Regulation

Hatching Bigger Government

Is government regulation making our food any safer?

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There have been a lot of unsurprising news stories lately. Rod Blagojevich going on TV. Tiger Woods and his wife divorcing. The economy racing along like an elderly tortoise. And the Food and Drug Administration saying the salmonella outbreak proves the agency needs more power.

We should have seen that coming. In the private sector, entities that fall short of doing their jobs find themselves forced to shrink. In the public sector, the opposite is typically true. Failure is an option, and often a beneficial one.

The Federal Reserve Board and Treasury facilitated the 2008 financial crisis? Then obviously we have no choice but to give them even more responsibility. The Securities and Exchange Commission let Bernie Madoff rob investors? A bigger SEC will be a smarter SEC.

Just once, I'd like to see a government official say, "We blew it, and you know what? If you give us another chance, we'll probably blow it again." But so far, my hope has not availed.

It's true that the FDA is charged with assuring food safety. But really, the government can't do that. The task is too big and too complex. Fortunately, it doesn't have to do it, because the pressures of competition force producers to make sure their goods are clean and wholesome.

What goes curiously unnoticed is that egg suppliers and grocery stores have nothing to gain from sickening their customers—and a lot to lose. It doesn't take many obvious hygiene lapses for a company to get a bad reputation, and a bad reputation can be catastrophic.

In 1971, a New York man died of botulism after eating a can of Bon Vivant soup. If you've never heard of Bon Vivant soup, there's a simple explanation: In no time at all, the company was bankrupt and the brand was as defunct as William McKinley.

The farms implicated in this episode are likely to find themselves oddly short of buyers in the coming months, if not years—unless they can prove they have taken drastic steps to clean up their act. But the burden of proof will be on them.

They can also expect to be sued for huge sums of money. Meanwhile, there are plenty of other companies that didn't screw up, whose wares will be more attractive going forward.

Most consumers, however, accept the possibility of getting salmonella as a fact of life. Each year in the United States, there are nearly 175,000 cases of food poisoning caused by this sort of contamination in eggs.

But that's less than it sounds, and in recent years, the problem has steadily declined. Experts estimate that in normal times, the incidence of salmonella is about one in every 10,000 eggs, which means the average person can expect to eat one about once every 40 years.

Even without a federal recall in this outbreak, fewer than one in every 100 eggs would be tainted. It's a level of risk that doesn't cry out for new legions of federal bureaucrats to gallop to the rescue.

Also worth keeping in mind is that the rare encounter with a bad egg need not be unpleasant. For years, the U.S. Department of Agriculture has advised consumers to cook all eggs thoroughly and avoid foods (Hollandaise sauce, homemade mayonnaise, Caesar salad dressing) that use raw eggs. Follow those instructions, and you are exempt from harm. Skip them, and you're still pretty safe.

Those consumers who want to be extra-vigilant have another option: pasteurized eggs, in or out of the shell. Widely available in grocery stores, they can be eaten undercooked or raw with impunity.

Most people, however, don't see the need to go an extra mile to eliminate a hazard that is already so small as to be invisible. Why should Washington try to impose a level of safety that buyers can already select for themselves if they feel the need?

Given the chance, the market offers options. Some people would prefer slightly lower prices and a slightly higher risk. Some would pay more to get greater peace of mind. Stricter federal rules may eliminate choices that some competent adults would prefer.

A moment of alarm, however, can be used to justify legislation that may impose unseen costs without solving the problem. That's reason to question any new powers sought by regulators. Granting those powers is as easy as scrambling an egg. Unscrambling is a lot harder.

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64 responses to “Hatching Bigger Government

  1. Creep, like kudzu. Just growing. Self perpetuating bureaucracy.

  2. Arguably, egg buyers (distributors) only care because they bear the cost of the recall. No mandatory recall, no market correction.

    Consumers generally treat eggs as an undifferentiated commodity. I’m not sure how they’re to know which farms to avoid. Nor do I think most would bother.

    Without period inspections, what’s to stop melamine type incidents?

    1. The end-consumer generally does not buy his eggs fresh from the farm. Intermediary consumers like Wal-Mart and Giant buy the eggs more or less from the farms. If it turns out Giant’s eggs are tainted, and they can trace that to their supplier than both will have been scolded (assuming rational people are involved, but with our “education” system, that is more and more unlikely) through lost sales. But fuck it, I’d rather die from bad eggs than go to work most days anyway.

