Document jmpJr7LbkED94GNMz4mGp6OKR

23810001 Explosive Controversy tags 3 The Dispute Over PVC Sends Shock Waves Throughout Industry By Dana L. Thomas sure, claims that even this huge in DwvviiolnlerykIrledSapcreCrrsoehaLmltoOhacrptSaidtfnUeBercdoR,emrEtreFhsel,oainafsUGnt.tpgoShJiloeaoa. dsnnOratluiiccrvacichenrou'yrsmp,LoaapoEto,iouofthlinyseathreemodvOoeunuSestlcynHttmrtiA.vee'iscsTtnyoohst,ruettrlwibdninuligagltltertetneenovodret,tunrrece,eitqemsnupapoibirorrwelaeienmottoirismetkrynepottorosuetrw,mqtapuinenrtihpooet,tt al Safety & Health Administration also pose a health hazard. . (OSHA) to take stiff measures to re duce tho health hazard. After impos ing temporary lower exposure levels for the chemical, OSHA ruled in Oc tober that, beginning next January 1, producers and fabricators must equip their plants to cut the level .to near-zero --- one-part per million -- compared with the 50 parts per mil lion previously in effect. Arguing that it is technologically and eco nomically unfeasible to meet such a rigid standard, representatives of the industry have filed a suit seek ing modification of the OSHA ruling: oral hearings will be held hy the U.S. Court of Appeals this Friday. Meanwhile, the Society of the Plas tics Industry has asked the court Severe Resin Shortages Industry observers warn that if OSHA persists in its ruling, many .more firms will be forced to shut down wholly or partially, creating a severe shortage of the resin and sky rocketing prices. On the other hand, government agencies, labor unions and lobbyists for industrial health controls argue that corporations must be held socially accountable and forced to put considerations of human life and safety above profits --whatever the cost. So the battle has been joined; the outcome, as noted, will have far-reaching effects. Vinyl chloride, the basic raw ma terial for polyvinyl resin production, for an extension of its January dead is a gas at room temperature; it is line. . Needless to say, the polyvinyl case has sent shock waves through synthesized from chlorine and ethy lene in plants which resemble oil re fineries. It was launched commer out the industry. PVC resin is a basic December, Dr. John Creech, a com other blow. It was disclosed-that an pany doctor, learned that Earl Italian Professor of Medicine, Cesare Parks, who Hod begun working at the facility in 1943 and had been forced to retire in the late 'Sixties, owing to poor health, had died the previous August of a liver disease. Concerned about the suspiciously, high number of Goodrich workers suffering liver diseases, Dr. Creech asked to see an autopsy on Parks. Maltoni, had discovered--two years before the announcement of the Goodrich deaths--in laboratory ex periments that rats exposed to 250 parts per million of vinyl chloride developed angiosarcoma. The infor mation had been transmitted to the government and medical societies in When he learned that Parks had the U.S., but nothing had been done died of angiosarcoma of the liver, about it. Indeed, up until the Good the doctor recalled that two years rich fatalities, OSHA continued to before another Goodrich worker had insist that it was safe for production succumbed to the same disease. plants to operate at a 500-ppm ex Since angiosarcoma is exceedingly posure level. rare, the incidence of two such deaths in the plant's small work Another disclosure was equally . force struck Dr. Creech as highly sobering. Even before Professor Mal- ominous. toni's discovery, Solvay & Cie, a Belgian polyvinyl maker, which be He contacted Goodrich's occupa came worried over the increasing in- tional health director, who hired cidence of acro-osteolysis among Tabershaw-Cooper Associates, an epidemiological research firm, to workers at its plants, hired Dr. P. L. Viola to do medical research on the conduct an investigation of the mor subject. Dr. Viola was unable to de tality files of Goodrich workers. This had barely begun when a third velop acro-osteloysis in his labora tory 'animals, but he produced worker, who had been at the Good-' rich polyvinyl plant for 23 years, something worse -- cancer of the * liver. died of angiosarcoma. Greatly dis Requested Secrecy material employed in a host of indus The results were reported in trial and household products. Major 5 include the packaging of food, jpholstery,. wiring and compo Arguing that they are being asked to adhere to anrfarrfs that, ^ echnicallvsah Tokyo in 1969, and in 1970, to the Tenth International Cancer Con- piping, luggage and sporting goods. \VhU producers employ 6,000 work ers to turn out and fabricate the res in, two million jobs depend on its use. The value of products depen dent on PVC runs over SU0 billion a year. In short, the OSHA ruling could have an adverse impact on a big slice of the U.S. economy. "Blew Whistle on Itself" Ironically, prior to the public an nouncement of the death of the Goodrich workers, the PVC industry itself did all the medical research which established the link between vinyl chloride and cancer. Ralph L. Harding Jr., president of the Society if the Plastics Industry, declares: `This is a unique situation. Industry "inanced the studies and blew the vhistle on itself." However, government agencies *ushed in quickly thereafter, niak* og up for lost time by imposing .hat industry spokesmen claim are nrealistic safety standards. The *VC issue is a test case and perhaps nly the first in a long line of conroversies ahead. For OSHA is just ne of several new government gencies which have been estabshed since 1970, as a result of the ibbying of environmentalists, tho ise of consumerism and the growig crusade for industrial health rejrms. The OSHA ruling on exposure levs already has had repercussions in le ~"7C business--including presi stock prices of major proj<- . Goodyear has announced it shutting down n facility at Niagai, slashing its output of PVC resby 50'c, or 50 million pounds, and iminating 60 of the plant's 440 jobs, oodrich, while programming a $42 Ulioa outlay over the next three or ur years to reduce worker expo ly ujnnteasibTe, the peon chemical companies hired taking their case to court. Professor Maltoni to conduct the aforementioned . experiments. As noted, in 1972 he produced malig nancies In animals which were ex posed to 250 ppm of vinyl chloride. cially in the 'Thirties and, thanks to turbed, Goodrich management re In January 1973, this information its fire resistance and ability to be ported the deaths to officials of the . wus passed on to the Manufacturing molded into a wide range of forms, National Institute for Occupational Chemists Association in the U.S., was dubbed a "wonder plastic," Safety & Health (NIOGH). After in with the request it be kept confiden which went into hundreds of indus tensive consultation, the news was tial until Professor Maltoni had the trial and household products. Last made public on January 22, 1974. chance to further analyze and in year, nine firms produced vinyl chloride gas in 14 plants. Their out put was used by 21 companies to turn out over five billion pounds of polyvinyl resin, in 37 plants. The leading producer is B. F. Goodrich, followed by Firestone, Conoco, Union Carbide, Borden, Diamond Sham rock, Robintech, Tenneco, Air Prod ucts, Goodyear and Hooker (division, of Occidental Petroleum). Vinyl chloride had not been con sidered a seriously hazardous chemical. However, in the process of conversion from gas to resin, there is substantial leakage and the chief worry has been of plant explo sions. The gas can induce narcosis (sleep). In fact, it was once tried out as an anesthetic but was dis carded, since it caused heart irrita tion. During the 'Sixties, in cleaning out the vats during the conversion process, incidences of acro-osteolysis (bone and skin disease) cropped up among workers, and VCM proces sors introduced new techniques to reduce exposure. To further protect workers, OSHA, which was estab lished in 1970 under the industrialhealth safety act, set limits of 500 ' parts per million of the chemical, to which workers could be exposed In gas and resin plants. Matters were thought to be under The announcement hit the indus try like a bombshell. William Lloyd, director of health surveillance for NIOSH, declared, "This has to be one of the most startling findings ever in industrial medicine." Govern ment health officials immediately launched a nationwide investigation. Staf: members of NIOSH and OSHA went to polyvinyl chemical plants all over the country to study the situation. Charging that "workers are tired of being guinea pigs," offi-' cials of the United Rubber Workers and the Oil, Chemical St Atomic En ergy Workers, demanded that PVC producers eliminate tho exposure hazards or shut down. Health Crusader In addition, they asked Dr. Irving J. Selikoff, director of Mt. Sinai Hos pital's Environmental Sciences Lab oratory, to undertake medical Inves tigations on their behalf. Over the years, Dr. Selikoff has built a repu tation as a crusader for improved safety conditions in industry. A highly articulate spokesman, and a consultant to the AFL^CIO, the doc tor it known as the Ralph Nader of the industrial health field. He pitched in vigorously. Assisted by labor personnel, he began digging into the health records at producers' terpret his studies. The ban was lifted in July 1973 and the report on Dr. Maltoni'? experiments was transmitted by the Manufacturing Chemists Association to NIOSH and other government agencies. Inexplicably, nothing was done about Professor Maltoni's findings. The Labor Department claims, in retrospect, that it didn't get the com plete report; the MCA insists that the government did receive the data, but failed to comprehend its signif icance. In any event, Washington agencies made no effort to -change the standards of exposure that OSHA ' had decreed for the industry in 1971 --namely, 500 parts per million par ticles--double the level at which Dr. Maltoni produced liver cancer in his test animals. Meanwhile, Great Britain and Germany had tightened up their exposure levels. In the U.S., Dow Chemical hod been, raising its standards over the years, and Good rich, whose subsequent announce ment of fatalities was to touch off* the storm, by the middle of 1973 had upgraded its exposure goal consid erably above that of OSHA. The disclosure . that Washington and the MCA had known about the cancer-producing danger of vinyl chloride months before the Good- rich deaths sparked, a public furor. control until the tragedies at the plants. A Nashville newspaper ran a series aforementioned Goodrich plant. Last Then the industry suffered an-** Continued on Pag* 12 s T Political Pressure Needless to say, produc ers were shocked by the rul