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This May Be the Worst Regulation Ever - Pacific Research Institute

This May Be the Worst Regulation Ever

By Henry I. Miller, M.S., M.D., and Drew L. Kershen

The U.S. Department of Agriculture has created what may be the most bewildering, least cost-effective regulation ever. In July 2016, Congress passed a law mandating that all food containing genetic material that has been modified with recombinant DNA or “gene-splicing” techniques bear labels clearly identifying it as “bioengineered.” The statute acknowledged that bioengineered food is neither more nor less safe than other food, but the new rule—the National Bioengineered Food Disclosure Standard, or NBFDS—won’t help consumers understand that. It will only leave them confused.

Under the NBFDS, two identical bottles of corn oil on a supermarket shelf could be labeled differently—one as bioengineered, one not—even though both were derived from the same field and are identical in processing and quality. Both labels would comply with the regulation because the new rule doesn’t require a label “if the food does not contain detectable genetically modified material.” The NBFDS allows manufacturers to make voluntary disclosures on such products, but not that they “may contain” bioengineered ingredients.

The word “detectable” poses its own problems. Technologies will evolve and become ever more sensitive, so that a single molecule of “genetically modified material” would make a food bioengineered. This is an invitation to meritless litigation over what is “detectable.”

Under the 2016 statute, labels are mandatory only if the food must also bear labels administered by FDA or USDA’s Food Safety Inspection Service. Complying with the rule will require such detailed knowledge of the existing universe of food regulations that food lawyers will end up cross-eyed or wealthy—or both. Consider this gem: “Seafood, except Siluriformes (catfishes), and meats such as venison and rabbit are subject to the [Food, Drug and Cosmetic Act] (but not the Federal Meat Inspection Act). Thus, a multi-ingredient food product that contains one of these as the first ingredient would be subject to the NBFDS. A multi-ingredient product that contained one of these as the second most predominant ingredient or lower, could also require disclosure, unless the product is otherwise exempt (for example, due to the predominance of another ingredient such as chicken or beef).”

What elevates the rule from an irritant to an outrage is the USDA’s own admissions about its costs, which will “range from $569 million to $3.9 billion for the first year.” Thereafter, there will be additional costs annually—“in perpetuity,” as the rule says—of “$68 million to $234 million at a three percent discount rate and $91 million to $391 million at a seven percent discount rate.” And those estimates don’t take into consideration the many thousands of hours federal employees will spend fine-tuning and implementing the rule.

The benefit? There is none: “The NBFDS is not expected to have any benefits to human health or the environment.” Nor does the regulation assert any benefit to consumers.

Congress could repeal the law, but that would mean a return to inconsistent state-by-state requirements and the attendant litigation. Two decades ago, Vermont passed a mandatory-labeling statute for a bioengineered food—milk from cows treated with genetically engineered bovine growth hormone. Dairy manufacturers challenged it in court, and the Second U.S. Circuit Court of Appeals enjoined it on First Amendment grounds: “Absent . . . some indication that the information bears on a reasonable concern for human health or safety or some other sufficiently substantial governmental concern, the manufacturers cannot be compelled to disclose it.”

The USDA’s new regulation is vulnerable to a similar challenge. To head it off, Congress should pass a new law that repeals the NBFDS and pre-empts states’ ability to create their own food-labeling requirements.

Nothing contained in this blog is to be construed as necessarily reflecting the views of the Pacific Research Institute or as an attempt to thwart or aid the passage of any legislation.

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