Safety Board Head Under Fire Over Recalls

House Speaker Nancy Pelosi on Tuesday called for the resignation of the head of the Consumer Product Safety Commission following the recall of millions of Chinese-made toys.

Pelosi says it's clear that Nancy Nord, the acting chairwoman of the Consumer Product Safety Commission, doesn't understand the gravity of the situation, because she opposes legislation now before Congress that would double the agency's budget over the next seven years to more than $141 million a year, reports CBS News correspondent Chip Reid.

The legislation, which was passed unanimously by the Senate Commerce Committee Tuesday, would also give the agency tough new tools to go after companies that make or market unsafe products.

For example, the bill would raise the cap on penalties from $1.8 million to $100 million per offense and give company employees big rewards for blowing the whistle on unsafe products, reports Reid.

"Any commission chair who (says) ... we don't need any more authority or any more resources to do our job, does not understand the gravity of the situation," said Pelosi, who has been joined in her call for Nord's resignation by other Democrats in the House and Senate. "I call on the president of the United States to ask for the resignation."

Nord says the Democrats have it all wrong, reports Reid.

She agrees the agency is badly in need of more resources to modernize testing labs -- some of which are straight out of the 1950s -- and to help the agency's mere 420 full-time employees, including only 150 scientists, handle hundreds of thousands of product safety reports.

"Show me a bureaucrat who doesn't want more money," she told Reid.

In an Oct. 24 letter to the Senate Commerce Committee, Nord wrote that the bill "could have the unintended consequence of hampering, rather than furthering, consumer product safety."

She said Democrats want to change the mission of the agency's focus from product testing to litigation against companies producing unsafe products, reports Reid.

"This agency will end up hiring lawyers rather than the scientists and the safety inspectors that I think we need," she said.

The White House also opposes the legislation, citing the same reasons as Nord, reports Reid.

"We have serious concerns with a number of provisions in the legislation," said Allan Hubbard, director of the National Economic Council and assistant to the president for economic policy.

Despite the opposition, the committee sent legislation to the full Senate that would increase the number of workers at the agency to at least 500 by 2013, modernize its testing facilities and increase the number of safety inspectors at U.S. ports.

The Consumer Products Safety Commission was founded in 1973 with a staff of about 800. It now employs about half that number, while the importation of products from other countries has vastly increased.

Democrats say the limited resources given to the CPSC has made the products used by Americans less safe.

Under the bill, the agency's budget would go to $80 million in 2009 and increase 10 percent each year after that.

"It is very clear to me, as well as millions of moms and dads around the country, that the CPSC is failing to keep dangerous toys and products out of the marketplace," said Sen. Mark Pryor, D-Ark., who co-sponsored the legislation with Sen. Daniel Inouye, D-Hawaii.

More than 21 million toys made in China - from Baby Einstein Discover & Play Color Blocks from Kids II Inc., to Thomas & Friends Wooden Railway by RC2 Corp. - have been recalled because of excessive levels of lead paint, tiny magnets that could be swallowed or other potentially serious problems.

Lead is toxic if ingested by young children.

Pelosi was joined in the call for Nord's resignation by Sen. Sherrod Brown, D-Ohio, and representatives like Bobby Rush, D-Ill., and Rosa DeLauro, D-Conn.

Nord and the White House say they're not against modernizing and expanding the agency, but several parts of the Democrats' legislation concerns them.

"We want to work with Congress on a collaborative effort in order to help modernize and improve the CPSC," White House spokeswoman Dana Perino said. "This wasn't about the price tag, this was about a couple of the policies that are within a particular bill."

Under the bill, civil fines would be increased up to $250,000 per violation with a cap at $100 million, and criminal penalties would be increased criminal penalties to five years in jail for those who knowingly and willingly violate product safety laws. Whistleblowers reporting on bad products from inside companies would get additional protection and state attorneys general would be allowed to sue to enforce product safety laws.

"Many of our existing public safety activities would have to be severely curtailed or would cease entirely in order to attempt to fulfill all of the bill's proposed statutory directives," Nord said in the letter to the committee.