Saturday, June 06, 2009

Design Piracy Protection Act II - Rise of the Fashion Patent Trolls

I don't have much new to say about the Senate's second attempt to enact Diane von Furstenburg's wet dream of a law, the Design Piracy Prohibition Protection Act. DvF, for those of you who don't know, is a big time designer who currently heads the Council of Fashion Designers of America (CFDA). CFDA includes other tiny little "independents", like Oscar de la Renta and Donna Karan.

The DPPA, whose earlier incarnation I wrote about here, is a Three Card Monte tour de force. First they show you the money card, trademark piracy. Oh, the poor designers, having their precious Designs copied by unscrupulous, probably brown-skinned, sweatshop owners who copy the garments right down to the logos and trademarks. Then, they elicit your support, since nobody is in favor of people having their ideas stolen, much less their branding. When you look under the card, though, what you find is that the Act actually establishes clothing design as intellectual property, something only enforceable by civil action.

Back up a second. As I noted here,
First of all, note that this law protects designs, not branding. [Counterfeiting as is practiced on Canal Street in NYC] is ALREADY ILLEGAL UNDER EXISTING LAW, which are not enforced.

Second, THIS LAW DOES NOT ADDRESS THOSE ISSUES. But it will put independent designers out of business. Stop and ask yourself a few questions:

1) Who is more likely to have access to the necessary patent attorneys, independents or big designers? You are going to need lawyers to do patent searches [and applications] and to enforce claims.

2) Given that anyone in the supply chain can be sued for infringement, will you be able to hire pattern makers, cutters, etc.? Only if you can prove that you already own the design.

The biggest supporter of this law is knockoff artist Diane von Furstenberg, who recently got caught knocking off a Mercy jacket design.

This law will protect the big guys, squash what little innovation there is, and wreck US apparel manufacturing.

And another thing ... This is going to lead to patent trolls, the same way patents have in every other field. A patent troll is someone who patents all possible variations on a design theme simply so that they can control market share or set themselves up to be able to threaten potential market entrants with litigation and corner them into lucrative settlements.

Yes, the high end French fashion industry has protection. Have you ever noticed how much attention French fashion shows receive? Do you know why? It's because as soon as the show is over, designers in the US are poring over photos so they can knock them off. The industry thrives on copying, but mostly by copying the high end, not the low end. This law -- and people offering their support -- is advertised as helping the little guy, but it will actually help the big guy, who will go on knocking off the designs of the little guy because they can't defend themselves.

It's f-a-s-h-i-o-n. Everyone is looking to copy what everyone else is doing so that they can lay claim to being fashionable. At present, it's all Open Source. That's about to change. We're about to shift from GNU/linux to Windows 3.11 in the fashion industry.

Branding and logos have nearly killed the industry; no need to have innovative design if you can pass off t-shirts with collars and focus grouped pseudo colors as style. All you have to do is to associate the logo (the Swoosh, the Alligator, the Polo Player, FUBU, the name: Hillfiger, Mossimo) with a certain set of lifestyle choices in the mind of the mark consumer. Then you can pass off whatever crap you want to them at substantial markup.

Kathleen is going to have lots more to say about this, but you can start with these:

Proposed law to destroy 90% of design businesses
Fashion copyright: the death of us all

In the first one, she implores you to "Send emails. Sign the petition." Please do. Not like that has done any good in getting the attention of Congress or the MSM with regards to CPSIA, but at least we have a chance of killing this Golem before it becomes a law; there is little to no chance afterwards.

Hattips to Boing Boing and Walter Olson (Overlawyered).
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Note: If this law passes, I intend to patent the popped collar, enforce it against infringement, but refuse to actually make use of it. Perhaps this kind of thing can be stopped.

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Saturday, April 18, 2009

Things I have learned

This is a true story.

Once, in band camp I was out at a restaurant with a friend and his (now ex-) wife and she talked us into going to Hooters. Seriously. She offered to pay for the beer, how could we resist?

So we walk into Hooters and the place is packed. Everyone is in there watching TV, so I note that it is a NASCAR race. The only seats available were out on the porch. On the way there, we pass three tables together: at the middle table were seated two middle-aged couples, the table to the left featured their kids (we knew that because they were asking if they wanted more), and the table to the right was two older couples who were apparently their parents ("Dad, you want some more hot wings?"). I had a revelation: If you take your kids, and your parents, to Hooters, to watch the Pepsi Cola 500, you just might be a redneck.

