What was she thinking? CNBC commentator Erin Burnett got a huge laugh when her comments on China were broadcast on Jon Stewart’s Daily Show. "I think people need to be careful what they wish for in China. If China were to say start making toys without lead in them, or food that isn’t poisonous, their costs of production are going to go up. And that means that prices at Wal-Mart here in the United States are going to go up too." Her utter lack of irony blew the audience away.
And yet, she’s right. Here’s why. We live now in an out of control global economy – one created by a Second Industrial Revolution - with consequences more far reaching than the first. Some of these are well known, such as trading high paying jobs in the West for low paying jobs elsewhere, with trade deficits turning the U.S. into a debtor nation –and China holds the mortgage. But this ongoing global shift also adversely impacts the food we eat and the products we buy. China trade, especially if not exclusively, demonstrates how we further open our borders to imported goods at our peril. This is not xenophobia. This is a price we pay beyond the one on the sticker, when food is grown and processed without regulation or inspection, when goods from t-shirts to toasters are manufactured by the lowest bidder.
For more than 150 years, reformers - from Upton Sinclair to Ralph Nader – have fought to achieve tough regulation of our food, drugs, cosmetics and other consumer products. In 1848, Congress first imposed controls on imported goods with the Drug Importation Act. In the midst of the Civil War, Lincoln helped establish the Bureau of Chemistry, forerunner of FDA. Following exposés like The Jungle documenting unsanitary factories and adulterated food, populist Teddy Roosevelt pressed through the nation’s first food safety statute. And during The New Deal, Congress enacted the comprehensive food, drug and cosmetic legislation still in force today.
These and other efforts were intended to insure quality consumer products; they established our safety net. Compliance with such laws requires on-site and product inspection; liability is then imposed throughout the production chain. The absence of such safeguards in China makes production there of goods less costly. The absence of such safeguards too often makes imported goods of inferior quality, presenting higher risks.
During the NAFTA and other "free trade" debates, lip service was paid to imposing labor and environmental controls offshore. This approach was rejected "as protectionism". Well they were meant to protect, alright. They were meant to protect you against poisons in Fido’s meal and on Timmy’s toys.
Regrettably, we simply cannot rely entirely on our domestic safety net to protect us from hazards we import. First of all, from e coli in the spinach to Vioxx in the medicine chest, enforcement even for domestic goods is often weak and product inspection less than thorough. Agencies like FDA, USDA and the Consumer Product Safety Commission are woefully under-funded and poorly staffed. And they decidedly lack the resources to protect us from the ever increasing volume of goods coming off the ships, into the stores and onto the dinner table. When more than one million imported toys were found contaminated with lead, the government response was to calm and placate, not protect. Just this month, more than 1 million pounds of Chinese seafood - shrimp, catfish and eel - went to our supermarkets despite an FDA "import alert" that it all should be tested for contamination.
And only a tiny fraction of imported goods even get to that step.
So what’s an American consumer to do? Use the one power you have, self defense. Be careful of what you buy and from where you buy it. From toys to organic food, there has been a recent and dramatic surge in "buying American". That’s a start. But unfortunately, products do not always identify the country of origin. Nor are can we be confident that assurances from retailers like Wal-Mart and Toys ‘R Us ( Toys ‘R Lead?) are legitimate.
So here’s an idea. Institute a "global right to know". In California, often the place of new ideas, we already have laws on the books requiring companies to warn us when products – domestic or imported - present an unacceptable risk of cancer or birth defects. How about a warning on products that present other risks because they fail to meet minimum U.S. standards? Companies should be required to certify goods are safe. If not, tell us. If the warning is lacking and the product proves dangerous, then make the seller responsible for substantial penalties and a return of the purchase price. Let the market work.
Why punish the U.S. company? Why not the Chinese factory owner? Because it is Wal-Mart that took the manufacturing offshore and brought the products to us – they have a duty to insure product safety.
Unsafe workplace conditions translate to unsafe consumer products. The absence of adequate labor, health and environmental controls, together with cheap labor (Chinese toy workers make about twenty-five cents an hour), allow U.S. companies to garner even higher profits. The absence of such safeguards puts these workers at enormous risk; consider what the ambient lead exposure must be in a Chinese toy factory. China Labor Watch, a New York based human rights group, this week issued a report finding widespread labor violations in toy factories, including child labor, mandatory overtime, unsafe working conditions, and abusive managers. This is only the latest in a series of such reports by nongovernmental organizations this year. A market driven more level playing field would benefit workers and consumers alike.
If you went to a restaurant and were a victim of food poisoning, you would not return. Not so for U.S. retailers. They will keep going back to the same or similar factories so long as the price is right. It is a matter of business judgment, of risk-benefit. Your risk, their benefit. They have the power to insure safe products – and some do - by imposing tough quality controls in their supply contracts, by rigorous inspection of foreign factories, by comprehensive testing of consumer goods. But many would rather not know what they’re selling - or what we’re buying. They lack the incentive. So let’s give it to ‘em with an international right to know.
Al Meyerhoff is a consumer attorney in Los Angeles, California.