ing. They thought that they had presented a strong case in pointing out that no ani mal--let alone humandeath has been reported at under 50-ppm exposure. Some trade observers be lieve that the OSHA regula tion was issued under heavy political pressure from unions and industrial health crusaders. Others feel that OSHA proposed the most se vere standards possible, fig uring that the industry would challenge the ruling in court and that' the latter would then have the responsibility' of resolving the issue. Actually, OSHA wrote a loophole into its exposure regulation. This provides that while trying to get down to the one-part level with en gineering modifications, the industry could meet the deadline by supplying work ers with respiratory equip ment. However, producers claim that such devices are in short supply. Even if they were plentiful, PVC makers contend that they are dan gerous to use. At the OSHA hearings, government wit nesses conceded that respira tors, worn full time on the job, would be "instruments of torture." People with less i than normal pulmonary func- i tions can't breathe properly ; in them; 32% of the male I population over 35 falls into i this category. i Faced with the task of complying with a virtual i zero-exposure level and a shortage of respirators, pro ducers have warned that they may be forced to shut down all or a substantial part of their operations. SPI hired the Arthur D. Lit - *-f - tle consultant firm to assess the impact on the U.S. of a total shutdown of VCM and PVC facilities. Surveying all the industries dependent on such materials, Little con cluded that a complete shut down would result in a loss of 1.5 million-2 million jobs and losses of at least 560 billion in production and sales. Serious Consequences No one, of course, expects a total shutdown of the PVC . industry--even if the OSHA ! ruling is not delayed or mod ified by the courts. But just ' a partial shutdown or slow down could have serious con sequences. Hence, leading PVC makers are taking vig orous steps to try to adjust to the situation. Goodrich has announced that it will spend ! $12 million over the next three or four years to reduce worker exposure to the low est level possible in the six plants that make or process the resin. Diamond Shamrock, a major resin maker with two new plants, already has re duced its exposure levels to a range of 5 to 25 ppm; it ! hopes to improve operations further with the use of respi ratory equipment. The firm is going ahead with construc tion of a 200-million pound facility, which is expected to come on stream next year. Robintech, a resin and poly vinyl pipe fabricator, says it plans to apply new engineer ing techniques in its Painesville, Ohio, plant, and a Jap anese process it has ac quired for a new plant in Texas. But for the industry as a whole, the future is filled with uncertainty. DUAL-PURPOSE FUNDS Friday, December 6, 1974 Following is a weekly listing of the unaudited net asset values of dual-purpose, closed-end investment funds' capital shares as reported by the companies as of Friday's close. Also shown is the closing listed mar ket price or the dealer-to-dealer asked price of each fund's capital shares, with the percentage of difference. Cap. Shs. N.A.Val % Price Cap. Shs. Diff. Am DualVest .......... 3'/, Gemini ........... -r.. .. 5 3.47 -9.9 6.59 -24.1 Hemisphere ...... . 12 000 2 Income and Cap ... . VA 3.31 -5.6 Lcvc-raae ............. . 4 V, 4 82 - 6.6 Pegasus Inco&Cap . . 4'/, -0.79 z Putnam Duo Fund . . VA 2.22 +295 Scudder Duo-Vest . . 3'A 7.10 -33.8 Scudder D-V Exch . 15 15.73 -4.6 Lipper Analytical. 23810002 T BARRON'S Tenneco Chemicals testified it might be forced to close its vinyl chloride plants if OSHA insisted on a zero level. The firm supported the indus try's plan for a three-year program, but said it hoped to be able to achieve the final goal sooner in a new plant it is building in Texas. Dr. Selikoff testified that, while the only prudent course was to provide a zero-level, if he were' con vinced the industry was making every effort to re duce exposure as fast as pos sible, he would be as "pa- ' tient as Job" in requiring the [ ultimate standard. Peter Bommarito, president of the United Rubber Workers, I argued that if PVC cannot be j used safely, the industry ought to shut down. He ob served that the country got along without the material j for 200 years and could do so ! again if necessary. i ! Report Ignored After the hearings con cluded, OSHA, to help it ar- I rive at a decision, contacted Foster D. Snell, a division of Booz, Allen, Hamilton, to un dertake a study to determine I what the consequences to the | industry would be if stan- ! dards were to be applied at various levels, ranging from zero exposure up to 50 ppm. In late August, Foster Snell reported its conclusions that it would -not be technologi cally feasible to mandate a zero-level. It recommended that OSHA set gradually phased requirements for reaching its goal, to permit collection of' additional data and fuller assessment of newer medical findings as they become available. j ; I - 3. - On October 4, OSHA pub lished its ruling. Ignoring the Foster Snell report and the arguments presented by the industry at the hearings, it decreed that beginning Janu ary 1, 1975, the limit of expo sure must be set at one part I per million of VCM (or vir tually a