Greg Conko

Earlier today, Reps. Mike Pompeo (R-Kan.) and G.K. Butterfield (D-N.C.) introduced a bill in the House that would establish federal standards for the labeling of genetically engineered (GE) foods and preempt a growing patchwork quilt of state action on GE labeling. The underlying motivation behind the “Safe and Accurate Food Labeling Act of 2014” (H.R. 4432) is praiseworthy, so the congressmen deserve an A for effort. However, the execution leaves more than a little to be desired.

This year, an estimated 25, or more, states will consider legislation or ballot initiatives that would mandate special labeling for many GE foods. As I’ve written before, those proposals are bad policy, make no sense scientifically, would needlessly raise the cost of producing and selling safe, nutritious and wholesome food, and are arguably unconstitutional on several grounds. Nor would they give consumers any actual knowledge about what’s “in their food” – the ostensible purpose of those state measures.

The U.S. Food and Drug Administration’s current policy requires foods to be labeled when a material difference has been made in their composition – and the labels must say what the actual change is, not simply what technique was used to make the change. So, in many ways, the FDA’s current policy does a far better job of telling consumers what’s in their food than a GE labeling mandate ever could.

By explicitly preempting state labeling laws and making clear that FDA policy on GE food labeling is the law of the land, H.R. 4432 would serve an extremely valuable function. And, because the packaged food items found in most grocery stores are the epitome of interstate commerce, ensuring that oversight of their safety and labeling be governed at the national level, rather than state-by-state, perfectly reflects the plan established by the framers of the U.S. Constitution.

Unfortunately, in order to attract support for this perfectly reasonable preemption measure, H.R. 4432 offers GE skeptics the enticement of increasing the FDA’s regulatory power. The proposal would grant FDA the authority to keep all new GE foods off the market until agency heads and the presidential administration they work for feel politically safe to grant approvals. Like most other “gatekeeper” regulatory agencies, the FDA would not even need to reject approval for products they don’t like. They would need only decline to make an approval or disapproval determination indefinitely.

Supporters point to a 180-day statutory deadline in the bill, which they argue will force the FDA to make timely approval decisions. But it’s worth noting that the FDA faces identical 180-day statutory deadlines for making approval/disapproval decisions on a host of other products, ranging from new pharmaceuticals and medical devices, to new veterinary drugs and new GE food animals. The agency disregards those deadlines on a routine basis because there is no triggering mechanism that automatically grants a producer the right to put safe and effective products on the market when a recalcitrant FDA refuses to act.

Want to know just how effective that 180-day deadline is? Just ask AquaBounty, the developers of a GE salmon that would help fish farmers deliver one of America’s favorite seafoods to market in a less expensive and more environmentally sustainable way. The FDA determined several years ago that the AquaBounty salmon was safe for consumers and the environment, but its approval has been held up by the Obama Administration simply because their supporters in the environmental movement object to the technology.

Reps. Pompeo and Butterfield do deserve credit for trying to resolve the growing problem of confusing, expensive, and scientifically meritless state labeling proposals for GE food. But, the “Safe and Accurate Food Labeling Act of 2014” contains a serious flaw that will hopefully be corrected once the bill moves to committee.

With time running out for the Senate to act on a continuing budget resolution, members are trying to find some magic pot of money that would mask the fact that our government spends far more than it raises in revenue. Tonight, it looks like Sen. David Vitter has resurrected an old proposal to ban what are known as reverse payment patent settlements — agreements in which brand name drug manufacturers pay generic firms not to challenge patents on the innovators’ drugs.

Critics, including the Obama administration and the Federal Trade Commission, call these settlements “pay-for-delay,” and argue that successful patent challenges would get generics to market sooner. In turn, they claim, that could save federal health programs billions of dollars every year, which is why the proposal is so popular with both Democratic and Republican members of Congress. A CBO analysis scored a ban proposed in 2011 as saving federal health programs $2.68 billion over 10 years.

The problem is, any alleged savings from a ban on these patent settlements is illusory because reverse payment settlements actually have the effect of getting generic drugs on the market sooner, thereby lowering drug costs, not raising them.

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Former CEI scholar Tom Miller (now with AEI) has some thoughts on the Obamacare decision in today’s Los Angeles Times. Tom summarizes the meaning of yesterday’s decisions, but the meat of his article is spent asking, in his very thoughtful way, “What’s next?”

“We have already heard cries for repealing the law in Congress, but the fact is that most of the healthcare industry is resigned to shrugging its shoulders and falling back into line with the political deals it cut with the Obama administration several years ago. The political case for repeal will become much stronger among grass-roots voters — particularly independent ones — outside the Beltway this fall if it is combined with a credible, attractive alternative that offers better solutions to chronic health policy problems.”

The challenge now for free market advocates is to map out a course forward.

