Press Briefing on Import Safety by Health and Human Services Secretary Mike Leavitt and National Economic Director Al Hubbard
Room 350, Dwight D. Eisenhower Executive Office Building
10:49 A.M. EDT
MR. FRATTO: Sorry, everyone, that we're getting started late. This is an unusual way to do a briefing on a report that's going to the President. Ordinarily, we would deliver it to the President, hand it out there and brief on background afterwards. But we thought with -- especially with our schedule today -- it a little bit better to give you guys the briefing in advance with Secretary Leavitt and Director Hubbard, with an embargo time, so you'll have a good sense of what the Secretary is planning to do and what this report is, and its context, before it's released publicly.
So with that I'm going to turn it over to Secretary Leavitt and Al Hubbard and they can make some comments, and then we'll open it to questions.
DIRECTOR HUBBARD: Well, just to give context, as you know, the President in July asked Secretary Leavitt to lead a task force composed of a number of Cabinet Secretaries and the head of the Consumer Product Safety Commission to basically review our import safety standards and procedures. And since then the President has continued to talk about that and make inquiries, because this is of very much concern to him. And I know he's looking forward to the Secretaries meeting with him this afternoon, and the report. And Mike is going to give you all a preview of what the report is all about and answer questions about it. So we're going to turn it over to Mike.
SECRETARY LEAVITT: Well, thank you. Americans benefit from one of the safest food supplies, and we have among the highest standards for consumer protection in the world. I'll tell the President today that our review affirm that point. Our import system does many things right and that we intend to keep it that way.
But make no mistake, the recent dangers found in some imported products are warning signs to us. They're warning signs that our present system is not keeping pace. We've got to continue to adapt to a rapidly growing and changing global economy. The American people have reasonable expectations that food and other products that they buy are safe. We can and should do all we can to honor that trust.
To do that, the President, as Al pointed out, established this working group. And we went on a nationwide fact-finding mission. Before doing that, I will tell you we set up working groups in each of the 12 departments or agencies that have relevant duties here. We asked them to begin inventorying all relevant authorities, practices, and looking for ways in which they could be improved where there may be some deficiencies.
As chair, I visited 17 different cities in 53 days. I've been to ports and post offices, railroads, airports. I've seen freight hubs and border crossings and wholesale retailers and fruit stands. I've observed the processing of fish. I've seen vegetables being processed, and drugs. I've inspected everything from imported tire irons to gingerbread houses. So I feel like over the last 60 days I've had a chance to see it in context. And the other thing I feel best about is that the -- what I saw on the ground, after talking to as many expert people as I could who do this every day, their conclusions have matched what we found as we went through the various agencies.
Understanding a global economy requires us all to think about what we consume and where it comes from. You can go to any one of those places I mentioned, or even your own grocery store, and you'll see bananas that came from Guatemala, you'll see pineapples from Costa Rica, you'll see turkey wings from Canada, you'll see salmon from China and snapper from Vietnam. You've all seen this. That doesn't even begin to include the myriad of other products that are exported to this country: clothing, toys, automobiles, aircraft parts, electronics, furniture and other products. The total value of imports is expected to exceed $2 trillion this year. That's nearly twice the size of the economy of Brazil; it's roughly the equivalent size of the entire economies of France or Italy.
And so today, as we recommend to the President -- make these recommendations to the President, they are focused on the fact that we need to work with the importing community to change our strategy. Fundamental change in our strategy is being recommended.
It's a change from an intervention-focused strategy to a risk-based approach focused on prevention with verification. Instead of a point-in-time assessment at the border, we're recommending a focus on the full import life cycle, building safety into the products that we purchase every step of the way.
One way to think about this is that our current strategy is really a snapshot at the border. We're recommending a change that would create a video, in essence, through the entire process. This is not unlike preventative medicine. We seek to avoid disease by eating right and by immunizing our children. Regular screenings increase our ability to detect and prevent disease. And when necessary, we take action to fight disease through medical procedures. All three are there -- prevention, intervention and response. That's what we do in health care, it's time we do the same in import safety.