  3. We don’t live in a perfect, risk-free world. Never have. Big-government types would like to assure us that, given enough power, they can guarantee that bad things will “never happen again.” President Obama said that about the BP oil spill. Congress said it about the FCC. The Education Secretary is now saying it about our “broken” schools. Again. Sure, things “break,” but with the right bureaucrats in charge, wielding just the right regulations, we can “fix” the “broken” things, forever.

    1. … and this is why it cracks me up that libertarians are the ones viewed as utopians.

    2. I thought God was supposed to take care of us!

  4. “the pressures of competition force producers to make sure their goods are clean and wholesome.”

    Hahahaha! Clean and wholesome. You can’t satirize such things….

    1. You’re right. It’s in the interests of a business to harm its consumers. History has shown that the best business model is to try to poison consumers. Beneficent angels protect us from greedy businesses. Regulation is efficient and necessary. The record of history is clear: failing government programs just need a little more regulation to work properly. If only those darn obstructionists would get out of the omniscient, benevolent bureaucrats trying to get things done for the benefit of all of us, aka the Volkskoerper.

      1. It isn’t necessarily “rational” to hurt consumers, but human beings aren’t robots. A lot of laziness or shoddy decision making that would hurt both customer and business can be avoided by establishing procedural safety measures. The business itself can set those rules, of course, but it’s possible that “government regulations” may get better compliance from employees, who knows?

        Bear in mind that the market isn’t an intelligent designer so much as an evolutionary system with intelligent participants — any business that kills its customers should not last long in a free market, but that’s cold comfort to the dead and their families.

        1. “A lot of laziness or shoddy decision making that would hurt both customer…”

          See Criminal Negligence.

          “…and business can be avoided by establishing procedural safety measures.The business itself can set those rules, of course…”

          See Company Policy.

          …but it’s possible that “government regulations” may get better compliance from employees…”

          See B.P. regulators
          See S.E.C./Bernie Madoff
          See any heavily regulated market
          See Steve Chapman’s article above

          “who knows?”

          Everyone who read the article.

          “…but that’s cold comfort to the dead and their families”

          I’m not sure how you comfort the dead but if their families take comfort when a bunch of people who’ve never been on a farm before, armed with intuition rather than first-hand knowledge about farming, try to improve farming procedures by legislating costly, one-size-fits-all regulations on egg farms with a perfect record instead of pursuing a negligence case against the guilty parties, it is a false sense of comfort. The government should not be in the comfort business and they should definitely not be in the false sense of comfort business.

    2. the pressures of competition government bureaucrats “force producers to make sure their goods are clean and wholesome.”

      Hahahaha! Clean and wholesome. You can’t satirize such things….

      FIFY

  5. Have a tainted egg, troll.

  6. Is government regulation making our food any safer?

    Steve, Steve, … The proper question is “Is government regulation making our food any less safe?”

  7. “Why should Washington try to impose a level of safety that buyers can already select for themselves if they feel the need?”

    Eggsactly!

  8. But,
    What about the CHILDREN.

    1. Drink!

  9. Remember the Peanut Corporation of America. Didn’t think so.

    1. I figure people like that are going to exist in spite of regulations (we do have government-performed inspections of food production facilities already). The end result, with or without regulation would be criminal suits filed against the producers. If the end result is the same (people who do bad things being jailed), I will embrace the cheaper route to get there.

  10. If only the food supply was produced by the government.
    Then there would be no contamination or waste because people in government simply do not make mistakes.
    I’ll bet none of you posters here would pass the public service exams required for federal jobs.
    You’re just not good enough.
    Day in and day out you dare to think for yourself when there are people much more qualified to do that for you.
    All you need to do is turn off your brain and let your betters in government do the thinking.

    We’d be so much better off.

    1. If only the food supply was produced by the government.
      Then there would be no contamination or waste because there would be no food!

      1. “If only the food supply was produced by the government.”

        Your ideas are intriguing to me and I wish to subscribe to your newsletter.

      2. There would be food, you’d just spend the better part of your day standing in line. The Berlin Wall fell only 20 years ago, and people have already forgotten?

