Sunday, August 14, 2011

Back to OSHA and the Home Improvement Business

Ever so infrequently I have a guest Blogger and today it is one of my friends, a person who earns his living as a micro-business person.  He has a Bachelor's degree in Finance from Bentley University and worked as a Senior Financial Analyst before turning to craftsmanship.

Thus begins the Blog Post:

As Cliff’s, up until now, unnamed micro-business contractor “friend”, I’d like to thank him for bringing forth to his readers an issue that we have shared in conversation many times over this past year – overregulation, its detrimental effects on our economic viability and potential for recovery, and my personal experiences and observations having had to deal with it as a restorer of my family home.  Specifically that of OSHA and the EPA.

Kudos also to commenter nealcroz for his well written, articulate and completely accurate perspective of our ever-growing regulations and the overzealous agents who are mobilized to enforce them.  Right on nealcroz!

And then there’s commenter Jack Mitchell....  In response to Cliff’s July 8, 2011 article Unemployment Stats for June, and specifically Cliff’s disclosure that the contractor working to restore Lowell’s historical Immaculate Conception Church had just received a $50,000 fine from OSHA, Mr. Mitchell commented that businesses driven out by regulations “usually are the fly-by-night gypsy rip-off artists” and “I can’t help but care little while scam artists cry”.

Although I am not surprised at the animosity held by many toward building contractors and home repair specialists based on an ever increasing level of poor workmanship (for which I have often been called on to assess and/or correct), I can, with complete confidence, conclude that any contractor working on the spectacular 19th century architectural marvel that is the Immaculate Conception Church, could not be considered a “scam artist” or “gypsy paver(s)”. Being of solid granite, iron, slate and copper, the Immaculate project would only be accessible to those specialists who are tops in their field.

I also find it interesting how regulation loving Americans always vilify the targets of our regulatory agencies oppressive powers.  “Let's justify it by immediately demeaning the victim.”  Isn't that what they did for years with rape victims?  ‘You must have asked for it’, ‘your skirt was too short’, ‘your blouse too low’, etc., etc.  Automatically, any contractor who receives a citation is a "scam artist" or hack.

Furthermore, in response to Cliff’s most recent well written article (Regulations and Jobs – August 10, 2011), Mr. Mitchell writes: “Of course OSHA could potentially run off gypsy pavers and other scam artists” thus “limiting the pool of contractors to those professionals that place a premium on protecting their workers and providing craftsmanship”.  Mr. Mitchell is actually 180 degrees off the mark on this one.

The facts are that licensed, documented and insured contractors are the most likely to be hit by OSHA and the EPA under their newly expanded regulatory assault.  This is due to the fact that OSHA routinely courts local building inspectors to act as snitches and only licensed and insured contractors can pull permits.  Therefore, the most legitimate are the most visible on OSHA’s radar. Also, OSHA field agents check the public records in all of the town and city halls for permit-pulls to chase after.

One city building inspector was gutsy enough to write a letter to one of my trade magazines – the Journal of Light Construction. He wrote to express his distain for such tactics and to profess that he would never snitch on the citizens of his town to accommodate OSHA's subversive actions.  Was this not a common method of enforcement and oppression in communist East Germany by their feared Stasi?  Also, OSHA is now giving bonuses to its field agents based on the total fine dollar value issued.  As the many letters to my trade magazines express, only the unlicensed "gate slammers" will be left when all is said and done. And, unfortunately, many more letters are expressing the decisions by America’s best and most trustworthy building contractors to get out of the business and lay off all of their workers.

What I truly believe, is that if the average American were to be made aware of just what has been going on recently with OSHA and the EPA and their recent objectives targeting local residential home repair specialists, that it will present a baseline opportunity for all of us, liberal, conservative, Democrat and Republican, to gain a perspective as to why unrestrained regulatory oppression by what are known as our regulatory bureaucracies, are, over the long term, doing more harm then good.

OSHA was formed in 1970 by the Nixon administration.  It just celebrated its 40th birthday in 2010.  Word has it that over these forty years, OSHA’s standards documentation has grown from the thickness of a book to a stack over eight feet tall.  This points to the fact that while our regulatory agencies are always open to add more regulation, they are very reluctant to remove those that are deemed obsolete or, via extension, harmful.  Another interesting tidbit is that for the past forty years of its existence, 1970 - 2010, the graphically charted decline in workplace injuries is approximately equal to that which took place in the forty years prior to its creation - 1930 to 1970.  This, to me, confirms that businesses and the American people are, for the most part and in general, determined to protect the health and welfare of their fellow man and employees.  Add to that a civil court process fully accessible to all Americans and a liquid and affordable insurance and underwriting industry, I can only conclude that we may very well never have needed the $500 million bureaucracy that OSHA has ballooned to in the first place.  This coming from a Democrat voting un-enrolled political centrist!