(Grrr, something wrong with ftp)
(From this photo set)
Not that there's anything wrong with that.

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Wednesday, April 01, 2009

What is the point of government science?

Until this morning, I had been operating under the assumption that the ban on phthalates contained in the CPSIA was (1) scientifically justified, and (2) not supported by the earlier legislation that guided the CPSC's actions. Guess I was wrong.

It's not that I have done the research on either point. On the science, I did just enough to see that this was likely to devolve into one of those smear campaigns that one sees in Global Warming or Second Hand Smoke debates. You know: every argument degenerates into an ad hominem because the scientist in question works for a university that once accepted money from a (pick one: oil company, tobacco company, chemical company, government agency) and therefore cannot be right about anything. On the legislation, I just accepted the special interest groups' claim that this legislation was necessary. I felt I should do that because this wasn't fertile ground for argument. My approach has always been that the CPSIA does not take into account the particulars of the industries regulated, so there are predictably unintended consequences (an oxymoron or not?).

If this NPR report (Public Concern, Not Science, Prompts Plastics Ban) is any guide, it turns out that career science staff at the CPSC found problems with two types of phthalates (DEHP and DINP) and got them restricted 25 and 10 years ago. Otherwise, there simply is little ground (according to their research) for concern. If the CPSC science is good, babies simply do not keep these things in their mouthes long enough to get a large enough dose. Congress' take on it?

Sen. Dianne Feinstein (D-CA) said the ban was needed because phthalates had been "linked to serious reproductive defects."

Rep. Jan Schakowsky (D-IL) talked about "potential harm to testosterone development and the male reproductive tract."

Yes, this is the same Jan Schakowsky who threatened my wife.

I'm still not interested in the science: I'll stipulate to the dangers. But one has to wonder about the utility of government scientists when the people who insist that we must have them to provide data free of conflicts of interest also refuse to accept their conclusions. I must once again conclude that the special interest groups -- US PIRG, Public Citizen, Consumer's Union -- control Congress, this time with one-sided and dubious "science" and "facts". Perhaps it's the allure of truthiness, a quality apparently not limited to the Bush Administration or Republicans despite their well-documented war on science.

And having stipulated to the science, it appears that the CPSC already had some leverage (link, caveat emptor, but also listen to the NPR story linked above):

In the United States, the Consumer Product Safety Commission (CPSC) and the Toy Manufacturers of America (TMA) agreed upon a voluntary limit of DEHP at 3% in pacifiers and teethers in 1986. Later in 1998, the CPSC asked toy manufacturers to voluntarily withdraw vinyl teething rings and rattles containing the phthalate DINP from the market.
Nancy Nord summarizes the problem nicely in a letter to the POTUS today:
Upon joining the CPSC, the new chairman will be presented with a law that curtails the agency's ability to prioritize its regulatory activity based on an assessment of risks, the magnitude of those risks, and the actual consequences of those risks.
Not to mention a hostile Congress that refuses to listen to its constituents or to the career scientists whom we pay to advise the representatives we elect to ignore us.

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Saturday, March 28, 2009

Astroturf

Given that we've already heard from US PIRG and Public Citizen, it should not be surprising that another Nader organization has decided to weigh in on the CPSIA debate. This time, it's a front organization for Big Law, the Trial Lawyers, called the Center for Justice and Democracy, and their pet blog, the Pop Tort.[1] They are dredging up the same arguments that David Arkush and Rachel Weintraub have already trotted out to the applause of The True Believers:
There is no problem with CPSIA, the CPSC has all the power it needs to make broad exemptions for small businesses, etc. The real problem is Nord, she needs to go. [paraphrasing]
I think we've already exploded that several times over. It flies directly in the face of Rachel Weintraub's statements before the committee during the hearings for the CPSIA (pdf) (HR 4040):
Unfortunately, the CPSC's ability to be proactive has been thwarted by a shrinking budget, a lack of aggressive leadership within the agency, and statutory provisions that create obstacles to the effective prevention of product risks.
...
Before proceeding to a detailed explanation of our recommendations, we wish to emphasize the importance we place on four particular issues -- Section 6(b), independent third-party testing of children's toys and products, the need to include whistleblower protections, and language clarifying the reach of CPSC's authority regarding the preemption of common law claims in any CPSC reform package.
Her recommendations then begin with an entire section -- headlined in boldface, "1. Strengthen CPSC A. Increase Budget" -- which has since been dropped by all of the pro-CPSIA crowd as an issue. CPSIA increased the budget authority, but Congress has not allocated the actual resources. Nevermind that the same people who passed the law still control the Congress, or that they have sent hundreds of billions to Wall Street, Detroit, and various other places.