Logical or not, the ruling underscores the dangers of relying too heavily on the Supreme Court to solve policy problems. Conservatives should have used the time that the court was deliberating to formulate attractive legislative proposals to both repeal and replace this unpopular law.

But they didn’t. So where does this leave us? …

The country needs a more competitive healthcare marketplace that encourages more entry and less command-and-control regulation. New insurance purchasing vehicles such as the exchanges called for under Obama’s law should remain optional, not exclusive, and should welcome all willing buyers and sellers. By providing better and more usable information about the “value” of healthcare options — including how different healthcare providers perform — but without dictating decisions, the federal and state government could empower consumers to make more responsible choices on their own.

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Post image for Supreme Court Concocts New “Rational (Tax) Basis” Test in Upholding Health Law

In a move that seems to have surprised many observers, the Supreme Court today upheld nearly all of the Patient Protection and Affordable Care Act by a 4+1 to 4 majority (I’ll explain the math below). Chief Justice John Roberts, who wrote the Court’s opinion, joined with the four liberal justices in affirming the individual mandate and essentially all of the Medicaid provisions. The Court’s three reliable conservatives, plus Justice Kennedy, wrote in dissent that the entire law should be ruled invalid. The opinions can be read in their entirety here.

Addressing the question of the individual mandate, Roberts agreed that the mandate was not a proper exercise of Congress’s commerce power:

“The power to regulate commerce presupposes the existence of commercial activity to be regulated. … As expansive as this Court’s cases construing the scope of the commerce power have been, they uniformly describe the power as reaching “activity.” … The individual mandate, however, does not regulate existing commercial activity. It instead compels individuals to become active in commerce bypurchasing a product, on the ground that their failure to do so affects interstate commerce. Construing the Commerce Clause to permit Congress to regulate individuals precisely because they are doing nothing would open a new and potentially vast domain to congressional authority.”

That’s the good news. A majority of the Supreme Court Justices recognize that Congress’s commerce power is not totally unbridled. Predictably, Justice Ruth Bader Ginsburg wrote a concurring opinion expressing her belief that the mandate WAS in fact a constitutional exercise of the commerce power (explaining the 4+1 majority I mentioned above). Although Justices Breyer, Sotomayor, and Kagan concurred with parts of Roberts’s majority opinion, they concurred with Ginsburg on the extent of Congress’s commerce power.

The four-Justice majority also rejected the government’s backup argument that the mandate could be justified under Article I, Section 8, Clause 18 (what grade schoolers are taught is the “elastic clause”) as “necessary and proper” for effectuating the rest of the Affordable Care Act:

“The individual mandate … vests Congress with the extraordinary ability to create the necessary predicate to the exercise of an enumerated power and draw within its regulatory scope those who would otherwise be outside of it. Even if the individual mandate is “necessary” to the Affordable Care Act’s other reforms, such an expansion of federal power is not a “proper” means for making those reforms effective.”

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Post image for Court Rules State Biotech Food Labeling Mandates Preempted By Federal Law

It’s been a few years since biotech foods have been regular front page news. The anti-technology activists cried wolf a few too many times, and none of the scare stories have come true. Still, the activists have re-grouped and are making an all out, well-financed assault on state and federal governments this year, agitating for mandatory labeling of biotech foods.

Stonyfield Farm Chairman Gary Hirshberg even gave up his position as president and CEO of one of the world’s largest organic food purveyors to lead what’s being billed as the “Just Label It” campaign, organized by a veritable who’s who of the organic and “natural” foods industry. And they’ve been busy – petitioning FDA and the White House, and lobbying Congress and state legislatures to mandate warning labels on biotech foods. But arguably the crown jewel in this year’s campaign is an initiative that will likely appear on California ballots this coming November.

I’ve written before about why mandatory labeling is a bad idea and why consumers don’t need mandatory labeling to exercise their choice to purchase non-biotech foods. But the simple fact is that labeling mandates of this type are also unconstitutional. In a case called International Dairy Foods Assoc. v. Amestoy, the U.S. Second Circuit Court of Appeals held that a Vermont statute requiring dairy products from cows given the biotech growth hormone rbST violated the First Amendment, and that food labeling cannot be mandated simply because some people would like to have the information. The Vermont law was unconstitutional because it forced producers to make involuntary statements contrary to their views even though there was no substantial governmental interest in requiring the label statement.

“We are aware of no case in which consumer interest alone was sufficient to justify requiring a product’s manufacturers to publish the functional equivalent of a warning about a production method that has no discernable impact on a final product. … Absent some indication that this 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. Instead, those consumers interested in such information should exercise the power of their purses by buying products from manufacturers who voluntarily reveal it.”