On December 22, 2010, Obama’s OSHA Director Nominee, David Michaels, announced his decision to reverse a 40 year ruling that exempted residential projects from OSHA oversight and citation targeting.  I personally was affected buy this last autumn, when an OSHA agent ordered me off of my roof, on my house, which I live in and which I was working on right here in Lowell.  After answering some very threatening questions as to my residency in this structure, he made it clear that I was “out of his jurisdiction”.  He did go on, however, to apprise me of all that which, under OSHA rules, he would have cited me for.  He then ordered me to fill out my name and address on a form that he pushed in my face.  (Which I believe to this day was an unconstitutional violation of my 4th Amendment rights against illegal search and seizure.)  It was after this incident that I was motivated to find out ‘why now and never before’ and discovered much about the “new” OSHA under David Michaels.  This assault by an agent of my government motivated me to research further.  Shockingly, although this agent did not assign any dollar values to the fines that I would have been given had my work been on anything other then my own residence, my research indicated that I would have been fined somewhere in the order of $60,000 in total.  Personal bankruptcy would have been in order for both my brother and I had he had more “reach”.

Also important to know is the fact that OSHA is using the same citation schedule for a one person micro business as they do for 3M or British Petroleum.  They have insensitively accorded no reduction in a fine that would be a mere nip for a large corporation as opposed to a life-ender for a small business person.

In a speech to defend his new aggressive and highly punitive OSHA, Mr. Michaels defended his strategy by stating that OSHA was no longer in the business of education and that America’s contractors were to be “shamed” into conforming to OSHA’s unrealistically rigid standards.  And about those OSHA rules as they apply to me and my fellow residential home repair and restoration specialists?  If I am on even a flat platform a mere 6 feet above grade, I have to have strapped to me an OSHA approved harness that is hooked via my OSHA approved rope to an OSHA approved lag attached with OSHA approved screws.  6 feet, my fellow Americans is the height of the average step ladder. You take more of a risk descending your stairs each morning then I am allowed to do to simply do my job.  Being an Ivy League academic, I very much doubt that Mr. Michaels has ever walked a roof.

There are approximately 120 million residential structures in the US, all of which require periodic maintenance.  According to the latest statistics that I could find, a total of 45 people died falling from residential structures in 2009 in the entire USA.  Yes, I agree, any death is one that we should work to prevent.  However, in comparison, between 35,000 and 45,000 people die each year in the US in auto related accidents.  If the National Highway Transportation and Safety Administration (NHTSA) were to decide to adopt the business plan that OSHA has under David Michaels, we will all be receiving $10,000 fines for things like not having our seatbelts buckled or not having our baby seat installed properly or even speeding.  (Feeling it now are you?)  Also interesting in this category of OSHA targets is the fact that OSHA’s top dollar amount citation category is Fall Arrest.  At 45 deaths among 120 million residential structures, I can only applaud America’s residential contractors on a job very well done!  I can further conclude that the only reason why Fall Arrest is the top “income earner” for OSHA is that a person on a roof is the easiest person to snag.

Although I do strongly agree that over-regulation in and of itself is a huge problem which interferes with the ability of small business to 'get its work done' and grow, what really scares me is the trend of government to assess crippling fines when a business is found not to be in compliance with their unrealistically ridged ideas on what constitutes workplace safety.

It's one thing for governments to mandate and supervise safety but it has gotten to the point (especially on a Federal level) when a breach brings on business-busting five and six figure fines.  Everything seems to be about the 'punitive' in this country now.  And this "punishment" is meted out in a purely financial manner. Of course this is going to paralyze business formation and growth not to mention the exponential trickle-down loss of jobs throughout our economy which is a standard of 2 additional jobs lost for every one layoff.  And all at a time when our country is wilting away under the fallout from the greatest economic disaster since the Great Depression.

As I tell people, our governments (Federal, State and local) are "protecting us to death".  They are poisoning the root-ball of economic progress. We (the USA) have morphed into the "Nation of No".  Our governments are now the "wet nurse" of the American people and at an enormous and crippling financial burden in my opinion.

OSHA and the EPA are like storm troopers.  Any contractor can now garner a debilitating fine for simply not having his or her daily safety log up to date.  It is all very Gestapo to me in that an agent of the Federal Government can come onto my job site at any time and "demand of me my papers".  If, upon inspection, they are not updated to the day, a, say, $10,000 fine is levied.

Right here in the greater Lowell area, there has been over $250,000 in fines levied by OSHA just this year among three local businesses.  And that is just what I have personally come across in newspaper stories.  $130,000 to a roofer shoveling snow in Wilmington, $70,000 to another in Tewksbury and $50,000 to the highly skilled crew working on the Immaculate Conception church right here in Lowell.  I don't even subscribe the Lowell Sun so I'm sure that the total amount is far greater then that.

The EPA just bagged their first victim under its newly enacted RRP lead law.  Two brothers in Maine were issued 5 citations at $36,500 each for a total of $182,500.  They were working to repaint a multi-family home that they own.

If our insurance companies ran their businesses with the same skewed data approach to safety that our government regulatory agencies do, none of us would be able to afford insurance.

Another thing to realize is the fact that OSHA receives $500 million from American tax payers to run itself.  But...... as a fine levying organization, they are free to engage in their own "fund raising campaigns" with an assumed objective of using these funds to gain some financial leverage and wiggle room in their operational cost constraints.  OSHA took in over $150 Million in citation revenue from American businesses in 2009.  With the recent waiver of the residential projects exemption, that amount could easily double.