After expressing support for a number of other measures designed to increase the size and scope of the CPSC, Weintraub then began to discuss lead in children's products. The boldfaced headline once again makes it clear that she wasn't talking about reasonable measures that take into account then actual risks: "Ban Lead from Children's Products". Nevermind whether or not the children can actually access the lead, or whether they are likely to come into contact with it, or whether they can actually absorb it (all of the things you would need to prove in applying for an exclusion, see below).

But the really interesting bit is this:
Lead has been found in products made by large manufacturers, as well as in those made by smaller companies. We support a ban on lead in all children's products, which currently does not exist.
They don't want a small company exemption. They are telling people that the CPSC can offer such an exemption, but the careful reader may observe that they never support their assertions with citation of the relevant portion of the law. Even their favored Chairman Moore has come out strongly against small companies (as noted below).

They don't want reasonableness. In her testimony, Weintraub said this:
We recommend that the language be preceded by the following statement, which is included in S. 2045:
"the prohibition contained in section 2(A) shall apply without regard to whether the lead contained in such children's product is accessible to children."
What about exemptions for inputs (cloth, dyes, components) or component testing versus final product testing? Again, Weintraub is against any compromise:
To assure that products are safe when they enter the American and global stream-of-commerce, safety must be infused into the earliest stages of the supply chain. For this reason, independent third-party testing of final products, as well as components, must be required [emphasis added]. Third-party testing entities must be independent from and have no financial relationship with the manufacturer producing the product. Testing must be conducted to identify design flaws as well as violations of existing regulations [emphasis added], such as those governing the use of lead paint. Components and final products must be tested at numerous stages of production and tests must be conducted randomly throughout the manufacturing process [emphasis added]. Products should also be certified that they meet the appropriate standards and should bear a label indicating that they are certified.
Testing for design flaws? Who will judge that, and by what standard? This is a statement that effectively places all decisions on design within the federal government as advised by Ralph Nader and his devoted followers, Rachel Weintraub (Consumer's Union et al), Ed Mierzwinski (US PIRG), David Arkush (Public Citizen) and Joanne Doroshow (Center for Justice & Democracy). Dissenters need not apply.

More recently, Weintraub reacted to reports that CPSIA is seriously flawed with what has become the party line: "Nord has to go. The law has to stay. And don't worry, they will address your concerns." Compare these new sentiments to her older comments quoted above:

"The most important issue right now is to ensure that there is strong, effective leadership at the helm of the Consumer Product Safety Commission," Weintraub said.

She emphasized that new leadership is vital in order to begin implementation and enforcement of the CPSIA -- which, among other things, mandates lead-testing for certain products intended for children--with "a common sense approach consistent with the law."

Weintraub acknowledged industry concerns about the law, particularly those having to do with the costs of testing products for compliance. However, she decried efforts to have the law revised as attempts to have it "opened, gutted and weakened."

The law as written, according to Weintraub, already addresses "almost every common sense concern," including those related to children's clothing and books. "Textiles that are 100% fabric ... and books printed after 1985 do not contain lead," and do not need to be tested.

An exemption for testing of textiles that are 100% fabric essentially means "togas". Except for togas, no final products consist of 100% fabric: diapers, sheets, and other "simple" products also contain thread and various other components such as interfacing and dye. Is she now endorsing component testing and opposing the random testing, in-process testing, and final product testing that she earlier claimed "must be required"? I doubt it. These are appeasements intended to shut down -- or shut up -- the opposition.