That should mean that the California ballot initiative would also be invalidated. Although the Second Circuit’s decision is only binding on courts in Vermont, New York, and Connecticut, other courts would view the decision as persuasive precedent. But I’ve just now been alerted to a recent California federal court decision providing a different legal theory for invalidating state labeling mandates.

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Post image for Pink Slime and the Slimy Tactics of America’s Food Elitists

Last week, the Media Research Center’s Dan Gainor wrote a nice article examining how the mainstream media has been complicit in smearing lean finely textured beef — what critics are calling “pink slime.” “ABC has covered the story almost round the clock in recent weeks with stories on ‘World News with Diane Sawyer’ and ‘Good Morning America’,” Gainor reported. Versions of the story have been picked up by dozens of major and minor newspapers around the country. And most television and radio news programs have covered it as well.

On Sunday, however, The New York Times‘s Andrew Revkin became what appears to be the first major media figure to debunk the misinformation campaign in a blog post entitled, “Why I’m O.K. with ‘Pink Slime’ in Ground Beef.”

I agree with Texas Gov. Rick Perry on something — the nutritional merits of derided “pink slime” — the processed last scrapings of meat and connective tissue after cattle are butchered. Dude, it is indeed beef — a source of low-fat nutrition.

One of Revkin’s sources, a historian and blogger named Maureen Ogle, explains the issue well:

“First a word about PS: It’s beef, people. Plain ol’ beef. It’s created by using a deboning process that removes every last morsel of flesh from beef carcasses. During the cutting, slivers and bits of bone end up with the beef, but those are reduced to mush in the processing that follows. … In the BEEF industry, its use dates back to the mid-1970s, although poultry and fish processors were already using the technique. Beef packers began using in the in mid-seventies because, at the time, all meat prices, but especially beef, were in the stratosphere. … So pushed by consumers on one side, and soaring costs on the other, meatpackers asked for, and got, permission from the USDA to use a “mechanical deboning” process that allowed them scrape meat off carcasses so that what had been waste could be eaten.”

Although critics are calling pink slime an unsafe food additive that ought to require mandatory labeling wherever it appears, the fact of the matter is, lean finely textured beef is exactly that: beef. And, compared to other ground beef, LFTB is probably better for consumers. It is processed in a way that removes much of the fat — thus the “lean” part of its name. And beginning around the early- to mid-1990s, following a foodborne illness outbreak linked to Jack in the Box hamburgers, processors began treating LFTB with tiny amounts of the common food disinfectant ammonium hydroxide to kill germs, thereby substantially reducing consumers’ exposure to foodborne pathogens.

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On Monday, I’ll be speaking at a Capitol Hill event sponsored by Americans for Choice and Competition in Agriculture, which also goes by the name of AgChoice: “Feeding the World & Growing Our Economy: Agricultural Innovation in the 21st Century.”

The global population reached seven billion people on October 31, 2011, and is expected to reach nine billion by 2050. In order to meet the challenge of feeding this growing population, agricultural output must double and food production must increase by 70 percent by mid-century.

Despite a weak global economy, the demand for U.S. agricultural exports is growing and has increased 45 percent in the last five years. Leadership from the U.S. agricultural industry will play an important role in addressing these challenges, but only if policies that encourage increased innovation are adopted. Join Americans for Choice and Competition in Agriculture and other thought leaders to discuss the agricultural challenges that lie ahead in the 21st century including how innovation will play a key role and what policies need to be developed in order to encourage ongoing innovation in agriculture.

Speakers:

Dr. Roger Beachy, Founding President, Donald Danforth Plant Science Center

Brandon Hunnicutt, Chairman, Nebraska Corn Growers Association

Gregory Conko, Senior Fellow, Competitive Enterprise Institute

Chandler Goule, Vice President of Government Relations, National Farmers Union

11:45 A.M. – 1:30 P.M.

1302 Longworth House Office Building

One of the topics I’ll be addressing is the way in which precautionary U.S. and foreign regulation of food biotechnology has made it more difficult for scientists to develop, breed, and sell innovative new crop varieties that increase agricultural productivity and lighten farming’s environmental footprint.

Of particular interest to AgChoice and its farm industry members is the expiration of several patents on some of the most widely grown biotech crops — particularly RoundUp Ready soybeans. But silly and unnecessary regulations in Europe and parts of Asia may prevent a generic biotech seed industry from developing.

Come see the event to find out how.

Post image for Consumer Freedom and the Risks of Raw Milk

Earlier today, Nicole Ciandella linked to an essay by the John Locke Foundation’s Fergus Hodgson, titled “The Absurdity of Raw Milk Prohibition.” It’s a good piece, worth reading. But Hodgson makes a couple of errors worth pointing out, so I thought I’d add my two cents.

