Wednesday, October 10, 2012

Why Prop 37 is a Bad Idea

I know a lot of folks have strong feelings about genetically engineered foods, but regardless of whether you think GMO foods are evil or are perfectly safe, there are plenty of good reasons to vote NO on Prop 37.

First, I begin with a presumption that making law by initiative is generally a bad idea. The initiative was created as a failsafe mechanism for the electorate to guard against a corrupted legislature, and should only be used when absolutely necessary. It is a very poor way to make legislation in general, particularly legislation that is complex and gets down to the details of regulations, such as what exactly has to be labeled, what the labels have to say, and what the exceptions are. Detailed legislation like that is often imperfect and later needs to be corrected. The State Legislature can amend the laws that it passes, but initiative statutes can only be amended by another initiative. Even in the "pro" and "con" arguments for this proposition, both sides point to details and exceptions. This is the sort of legislation that is likely to be flawed and to want amending, making it a bad candidate for an initiative statute.

Second, this sort of food labeling regulation is not something that should be undertaken at the state level. We currently have federal regulations from the USDA defining similar issues such as "organic" labeling and "milk from cows not treated with rBST/rBGH". The federal regulations concerning milk provide a framework giving some latitude for variation within states, which is viable for milk because milk is generally an intrastate business. For produce and even more so for commodity crops like corn and soybeans, which become ingredients in many processed foods, the interstate and international commerce is substantial. Imposing a California-only regulation on this interstate and international supply chain would create a complication for all California food producers and for global food producers who wish to sell in California, which ultimately means added cost for the consumer. It only gets worse if other states decide to get into the act. That is exactly why such things need to be consistently regulated at the federal level, as has been successfully and effectively done for organic food and growth hormone-treated dairy cows. Moreover, it is probable that the USDA will eventually provide regulatory guidelines for non-GMO foods that will preempt California's initiative, meaning that everyone in the agricultural supply chain from farmer to grocer will have been jerked around by California's initiative.

Finally, the approach proposed in Prop 37 fails to follow the successful and effective path already established by USDA "organic" and milk labeling regulations. In the case of foods labeled "organic", the USDA regulations standardize the criteria that must be met in order for a food to be labeled "organic". Note that this is a voluntary positive claim. Food producers who believe that consumers will find value in meeting "organic" standards can choose to meet those standards and put the label "organic" on their product. Products that do not meet the standards are prohibited from claiming to be "organic", but they are not required to put any adverse "non-organic" label. Under this voluntary "make the claim only if you can meet the standards" regulation, the organic food industry has thrived. As of 2010, U.S. sales of organic food and beverages were a $26.7 billion business, and represented over 11% of all fruit and vegetable sales. This approach has given the consumer good choices in the marketplace, and the ability to make their own choices about the value of "organic" food, which tends to command a higher price. A similar approach was taken with the growth hormone issue in dairy cows, where dairies were allowed to market under a standardized label stating "milk from cows not treated with rBST/rBGH" if they met the criteria, but were not required to put any adverse "contains rBST/rBGH" if they didn't meet the criteria. Here again, this approach enabled choice for the consumer and the development of a substantial niche market for those willing to pay a higher price for milk from untreated cows. Rather than taking this proven pro-consumer and pro-market approach, Prop 37 imposes a negative involuntary regime where all food producers who do not meet the criteria are required to put an adverse "contains GMO" label on their products. Unlike the voluntary USDA approach that allows food producers to decide if and when they wish to make a claim that some consumers may find valuable, the Prop 37 approach imposes its regime on all producers, which is likely to trigger supply chain disruption and higher prices as food producers scramble to meet the new California-specific requirements. (Not unlike California's specific requirements on gasoline, and we've seen lately how that can disrupt a supply chain and affect prices.) When we've already seen how well a voluntary claim system can work, it would be foolish to take Prop 37's negative involuntary approach risking adverse affects on farmers, grocers, and consumers alike.