In a particularly nasty posting containing a variety of outright lies, and ironically entitled, "True Lies: Debunking A Major CPSIA Myth [2]", the also ironically titled CJD asserts that the CPSC already has already asserted its own power to issue the small business exemption. As evidence, they cite the "Children's Products Containing Lead; Final Rule; Procedures and Requirements for a Commission Determination or Exclusion". All such rules contain a statement regarding compliance with the Regulatory Flexibility Act (RFA) which requires agencies to consider the compliance cost on small businesses. Their interpretation of that statement in the linked document is:
Here, the agency decided the CPSIA's impact on small businesses wasn't bad at all. Why? Because of its authority to issue exemptions to small businesses from the CPSIA!
The actual statement?
The Commission's Directorate for Economic Analysis prepared a preliminary assessment of the impact of relieving certain materials or products from the testing requirements of section 102 of the CPSIA. The Commission preliminarily found that the proposed rule would not have a significant impact on a substantial number of small entities. The procedures and requirements would allow certain businesses, including small businesses, the ability to seek determinations and exclusions which would allow these entities to continue to manufacture their products without the continuing cost of testing the materials for the presence of lead. Based on the foregoing assessment, the Commission certifies that the rule issued today on procedures and requirements would not have a significant impact on a substantial number of small entities.
Is this a small business exemption? No. It says that small businesses can apply for the "determinations and exclusions" which were the subject of the ruling. In that regard, they are no better off than large manufacturers. It does not grant them a "small business exclusion", it grants them the same right to apply for exclusions as large businesses by the following method:
For products that exceed the lead content limits prescribed in section 101(a) of the CPSIA, any requests seeking an exclusion must submit documentation based on the best-available, objective, peer- reviewed, scientific evidence showing that lead in such product or material will not result in the absorption of any lead into the body, taking into account normal and reasonably foreseeable use and abuse by a child, including swallowing, mouthing, breaking, or other children's activities, and the aging of the product, nor have any other adverse impact on health or safety. This is the standard by which the Commission will review such requests for exclusions. A justification submitted by an interested party for an exclusion should provide:

A detailed description of the product or material and how it is used by a child;

Representative data on the lead content of parts of the product or materials used in the production of a product;

All relevant data or information on manufacturing processes through which lead may be introduced into the product or material;

Any other information relevant to the potential for lead content of the product or material to exceed the CPSIA lead limits that is reasonably available to the requestor;

Detailed information on the relied upon test methods for measuring lead content of products or materials including the type of equipment used or any other techniques employed and a statement as to why the data is representative of the lead content of such products or materials generally;

An assessment of the manufacturing processes which strongly supports a conclusion that they would not be a source of lead contamination of the product or material, if relevant;

Best-available, objective, peer-reviewed, scientific evidence to support a request for an exclusion that demonstrates that the normal and reasonably foreseeable use and abuse activity by a child (including swallowing, mouthing, breaking, or other children's activities) and the aging of the material or product for which exclusion is sought, will not result in the absorption of any lead into the body, nor have any other adverse impact on health or safety. This literature should support a request for exclusion that addresses how much lead is present in the product, how much lead comes out of the product, and the conditions under which that may happen and information relating to a child's interaction, if any, with the product; and

Best-available, objective, peer-reviewed, scientific evidence that is unfavorable to the request that is reasonably available to the requestor.
All I can conclude about "Joe Consumer" [henceforth known as Paid Shill for Big Law in accordance with this site's policies regarding symmetric comment policies] at Pop Tort is that if his assertions were due to an honest mistake, he can and should correct that blog posting; otherwise, I can only conclude that if these people at CJD are lawyers, they aren't very good lawyers, or they are very unethical lawyers.