Hodgson begins well enough:

“Picture a peaceful, Amish farmer, selling one of nature’s super foods — fresh, raw milk. Eager customers came from afar, even across state lines, to savor the taste and access a nutritious product. Who could oppose such harmonious commerce on Rainbow Acres Farm? Government officials and their enforcers, that’s who.

This Pennsylvania farmer has been the subject of a yearlong sting operation, which included stealth purchases and a 5 a.m. surprise inspection. In February, a federal judge imposed a permanent injunction that prohibited him from selling his milk across state lines.”

So far, so good. But then Hodgson makes an error of over-simplification: “To defend this violation of freedom of choice, proponents claim to be protecting others from the purported dangers of raw milk. But this claim is laughable, since evidence to the contrary has been mounting for decades.”

As I’ve written on occasion, the health risks associated with raw milk consumption are generally quite low, at least for adults with a healthy immune system. But they’re not zero. After all, pasteurization was seen as a remarkable scientific breakthrough and public health miracle for a reason: raw milk can harbor any number of nasty bacteria – including S. typhimurium, Mycobacterium tuberculosis, E. coli O157:H7, Listeria, Campylobacter, and Brucella – which historically have had a nasty tendency to result in illness and, occasionally, death.

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Post image for Congress Seems Intent on Making Drug Shortages Worse

Now that the problem of prescription drug shortages has begun to affect children, members of Congress want to be seen as doing something – anything, really – to avert the crisis. A bi-partisan group of House members led by Rep. John Carney (D-Del.) introduced a bill two weeks ago. And yesterday, Sens. Amy Klobuchar (D-Minn.) and Robert Casey (D-Penn.) moved to attach their drug shortage bill to a piece of transportation legislation moving through the Senate. Unfortunately, most of the proposed action will have little to no affect on the fundamental underlying problems associated with drug shortages. Worse still, by ignoring the real problems and trying to put a defective bandage on the symptoms, the bills very well may make the shortages worse.

First, some background. There are currently around 250 prescription medicines — most of them generic versions of cancer drugs and surgical anesthetics — that are considered to be in “short supply”, according to the American Society of Health System Pharmacists. That’s up sharply from well below 100 drug shortages in a typical year — rising from just 58 in 2004 to 149 in 2008 to 211 in 2010. And, though there are alternatives for many of these drugs, several have no good alternatives for certain conditions. As USA Today’s Liz Szabo discusses, a shortage in the cancer drug methotrexate is particularly troublesome for children with acute lymphocytic or lymphoblastic leukemia (ALL). There are alternatives to methotrexate for other cancers, but not for ALL.

So, why the recent spate of shortages? In some cases, it’s due to a shortage in raw materials. And, for drugs like Ritalin and other ADHD treatments, heavy-handed DEA regulations have made it difficult to increase production of the raw materials. But only a relatively small portion of the shortages can be attributed to a shortage in raw materials. Still other regulations have significantly contributed to the shortages in many other products.

John Goodman summarized some of these other issues nicely in a post last summer. One contributing factor is the FDA’s increasingly strict regulation of drug manufacturing facilities, which Goodman calls a “zero tolerance regime” that is “forcing manufacturers to abide by rules that are rigid, inflexible and unforgiving.” FDA has been more aggressive in shutting down production facilities when even small quality control problems arise. A decade or two ago, a paperwork problem or some inappropriate handling procedure that didn’t directly affect drug safety or quality might have been addressed with a slap on the wrist. But over the last several years (and not just since the beginning of the Obama administration) FDA has, more and more, addressed these problems by temporarily shutting down plants until the problems could be resolved.

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Post image for Global Biotech Crop Acreage Up, Plus Clayton Yeutter on the Miracle of American Agriculture

Global planting of biotech crops grew 8 percent last year, to a record high of 395 million total acres, according to the latest report from Clive James at the International Service for the Acquisition of Agri-Biotech Applications (ISAAA). Despite the many regulatory hurdles that governments around the world have erected to the approval and adoption of biotech crop varieties, when farmers have the opportunity to plant them, they do. Last year, more than 16 and a half million farmers grew biotech crops in 29 different countries.

What’s particularly noteworthy is that, while activists try to portray biotechnology as a rich industrial world tool, the bulk of recent growth in biotech crop adoption has come among relatively resource-poor farmers in less developed and newly industrialized countries. The United States has, since the first biotech crop introductions back in the early 1990s, grown the largest number of acreage planted with biotech varieties. But, while annual acreage increases in countries like the U.S. and Canada is starting to flatten a bit, the most robust growth has come from Brazil, India, and China. LDCs and NICs now grow about half of the world’s total biotech crop acreage. In China alone, roughly 7 million poor farmers grow biotech crops on an average of just one and a quarter acres.

On a related note, in this short video, former Secretary of Agriculture Clayton Yeutter discusses the role that advanced technologies have played in making U.S. agriculture a vibrant and productive contributor to the global economy.