Oregon is soon heading to the ballots to vote on Proposition 92. The Proposition will require the mandatory labeling of genetically modified foods. Opponents of the measure say that the labeling costs will increase the prices.
In my previous posts I have covered the economic consequences of requiring labeling for GM foods. In Oregon, some supporters just released a study saying that the cost to consumers would be only $2.30 per year.
Just $2.30 for mandatory labeling of unhealthy and inorganic food? Yes please!
Firstly, download my free ebook where I go into detail and explain how genetically modified food is not bad for health. In some cases, it can actually be better for the consumers.
But that’s not the point of this post. In this post, I want to point out all the crucial elements that the study overlooked while reaching that low number.
The 14-page study was published by a consulting firm that is based in Portland. ECONorthwest was commission by the Consumers Union to make this report.
The Oreganian has a report on this issue.
“That’s less than a penny a day for each consumer,” said Jean Halloran, director of food policy initiatives at Consumers Union, the policy arm of Consumer Reports. “A tiny fraction of the cost estimates put out by industry and certainly a very small price to pay for consumers’ right to know if their food has been genetically engineered.”
Halloran said the results disprove anti-labeling television ad claims that mandatory labeling of GMO products could cost anywhere from $400 to $800 annually.
Robert Whelan, a senior economist with ECONorthwest, said the effort involved pulling together “every bit of research we could find” on the topic of costs associated with GMO labeling requirements.
But Dana Bieber, a spokeswoman for the No on 92 Coalition, said the real costs associated with the measure will fall upon food manufacturers who will have to remake their products just for the state of Oregon.
Read that last paragraph again.
The real costs associated with the measure will fall upon food manufacturers who will have to remake their products just for the state of Oregon.
ECONorthwest only took into account the consumer-facing costs of the proposition. It ignored the costs that will be associated with food companies and hard-working farmers who will have to change the ingredients, crops, and seeds that they currently work with.
If you read the report, the very first page mentions a disclaimer. They clearly state that they did not consider scenarios where companies subjected to genetically engineered labeling requirements are assumed to reformulate their products to contain only organic ingredients.
Even the FDA is required to analyze the costs and benefits of proposed food regulations prior to approving any such regulation.
ECONorthwest chose to ignore that.
Now let’s examine some studies that have actually examined the real world cost of GMO labeling. The Washington State Academy of Science [bold this], a world-renowned institution, published a report in 2013 that put the annual cost to the food industry at about $150 million to $920 million.
$150 million to $920 million.
They’re not the only ones. Cornell University estimated that mandatory labeling of genetically modified food would result in costs “with a midpoint value of $224 for the four person family, or $1.1 billion annually for all New Yorkers.”
Just New Yorkers would have to bear a collective cost of $1.1 billion if a measure similar to the one in Oregon was to pass.
In the next post, we’ll talk about why the costs are so high.
Tweet out this post to your friends and family and inform them of how expensive this Proposition can become.
As one commentator said:
As someone who lives in Oregon but is not a weird Portlander I’m getting tired of the non-stop legislation (including voter initiatives) in this state. They cost money and add a lot of excess laws (latest law being pushed – no smoking on beaches being pushed by people from Portland that go to the beach probably 1-2 times a year and don’t remember that you’re NEVER standing right next to someone on a beach in Oregon). The kind of people that care if their food is GMO or not already can figure that out for themselves and probably do. It is really starting to get annoying.