Friday, December 30, 2005

FEDS BAN SURFING! Or Why regulatory agencies have image problems.

“So, I hear OSHA has put the surfboard industry out of business. Some new regulation or something,” my father informed me when I got to California last week. Now he’s well-read and relatively liberal (for a retired businessman), so knowing that OSHA can’t legally put anyone out of business and that the agency hasn’t issued a new chemical standard within the lifetime of most people living on earth today and that EPA’s laws are so weak that the agency can’t even ban asbestos, I was curious about what was going on.

Turns out that Gordon “Grubby” Clark has gone out of business and blamed government regulations for his demise. Why does anyone care? Clark Foam has dominated the business of making foam innards for surf boards. Clark, the “Howard Hughes of the surfboard world” blamed a number of factors, “including the cost of complying with federal and state regulations,” according to the NY Times.

Wall St. Journal columnist John Fund argues that Clark’s retirement is an example of how Governor Schwarzenegger has failed to halt California’s slide into a business hostile state.

The article in today's New York Times tried to explain the situation.
In 2003, Mr. Clark received a notice from the Environmental Protection Agency for, among other things, failing to safeguard workers against the accidental release of toluene diisocyanate, or TDI, a liquid catalyst and known carcinogen used in making polyurethane foam.

There was also the cost of workers' compensation, insuring machines of his own design and "a claim being made by the widow of an employee who died from cancer," he wrote.

"For owning and operating Clark Foam," the letter began, "I may be looking at very large fines, civil lawsuits, and even time in prison."
Both the E.P.A. and the Orange County Fire Authority, which monitors factories for hazardous materials, said, however, that Mr. Clark had recently been in compliance.

"We were kind of dumbfounded," said Capt. Stephen Miller of the fire authority.
And making surfboards isn’t all fun and games for the workers:
"Surfers are supposed to be environmentally sensitive, but the boards are questionable," said Steve Pezman, publisher of The Surfer's Journal. "They're a part of the puzzle that doesn't really fit the ethic."

Pete Reich, a specialist with the E.P.A. in San Francisco and an avid surfer, said blank makers and glassers are exposed to toxic fumes, and the people who sand and shape surfboards contend with noxious particulates.
The main thrust of the article was how Clark’s retirement had increase the rate of surf board thefts in California, but also buried waaaaay at the end of the article was this nugget that confirms a not-so-well-known fact about the effects of regulation: it promotes innovation:
Of the possibility of new methods, Yvon Chouinard, a surfer and mountain climber, said, "My attitude is, It's about time."

Mr. Chouinard's company, Patagonia, has developed what Mr. Chouinard says is a less toxic process.

Many surfboards wind up in landfills after six or eight months, said Randy French of Surftech, a Santa Cruz company making boards out of epoxy composite and one of Mr. Clark's few major competitors.

He said that some of the current shortfall will be filled by suppliers in Australia, Brazil and South Africa.

Looking out over The Hook, Boyd Halverson, wearing a wet suit and barefoot on a cold rainy Saturday, braced himself for what he called an "ice cream headache" from frigid waves. Mr. Halverson, 27, who repairs damaged boards, said that the demise of Clark Foam would be good for his business.

Mr. Coletta, the shaper, who was sitting on a three-month inventory of blanks, regarded the situation the way he might a long, glassy right point break. "Before, no one found the need to experiment with new materials, to get the feel right," he said. "I'm really stoked."