China Plays Tug-of-War With U.S. Inspectors Over Drywall
A team of federal investigators who traveled to China last year to search for answers about defective drywall faced resistance from Chinese government officials. At one point, a Chinese official snatched a drywall sample from an American’s hands.
A federal investigation into contaminated Chinese-made drywall has been a long, hard tug-of-war for U.S. investigators trying to pry information from Chinese government officials and manufacturers. When a team of investigators traveled to China last year, the tug-of-war became physical, with a Chinese official trying to wrest a piece of drywall from an American’s hands.
The federal probe is the largest defective-product investigation ever conducted by the Consumer Product Safety Commission. But almost two years after it began, the CPSC still hasn’t been able to figure out what materials in the Chinese drywall are triggering the release of sulfur gases. The gases have a chemical smell and have corroded wiring and appliances in thousands of U.S. homes. They’ve also been linked to respiratory ailments, nosebleeds and sinus problems.
The best chance for solving the mystery came last year, when a team of CPSC investigators traveled to China to inspect drywall-manufacturing plants and gypsum mines. But the trip did not go as planned, according to CPSC officials, including an inspector who was part of the group and who spoke with ProPublica and the Sarasota Herald-Tribune.
Chinese government officials interfered with their investigation by rushing the Americans through inspection sites, blocking their attempts to ask questions and take samples and engaging in a coordinated campaign to intimidate them, the CPSC officials said. At one point, a crowd of employees was ordered to block the entrance to a gypsum mine and encircle the Americans.
“We were surrounded,” the inspector said. “There were five of us and 50 of them.”
The CPSC officials interviewed for this story, including the inspector, spoke on condition of anonymity, citing the ongoing nature of the investigation.
Most of the manufacturing companies the Amer icans visited refused to disclose even the most basic information about the chemicals they put into their drywall or the manufacturing processes they use. Despite these limitations, the Americans noticed serious quality-control problems at all the plants and mines they visited. The inspectors were so desperate to get samples that they slipped away from their government handlers twice to buy drywall directly from vendors. The vendors said at least one brand of drywall being sold in China smells so bad that contractors refuse to buy it.
China’s failure to cooperate with the CPSC on drywall demonstrates how little recourse U.S. consumers have when they buy defective products imported from abroad, public interest advocates and international trade experts say. Nearly 20 percent of all U.S. imports come from China, according to U.S. Census Bureau statistics. Only Canada sells more goods to the United States.
“It shows that an agency like the CPSC has no leverage to get a foreign government to cooperate if that government doesn’t want to,” said Pamela Gilbert, who was the CPSC’s executive director in the Clinton administration and is now a partner at Cuneo Gilbert & LaDuca. “I believe that’s true with all the regulatory agencies that have had trouble with Chinese products.”
Gilbert pointed to a range of defective products that China has exported in recent years, including pet food, toothpaste, pharmaceuticals and children’s toys.
The problem won’t be resolved, she said, until “the highest levels of the U.S. government, like the State Department, get involved.” \CPSC officials close to the drywall investigation told ProPublica and the Sarasota Herald-Tribune that they’ve asked the State Department and the White House for help in dealing with the Chinese, but they wouldn’t provide details about the discussions.
This week, a CPSC delegation led by Chairwoman Inez Tenenbaum is in Beijing for trade talks with China. Tenenbaum is expected to discuss the drywall investigation, along with other product safety issues.
The CPSC officials who spoke with ProPublica and the Herald-Tribune about the 2009 trip to China said their government hosts were cordial when they arrived but that the relationship quickly became tense.
The Americans shared a bus with officials from China’s General Administration of Quality Supervision, Inspection and Quarantine, known as AQSIQ, which employs more than 30,000 people throughout the country. More officials followed in black sedans, with a new group switching in each time they passed into a new province.
“It was very carefully choreographed,” one of the U.S. officials said. “We spent a lot of time with party officials and not as much time in the plants as we wanted to do.”
The Americans had spent months preparing for their trip. They visited U.S. sites where gypsum, a white sedimentary rock used to make drywall, is mined. They studied how another form of gypsum—known as flue gas desulfurization gypsum or FGD gypsum—is produced from ash created by coal-fired power plants. They also visited drywall-manufacturing plants where they were told which chemicals went into the final product.
The CPSC officials said they couldn’t name the U.S. or Chinese sites.
The team’s first stop in China was a plant in the city of Linyi in Shandong province. Both Taishan Gypsum Co. and Knauf Plasterboard Tianjin, the two companies accused of manufacturing most of the defective drywall exported to the United States, have said the gypsum they used may have come from mines in Shandong province. Taishan’s manufacturing plant is also located in Shandong.
Although the plant managers were polite, they wouldn’t reveal the chemical additives they used or explain how they monitor the quality of their product. What the team saw wasn’t encouraging.