We have organized our strategy under the keystone principles of preventing harm in the first place, and then intervening when risks are identified, and lastly, responding rapidly when things go wrong. We recognize that several federal agencies and some of the commercial sectors have already begun to make this shift to a risk-based import strategy. They're already focusing on prevention with verification, and others are beginning to do that. As I traveled the country looking at all of the places through the process, it became clear to me that many were adopting these strategies. And the best of what we saw clearly were focused on the entire process.
An example, I went to a lettuce processing plant. As the lettuce came in the door, it's marked in a way that would allow it to be tracked back to the row on which it was picked, the time of day in which it was picked. And talking to the processing manager, he said, our motto is, "know your grower." He said, I not only want to know where it was picked and what time it was picked, I want to know the nutrients that were given to that lettuce; I want to know the kind of water that was provided; I want to know about the quality every step of the process, every step along the way.
We're recommending the implementation of this strategy in six cross-cutting building blocks. Let me review them for you. The first is, advance a common vision. Let me give you some commentary on that point. There are many different organizations who have specific responsibilities. And in some cases, they have different priorities that need to be melded into one common vision. In other words, rather than just looking at whether the border is secure, we also need to make certain that the products that are crossing them are safe and we can use the same technology in many cases to detect both. So a common vision.
The second is increasing accountability enforcement and deterrence. I talk about prevention with verification. Clearly, we need to have strong enforcement. The third building block is focus on the risks over the life cycle of the imported product. I've given you some -- that's basically going from a snapshot to a video.
The fourth -- and I'll dwell on this a little more -- is on building interoperable systems. We found that there were data systems that -- used by, for example, the FDA, where an FDA inspector would need to have five passwords to get into five different parts of the FDA system. We found that the Customs and Border Protection would have seven different sections of their system, and neither could access data of the other. We found that there were substantial systems being developed among the shippers and the retail and wholesale community, and they were not integrated. So there is a remarkably important opportunity here to create interoperability among systems, so that we can see the life cycle of the product and have much more efficient capacity to track and to screen and to respond.
The fifth building block is a culture of collaboration. This is not a new problem within any federal or public/private enterprise, being able to break down silos. And sixth, promoting technological innovation with new science. We saw many instances where field tests, for example, were useable for inspectors to make on the spot determination, as opposed to needing to take samples and send them to a lab.
Now, I'd like to touch for a moment, if I could, on resources and the next steps. As the volume and value of imports increase, the complexity of the systems will also increase and so will the cost to both the public and the private sector in ensuring that the products are safe. How much will it cost? Although additional resources and authorities may be needed, that will be evaluated after the comment period and after we've put together the specifics of the implementation plan.
What can I tell you now? What I can tell you now, I should say, is that the strategic framework that we're presenting to the President today will focus in a way that makes the most efficient use of our resources and provides the greatest protection to the American consumers over the long-term. The federal government cannot and should not attempt to physically inspect every product that enters the United States. Doing so would not only bring international trade to a standstill, it would distract the limited resources from those imported goods that pose the greatest risk. And so, instead, we have to do this smarter.
Over the coming weeks, the import safety working group will now begin to solicit extensive comment to the public and by mid-November will provide a follow-up action plan that will lay out a road map with short- and long-term recommendations on improving product safety. So what we have done to this point is to create a vision, a general strategy -- which is a substantial change in our approach -- laying out six building blocks and over the next 60 days we'll report back with specific implementation plans on all six of those.
I'm confident that this is going to be a -- this will protect American consumers, not just today, but for many tomorrows into the future.
Now, I would like to indicate that we'll be presenting four immediate actions to the President that will not wait until the implementation plan 60 days from now. The first one actually is the adoption of this report, which brings us together into a common strategy. The second is accelerating the interoperability that I spoke of. We recommend, and will recommend to the President, instruct all of the executive agencies to complete their identification of technical, business and legal requirements for operating within what has become known as the automated commercial environment, or international trade data system.
Now, let me give you a little bit of background. This problem of interoperability I talked to you about with the different systems from the -- we weren't the first to discover that, obviously. And in fact the -- what's known as the "SAFE Act," the Security and Accountability for Every Port Act of 2006, actually requires all federal agencies that license, permit or certify imported products to participate in the development of a single window system. That has begun. It had an implementation date of 2011. We're recommending to the President that we accelerate the development of that, so that it is -- it can be implemented in stages with full operability by 2009. It will require that the 34 federal agencies that are currently referred to as participating government agencies begin to accelerate their efforts. And we'll get more detail in written form to you on that.
