Consider the omnipresent peanut: consumed by man for over 8,000 years and originally farmed in South America, the peanut came to the U.S. from Africa in 1800. Today, over 35 billion tons of peanuts are eaten by the world’s population. That’s a lot of jelly, too. Fast forward several hundred years and peanuts have become a mainstay of the American diet. And, like any mainstay such as milk, beef or wheat, government regulations relating to production, processing and quality control have attempted to keep pace with modern manufacturing, distribution facilities and inspection techniques.
Recent problems with salmonella contamination within a Texas peanut butter manufacturing plant (formerly housed, oddly enough, in a hog slaughterhouse) exposed a faulty inspection system that was cursory at best, criminally haphazard at worse. FDA officials blamed the industry for a lackluster, self-policing inspection plan. Congressional hearings swung into action, testimony was heard from industry officials, and the hunt for scapegoats began. The national media engaged the story with a zeal befitting another perceived “scandal” that happened over a 100 years ago in President Obama’s home town.
Muckraker (and Pulitzer Prize winner) Upton Sinclair famously infiltrated the Chicago meat packing industry to expose horrendous practices in the slaughter yards and the packing factories. Sinclair focused primarily on the human cost of the grisly work practices that workers had to endure during 16-hour shifts amidst spinning metal saws and blood slicked factory floors, causing a public uproar that partly contributed to the passage of the Pure Food and Drug Act and the Meat Inspection Act of 1906. Then, as now, an investigation suggested a cozy relationship existed between the food processing companies and the auditors hired by the businesses to inspect their facilities.
In response to the peanut-salmonella outbreak, the White House hasn’t missed an opportunity to score political points with the electorate. President Obama recently appointed a Food Safety Working Group to study the question of government regulations affecting the food industry and the number of food inspectors currently employed by the government. Representative Diana DeGette (D-Colo.) has suggested legislation giving the FDA authority to issue mandatory recalls for contaminated food – no more relying on the goodwill of businesses that might be tempted to put the bottom line above the public health – and would require it to devise a system to trace food and produce from the farm to the dinner table. Even more legislation is being suggested that would require companies to test for the hazards that are most likely to occur in their products and have the federal government devise standards for what constitutes a hazard.
These regulatory efforts appear to be a harbinger of further efforts by the current administration to create an atmosphere where government is portrayed as the savior of its citizens with new laws and regulations. And, while one cannot argue with such basic issues as the need for food safety, there is a “sweet spot” within the heart of the regulatory issue that private and public sector must find if our country is to avoid becoming a corporatist state.
While exact numbers of how many government regulations have come and gone remain murky, the federal government, when given the opportunity, has “run for daylight” in the creation of new regulations. The 1970s proved to be a transitional period for regulation (OSHA, EPA and the Consumer protection Agency), much like the 1940s under Roosevelt, whose New Deal programs and regulatory laws represented a move in the direction of a corporatist state.
In particular, critics focused on the National Recovery Administration, a model frequently cited by the current Administration. In 1935 Herbert Hoover described some of the New Deal measures as "Fascist regimentation." In his 1951 memoirs he used the phrases "early Roosevelt fascist measures", and "this stuff was pure fascism", and "a remaking of Mussolini's corporate state".
On the heels of the food safety imbroglio, we have the nationalization of banks, insurance companies and hedge funds. A recent finding by the fore-mentioned EPA, and now under consideration by the White House, furthers the notion that government can legally, and justifiably, enact laws that will devastate the national economy. Enforcement of the 40-year-old Clean Air Act, and the subsequent limitations of greenhouse gas emissions, will be costly and complicated. If the administration goes ahead with the proposal, immediate effects on the American Recovery and Reinvestment Act could be felt immediately – just when the economy seems to be finding its footing.
If you haven’t started to develop a queasiness after reading this (and it’s not from the peanut butter you ate last night), you should. What is underway way right now by the occupants of the White House and the Democrat controlled congress is nothing less than a blitzkrieg of regulatory efforts under the guise of consumer protection. These regulatory efforts represent an attempt by extremist elements within the government (both career bureaucrats and political appointees) to hobble and bring to ground the spirit of American Capitalism. The academicians who currently lead the policy process within the White House are part of a group that has never held a private sector job that has never signed a payroll check and resent those who have amassed wealth.
Make no mistake about – under the guise of regulatory efforts to protect children, the elderly and the vulnerable, we are witnessing a grab for power the world hasn’t seen since Italy and Germany in the late 1920s and early 1930s, or in our own country during the “New Deal”. If they are successful, the United States will cease to be a nation whose business welfare depends on the decisions of its private entrepreneurs.
Matt Crow joined Reagan Administration in 1987; worked in both Bush 41 and 43 Administrations; plays to a 19 golf handicap and loves to vacation at the beach with his wife and children.
