"… toxic Chinese drywall may well become the biggest environmental crisis to hit North American homeowners and builders in decades." — Toronto Star
You may not know much about drywall (I don't) and buy on price. Or maybe your handyman or contractor does that for you. There might be consequences. If you're buying to resell after a renovation, you may not care. After all, if the products are being sold legally, they probably meet mandated standards.
Welcome to Chinese drywall.
Thanks to the US building boom, Chinese drywall started entering the country in 2001. Hurricanes in 2004-2005 contributed to drywall shortages and imports grew. Between 2006 and 2008 alone, enough drywall was imported to build 60,000 houses in 39 states (over 550,000,000 pounds). Hurricanes didn't hit Canada but the bad drywall is here too.
ConsequencesThe bad drywall emits smelly, noxious gases. The health issues include "fatigue, difficulty breathing, asthma attacks, sore throats, sinus problems, nosebleeds, runny noses, irritated and itchy eyes and skin, persistent cough, insomnia, loss of appetite, and headaches" (Contingencies magazine). Quite a list.
Non-health issues include copper turning black and powdery. That affects piping, wiring, air conditioners, TVs, video game consoles, fridges and dishwashers. There are other problems too, but you get the idea.
Once the drywall is in place, how can you tell if you got the bad stuff?
Cost CuttingCompanies boost profits by switching to cheaper ingredients and processes. High fructose corn syrup instead of sugar. Veneer instead of hardwood. Plating instead of solid metal. Processed cheese instead of real cheese.
That's okay if you know what you're getting. What if you're not sure or don't understand the long term implications of your decision? Consequences like obesity take years to materialize. We tend to fear the wrong risks (Harvard Business Review).
Closer To HomeDrywall isn't the only way to suffer from shortcuts or lax quality control. We've heard about lead paint in toys (New York Times), melamine in pet food (USA Today) and salmonella in spinach (CBC). I was disturbed by shortcuts at Johnson & Johnson, which used to be reference for putting customers first (Fortune). They recalled 300 million packages in 2010 and another 50 million this month (Reuters).
At least there were big public uproars and quick action. That support is less likely when you're buying intangibles like financial services. Even if you buy a financial product, it's been tailored for you. You probably signed agreements that say you understand what you bought.
If something goes wrong, getting redress takes time and money. Even today, the Chinese drywall makers are still refusing to pay compensation --- and that's when governments are involved.
- Chinese drywall controversy (Wikipedia)
- Chinese drywall makes refusing to compensate US homeowners (Insurance Journal, Jan 2011)
- Tainted Shelter: The dilemma of defective drywall (Contingencies, Jan/Feb 2011)
- Chinese drywall creating crisis (Toronto Star, June 2009)
- Physical products vs. financial products
- Why J&J's headache won't go away (Fortune, Aug 2010)
- The unexpected costs of home ownership
- Fearing the wrong risks (with examples)
- image courtesy of Contingencies (Jan/Feb 2011)
Podcast Episode 102 (4:11)
direct download | Internet Archive page
PS Remember asbestos?