WikiLeaks: US targets EU over GM crops

The US embassy in Paris advised Washington to start a military-style trade war against any Euroxpean Union country which opposed genetically modified (GM) crops, newly released WikiLeaks cables show. In response to moves by France to ban a Monsanto GM corn variety in late 2007, the ambassador, Craig Stapleton, a friend and business partner of former US president George Bush, asked Washington to penalise the EU and particularly countries which did not support the use of GM crops. "Country team Paris recommends that we calibrate a target retaliation list that causes some pain across the EU since this is a collective responsibility, but that also focuses in part on the worst culprits. "The list should be measured rather than vicious and must be sustainable over the long term, since we should not expect an early victory. Moving to retaliation will make clear that the current path has real costs to EU interests and could help strengthen European pro-biotech voices," said Stapleton, who with Bush co-owned the Dallas/Fort Worth-based Texas Rangers baseball team in the 1990s. In other newly released cables, US diplomats around the world are found to have pushed GM crops as a strategic government and commercial imperative. Because many Catholic bishops in developing countries have been vehemently opposed to the controversial crops, the US applied particular pressure to the pope's advisers. Cables from the US embassy in the Vatican show that the US believes the pope is broadly supportive of the crops after sustained lobbying of senior Holy See advisers, but regrets that he has not yet stated his support. The US state department special adviser on biotechnology as well as government biotech advisers based in Kenya lobbied Vatican insiders to persuade the pope to declare his backing. "… met with [US monsignor] Fr Michael Osborn of the Pontifical Council Cor Unum, offering a chance to push the Vatican on biotech issues, and an opportunity for post to analyse the current state of play on biotech in the Vatican generally," says one cable in 2008. "Opportunities exist to press the issue with the Vatican, and in turn to influence a wide segment of the population in Europe and the developing world," says another. But in a setback, the US embassy found that its closest ally on GM, Cardinal Renato Martino, head of the powerful Pontifical Council for Justice and Peace and the man who mostly represents the pope at the United Nations, had withdrawn his support for the US. "A Martino deputy told us recently that the cardinal had co-operated with embassy Vatican on biotech over the past two years in part to compensate for his vocal disapproval of the Iraq war and its aftermath – to keep relations with the USG [US government] smooth. According to our source, Martino no longer feels the need to take this approach," says the cable. In addition, the cables show US diplomats working directly for GM companies such as Monsanto. "In response to recent urgent requests by [Spanish rural affairs ministry] state secretary Josep Puxeu and Monsanto, post requests renewed US government support of Spain's science-based agricultural biotechnology position through high-level US government intervention." It also emerges that Spain and the US have worked closely together to persuade the EU not to strengthen biotechnology laws. In one cable, the embassy in Madrid writes: "If Spain falls, the rest of Europe will follow." The cables show that not only did the Spanish government ask the US to keep pressure on Brussels but that the US knew in advance how Spain would vote, even before the Spanish biotech commission had reported. • This article was amended on 21 January 2011. The original sited the Texas Rangers team in St Louis. This has been corrected.

Read More

Are The USDA & FDA Influenced By Outside Agencies When Approving GMO (Zombie Food) Crops?

 

 

Many corporations have gotten good at pulling the levers of government to tilt the odds in their favor, weakening regulations or securing perks, justified or not, to further their business interests. Economists use the term "regulatory capture" to describe the phenomenon whereby regulatory agencies serving the public instead end up advancing the interests of the companies they regulate. The main way companies accomplish this, economists theorize, is through lobbying and campaign contributions that convince legislators to pass laws in their favor.

Once those laws are passed, however, it's less clear how companies sway the regulatory agencies that enforce them, which are more isolated from the direct effects of money or persuasion. "If a company can get enough farmers to support the product and they write letters, then the USDA is going to listen."

"Traditional theories of regulatory capture cannot be used the same on agencies," contends Shon R. Hiatt, an assistant professor at Harvard Business School. "There are a lot of checks and balances and firewalls in place."

 

So how are these agencies influenced?

Hiatt, who grew up on a dairy farm in Idaho, began asking that question through research on the controversial issue of genetically modified organisms (GMOs), agricultural products that are genetically altered to increase yield, incorporate pesticide properties, or exhibit other beneficial qualities. (Calgene's Flavr Savr tomato was the first genetically modified product to come to market, in 1992.) However, the organisms also potentially carry health and environmental risks. After reading about these dangers, Hiatt wondered how the US Department of Agriculture (USDA) decides which GMOs to approve—and how agribusiness influences the process.

Traditional theories break down

As Hiatt began investigating, he found that traditional theories of capture such as lobbying and campaign contributions had little effect on whether any particular GMO was approved. Even more direct means of influence such as scientific articles funded by industry or letters written by industry-friendly congresspeople were equally ineffective.

What did seem to affect the approval process, however, was the influence of third-party groups separate from Congress and industry, to which the department looked to justify its decisions.

We may think the primary goal of agencies such as the USDA is to protect public health and safety; based on previous economic theory, however, Hiatt started with a different assumption—the primary goal of an agency is really to protect its own legitimacy. After all, it's the perception of an agency's effectiveness by Congress and the White House that will determine its budget and the career trajectory of its top officials. Of course, there is an overlap between the appearance of doing a good job and actually doing one. "If the USDA weren't doing its job, it would have very little legitimacy," says Hiatt. But that subtle difference in perspective also has the potential to distort the agency's reliance on pure science in its approval of GMOs.