And finally, for all of you white-collar business owners who believe that you will never have to worry about that which I and my blue-collar peers have to, please know that OSHA, under Obama-appointed David Michaels, had recently attempted to reach into your clean-as-a-whistle offices by having Carpal Tunnel Syndrome exposure placed under its purview.  Fortunately for you, their request was batted down by Congress.  Had they succeeded, OSHA would have had the right to enter your offices at will with no notice and with the same level of accessibility as an FBI agent with a court issued subpoena and inspect the keyboards on every one of your many computers.  And also know that OSHA uses a multiple system of applying citation amounts (as does the EPA).  They take the standard amount and multiply by the number of, say, in my case ladders and in your case, keyboards, and then multiply again by the number of employees within reach of said offensive article of equipment.

I believe that this is an ultimate "across the aisle" issue as the recent inclusion by OSHA of residential projects targets the common man and not just the big, bad corporations.  It is time to reach out to our elected representatives – both Democrat and Republican - to fully apprise them of the oppressive and financially crippling practices of our regulatory agencies toward the American common man and woman.

The bottom line is that I, as a true craftsmen and doggedly honest professional, cannot with any conscience, encourage the young and talented future crafts and trade persons of America to pursue a future in a profession that on which any given work day, they can lose everything including their business, their home and the very food on their dinner table from which they feed their families for simply doing what they do.  As a matter of fact, I am now strongly discouraging anyone from entering into the business of home repair based on the recent fusillade of regulatory targeting.  And I, sadly, have decided to exit my profession as soon as is economically feasible.

Very bleak it is, if you ask me.


nealcroz said...
This comment has been removed by a blog administrator.
nealcroz said...


What an eminently professional and informative piece of journalistic excellence. I would only add (for emphasis) a few comments.

The first is, OSHA and EPA are only two of dozens of Federal bureaucracies hard at work promulgating new and more onerous regulations. This is what a "regulatory agency" does. What purpose does a regulatory agency serve if it doesn't provide regulations? Moreover, how on earth can it possibly grow and prosper unless it can create or find a whole host of violators that must be stamped out with great haste lest the public good be irreparably harmed. Many folks will scoff at that comment saying that there ARE bad people out there doing BAD things to the public and so...regulatory agencies are necessary. I would respond that it is true, however, unregulated regulatory bodies become the greater harm to the public than the threat they are constituted to protect us from (I know...horrible sentence construction). These "agencies" who promulgate intrusive policies range from the Dept of Education who mandate via state aid and national education policy (often using the AFTA and NEA as their defacto primary implementation and enforcement agent) binding policies requiring all sorts of restrictive rules. What the Feds miss the states fill in. For instance, softball, dodgeball, red rover, capture the flag, and a host of other recess games are forbidden in public schools in NY state. Too dangerous. USDA is about to launch into a veritable cascade of food regulations that will presume to know precisely what you SHOULD eat and prevent you from consuming things they adjudge to be bad for spite of the fact that there is little empirical and settled science to back their assertions. The FDA purposely restricts the sale of many drug items in this country..items freely available without any horrible outcomes in other countries....and withdraw other drugs under the guise of not being efficacious (gee...why did they approve them to begin with?). Let's try to not even discuss the regulatory disaster that is the FAA....the child of another government disaster, the DOT.

Yes, some of the things these agencies do good...and necessary.....things for the public but there are no upper limits.

And now under the guise of public protection, we have genuine police agencies who are assuming intrusive capabilities that begin to rival those of police state agencies...such as the Stasi and the NKVD. The FBI can dig into your past and present life with complete abandon...just because they think there is something you are hiding.....and the DOJ position seems to be one of, well...that is why we have the court sort it all out. And how many people have been put to death over the years...only to discover that they were telling the truth...people convicted by FBI testimony and "lab evidence?"

Now we find that the BATFE is selling automatic weapons to known felons for redistribution to Mexican that they can see "where the weapons go." Huh???

A government big enough to give you everything you want is also big enough to take everything away from you...and you are powerless to prevent it....because they are THAT big.

Finally, I would submit that by piling on onerous regulations and levying steep fines that are motivated by field agent bonuses, the really GOOD contractors will leave the field. They are excellent businesspeople...that is how they got good. And as a good business manager, they assess risk and make decisions accordingly. That is why many won't take on certain jobs..or if they do, price it accordingly. Risk will drive them out. The only ones left will be the scam artists..the ones who figure that they can beat the system...and many will....and the customer will pay.....always.

In the end, Big Big Brother will drive down the quality of goods and services to the lowest possible level witness the downfall of the Soviet empire....the state was supreme.

Jack Mitchell said...

Definately something to consider. Well, except for the Nazi parallels.

JoeS said...

I would be for doing away with OSHA. However, the function would have to be provided by the insurance companies.

But that leads to mandatory insurance, at least for contractors working on other people's properties, and some method to ensure that coverage has been taken out. Each time we have a contractor do work for us can we be sure we are not going to be sued for his accidents?