Thus, regardless of how you feel about GMO foods, I hope you will agree that Prop 37 is a bad idea.

6 comments:

Mark K said...

You say: all food producers who do not meet the criteria are required to put an adverse "non-GMO" label on their products. I think you mean "contains GMO", not "non-GMO", yes? Or am I reading this wrong?

Tom Chatt said...

Thanks, Mark, you're right. Good catch. I fixed it.

Anonymous said...

Someone posted a link to this blog on one of my friends facebook page. This is the rebuttal I posted on their page, and then figured I should post it here, as well. Rebuttals 1. "The initiative was created as a failsafe mechanism for the electorate to guard against a corrupted legislature, and should only be used when absolutely necessary." - This issue is a slam-dunk example of a corrupt legislature causing us to need the "mechanism" of initiatives. Over 90% of Americans believe that GMO's should be labeled. How anyone can argue that we should not have the right to choose what we put into our bodies absolutely floors me. 2. "Second, this sort of food labeling regulation is not something that should be undertaken at the state level." - If our federal legislators would get off their asses and do the right thing, it would not have to be undertaken at the state level. Thank goodness we have a mechanism to get the ball rolling. First California, then the rest of the country. 3. "Imposing a California-only regulation on this interstate and international supply chain would create a complication for all California food producers and for global food producers who wish to sell in California, which ultimately means added cost for the consumer. It only gets worse if other states decide to get into the act." - If manufacturer's just do the right thing, and list the ingredients properly on ALL their products, then they won't have to create special labeling just for California. If costs go up it is because the manufacturer's are choosing to continue to deceive consumers in the states they're allowed to deceive them in. 4. "Prop 37 imposes a negative involuntary regime where all food producers who do not meet the criteria are required to put an adverse "non-GMO" label on their products." - First of all, I'm sure this is a typo, and he meant "an adverse "contains GMO" label." The issue here is that the companies behind GMO's have also fought tooth and nail to keep food producers from putting a "non GMO" label on their products. I haven't researched this recently, so am not sure exactly where this issue stands, but I am aware of several lawsuits, in the past, where Monsanto has sued food producers using the argument that the food producers' use of the term "non GMO" unfairly makes people think that there is something wrong with genetically modified organisms in food, and therefore is damaging to Monsanto. If they'd just backed the hell off and allowed manufacturers to go ahead and label their products proudly as non GMO, maybe we wouldn't have to be forcing this "involuntary regime" on them. In addition, this isn't a case of something that has been tested and generally regarded as being safe being added to our foods. GMO foods are potential carcinogens and allergens, and therefore it is up to the producers using them to make us aware that we are eating them. It would be great if food producers had to list the pesticides they've used on food, but since pesticides are external (and therefore it can be argued that they are not IN the food) I can kind of understand why they don't require them to disclose it. With GMO's, it is IN the food and cannot be eliminated or minimized by washing or peeling the product.

Tom Chatt said...

I'd be very interested to see specific references to lawsuits preventing food producers who want to label their food as "non-GMO" (provided of course that their claim is true). I'm not sure on what legal basis such a lawsuit could prevail. I do know that some food producers are currently labeling their food "non-GMO" -- Lundberg Rice here in California is one good example -- and they are not being stopped by Monsanto or anyone else.

As to whether 90% of Americans believe GMO food should be labeled, well, 90% of Americans would agree to just about anything if you worded the question to get the answer you want. If 90% of Americans truly felt strongly about this, then the market would have already responded without any government intervention. Perhaps that may be beginning to happen. The true test will be when the non-GMO product is on the shelf next to the GMO product, whether the consumer is willing to pay for it. I suspect it will be a substantial niche market, as organic food is.

As to whether GMO products are unsafe and untested, I don't think it is responsible to make such a sweeping assertion. Genetic modification is a technique. Each particular genetic modification may be safe or unsafe, independent of any other. There is nothing inherently unsafe about the technique itself.