The rest of the Pop Tort "debunking" is about as nutritious and wholesome as its quasi-namesake, consisting of anti-Nord smears and a few other false statements. One of those is that the Commission should have already completed issuing rulings on testing protocols, but still has not done so. Recalling even Rachel Weintraub's statements about the lack of staff and underfunding, it is worth noting that in addition to having to enforce the CPSIA and its aggressive set of required rulings, the CPSC has also been saddled with the Children's Gasoline Burn Prevention Act of 2008 and the Virginia Graeme Baker Pool and Spa Safety Act of 2008. These latter two laws are arguably much more important than CPSIA because actual children have actually died from gasonline burns and pool drain issues, while nobody has died from lead poisoning from a garment. Even so, no, the CPSC could not have issued final rulings because of the heavy schedule imposed by the CPSIA and the continuing limitations of staff and budget due to Congress, not Nord (alternatively, we could conclude that Nord, Moore, Weintraub, and others were incorrect or lying about staff and budget back in 2007 and 2008, but I doubt the Naderites would be willing to adopt that argument). Eight (8) CPSC rulings were mandated by law between 8 August 2008 and March 2009 and seven (7) more are required by August 2009, in addition to six (6) sets of Test Procedures and Accreditation requirements, and numerous rulings not specifically required, such as findings on the retroactivity of the lead ban, findings on the retroactivity of the phthalate ban, and defending the latter in court against special interest groups who advocate a hard-line interpretation of the rulings with exemptions for nobody, regardless of their public statements about the ease with which CPSC can make hardship exemptions. The final rulings on lead testing are not required until August 2009. Incidentally, several of the standards change in August 2009, so all testing done until now will be null & void unless manufacturers -- who still have not been granted any exemptions or stays from the requirements to comply with lead levels -- have been testing at the more stringent level.

To see what the CPSC really thinks of small businesses -- regardless of what the Naderite puppetmasters are saying publicly -- one need only look at the statements of Thomas Moore, the "good" commissioner, upon the announcement of the stay of enforcement. He said,
Many of the smaller businesses do have legitimate concerns about how they will comply with the new law and the cost of the new testing and certification requirements. However, their fears are being fueled to some extent by others who, through an aggressive misinformation campaign, are trying to create a groundswell of panic that will lead to the repeal of the testing and certification requirement entirely.
The goal of the testing and certification provision is a sound one: to make sure every manufacturer of a children's product, no matter their size [emphasis added], regardless of where they are located, knows the standards that apply to their products and takes the appropriate steps to ensure compliance with those standards before the products are put into the hands of consumers. The closer we get to that goal, the fewer recalls our agency will have to undertake and the fewer injuries we will see to children.
Note first that he is ambiguous on the point of whether their concerns are legitimate or fueled by misinformation. He was parroting the party line of the special interest groups at that time: "there are no problems with the law, there is only a misinformation campaign conducted by some nebulous and nefarious group out there." He is offering to note their concerns and at the same time to dismiss them; the former to make them think that he gets it, the latter to assure his handlers that he isn't swayed.

Note second that it does not offer any exemption related to business size. The rest of Moore's letter emphasizes the ways in which small business might be able to comply, but no size-based exemption is in the offing. The game continues.

This rhetoric is a classic shell game, a bait & switch. The Naderite grifters are running this game brilliantly: here they offer a chance of component testing, there they pull it away; here they offer a small business exemption, there they pull it away. In their official statements before Congress and the courts, it is all hardline, take-no-prisoners, "safety vs. profits", while in their press releases intended to appease the legitimate concerns of small businesses, they talk about exemptions and the possibility of "reasonableness". The legislation was intended to remove the reasonableness and lattitude the CPSC had in enforcing the existing statutes (including the Flammable Fabrics Act), but you wouldn't know that from their non-binding public assertions. It's the iron fist in the velvet glove.

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[1] The title is a reference to the practice of creating organizations which have the appearance of grass-roots organizations, but are not. Many of Nader's organizations are front-groups for the enrichment of Ralph Nader, while others (CJD) are front-groups for Trial Lawyers and other special interest groups. They are actually very small groups of people who work with each other in interlocking groups to give the appearance of being a much larger "movement". See Walter Olson's earlier work to expose the inappropriately named Center for Justice & Democracy.

[2] Incidentally, you can try to comment on the post at Pop Tort, but they won't publish it unless they can put you in a bad light. I commented, nothing. Kathleen commented, nothing. Kathleen commented on their asymmetric commenting policy (they commented on all of the CPSIA reform blogs) and that one he published. This is the same policy enforced on the US PIRG blog (which Rick Woldenberg has noted).

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Tuesday, March 24, 2009

Insull

Forrest McDonald's biography of Samuel Insull strikes me as an unreliable source of information. I can't put my finger on it exactly, but it is striking that all of Insull's enemies and competitors just happened to be either corrupt or incompetent. I suppose it's possible, but I think perhaps Mr. McDonald overlooked some of Insull's less stellar moments.

