Baby Food Fight

Canadian bureaucrats must have pablum for brains. The federal government has granted a de facto monopoly for jarred baby food, handing all the business to Heinz. As a consequence, prices have skyrocketed.

The strange story began last year, when Heinz (which makes its baby food in Canada) complained to the feds that Gerber was "dumping" baby food, importing it from the United States and selling it for less in Canada than it does in the United States. Gerber sold for as little as 33 cents a jar in Canada, about 10 cents less than Heinz.

In May of this year, a federal tribunal sided with Heinz and ordered Gerber to raise its prices 60 percent. Gerber says it can't compete at the new prices and--after 49 years of selling baby food north of the border--has abandoned the Canadian market.

Now that consumer groups are outraged, the tribunal has said, in effect, "Oops." It didn't mean to throw Gerber out entirely. The tribunal held hearings in September to reconsider its decision and will report its findings later this fall.

But in a bizarre twist, another branch of the federal government, the Competition Bureau, has requested a North American Free Trade Agreement panel to review the anti-dumping decision. It will be Canada vs. Canada when this panel convenes in January, the first time since the establishment of NAFTA in 1994 that one country has gone to war against itself.

Meanwhile, stoic Canadian shoppers--who have been forced to pay millions of additional dollars for bicycles, sugar, fresh garlic, and even tombstones after recent anti-dumping decisions--will have to collectively fork over millions more if they want to feed their toddlers yummy strained peas and carrots.

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