The third immediate action we're recommending is that many different departments and agencies are currently dealing with international agreements. We believe that all of the agencies need to develop and increase international cooperation and collaboration. And we'll have specific recommendations within the 60 days on that. And also with respect to agreements with foreign governments, we're recommending that he instruct the agencies to catalogue ongoing and planned import safety related agreements with foreign governments. And there are numerous going on right now. In fact, this week there is a group in from China with the Consumer Product Safety Council. We've got an ongoing set of deliberations with China, as well, on food safety; a group scheduled to go out very soon to continue those negotiations. And so the cooperation and -- rather, the coordination of those will be important.
That will give you an overview. Al, you may have more you'd like to add, otherwise I'd be pleased to respond to any of your questions.
Q You mentioned that some agencies are already moving towards a risked-based inspection system. Can you tell me a little bit more about that, what agencies?
SECRETARY LEAVITT: Yes. Certainly the Customs and Border Protection group have. they've begun to find ways of prioritizing. The way this system works, every product that is imported into the United States requires that the shipper give us advance notice. If you're bringing it in by ship, I think it's 96 hours, if I'm not mistaken -- you'll want to verify this with someone. If it's by truck, we have to have one hour. If it's airplane, I think it's 24 hours. So there's an advance notice that comes in. And they have certain amounts of information that are presented to the Customs and to FDA and USDA and others that would be doing inspections.
Using the systems that they have, they're able to then look at all of the items that are scheduled for importation into the United States and they're able to make selections on those that they believe most need to be inspected. If they see a shipper they've had trouble with, that goes on the list to actually -- to divert the crate, pop it open, tear open the boxes, and actually look at the product. If they see signs of -- information that doesn't match up between the systems, that becomes an opportunity for them to -- it becomes a higher risk, and they therefore have a higher likelihood.
You can quickly see that if all of these systems were interoperable, that the capacity to screen more accurately and better identify those which have a higher risk would exponentially go up. And so that's the reason we're putting so much priority on the development of these interoperable systems, so that we can use technology to -- one FDA inspector said to me, our job is to find the needle in the haystack. Our first job is to shrink the size of the haystack, and we can do that with technology. We can narrow down what is an incomprehensible amount into something that begins to be manageable, in terms of those that we most need to look at.
Q The FDA and USDA say that they're already using a risk-based system. So what's the difference between what you're proposing, and what they're already doing?
SECRETARY LEAVITT: There are many who are using -- moving toward a risk-based system. But what I just described was a way in which we can, first of all, focus the entire effort on risk base and begin to create policies. We found instances where our procedures and our regulations were not consistent with a risk-based system. And so when we get in the implementation plan, you will see that there are many ways that we're suggesting be changed.
Now there were places here, frankly, where we believe more authority might be necessary. For example, with the -- I think the report uses an example of the Consumer Product Safety Council can have a voluntary recall, but retailers can continue to sell it even though they have knowledge that there's a recall. There's a strengthening of authority that might be necessary. There'll be several of them in the implementation plan. This gives the broad strategy.
Q I'm interested in all the places that you traveled to look at various things coming in. What scares you the most? Are you concerned about toys coming from China and this Christmas season, or are you more worried about cantaloupes from Mexico or -- are there hot spots, are there things that are more pressing than others?
SECRETARY LEAVITT: I think the most impressive thing that happens when you see the system as a whole, as I have, is how much there is. When I was in basic training, I did my share of KP, and I remember walking into a warehouse that would open and would fill up and empty out every day because they fed 3,000 men.
What I have now seen is essentially what it takes to fill up and empty out the pantry of the United States every day for 300 million people. And it's just -- I don't have words to describe how much stuff it is. I mean, in 400 different ports around the country, you've got multiple cranes working as fast as they can, bringing off large container loads of, as I mentioned, everything from fruits to tire irons to gingerbread houses. And it just happens very rapidly, and it has to.
