The Food and Drug Administration (FDA) announced last week that proposed rule changes that would ban the term “milk” for nondairy products, such as almond and soy milk, were about to get underway. Online commenters immediately ridiculed the plan, wondering if the FDA would address milkweed, milk of magnesia, or why hamburgers don’t contain ham. Unfortunately, this isn’t a headline from TheOnion.com. It’s yet another way industries or companies try to use government regulation to drive out the competition -- and it’s a serious threat to consumers.
FDA’s action is a transparent attempt by “Big Dairy” to push nondairy competitors out of the refrigerator case and off pantry shelves. This is something that happens all too often. When an industry starts to see its product’s market share slip, they’ll often seek the last refuge of rent-seekers: government regulation.
In Florida, it wasn’t a nondairy beverage the state Department of Agriculture and Consumer Services (DACS) tried to keep out of the market, it was skim milk. That is, milk with the cream skimmed off. But, because the milk didn’t include artificial vitamin additives, the DACS wanted producer Mary Lou Wesselhoeft to call her milk “imitation skim milk.” The Institute for Justice prevailed in defending Wesselhoeft’s First Amendmendment right to call her product what it was: skim milk.
Likewise, the American Egg Board, which is the egg-industry’s check-off program, waged war against a company producing vegan mayonnaise. The Egg Board -- authorized via the U.S. Department of Agriculture (USDA) -- claimed Just Mayo couldn’t use the term mayonnaise because it didn’t contain eggs. Fortunately for consumers, they were unsuccessful.
Regulatory retaliation isn’t just a threat to domestic products. Facing competition from catfish grown elsewhere, U.S. catfish producers successfully lobbied to switch catfish food-safety inspection from the FDA, which already oversees inspection for other fish and seafood products, to the USDA. This wasn’t done out of any safety concern, but in order to create regulatory hurdles for foreign competitors. The move has created tensions with key trading partner, Vietnam, who have lodged their concerns with the World Trade Organization.
By using USDA regulations to create trade barriers that favor specific domestic products -- all under the auspices of “food safety” -- Congress has opened the door for numerous other producers to use the same dangerous tactics. Shrimp, tilapia, and trout could be next.
This doesn’t bode well for U.S. consumers who pay higher prices and have less choice as a result of market-meddling. It’s also bad news for producers of other goods and crops who can expect retaliatory tariffs, just like those already imposed on U.S. products as a result of Administration missteps on trade.
Taxpayers shouldn’t be surprised when big industries use big government to go after the little guy. This is an innate risk anytime more power is ceded from the people to the bureaucrats. Everyone should be troubled by this latest move by FDA. It sets a dangerous precedent that other industries could use to push out others they perceive as a threat.
Consumers don’t need to be protected from the threat of almond milk. FDA resources would be far better spent resolving the generic drug approval backlog, working to increase patient choice and drug affordability, and addressing the true health threats Americans face.