“Gauges weren’t labeled, the plant was very dirty and it was clear that there were very few process controls,” the CPSC inspector said. Without proper gauges, workers couldn’t monitor the quality of the material as it made its way down the line.
The team also didn’t see any documentation for the raw gypsum that was arriving from a nearby mine. In the United States, the CPSC official said, gypsum is labeled with a truck number, load number and other information that identifies its origin and consistency. “They didn’t have any of that,” the official said.
When the U.S. team started taking photographs inside the plant, their government handlers began getting nervous. When they asked for a sample of the finished product, they were offered a precut piece of drywall that had been laminated in plastic. Eventually the plant manager gave them what they wanted—a sample right off the assembly line—but a government official grabbed it from the CPSC inspector’s hands.
“Then we snatched it back. Eventually, we won the tug-of-war,” the CPSC inspector said.
The Chinese officials were infuriated.
“The handlers all began talking real loud on their cell phones. They were obviously upset and told our translator that they were angry that we took photos and samples at the plant. We were told that there would be no samples and no photos at the next stop.”
When they stepped off the bus at the next stop, a gypsum mine, about 50 employees blocked some of the mine entrances and began taking pictures of the Americans. “The clear aim was to intimidate us,” the CPSC inspector said.
The Americans had hoped to gather samples and learn how the miners avoided deposits of sulfur or other minerals that some scientists suspect may be causing the drywall problem. “But they refused to answer any of our questions,” the CPSC inspector added. “They wouldn’t let us grab a sample.”
The visit was supposed to last several hours, but it was over in less than 30 minutes.
CPSC officials said they phoned the U.S. Embassy in Beijing from the bus and reported that the Chinese officials were interfering with the investigation, but the CPSC wouldn’t tell ProPublica and the Herald-Tribune how the embassy responded.
As the bus approached a second mine in Shandong province, overpowering smells of sulfur and then livestock seeped inside. They were told the odor was from a nearby hog farm, but there was no farm in sight.
At the mouth of the mine the inspectors were shocked to see miners separating pieces of rock by hand—a process CPSC officials said is unheard-of in the United States and that the inspector described as “ludicrous.” Modern mines have tools and testing equipment on site to ensure that the rock they’re extracting is gypsum and that it is pure enough to be used in products such as drywall.
“They weren’t doing any kind of testing, they were just looking at it,” the CPSC inspector said. “They looked like they were straying” into areas of the formation that could contain sulfur or other contaminants “and then just trying to sort out the bad stuff by hand as it came out.”
Asked why the company wasn’t testing for contaminants, a company representative told the team the mine was fulfilling its contract with its customers and there was no government requirement to do so.
The team tried to get a sample of the rock.
“When I tried to go over and take a sample out of a huge pile of rocks, I was told it was too dangerous because of the machinery nearby,” the CPSC inspector said. “But there was no equipment anywhere near it.”
Instead, the inspectors were handed a piece of rock that looked “nothing like what was piled up on the ground.”
“It looked like a showpiece that you would put on your desk,” the inspector said.
The U.S. Geological Service later confirmed that the rock was gypsum, but there was no way of knowing if it came from the mine the Americans had visited.
The CPSC “suspected this mine as having problems,” the inspector said. “I was well-briefed before I left. We had a list of questions. None of them were answered.”
The second plant the group toured made its drywall from FGD gypsum. Using this form of gypsum in drywall is increasingly popular in the United States as well as in China because it’s cheap and plentiful. FGD gypsum is so similar in chemical composition to naturally mined gypsum that manufacturers say it’s difficult to tell whether drywall has been made from one source or the other.
Again, the Chinese officials tried to rush the Americans through the plant.
“They wanted us in and out of that plant in 10 minutes,” the CPSC inspector said. “But we just took our time, which made them really upset.”
The Americans weren’t allowed to take a sample of the drywall, but they got a sample of the FGD gypsum the company was using. But only one of their questions was answered: How did the plant keep track of where the coal ash came from?
The question was an important one because without proper documentation it’s impossible to track drywall made with tainted gypsum back to its source. In the United States, deliveries of mined gypsum or FGD gypsum come with a certificate that is supposed to specify critical details such as water and sulfur content, CPSC officials said.
The answer surprised the U.S. team. The FGD gypsum came from five different power plants, and when it arrived it was dumped together in a big pile.
“I asked if there is some kind of conformity certificate that says where all the material is coming from. They said no,” the CPSC official said.
Back to Beijing
The last plant on the CPSC trip used both FGD and naturally mined gypsum. It was located southeast of Beijing, in the city of Tianjin. Tianjin is home to a plant owned by German-based Knauf Group, whose Chinese subsidiary, Knauf Plasterboard Tianjin, is one of the main players in the U.S. drywall crisis.
The managers at the Tianjin plant seemed more eager to cooperate with the U.S. team, and they shared the full list of chemicals used in their product. The facility was also more modern than the other plants they had visited. “If I were to build a plant, this one had a lot of what I’d like to have in it,” the CPSC inspector said.