And so I think the thing I saw that concerned me the most was the need for us to have interoperable systems that will allow us to screen everything in an efficient way and be able to find the needle in the haystack more effectively.
Q Did any country stand out, or any area that you thought was a problem, like you're more worried about stuff coming from Asia into California, than to the east to the --
SECRETARY LEAVITT: I did not -- there's nothing I would identify in that way. I mean, I -- frankly, as I said earlier, there's a lot here that goes right. I've seen some very impressive things that are beginning to happen outside of government, meaning people, like the Wal-Marts of the world, who have said, if you're going to do business with us as a company, when we put that product on our shelf, it doesn't matter where it was made, it's our brand, and therefore we're going to implement a system of continual improvement every step of the way.
I talked to a guy at a fruit -- I mean, everyone is focused on this. I was -- last week, I was -- where was I, I was in Florida. And I went out to a fascinating little business put together by two Cuban emigrants to this country, a husband and wife, who are the freight forwarders: They take the thing off the plane and they take every shipment off the -- and finally -- if I'm a fish distributor and I don't want to have trucks and a refrigerated building, I hire them.
Well, I was introduced to them by the FDA. And I went through and saw how they test the fish to make certain it's X degrees. And I came, in the course of that, to find that they literally inspect -- whether the FDA is there or not, they still do the same test that the FDA does. Why? Because if they take fish to a customer, they lose the -- if it's bad, they lose the customer.
And what I -- they've got automated systems. We ought to have that information in this interoperable system. I'm going on and on here about the interoperability, but the real key to continuous monitoring is the interoperability of systems and this sense of collaboration and looking at the process.
I mean, I was in a grocery store in the Midwest and they have a value card. You know, you go and they say, do you have your CVS card or you have -- and several weeks ago, we had a chili recall. And I asked them, how did that affect you? Well, they immediately went to their data system and found that they could identify everyone who bought that chili between X and You date.
And so what you see is a vision here where literally where it's picked to the point that it is placed in the mouth, you have the ability to track the system, once we have interoperability of these systems. And so it's a very exciting vision and one that I think is -- the elements are beginning to come about now to produce.
Q Mr. Secretary, you said a few minutes ago that there are ongoing deliberations with China on issues around food safety. Do those deliberations now get expanded, given the issues that have come up around toy safety, or do you pursue something on a different track? What happens now as far as that goes?
SECRETARY LEAVITT: Well, this is a good case in point. First of all, let me say this is not -- this whole thing is not just about China. This is about every one of our importing countries and our partners. And we made it -- we are sending a very clear message that if you desire to produce products for American consumers, you need to meet our standards of quality and safety -- not yours, ours.
Now there are ongoing discussions right now with China on -- with the Consumer Product Safety Council. That's happening, I think, tomorrow and the next day. We've got another group who are coming in on food and drugs. And so one of the strategic points here is we need to coordinate those efforts because you do have different parts of the government with different areas of expertise. And it's a different set of discussions going on with toys than there are with drugs and food and devices, but they do need to be coordinated here.
Q But only one Chinese --
SECRETARY LEAVITT: Say again?
Q But only one Chinese agency in all those discussions.
SECRETARY LEAVITT: No, that's just not true. We're -- and even on food and drugs, we're dealing with two ministries, and I suspect that there are others as well.
Q -- taking the floor, can I ask, how do you send this out for public comment without giving some sense of how much this is going to cost, since the FDA has already said they're under-funded to do what they're trying to do today?
SECRETARY LEAVITT: Well, as I indicated, there will be significant parts of this that require new resources. But it's -- until you get it down to a more specific implementation plan, it would be taking a figure off the wall as to what that part would be. It also needs to be looked at in the context of other pieces. There are parts of this that may, in fact, cost less.
I'm reluctant to use a number. There is no number at this point. But in the context of this implementation plan and the '09 budget, we'll be dealing with that.