My interest in the book has to do with seeking out the origins of public utility regulation. I had once read that Insull, like AT&T's Vail, was a great advocate of natural monopoly theory and actively sought it. While McDonald mentions this a few times, he does not try to document or substantiate the claim. He notes that Insull's English upbringing left him regarding monopolies as benign, and his association with German Henry Villard left him believing in the benevolence of regulated utilities. However, it does become apparent from the narrative that the electric industry was not exactly the wild and wooly unregulated market one might suspect from reading other sources about the period.

Insull's empire was built on at least two other types of government regulation that pre-dated the Public Utility Holding Company Act (PUHCA). The first was the patent, and the second was existing public utility regulations. Insull started his career as a secretary for Thomas Edison, and eventually worked his way up to become an executive in the Edison General Electric Company (the forerunner of the modern GE). When the Morgan group forced out Henry Villard, Insull went to seek his fortune outside the electrical equipment manufacturing industry and found a little generation company.

Edison (and, to a lesser extent, others) had started into the electrical generation business by selling two different types of generators: central station and isolated power. The latter was easier to sell since the objective was to provide power for a single building; the infrastructure was either pre-existing or easily installed; and for the most part, these provided power to the new-fangled elevators. The former, however, was the route by which economies of scale could be obtained if you could only build up the distribution infrastructure and subscribership.

One could only obtain the machinery required to run a central station from about 4 companies at that time: GE, Thomson-Houston, Westinghouse, and Siemens. Each enforced a regional sales strategy, so the only way to obtain rights to buy from Westinghouse was to either be the first to make a deal with them, or to enter into partnership or to buy someone who had. So all Insull had to do was to acquire ownership of 4 of the "central" stations in Chicago and he had a lock on the whole region. So the means was institutional failure, right? Well, not really. The real issue here was patent protection: only four manufacturers existed because innovating companies like GE learned to aggressively defend their patents (from Edison's experience with the light bulb), and companies like Thomson-Houston existed for the primary purpose of buying up patents to defend (patent trolls).

At the time Insull entered the business, many cities already had a history with gas lighting companies. It didn't take long for politicians in places like Chicago to realize that they could charge them franchise fees and use the money to run their political machines. So when a new upstart -- including electrical generators -- showed up, it was relatively easy to use this machinery to keep them out, and when that proved unworkable, to aim it at the newcomers. And once the newcomers showed themselves to be reliable campaign contributors, it didn't take long for them to realize that they could employ the politicians to keep the public on a leash on one side, and competitors on the other.

By the end of the story, we learn that Insull was a generous man (who fired people for failing to say good morning) who contributed much to the war effort (in support of his native England). During WWI, he developed a powerful propaganda machinery which he put to private use after the war. At a high school reunion one time, I asked a classmate who now works for a big power company why they wasted their money on advertising since they are, after all, a legal monopoly. He said he had pointed out the same thing at a cost-cutting meeting one time, but got shot down. I think I know the answer now: the PR machinery needs to stay limber in case the public decides to bring out the torches and pitch forks and starts talking about public ownership. It is all based on Insull's war propaganda example.

Another interesting factoid: just prior to Insull's great downfall, England approached him to ask for his help in setting up their national grid. The entire national system was based on Midwest Utilities. After the collapse, for which Insull was found not guilty (not easy, given the times and the public persecution), the TVA was said to be founded on the public English example instead of the corrupt capitalist systems. Yep, they traveled across an ocean to look at a copy of the original instead of basing it on the original which itself lay in their own back yard. But propaganda isn't just for utility operators.

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Monday, March 23, 2009

Gymboree

Incidentally, regarding Jon Stewart's point regarding the lack of any accountability in business reporting, anyone remember this video interview with Hitha Prakhabar a couple of months ago? Remember that she said that appliques and trinkets have been tested already? Or that she said, "even though this law is gonna be passed [sic] it's not going to affect the children's clothing industry that much"? Or that the interviewer said, "you mentioned The Children's Place, Gymboree, these retailers will be fine" and Hitha confirmed, "while Gymboree and The Children's Place have probably tested their stuff already and the pieces that are on the clothes, it's not going to have a major effect."