But the inspector also found a problem. “Despite all of this good stuff, all of its raw materials were co-mingled and dumped,” he said. “So there was not much in the way of keeping track” of where the gypsum came from.
Dan Harris, an attorney with Seattle-based Harris & Moore, which represents clients in both the United States and China, said he wasn’t surprised about the lack of documentation in China’s drywall industry.
“There are a lot of industries where the Chinese don’t track goods terribly well,” Harris said. “Until there is a reason to keep better records, they aren’t going to do it. Perhaps this will be the reason.”
“Quite a Spectacle”
As their trip drew to a close, the CPSC delegation returned to Beijing for a final set of meetings with Chinese officials—and to make a last-ditch effort to collect more samples.
That night three of them slipped out and took a taxi to a Beijing street market, where they’d been told drywall was sold. They bought as many kinds of drywall as they could find, cutting small samples from each piece and cramming them into their backpacks.
“The vendors were kind of shocked,” the CPSC official said. “They couldn’t understand why we would buy the whole sheet and then cut a small piece out of it.”
The next day, on their way to meet with a Chinese government administrator, they spotted a large building-supply market. On their lunch break, they rushed back to the market and began asking the vendors questions they couldn’t get answered by the Chinese companies they visited. “We actually got more information from them than from anyone else,” the inspector said.
“It was quite a spectacle. People wondered, 'What all these Americans were doing here?'” one of the officials said. “We were there for about two hours, putting drywall samples into our backpacks and briefcases.”
The vendors told them the quality of the drywall they dealt with varied widely. They said some of it had a foul odor, and one vendor mentioned a specific brand that was known for its bad smell. The vendor was shocked when the Americans asked to buy some.
“He said he didn’t have any because his customers all complained about it,” said the CPSC inspector, who would not divulge the name of the brand.
The team sent the samples back to the United States through the U.S. Embassy in Bejing, because they worried that Chinese officials might seize them at the airport.
“We didn’t want to take a chance,” the inspector said.
China hasn’t provided any more information to the CPSC since the U.S. delegation returned home 14 months ago.
In May, the CPSC released test results of 10 Chinese drywall samples that released the highest levels of sulfur gas. It said that three of the 10 were manufactured in 2009, more than a year after Chinese-made drywall began causing corrosion and health problems for U.S. homeowners.
The agency is continuing to test the samples, but it still hasn’t determined what is causing the problem. The CPSC officials interviewed by ProPublica and the Herald-Tribune said that without more information from China about raw materials and production methods, they may never be able to answer the question.
When ProPublica and the Herald-Tribune told Florida Sen. Bill Nelson what happened to the CPSC in China, he said China’s treatment of the U.S. delegation was “inexcusable.” Florida has been especially hard hit by the drywall problem.
“The president should consider the strongest economic sanctions against China until they own up to their responsibility to American consumers,” Nelson said. The White House did not respond to questions for this story.
In April, Nelson wrote a letter to Secretary of State Hillary Clinton, urging her to push China “to act responsibly and help find a remedy” for the drywall issue. Nelson told Clinton he was particularly alarmed by the fact that he had “raised the issue of defective drywall directly with Premier Hu Jintao” in April 2010 and the premier said he knew nothing about the drywall problem.
In June, the State Department told Nelson that it had met with a Chinese product-safety minister and had urged that Chinese companies meet with the CPSC and discuss a “fair arrangement to benefit the Americans who have suffered.” The Chinese government said “the matter was under careful review.”
The State Department would not respond to specific questions about whether it has offered any additional help to CPSC. Instead it sent a statement saying it “believes that coming to a fair resolution of this trade-related problem is a matter of great importance to the United States, and should be of similar importance to China.”
But earlier this month, an attorney representing Taishan— which is owned in large part by the Chinese government—suggested that the company’s executives still aren’t convinced that their drywall is problematic.
“They absolutely do not understand why their high-quality drywall allegedly emitted excessive amounts of hydrogen sulfide,” Taishan’s attorney, Joe Cyr, told the New Orleans federal court that is hearing multidistrict litigation about the drywall problem.
Harris, the trade attorney, said China has little incentive to cooperate with the federal investigation.
“The Chinese government doesn’t care at all about homeowners in the U.S.,” Harris said. “Let’s face it. They care about protecting companies in China. If that means not sharing samples with the U.S., then that’s what they are going to do.”
Foul air from Chinese-made drywall has created a nightmare for thousands of homeowners.
The Story So Far
ProPublica and the Sarasota Herald-Tribune began examining in May 2010 what was—or wasn’t—being done to help people whose homes had been built with contaminated drywall. The problematic drywall, much of it imported from China, emitted foul odors and frequently caused mysterious failures of new appliances and electronics. Worse yet, some residents complained of serious respiratory problems, bloody noses, and migraines.