Q Mr. Secretary, you talked about risk-based inspection. But did you get -- let me ask you two things. Did you get into specific possible ways to make inspection (inaudible) -- pre-clear importers, better focusing? I mean, nobody is saying -- nobody is saying that the United States should inspect everything coming in. People are saying that the United States should inspect more and should target it better. And the second thing is, you've alluded to some of these things may cost more, but almost everybody -- Republican and Democrat -- on all sides who has criticized the current situation has said that the FDA's funding is woefully inadequate. Did you not deal with that particular question?
SECRETARY LEAVITT: I want to emphasize that our purpose in breaking this into two parts was to create a strategic framework, and then to do an implementation. You don't deal with the issue of resources in the development of the strategic framework. You deal with that after you have an implementation plan, which we are going to now spend time with producers and with shippers and with retailers and with many others getting them to -- asking them to respond to this strategic framework. Then we'll deal in more specificity when we have the more specific implementation plan.
Q What's the -- are you going to publish this in the Federal Register, call for comments, or are you going to --
SECRETARY LEAVITT: Jerry?
MR. REGIER: It was published in the Federal Register. It was published a couple weeks ago. The public comment day is October 1st.
Q Published a couple weeks ago? I thought you were just releasing this today.
MR. REGIER: No, it was published that we will have a public comment day on October 1st.
Q Yes, but how will people -- will you be publishing this report in the Federal Register?
MR. REGIER: They can access it on the website, www.importsafety.com. So that was put in there, but it won't be posted until this afternoon.
Q I see, okay.
MS. PEARSON: It's actually www.importsafety.gov.
Q Mr. Secretary, when you talk about the interoperability of systems, do you mean different government agency systems, do you mean private sector systems? And if so, would there be some new requirement that the private sector start tracking things that aren't tracked now?
SECRETARY LEAVITT: I'm not in a position to respond to that level of specificity. But the vision is very clearly laid out in the SAFE Act of 2006, which is for the one screen view, where a person at -- an official at a port can access the information that could be coming between USDA -- the report actually talks about instances where people were trying to redirect things that had been -- they called it chicken, but it was actually fish, and they were trying to bring it through another port, where if we had systems that connected, we would have more easily been able to identify that.
MR. FRATTO: It tasted like chicken though. (Laughter.)
SECRETARY LEAVITT: It did taste like chicken, that's right. (Laughter.)
I went to -- I spent a lot of time one night at FedEx in Memphis. It's just inconceivable how 3.3 million packages come in, and they know where every one of them is, everywhere along the way. We ought to be advantaging ourselves of that information by having our system interconnected with public -- with the private systems, to the degree that they facilitate the process and don't violate anybody's proprietary interest. Wal-Mart and others are the same.
So this is not just about creating interoperability of government systems. Ultimately, we need to have the ability for that vision of when -- from the point that production all the way through its consumption, we need to have three capacities -- one to prevent, one to intervene, and the third to respond. You can easily see how using technology -- I mentioned the value card -- I think the day will come when a person can sign up at their grocery store to say, if a product is recalled, I'd like you to send me an email, so that I would get it instantly and know that it happens.
I'd like to know, for example, that every store had the ability -- where I saw many of the major retailers, if the product is recalled, it can be off the shelves in a matter of hours, as opposed to days. That's what we think that system ultimately can produce. It won't happen overnight, but as I indicated we want the federal -- we want to have our -- we want full operability among federal agencies by 2009, and that's moving it up from what right now is 2011. So this is -- if you're looking for a significant tactical change, that's it.
Q When you say that you want importers to meet the same quality standards and safety standards, are you in essence planning to hold their feet to the fire on these six building blocks?
SECRETARY LEAVITT: Well, we think that if people are going -- if any private organization, whether they are inside or outside the United States, desires to make -- to produce products for American consumers, they need to meet our standards. Now in many cases that means we have to produce a standard, because there isn't a standard for everything. And second of all, we need to have a means by which we can assure it's being met.
Now in many cases, if we're -- again, looking at this large picture from a snapshot to a video, in many cases that may mean that we develop sufficient confidence in the exporting country's certification process, and then we essentially audit their process. They refer to that as certification. That's a legitimate tool.
