USDA Imposes the Worst Regulation Ever

In 2018, the overall cost for Americans to comply with regulations issued by U.S. government agencies decreased for the first time since that burden began to be measured in 2005. But that achievement wasn’t an across-the-board success story, because one federal government department bucked the trend by greatly increasing the regulatory burden on American food producers, where the cost of complying with new regulations issued by the U.S. Department of Agriculture (USDA) will ultimately be paid by all Americans whenever and wherever they might shop for food.

The new regulation is the National Bioengineered Food Disclosure Standard (NBFDS), which was imposed by the USDA on December 20, 2018, just ahead of the partial federal government shutdown, which Henry Miller, the founding director of the Food and Drug Administration’s Office of Biotechnology, and Drew Kershen, a law professor at the University of Oklahoma, have described as the USDA’s “most bewildering, least cost-effective regulation ever” in a recent op-ed in the Wall Street Journal.

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.

While issuing confusing regulations is nothing new for federal government agencies, what puts the NBFDS into a class of badness all its own is the absence of any positive benefit to go along with the increased costs it will impose on all American food producers, distributors, and consumers.

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.

That is not an error. The USDA’s regulators really believe its new bioengineered (BE) food labeling requirements will provide no measurable value to improving anybody’s health, or their pocketbook, or to the environment, where the only benefit they identify to justify the massive new regulatory burden lies in “eliminating costly inefficiencies of a state-level approach in BE disclosure”, where they single out the state of Vermont’s bioengineered food labeling regulations as even more costly.

While the NBFDS might save money in Vermont, the USDA’s new regulation for bioengineered food labeling comes at the cost of imposing new burdens on all other Americans. Since that cost comes with absolutely no benefit, making it perhaps the worst regulation ever, it is completely unjustifiable in any sane world.

If anyone in the U.S. Congress is serious about making the federal government work for the American people instead of against them, they’ll take action to stop the USDA from doing this very stupid thing as soon as possible.

Craig Eyermann is a Research Fellow at the Independent Institute.
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