Terry H. Schwadron

May 20, 2022

The continuing lessons from the explosive public reaction to shortages infant formula should make us yet more angry about what passes as normal business in normal times in normal America.

Surely this shortage is a national emergency, and after the late start, government and business that should have been prepared are now focused on solutions.

White House declaration of powers of the Defense Production Act apparently will speed delivery of ingredients to re-opened private manufactures and product distribution. Congress, equally late, is promising hearings with a hint that civil or criminal indictments could follow.

Whatever the shortages, which are spotty around the country, they will be gone in a few weeks, even as the government is arranging for imports from Europe.

It took no time at all to become a partisan political blame football in our current divisive fashion of blaming the White House for any American discomfort.

Joe Biden let us know that had he known about a building problem, he would have acted sooner, but by then, he had become the object of Republican criticism for offering too little too late.

What’s Normal is Worse

But if you really want to get angry, consider what was totally normal about the situation:

Consolidation. As with much American business, this industry has contracted into three main producers — Abbott, Gerber and Reckitt — when the market suggests there is room for more producers. Who is responsible here beside the market forces we so defend? What exactly do opponents want the government to do about encouraging competition in a targeted industry – something they oppose for solar panel manufacturers, for example, or computer chip makers?

Greed. Abbott, which shut its plant for safety reasons, decided to spend recent record revenue on stock buybacks rather than safety improvements. Isn’t this directly on demand of American capitalism that puts profit before all else? Over and over, we learn that companies are taking government tax cuts or other relief packages and using them to lessen corporate expenses all while opposing any increase in taxes on companies.
Protectionism. Because of our latest NAFTA version, the baby formula industry was protected against imports. Isn’t it weird that Mexico and Canada have plenty of infant formula at this moment?  Infant formula turns out to be one of the specified industries that are exempted from import – without recognition of potential emergencies like the one we are witnessing. So much for America First and Only.

Regulation. The Federal Drug Administration has nine people to oversee this industry – and that was up from three until a couple of years ago. The perception of over-regulation has been the bugaboo for American business and Republicans. Now, failure to oversee both manufacturing safety and continued supply have made of regulation has bitten our rear. Meanwhile, the FDA should not escape unscathed after ignoring whistleblowers from this industry’s practices apparently since last November, and certainly since the major plant shutdown in February.

Serving the Poor. In its fouled attempt to protect American taxpayer money, Congress limited the use of Women, Infants and Children (WIC) food stamp aid to a single brand – the brand that has disappeared from store shelves. Whose interest is being served here? Why does it take an emergency to make people look anew at the rules? As always, our problems once again are landing on those least equipped to handle flexible workarounds.

Are Solutions Effective?

The simple solution, as newspaper editorials advise, is to open imports of infant formula from  European Union, Britain, Canada, Australia and Japan. The FDA’s announcement that it was streamlining its review process so that foreign manufacturers could begin shipping more formula  should have happened weeks ago.

What doesn’t help in all this are those crowing about the government sending pallets of infant formula to border detention facilities along with claims that Biden is prioritizing foreign children over America’s youngest. The sales orders were months’ old and were court-ordered.

Also unhelpful are the calls that shame mothers who choose not to breastfeed. How is this possibly helpful or charitable in spirit?

Lastly, faux outrage in Congress from both sides of the aisle towards business officials and federal agencies alike may look good on the campaign trail. But they hardly contribute to getting early deliveries of a needed product in store shelves any sooner.

Keep asking yourself whether the words we are hearing provide effective relief anytime soon, whether we are talking drugs, guns, culture wars or infant formula.

The sorriest lesson learned in the infant formula mess may be that it is a uniquely American outcome of normal capitalist thinking as practiced in our country.

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