When I was in a grocery store, I picked up a -- kind of a tube of filet mignon that was -- it was packed, and it looked like a tube. And there was no USDA stamp on it, but there was an "inspected in Australia" stamp on it. Well, that surprised me. When I asked, I found that we have an arrangement where if the Australians inspect it, that's good enough for us, because we have great confidence in their inspection process and we are constantly monitoring their inspection process. That's one way in which something like that can occur.
Q Mr. Secretary, aren't people who produce products for this country already required to meet our standards? Other than --
SECRETARY LEAVITT: Well, they don't have standards in every --
Q But other than that, I mean, the toys, all these other issues that have already come up -- I mean, there's nothing new here, is there?
SECRETARY LEAVITT: Well, in some cases we don't have standards. In other words, we don't have ways of -- other than the snapshot; that's the difference. Rather than a snapshot at the border where we find parts of it, we find that we don't, we want to build quality in. It's a great question. We want to build the quality in to where we know that someone is looking at that many times through the course of the process and that we have confidence that quality is being built in, and you don't ship into our country unless you're part of that system.
Q Can I ask a couple questions off topic?
MR. FRATTO: Off topic?
Q It's on topic, but a slightly different --
SECRETARY LEAVITT: I have no idea what the general is going to say today. (Laughter.)
Q I do. (Laughter.)
The FDA inspectors that went to China, we've not heard anything about what they found. Can you shed any light on what they did find?
SECRETARY LEAVITT: There will be other people better able to answer that than me. I've had --
Q But they won't.
SECRETARY LEAVITT: I've had brief reports, but not enough detail I'd feel confident in being able to represent them.
Q Anything surprise you that heard from them?
SECRETARY LEAVITT: Well, what I can tell you is that we have very active discussions going now on both drugs and devices and food. And it's clear to me that the Chinese have the picture here, that they know that if they're going to have access to American markets, we have to come up with a system of assuring that it's meeting American standards. In some cases, that means -- we started off these discussions in many cases arguing about what was the right standard. Well, the right standard is the American standard if you're going to be shipping to American consumers. That's an ongoing conversation.
Q In the bilat last week, between Hu and President Bush, did this come up? Who brought it up? What did they say?
SECRETARY LEAVITT: Others would have to speak to that. I read in the paper it did, and I'm going to see him today, and I expect I'll hear about it.
DIRECTOR HUBBARD: Hu did, in fact, bring it up.
Q Hu brought it up?
DIRECTOR HUBBARD: Right. And talked about their commitment to addressing the issue.
MR. FRATTO: There's a transcript from a gaggle that followed the bilat that was a readout. I think Dan Price and Jim Jeffrey gave a readout on that.
Q And finally, do you expect anything to come out of these meetings this week?
SECRETARY LEAVITT: I'm not a party to the Consumer Product Safety Council discussions.
Q But there will be FDA discussions.
SECRETARY LEAVITT: They are part of a process that I expect to bear fruit. Whether it will be fruit that's evident this week -- it will more likely come later. But I can tell you that substantial progress is being made.
Q On the standards, you talked about certification. If there's not certification, are you envisioning increasing resources to put U.S. government inspectors overseas in an increased role? You talked about looking at risk-based assessment throughout the life cycle.
SECRETARY LEAVITT: Well, that's a good example of where risk-based priority setting would be used. If we don't have a certification process, then obviously more resources would have to go into that, or resources would be used there. The goal of certification is to, in the most efficient way, gain the highest degree of confidence that quality is being built in.
Certification is a tool that can be deployed some places and is less useful others. It's not something that's likely to be used universally across every front. Not everyone will have a system we are confident of.
Q So what do you do in those cases where countries don't have a system you're confident in?
SECRETARY LEAVITT: Well, I think they'll have to be dealt with on a case-by-case basis. I wouldn't want to generalize there.
MR. FRATTO: Last question, anyone?
Q You talked about integrating with more -- integration with private systems that are tracking. Is there any component in this about any concerns about privacy rights for consumers and proprietary rights for businesses?
SECRETARY LEAVITT: Of course we deal a lot on this question with electronic medical records. And privacy is the first principle. However, in the context of -- there's much different in the context of a personal health record than it is the production of pineapple, where there's a compelling public interest to know the safety and security of those goods.
MR. FRATTO: Okay, thank you.
END 11:30 A.M. EDT