It’s Only Getting Worse

In case you’d grown bored with product recalls about lead in our children’s toys, a new danger now exists. Traditionally, this danger has only concerned party going teens and twenty-somethings – but now, children as young as four are being poisoned by a date-rape drug found in the popular toy item Aqua Dots. Manufactured in China, Aqua Dots, which are supposed to be produced with a safe, non-toxic glue, are being produced with a cheaper ingredient: a toxin which mimics a date-rape drug.

While most consumers love a bargain, I imagine most would be willing to pay a little more for their children’s toys if it meant keeping them from acting drunk, vomiting, and then slipping into a coma. Why can’t toy manufacturers and sellers like Wal-Mart understand that poisonous toys aren’t an option for children? We will pay the difference, but please, give us a chance.

U.S. Orders New China Toy Recall [Wall Street Journal]

More than four million Chinese-made toys sold in the U.S. as Aqua Dots are being recalled after reports surfaced that children swallowed beads containing a chemical found to mimic the effects of the so-called date-rape drug.

The Consumer Product Safety Commission said it has received two reports of children swallowing Aqua Dots and slipping into comas. Both children are now fine, the commission said. At least three children have been hospitalized in Australia, where the product is called Bindeez, after ingesting beads from the toy.

The incident deals a blow to the toy industry just as the Christmas shopping season is getting under way. Wal-Mart Stores Inc. listed the product as one of its “Top 12 Toys of Christmas.” Wal-Mart has instituted an “electronic stop” at its cash registers to prevent further Aqua Dots sales and directed employees to remove the toys from its shelves, according to a spokeswoman. Toys “R” Us said it has pulled the toy in the U.S., and the toy was removed from other major Web sites and stores, including Amazon.com and Target.

The recall highlights a common practice in Chinese factories: cutting costs by substituting ingredients. The toy’s manufacturer, Moose Enterprise, of Melbourne, Australia, yesterday said the problem had been traced to a Chinese factory it contracted that substituted a toxic chemical for a safe glue during manufacturing.

Moose declined to name the manufacturer but said the beads contained an adhesive solvent called “1,4 butylene glycol,” which can simulate the so-called date-rape drug gamma hydroxy butyrate when ingested, causing seizures, coma or death. The toy hasn’t been linked to any deaths.

The 4.2 million recalled toys in the U.S. were sold at mass merchandisers nationally from April through November. In North America, the toy is distributed by Spin Master Ltd. Earlier yesterday, Spin Master had requested retailers stop selling the toy. Spin Master said that “out of an abundance of caution” it has stopped shipping the item. The company has issued at least three other recalls of toys made in China, according to notices posted on its Web site.

Aqua Dots sets, which were expected to be hot sellers this holiday season, are arts-and-crafts toys that feature small beads that stick together when they get wet.

The CPSC said a 20-month-old child swallowed several dozen beads and became dizzy and vomited several times before slipping into a coma. A second child also vomited, slipped into a coma and was hospitalized for five days.

Several recent recalls of Chinese goods have involved product substitutions, including toothpaste that contained diethylene glycol, an antifreeze ingredient. In July, the Chinese government said it had closed 180 food manufacturers found to have used industrial chemicals and additives in food products, including formaldehyde and the carcinogen malachite green.

China’s General Administration of Quality, Supervision, Inspection and Quarantine wasn’t available to comment.

Australia’s New South Wales state minister for fair trading, Linda Burney, ordered the toys removed from stores there Tuesday after a 2-year-old boy and a 10-year-old girl were admitted to a Sydney hospital after swallowing large quantities of the beads. A 19-month-old from Queensland also was receiving medical attention after eating the beads, the state’s chief health officer, Jeannette Young, told the Australian Broadcasting Corp.

The New Zealand Herald reported yesterday that two children in Auckland had been hospitalized recently after ingesting the beads, and quoted a New Zealand Ministry of Consumer Affairs spokesman saying the importer of Bindeez had agreed to stop supplying them.

Moose Enterprise said yesterday that samples of toys are being tested in markets around the world to see if the problems affect shipments outside of Australia but that the results may not be available until tomorrow. At least one million versions of the toy had been shipped to Australia, but world-wide figures weren’t available.

Moose said that when the toys return to the market, it will add Bitrex to the beads, a foul-tasting ingredient aimed at discouraging children from eating multiple beads.

Kent Kedl, executive director of the Shanghai-based consulting firm Technomic Asia, which advises U.S. companies in China, said product substitution is a common problem when dealing with Chinese factories. He cites problems including companies that substitute low-quality screws or fasteners.

“It could be because the Chinese company doesn’t know any better, or may be trying to cut corners and use cheaper product,” he said.

Bindeez’s London-based distributor, Character Group PLC, said it was notified Monday by Moose about the problems with Bindeez and decided to remove the toy from U.K. shelves as a precaution. The company is awaiting product-testing results from a toxicologist.