  11. If you are not in favor of more government control over food quality, then you must be in favor of POISONING CHILDREN! Especially black children.

    1. I’ve been saying that for years!

  12. I personally liked a NYTimes take on the issue where the author points out the government regulation failed while the market in the UK largely took care of the issue. Their conclusion of course was more government regulation despite all the evidence they presented suggesting the market outperformed the government in this area. The FDA found through a scientific study on potential inoculations the inoculations didn’t work. The UK market found otherwise, and widely adopted them without any government interference… I just want to eat some raw oysters when they’re in season, and everyone else can fuck off – especially the FDA and their irradiation bullshit. They’ve already fucked with the flavor of oysters, milk, and cheese. These statist pigs are stealing the good things in life.

  13. 1 in 10 million Americans are killed by tainted eggs each year. Clearly, now is the time to panic.

    1. And by comparison the odds of being struck by lightning are only 576,000 to 1. Why hasn’t the government been more effective at stopping reckless lightning?

      The answer, of course, is deregulation and right-wing obstructionism! And probably some racism too. I mean, if more lighting were black, you KNOW the teabaggers would be all up in arms about it.

      1. Gr, if more lightning were black, that is… Teabaggers have expressed no comment that I can find on the subject of black lighting. But I’m sure they hate it too.

        1. Black lighting leads our youth to do immoral things. Just look at the living rooms and basements in any college town.

          1. Black Lightning was once a valuable part of the Super Friends team. Let’s show a little respect for the man.

      2. White lightning a.k.a. moonshine is already illegal. Problem solved.

  14. the pressures of competition force producers to make sure their goods are clean and wholesome.

    There is much ignorance about risk-calculation and decision making on display on here. Start with the word “force,” and then the assumption that competition only pushes producers to higher quality (rather than lower processing costs).

    Ya’ll are usually smarter than this.

    1. Yes, competition pushes producers to maximize quality and minimize costs, both, as much as possible, at the same time — imagine that!

  15. “In the private sector, entities that fall short of doing their jobs find themselves forced to shrink. In the public sector, the opposite is typically true. Failure is an option, and often a beneficial one.”

    Good article Steve.

    1. In the public sector all that matters is intentions. If the actual result differs from what was intended, then it was obviously due to a lack of funding or enforcement.

      To question the results by any other measure is to question the intention, and that makes you a bad person.

      1. I know. I’m sorry.

        1. B-B-B-B-B-B-Bad

        2. b-b-b-b-b-b-bad

  16. Neu Mejican|8.30.10 @ 11:26AM|#
    “the pressures of competition force producers to make sure their goods are clean and wholesome.”
    There is much ignorance about risk-calculation and decision making on display on here. Start with the word “force,” and then the assumption that competition only pushes producers to higher quality (rather than lower processing costs).”

    You are more than welcome to all the cheap Bon Vivant soup you can eat.
    The market decided that bad was bad, cheap or not.

  17. Public health is a legitimate concern for government regulation. That’s why the FDA should direct its budget to spraying all these damn mosquitoes.

  18. Kudos to 7:12AM, FDA, and Neu Mejican. If you buy eggs produced by hens stuffed into battery cages, you pretty much deserve what you get.

    1. I’m sure you’re pleased the cost of eggs went up to put smiles on hens, right?

      1. Ron L, the price of good eggs is higher. The costs of megafactory eggs are externalized. Happy animals produce fewer stress hormones. You like eating those?

        1. What if the stressed animals taste better?

          1. The Koreans beat dogs before killing a butchering, they swear the adrenalin make the meat taste better.

        2. Matthew Meyer|8.30.10 @ 1:50PM|#
          “Ron L, the price of good eggs is higher. The costs of megafactory eggs are externalized.”
          Ah, yes. When you can’t find a reason, just claim ‘externalities!’

          “Happy animals produce fewer stress hormones. You like eating those?”
          Oh, NO! Not stress hormones!
          Tin foil lids are on special, aisle #6.

  19. I do find it ironic that if you are a farmer and wish to label your food organic then you must abide by strict federal guidlines, some of these rules are that the field for planting may not have been applied with any agrochemicals for up to a 3 year period, monthly testing by auditors to make sure common agrochemicals be present in only the smallest ppms.

    However if you choose to farm the traditional route there are no rules telling you how much insecticide or chemical fertilizer you can apply, heck apply the DDT if you would like just dont be caught in possesion of it.

