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Most Americans believe that the federal regulatory process is simply designed to protect them from fraud and unnecessary public health and safety risks. But, all too often, federal regulation simply undermines a competitive marketplace—reducing consumer choice and even increasing risks. A key example is the federal pesticide law, which imposes a very expensive and lengthy registration process before products can be sold. Not only do such costs deter many registrations and innovation, some companies use the process to eliminate and preempt competition. A recent example involves the cancellation of certain products used to preserve outdoor wood structures.
This past summer, the U.S. Environmental Protection Agency (EPA) banned residential uses of the wood preservative chromated copper arsenate (CCA), which is most commonly used to make pressure-treated wood—the wood used in decks, playground equipment, docks, and other outdoor structures. The preservative protects these structures from pest damage and decay. The ban takes effect in January 2004.
Since the ban was finalized, wood processors and others discovered a previously overlooked potentially affordable and effective alternative, which was in use before CCA. But new regulatory proceedings at EPA may place that product in jeopardy of cancellation as well. Should this new product be cancelled, consumers may be left with few good alternatives. They may have to choose between buying an inferior product, which itself poses legitimate safety risks, or spending substantially more for plastic lumber or expensive woods like cedar and redwood.