Character Group Chairman Richard King said the company does its own testing of toys that goes beyond the testing done by Moose. He said the company had heard of five reports of children who had ingested the product but hadn’t been seriously harmed.

--Ellen Zhu in Shanghai and Sky Canaves in Hong Kong contributed to this article.

Posted by Michael Mignano on Thursday, November 08, 2007

COMMENTS

Walmart is at fault for some of this, their chase for the lowest possible price is a big part of the reason for China manufacturing.
THE LARGEST PART OF THE BLAME Has to be on the toy companies. How can Fisher-Price, Hasbro, Mattel, and all of the others just put their name on a toy and not know if it is safe?
Let me put it this way. If your Dodge Neon where recalled for bad brakes, is it the fault of the dealership you purchased it from or is it Dodge’s fault?

Scott in Ohio
Thursday, November 08 at 04:54 PM

Look what the trade imbalance with China has resulted in for American. From the Toronto Star:

Loonie’s rise signals end of American era
A new world currency?

Nov 08, 2007 04:30 AM
Thomas Walkom
National Affairs columnist

The story of the soaring Canadian dollar is no longer just about shopping in Buffalo or the troubles faced by domestic exporters. It is no longer just about Canada at all.

Rather, the story of the soaring Canadian dollar is now about something far more dramatic and dangerous. It is about the decline of the American dollar as the world’s currency of choice. It is about the end of a world financial system that has been in place, in one form or another, since the 1930s and that has given the developed world unprecedented wealth. It is about America’s economic chickens coming home to roost. It is about the end of empire.

And for Canada, which has prospered from its privileged position near the heart of this empire, it is potentially very bad news.

At the heart of the problem is a development that Canadians have difficulty getting used to: The American dollar, which we tend to see as a fixed star in the firmament of currencies, is falling. It is falling relative to every major currency – the euro, the Japanese yen, the British pound. It is falling relative to gold. It is falling relative to oil.

The fact that a barrel of oil now costs about 40 per cent more than it did in August is tied in large part to the depreciation of the currency in which its value is measured: The U.S. dollar.

Every successful empire brings with it an imperial currency. In Roman times, the denarius dominated trade in what is now Europe. At the height of the British Empire, the pound sterling was literally as good as gold.

Similarly, when empires wane, so do their currencies. As Rome overextended itself with military adventures, it devalued the denarius. In 1931, depression-torn Britain officially served notice that its empire was on the rocks when it decoupled the pound from gold.

Since then, the U.S. dollar has been the world’s currency of choice. Arab princelings demanded dollars for their oil. So did Colombian cocaine dealers.

When China abandoned Maoism, it was dollars that Communist authorities wanted in exchange for the exports they sent abroad.

So it was perhaps appropriate, yesterday, that it fell to Chinese central banker Xu Jian to announce officially what economists have been saying for years: the dollar is “losing its status as a world currency.” China, he explained, would no longer keep just American dollars in its reserves but would diversify its holdings to include other major currencies.

Given that China’s central bank holds $1.43 trillion worth of U.S. dollars, that was not an insignificant statement.

The reasons for the dollar’s decline are familiar. Like the Romans and British before them, the Americans have overextended themselves. As a country, they import more than they export. As individuals, they spend more than they earn.

Up to now, these excesses have been balanced by the rest of the world’s willingness to hold dollars. China, for instance, was willing to take dollars in exchange for useful manufactured goods because it believed the U.S. currency would hold its value.

In a sense, it was like a giant pyramid scheme. As long as everyone believed the dollar was strong, it remained strong.

But as soon as a crack appeared, the edifice shuddered.

If the American dollar were just America’s dollar, none of this might matter. Indeed, a lower U.S. dollar, by boosting American exports, will help the U.S. get through any downturn sparked by that country’s housing and mortgage crises.

But the U.S. dollar is not just America’s. It is the world’s currency; it provides a platform of stability on which other countries can operate.

French president Nicolas Sarkozy sounded the alarm yesterday in his address to the U.S. Congress. For America to stand by and let its dollar collapse, he said, is to risk a trade war of global dimensions.

What he meant was that Europe would not let the U.S. engage in competitive devaluation without retaliating.

And this is the danger for Canada. As a small trading nation, Canada is sure to be sideswiped in an all-out trade war. As a small trading nation, Canada also depends on a stable international financial system based on a stable international currency.

So forget the minor ups and downs of the loonie. Sure, it matters if the Canadian dollar sits at $1.08 (U.S.) or $0.88. But it matters more if the U.S. dollar itself is under stress. The key development yesterday was not the fact that Canada’s dollar closed down slightly from the day before. It was the fact that, relative to the euro, the U.S. dollar hit a record low.

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Alex in Ontario, Canada
Thursday, November 08 at 05:31 PM