    I now ask why must the organic farmer run a gauntlet to get his product to market where the traditional farmer do what he please? Shouldnt my bag of “ready to eat” spring mix say “farmed using UN-42, Imidacloprid and Thiamothoxen”?

    How come the FDA doesnt have the cajones to force that one for “Food Safety”????

    1. Carl|8.31.10 @ 1:17AM|#
      “…However if you choose to farm the traditional route there are no rules telling you how much insecticide or chemical fertilizer you can apply, heck apply the DDT if you would like just dont be caught in possesion of it….”
      Uh, how about making money? Wouldn’t that sort of tell you not to use more of anything than you need?

      1. the point i was making was would you purchase food that had a label showing the different agrochemiocals applied during the growing and harvesting process?

        For me it goes back to the whole idea of government creating collective groups elevating one over another instead of having an individual playing field.

        1. Carl|8.31.10 @ 12:20PM|#
          “the point i was making was would you purchase food that had a label showing the different agrochemiocals applied during the growing and harvesting process?”
          I guess it would be of academic value, but would this be different from say the chemicals used to treat your clothes? Or the chemical make-up of the alloy in your table wear?
          IOWs, I think there’s a case here for rational ignorance.

          “For me it goes back to the whole idea of government creating collective groups elevating one over another instead of having an individual playing field.”
          The organo-whackos pretty much brought that on themselves. They wanted a government stamp of ‘organic’, so you’re gonna get the government specs to go with it.

          1. The organo-whackos pretty much brought that on themselves. They wanted a government stamp of ‘organic’, so you’re gonna get the government specs to go with it.

            And how true the point you make here!

            Not gonna lie I buy organic and if I cant I get from small hobby farmers as they have they are in a position to grow small acerage amounts of unique foods without getting hit hard economincally if their crop goes south Im a competitive athlete and view food as fuel (boring i know).

            In college I worked at a health food store and I got a kick out of the shoppers. They were usually smug liberals (clintion/obama supporters) who would love to get into discussions about their right to organic foods, supplements being taken away however they never did any research as to who was pushing for these regulations and if they did they would see that it was the liberal elite. Same thing happened with the backlash against the Whole Foods CEO who was against Obamacare and his liberal shopper base got all pissy about him being against obama when all the CEO was doing was advocating having choice in health care, kinda like choice in the food we eat…

            1. I wrote sloppy, cut me some slack

  20. “In the private sector, entities that fall short of doing their jobs find themselves forced to shrink. In the public sector, the opposite is typically true. Failure is an option, and often a beneficial one.”

    Stopped reading at that point. As much I don’t like waste in the public sector, I have no use for purely ideology driven public sector bashing.

    1. fine, name a public service that has been curtailed due to its failures

    2. How about purely ‘fact driven’?

    3. I think about those Gangland shows where there are a few individuals in a group who are criminals with some sort of operation and when those few get busted the entire group is dismantled and labeled as criminal.

      how come when we find out that a law enforcement agency has a few bad apples and an investigation finds them guilty the whole agency in itself is not labeled criminal?….and sent home for 2 weeks no pay LOL

  21. I’ve been checking out this blog it’s been really helpful. I was not understanding what I was doing. But your blog helped me a lot. Thank you very much and all the best in future.

  22. In 1971, a New York man died of botulism after eating a can of Bon Vivant soup. If you’ve never heard of Bon Vivant soup, there’s a simple explanation: In no time at all, the company was bankrupt and the brand was as defunct as William McKinley.

  23. It all sounds nice in theory, but it simply doesn’t connect with reality. It’s unarguable that the long term consequences of poor production quality will destroy a business, but businesses are run by humans, and humans lack foresight, and they lack long term incentives to care about what becomes of the company. The main incentive in the next bonus, the size of which is determined by the amount of growth and revenue brought in. Experiments have proven that humans, almost without exception, choose to grab the closer, smaller, more tangible reward than to wait longer to receive a greater reward. The real incentive is to grab what you can, when you can, and it’s for this reason that logic cannot be applied to the decisions of businesses, and regulation is completely necessary. Of course regulation is imperfect, because all things are, but deregulation would guarantee these outbreaks of contaminated products would happen, rather than just making it likely the way it is now.

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