Well, Hitha, I'm sorry dear, but it seems to have had a major effect, if, by "major effect", we mean a 40% drop in Gymboree's stock:
BANGALORE, March 4 (Reuters) - Gymboree Corp (GYMB.O) forecast a bleak first quarter as regulatory changes related to product safety significantly weigh down on the children's clothing retailer, slamming its shares down 40 percent in aftermarket trading.

...

Gymboree said regulatory changes related the Consumer Product Safety Improvement Act (CPSIA) passed by the Congress in August 2008 will impact sales and gross margins in the first half of 2009.

The Act required the Consumer Product Safety Commission (CPSC) to begin enforcement of new lead and phthalate standards for children's products on Feb. 10, 2009.

In order to comply with the new laws, the company began an initiative to remove any styles in its 800-plus stores that did not meet the new limits prior to Feb. 10, Chief Executive Matthew Mccauley said on a conference call with analysts.

The company had already pulled out products and changed production lines even before a clarification to the law was issued on Feb. 6, Mccauley said.

Separately, the company said a change in safety requirements related to levels of phthalates, a chemical used to increase flexibility in plastics, rendered about 1.7 million of its inventory obsolete.

"This...caused us to pull sleepwear for ages three and under off all of our shelves," said Mccauley.
That seems to be in the neighborhood of roughly pi radians off of the claims made by Hitha.

May I suggest a strategy for all of those would-be industry experts and assorted talking heads out there? If Fox or Forbes asks your opinion on a subject about which you are completely ignorant, you can decline to comment, or you can do some investigation. Just "going with your gut" doesn't work any better for you than it does for any of the CNBC stock jobbers.

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Investing in failure

We've been hearing for months that we need to "invest" in energy security, energy efficiency (y'know, to stop global warming), etc., and that this will require massive re-tooling of the automobile industry. Then, a few days ago, we learned that we had to bail out the existing auto parts industry but no concessions from them or the existing auto makers were required. Today, I learned that bailing out other businesses does cause Dr. Krugman anxiety. The difference? I can't figure it: both seem to be built on unsound business models and don't seem to want to change. Here's to hoping that Krugman salvages his intellectual credibility and remains at least as critical of this administration as the last.

And, I note that I heard on talk radio last week a union member asking why AIG execs should be allowed to keep their bonuses (their property! they had a contract!) but union members should not (what about their property, their contract?). The host was predictably perplexed and evaded the question. I do have to say that most of the neocons I know have at least been equally critical of both the UAW and the AIG execs, but since both have been manufactured crises, they have been largely ignored. XKCD understands.

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Saturday, February 21, 2009

NPR's hiring choices

I have gotten to the point where I can almost accept listening to Ellie May Eleanor Beardsley. I only barely expect to hear her talk of President Sarkozy cipherin' down by the ce-ment pond. The illusion is broken by her use of the BBC reporter's "dadadadadadaDA-a" cadence for e-v-e-r-y s-i-n-g-l-e s-e-n-t-e-n-c-e. But Louisa Lim? What were they thinking?

Do we have to endure four more years of "Wuisa Wim wepoowting on Hiwwawy Cwinton's visit to Kowea"? Can one not think of Giwda Wadnew doing Baba Wawa? Now my choices are between BBC reporters in "Asier", "Chiner", "Kore-er", "Indier", and "Australier" or Wouisa tewing me about Pwesident Obama's Secwetaway of State? God help us if she has to empwoy shuttew dipwomacy between Noowth and south Kowea, which, as you know, wie in the wegion between Manchuwia and acwoss fwom Japan. Evewy singeew wepoowt wiw weeqwuire Wouisa to pwonounce Hiwwawy Cwinton. Dear God, please have her report from Sweden or Mexico (where the letter requires a completely different part of the naso-labio-lingo-glotto-region).

From what I can recall, Amanda Beardsley seems to be a good reporter. But I cannot listen to the content of Louisa's reports because the pronunciation problem is such a distraction. Why didn't someone encourage them to go into newspaper or magazine reporting? Why radio?

Incidentally, I have no problem with Bailey White, Andrei Codrescu, or others with even stronger accents. Context is important.

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