zero-level) as mea sured over an eight-hour ' I working day, with a ceiling i of 5 ppm measured over any period no longer than 15 min- . I utes. To help achieve this _ I standard, respirators will be ! required for all employes ex- ! posed to chemical inhalation 1 in excess of these limits, ex- I cept that until January 1, | 1976, the use of such respira- ' tors will be descretionary for i employes whose exposure is ! at a 25-ppm level or under. In addition, monitoring and ! measuring programs must be initiated in plants to de termine whether exposure levels exceed 5 ppm; tests must be made monthly or quarterly. Moreover, medical exams must be given every six months to workers who have had 10 or more years exposure at a plant, and an nually to all others. Warn ing signs, posters and labels in plants must carry the in scription: "Cancer Suspect Agents"; they must be shown on all packages of PVC. Although the new rul ing will apply to the produc ers of VCM and PVC and to the packaging, repackaging, transportation storage of the chemcial, it won't include ' the handling or use of end products. ! ' I 23810003 T z- , .BARRON'S December 9, 1974 EXPLOSIVE CONTROVERSY Continued from Page S of articles, charging that .a ; "Watergate-type cover-up" had been engineered to con ceal the truth about the danger of the chemical . and that the industry admitted the facts only when they were about to be discovered by the public. Dr. Selikoff, NIOSH and the unions demanded that VG producers reduce the expo sure level to zero. However, OSHA, which was responsible for taking I into account the technical and economic consequences of its regulations, decided to compromise on a temporaryemergency standard of 50 parts per million, pending further study. This level, the equivalent of a teaspoon of vinyl chloride in a room 20 by 20 feet, went-into effect on April -5. Then the government was embarrassed by another dis covery. In mid-April, the Manufacturing Chemists As sociation, which had spon sored tests at the Industrial BioTest Laboratories in Northbrook,. 111., reported that two angiosarcomas had been produced in mice at the 50-ppm exposure level adopt ed by OSHA. That agency immediately proposed a change to a "non-detectable" . .level. But it decided before putting that standard into effect to hold public hearings to collect all available evi dence. Meanwhile, PVC produc ers, who had been keeping a low profile ever since an nouncement of the Goodrich deaths, were becoming alarmed at the adverse pub licity and the threat of exces sive Washington action. In dustry spokesmen answered charges of labor and health groups that they were dere lict in failing to act on the warnings of the European research by pointing out that these findings did not wave a red flag because all the liver cancers reported had oc curred in animals. It wasn't until disclosure of the Good rich deaths that it became apparent that the cancer could occur in human beings. Makers of VCM and PVC agreed that they had an obli gation to tighten safety stan dards. Via the Society of the Plastics Industry, they pro posed as an alternative to zero-level exposures that they be permitted to reduce average levels over a three- year period to five ppm in VCM plants and 10 ppm in PVC ones. They also sug gested an initial time- weighted average exposure of 25 ppm, with a ceiling level of 40 ppm, to be effec tive from October 5, 1974. Meanwhile, throughout the country fabricators be came worried that their business would be seriously affected, if producers were forced to shut down or cur tail their supplies, owing to "unreasonable" government regulations. Fabricators bombarded the Labor De partment with letters, warn ing of the hardships that would ensue from such ac tion. Spokesmen for the phono graph record business wrote that polyvinyl chloride is vital to their product and they couldn't survive if pro ducers cut their supplies. A medical equipment manu-. facturer wrote that devices it provided for heart surgery and kidney dialysis treat ment used PVC as a vital in gredient, and it could be forced to shut down if '- it . couldn't get the resin. ? Public Hearings Amidst this tense atmo sphere, OSHA opened its public hearings in Washing ton on June 25. They lasted through July 11, generating over 200 oral and written submissions, adding up to 4.000 pages of testimony. Qn the first day, Dr. Herman Kraybill, of the National Cancer Institute, testified that OSHA's temporary stan dard of 50-ppm exposure was inadequate because at that level, according to recent studies, there was a high j| probability of causing can- j cer in man. On the other I hand, Dr. Paul Kotin, former ' head of the National Insti- I tute of Environmental 1 Health Services and a spe- 1 cial consultant to Air Prod ucts & Chemicals Inc., I argued it was inappropriate to set a standard for humans on the basis of animal exper- j iments. Other representatives of Air Products said the firm had' hopes of achieving an average time-weighted exposure of 20-25 ppm of VCM in their plants by Octo ber 1974. However, they stressed that it would be im possible to do better with out significant improve ments in current control technology. A team from Dow Chemi cal testified that the firm had already gotten its level down- 10 ppm, on an eighthour time-weighted average, in most of its operations. 23810004 T