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Saturday, March 4, 2017

The FDA Thinks Consumers Are Dumb

Behind every ridiculous regulation there is a crony capitalist using the government to protect its own interests.

The federal government does not think consumers are capable of making informed decisions, or so its labeling policies would imply.

The Food and Drug Administration (FDA) has often capitulated to the whims of the dairy industry, going after its competitors by enforcing obscure laws. Some of these regulations have been so insignificant, they have addressed seemingly irrelevant details such as determining how dairy alternatives are legally allowed to label their products.

Individuals are not unknowingly being bamboozled into buying dairy alternatives.

Concerns over the matter stem from the dairy industry’s alleged fear that unsuspecting consumers are being fooled into purchasing items claiming to be something they are not: milk.

While actual consumer trends paint a more realistic picture of a country moving away from dairy and towards products like soymilk, almond milk, and coconut milk, the dairy industry thinks this phenomenon is the result of a simple mistake made by consumers who think they are purchasing milk from cows.

In reality, however, milk sales have suffered over the last several years because consumers now have access to a wider range of alternatives. Individuals are not somehow unknowingly being bamboozled into buying dairy alternatives; they are purposefully seeking out these products at trendy health food stores like Whole Foods or Trader Joe’s.

There is nothing young, hip, professionals love more than their health-conscious eating habits. In fact, following certain dietary trends has become somewhat of a status symbol. Whether you’re vegan or paleo, many of these nutritional lifestyles discourage the consumption of dairy products. As a result, many consumers are going after dairy alternatives like nut milks.

For consumer products that do not enjoy the luxury of government protection, falling sales would indicate that a trip back to the drawing board was needed. However, for the dairy industry, increased competition simply means calling in a favor from the FDA to help stomp out the competition.

The Dairy Cartel

The dairy industry is no stranger to calling in favors from the federal government. In fact, when margarine hit the scene in the late 1800’s, dairy farmers called for a federal “margarine” tax to dissuade consumers from buying the butter alternative.

In 1902, this policy was taken even further when an additional tax was applied to any margarine brand that used artificial dye to make its appearance seem more like “authentic” butter. This tax was really meant as a punishment for the margarine companies, who were supposedly “tricking” consumers into buying their “wannabe” butter. The real threat, of course, was that margarine was less expensive than butter, which concerned the dairy industry and delighted shoppers.

The brand Yoplait was also once a target of the dairy industry and faced legal action over its Greek yogurt products.

The FDA has the unique and broad authority to set standards for just about anything a human is able to consume. This unique power gives the federal entity the ability to determine what a product can legally call itself. For example, if a brand wishes to label its product as yogurt, it must have certain ingredients present in its recipe.

An outdated state law forbids foreign butter from being sold on Wisconsin shelves.

Unfortunately for Yoplait, the company had decided to add a new ingredient to their Greek yogurt line that served as a thickening agent. However, since this new ingredient did not exist when the terms for “yogurt” were set, the dairy industry filed suit against Yoplait in an attempt to ban the company from being able to use the term in any product labeling. Luckily for Yoplait, the judge threw out the case before the situation escalated.

A few months ago, the dairy industry leveraged its power in the state of Wisconsin and managed to get a popular brand of butter pulled from grocery store shelves.

Kerrygold Grass-fed Irish Butter is not made in America, as its name might have alluded. Since it is made abroad, it is not subject to Wisconsin’s overly-rigorous approval process for dairy products.

However, an outdated state law forbids foreign butter from being sold on Wisconsin shelves. Since Kerrygold is made and packaged abroad, it does not go through Wisconsin’s specific regulatory process, making it contraband within the state.

What’s in a Name?

Now, the dairy industry is up to its old antics again, this time asking the FDA to crackdown on any non-dairy product using “milk” in its name.

While all this sounds almost too ridiculous to be true, this is the regulatory circus born from cronyism.

It is alleged that “milk imposters” are ruining the dairy industry’s image by confusing consumers who may think they are buying “real” cow’s milk when purchasing soy milk or other dairy alternatives.

While this may seem like an arbitrary point of contention, the dairy industry takes the definition of “milk” very seriously, as has been demonstrated by its persistence on this issue. In fact, the industry has been heavily pushing the FDA to enforce the “legal” definition of milk since the year 2000.

This labeling issue is so important to some, new legislation has recently been introduced that would require the FDA to start actively enforcing the law that restricts products from being labeled as “milk” unless they are made by “complete milking of one or more healthy cows.”

While all this sounds almost too ridiculous to be true, this is the regulatory circus born from cronyism. When laws are made explicitly to give one specific industry a leg-up on the competition, you can bet your bottom dollar that these regulations have more to do with squashing the competition than protecting the consumer.

  • Brittany is a writer for the Pacific Legal Foundation. She is a co-host of “The Way The World Works,” a Tuttle Twins podcast for families.