Anonymous said...

Tom - Your assertion that the market would have already responded without government intervention is pretty silly, given that is exactly what Prop 37 is about. Most consumers do not know the food they are purchasing has GMO in it. If they did know, they would choose a product without gmo. Monsanto and the others knows this, hence they're HUGE opposition to labeling. A niche market? Really? You are speaking as though genetically modifying food is the norm, and leaving the foreign organisms OUT of the food is some special, niche, process. Genetically modifying food is not the norm, it does not make food cheaper to produce, and it has not shown to be beneficial to consumers at all. There is no reason that non GMO foods would be more expensive than GMO foods. In fact, GMO foods are more expensive for farmers to grow, in most cases, than conventionally grown foods because farmers have to buy the patented GMO seeds, each year, and cannot save seeds from the previous years harvest. You really need to do more research on the GMO industry because your opinions seem to be just randomly pulled out of the air. Here is an article that I found this morning that talks about how important Prop 37 really is. http://www.nytimes.com/2012/10/14/magazine/why-californias-proposition-37-should-matter-to-anyone-who-cares-about-food.html?_r=0

Tom Chatt said...

Anonymous: My assertion that if consumers really cared at the 90% level, the market would have already responded is not silly at all. It is just plain economic sense. You are making the classic mistake of what economists call confusing stated preferences for revealed preferences. In plain English, that means that what people say they would like on a survey (where there is no cost) is not the same as what they will actually do when making purchasing decisions. There is currently no barrier to food producers making GMO-free products and advertising them as such. (You claim there is, but have pointed to no evidence, and I have cited specific examples of products I have seen myself such as Lundberg Farms rice, bearing "non-GMO" claims prominently on the box.) I am not saying there is no market. On the contrary, I believe there is a developing market there, and that it will see significant growth. But I also believe it will be a niche market, similar to organic foods, which represented 4% of overall food and beverage sales as of 2010. Those who want non-GMO foods will be increasingly able to find them. Whole Foods Markets, for instance, is championing the cause in their store offerings, including their private label products. The market is responding at an appropriate pace to the demand, just as it inevitably will.

You make some further claims that are economically dubious. For instance, you claim that "GMO foods are more expensive for farmers to grow". I could point you to academic papers stating that GMO technology increases production, reduces costs, and lowers prices. The cost reductions come from higher yields, and lower costs in spraying and reduced labor. But even without looking at academic papers, you just need to ask yourself this: if GMO costs the farmers more, as you assert, why would they do it? The answer is simple. GMO exists in the marketplace at such substantial shares because it does cost less.

And speaking of the GMO food marketplace, your claim that "genetically modified food is not the norm" is hard to defend. Here are some relevant facts from an MSNBC news article: "GMOs first appeared in 1995, and today bioengineered seeds are used in 81 percent of corn crops, 91 percent of soybean crops and 95 percent of sugar beet crops. Genetically modified foods are used in most processed foods and as feedstock for most cattle and chickens.". You may well wish this not to be the case, and you may well argue that it is due to consumer unawareness, but you can't argue that bioengineered food doesn't represent a substantial majority of the food consumed by Americans over the last decade and a half.

I am sorry if my opinions seem to you to be "pulled out of the air". I try to base my opinions on science and evidence rather than propaganda, and am open to changing my opinions when presented with good evidence to do so. At the moment, my opinion is that bioengineering technology offers great potential benefits to global food production, as well as offering potential risks, but each specific innovation should be evaluated on its own merits. If it were found, for instance, that some particular corn modification had detrimental effects, that would be reason to not want to eat that particular type of corn, but it would not logically entail fear of any other GM products, any more than one failed drug trials means that we should be worried about all drugs. That type of non-specific fear is irrational, and yet to me seems to be the primary motivation behind desires to force mandatory GMO labeling regimes.