Why Liberals and Conservatives Should Support Proposition 37

Why Liberals and Conservatives Should Support Proposition 37

Guest blog by Paul Matteucci

37.jpgCalifornia’s Prop 37 requires food makers to label most food products, when they contain Genetically Modified Organisms (GMOs).   Now, the word “organisms” is unfortunate, as it conjures up notions of super bacteria, manufactured with benign intent, but possessing some latent quality that devastates mankind.  And, in fact, that is what some GMO detractors believe could happen.  Others want more testing and regulation; and still others just want to know what’s in their food.  Many liberals simply don’t trust the suppliers of GMO products, mostly big agriculture companies, to do what is best for customers, over what is best for their earning reports.

As a graduate student of business and economics, I had professors, who drilled into me that information possessed by everyone makes the market more efficient, which usually makes products and services cheaper.  Information possessed only by a few necessarily engenders inefficiencies, which spread unevenly among participants in a marketplace.  Some win, some lose.  In general:  Information=good.  No information = bad.

You can understand why I was confused to see a commercial where Dr. Henry Miller, a Hoover Institute scholar, advocates a NO vote on Prop 37.  Hoover is, after all, the premier conservative policy research institute on the planet and, in general, a defender of free-market principles.  Dr. Miller should know that withholding information is generally a bad thing for the operation of free markets.  Perhaps, if there is an economist in the tower, he or she may want to drop by Dr. Miller’s office and remind him of just how efficient markets work.

Dr. Miller’s stated reasons for opposing Prop 37 are that the exemptions are arbitrary and illogical, like requiring labeling of meat for dog food, but not meat for human consumption.  Well, I too am not pleased when my labradoodle eats better than I do.  But missing information makes 37 imperfect.  It does not necessarily follow that it is, on balance, bad for us. 

Some information might be worse than no information in rare cases, but not most of the time.  Usually, a little information is the first step towards more information.  Eventually, we know enough to make better decisions.  On the other hand, economists tell us that uneven access to information results in benefits for those who have it at the expense of those who don’t.  That’s why, for example, we have insider-trading laws in securities markets. 

The Nanny State--Telling me I can’t buy a goldfish or drink a soft drink of a certain size are examples of Nanny-statism.  Telling me how many calories are in a chicken finger or how much fat is delivered in a bag of corn chips is not.  On the contrary we have a Nanny State when our laws are constructed to keep facts out of our consideration.  In this case, the Nanny is channeling Jack Nicholson, who once famously said, “You can’t handle the Truth”.  Well perhaps not, but my bet is on my and my fellow citizens’ abilities to process information, over those who think we cannot handle it.

The Cost--NO on 37 ads state that the law will cost California families an average of $400 per year in increased grocery prices.  I don’t believe this, because almost nothing the government does costs me only $400.  Still, in this case, I have a hard time understanding why goods, most of which already have labels, will cost more, when they can simply add a little ink to their current tag.  If the formula for one ounce of Fritos changes to add a gram of fat, does it really cost very much for Frito-Lay to change its label from 10 grams to 11 grams.  It just doesn’t pass the sniff test.

If anything, economics would tell you that if people don’t want GMOs, the reduced demand for these products in the face of labeling would actually propel their prices lower.  The more you don’t want something, the cheaper it becomes.  Eventually, supply contracts and prices stabilize, probably at a lower level than before.  Is this perhaps what really scares opponents?

No on 37 also says that the law will require a new state bureaucracy to enforce it.  Well yeah!  If they cheat.  I find it ironic that the folks paying for No on 37, are telling me that we will need to finance a big bureaucracy to prevent them from cheating and, in the same breath, telling me to trust them that GMOs are good for me.

Rule of Thumb--As a lifelong resident of California I have spent thousands of hours digesting referenda, since I was old enough to vote.  You can’t learn everything about everything.  So one rule I employ is when I see tons of money on one side of an issue, somebody’s economic ox is being gored.  I have trained myself to be extra skeptical in these cases, whether the source of the money is Monsanto, the AFL/CIO, or the Little Sisters of the Poor.   In the case of Prop 37 the ratio is:

  • Yes on 37 $7M
  • No on 37 $44M

Are GMOs Bad for Us.--I am not anti-GMO.  In fact I am quite sure that if 37 passes, much of my pantry will light up with scores of new labeling.  Rather, I am pro-information.  When some one tells me that “not knowing” is good for me, the hairs on the back of my neck stand-up.  We will never be able to answer the question of whether GMOs are good or bad for us unless we have more information.  The likely answer is, “it depends what we do with them”.  But I am positive it does not make sense to allow those who profit from GMOs to have a monopoly on information.  

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