm this year, despite repeated statements by campaign officials that he had ended his relationship with the firm in 2006, according to corporate records. [...]

In its initial statements to reporters this week, the McCain campaign said that the disclosure of the payments from Freddie Mac was irrelevant because Davis, who was never a registered lobbyist for the troubled housing corporation, had severed his relationship with Davis Manafort in 2006, and was no longer drawing any income from it. Jill Hazelbaker, the campaign’s communications director, said in an e-mail Tuesday that Davis “left” Davis Manafort in 2006. In a statement attacking The New York Times, posted on the campaign’s Web site on Wednesday, campaign spokesman Michael Goldfarb said that Davis “separated from his consulting firm, Davis Manafort, in 2006.” (A senior campaign official, in an e-mail statement to NEWSWEEK that was not for attribution on Tuesday night, said “Rick is no longer affiliated with the firm.”)

But those statements appear to have overstated the extent to which Davis had severed his relationship with his lobbying firm. Filings made by “Davis Manafort Partners” with the Virginia Corporation Commission as recently as April 1, 2008, show that Davis was still listed as one of only two corporate officers and directors of the firm, according to records on the commission’s Web site reviewed by NEWSWEEK. That filing records Davis as the “treas/clerk” of the firm; his business partner, Paul Manafort is listed as the president and chief executive officer.

Another filing by “Davis Manafort, Inc.” (with the same Alexandria, Va. address, and recorded on Oct. 17, 2007) also lists Davis as an officer and director of the firm, reporting his position as “T/Clerk,” a reference to his formal title as corporate treasurer and clerk.

It’s getting harder and harder for the McCain camp to defend this guy, but at this point what choice do they have? They can’t fire their campaign manager with less than 40 days until the election. That would be suicide.

Nope, they’ll have to obfuscate and ride this one out and hope the media just ignores it.

First Rick Davis and now William Timmons Sr., a guy who lobbied for the troubled mortgage giant for 8 years…right up until last month when the government took over.

From Bloomberg…

Newly available congressional records show Timmons’s firm received $260,000 this year before its lobbying activities were barred under terms of the government rescue of the failed mortgage giant. Timmons, 77, is listed as a lobbyist for Freddie Mac on the company’s midyear financial-disclosure form.

While Republicans say Timmons is making plans for the transition if McCain wins in November, the campaign wouldn’t confirm his role. Timmons didn’t return a phone call seeking comment.

To be fair to McCain, it’s not like he has had long ties with this guy, but he needs to drop this guy and his firm like a sack of hot rocks immediately or face even more scrutiny about his lobbying ties.

However…there’s one catch. Apparently Timmons is one of the most well known and well connected lobbyists in the world…

Timmons is a longtime power in the Washington lobbying industry whose clients include the American Petroleum Institute and Chrysler LLC. Visitors to the company’s Web site are told that “Timmons and Company pioneered the concept and the industry standard for Washington representation.”

He founded the company in 1975 after leaving the administration of President Gerald Ford, and has worked to elect every Republican presidential nominee since.

So basically, this guy has been a lobbyist for more time than McCain has been in office.

Now that’s a long time.

Again, it doesn’t look good for McCain’s maverick/reform message that this firm had such close ties with Freddie, and he’d do well to consider a different team.