In his working paper "Lords of the Harvest: Third-Party Signaling and Regulatory Approval of Genetically Modified Organisms, written with Sangchan Park, an assistant professor at the National University of Singapore, Hiatt identifies two types of legitimacy important to the USDA. The first, "consequential" legitimacy, is the perception that the process produces effective results; the second, "procedural" legitimacy, is the perception that it is fairly following the rules of the process. In both cases, the researchers found that the department looked to outside stakeholders in order to establish that legitimacy.

 

In the case of consequential legitimacy, Hiatt and Park found a strong influence of farmers associations, such as the Iowa Soybean Association or the Kansas Corn Growers Association, which have the power to judge whether the GMOs are performing as intended without side effects. While these groups might have some industry members, they are separate from the agribusiness companies that are introducing GMOs. In cases where they supported a particular organism, there was an 84 percent increase in the likelihood of approval.

"If a company can get enough farmers to support the product and they write letters, then the USDA is going to listen to that and say, 'We have to keep our stakeholders happy,' " says Hiatt.

Other agencies influence approvals

In the case of procedural legitimacy, the researchers found a strong influence from an unlikely source—the USDA's sister agency, the Food and Drug Administration. In the process of approving GMOs, companies have the option of consulting with the FDA to design nutritional labels for their products, earning a certificate of approval when they address FDA concerns. "They get these consultations and they are somewhat meaningless—they have little to do with the USDA approval process," says Hiatt.

Regardless of that fact, however, Hiatt and Park found that a positive endorsement by the FDA had a huge effect on USDA approval, increasing the likelihood by 157 percent.

Hiatt hypothesizes that in addition to receiving nutritional information on the GMOs, getting the green light from another agency might help insulate the department from criticism. "The USDA could be looking for a scapegoat," he speculates. "A positive signal from a fellow bureaucratic actor could diffuse the blame and provide political cover were the department to approve a faulty product."

 

These effects seemed to be even higher during instances where there was significant controversy or uncertainty. In cases where there were protests by activists over a particular GMO, the researchers found that the overall percentage of approvals went down, but the degree to which a positive endorsement by farmers associations increased the likelihood of approval by 117 percent. Results were even starker during a congressional election year, in which a heightened political environment presumably casts more scrutiny on agency decisions.

 

In those cases, farmers associations' influence increased the likelihood of approval by a whopping 400 percent. In addition to increasing the likelihood of approval, says Hiatt, third-party endorsements shorten the approval period. With farmers' approval, agricultural companies shaved about 162 days off the average approval time; with FDA consultation, they cut it down by about 257 days. That can translate to big bucks for companies.

"The average seed company earns about $2 million per day of revenue for high- selling GMO crops such as soybeans," notes Hiatt. "That's a substantial amount."

He stresses that these findings only concern the USDA, and only GMO approval; more research is necessary to determine whether the effect of third-party stakeholders on the USDA has an effect on other agencies or other policy issues. Conceivably, the same findings could hold true for other agencies: for example, the influence of doctors associations on the FDA drug approval process or consumer bureaus on rate increases by public utilities commissions.

Regulators must recognize influencers

To the degree these third-party stakeholders do have influence, it complicates the traditional models of regulatory capture. On the one hand, it is perhaps a relief for democracy if companies don't have such direct influence on the process. On the other, it opens up the possibility that firms could capture these third-party actors instead—for example, drug companies influencing doctors with incentives for prescribing drugs or sponsoring medical conferences.

Perhaps the larger lessons from Hiatt and Park's research, however, concern regulators themselves. It's important that agencies such as the USDA realize their susceptibility to these outside influences, less they short-circuit their reliance on scientific procedures. That is just what happened with the approval of GMO alfalfa and sugar beets: both received positive signals from farmers and the FDA, and were approved by the USDA. But environmental groups protested that these products were approved without a full environmental review, successfully suing to take them off the market. (Alfalfa was subsequently reapproved after a multi-year delay. Sugar beets are still pending approval.)

"Regulators need to be aware of the influence they are putting on these stakeholders and other regulatory agencies," says Hiatt. "In those cases, it's even more important they follow the same scientific procedures they usually do. If they find themselves cutting corners, they could run into problems." - Michael Blanding

Read More

Who Sways the USDA on GMO Approvals?

 

Many corporations have gotten good at pulling the levers of government to tilt the odds in their favor, weakening regulations or securing perks, justified or not, to further their business interests. Economists use the term "regulatory capture" to describe the phenomenon whereby regulatory agencies serving the public instead end up advancing the interests of the companies they regulate. The main way companies accomplish this, economists theorize, is through lobbying and campaign contributions that convince legislators to pass laws in their favor.

Once those laws are passed, however, it's less clear how companies sway the regulatory agencies that enforce them, which are more isolated from the direct effects of money or persuasion.

"If a company can get enough farmers to support the product and they write letters, then the USDA is going to listen."

"Traditional theories of regulatory capture cannot be used the same on agencies," contends Shon R. Hiatt, an assistant professor at Harvard Business School. "There are a lot of checks and balances and firewalls in place."

So how are these agencies influenced?

Hiatt, who grew up on a dairy farm in Idaho, began asking that question through research on the controversial issue of genetically modified organisms (GMOs), agricultural products that are genetically altered to increase yield, incorporate pesticide properties, or exhibit other beneficial qualities. (Calgene's Flavr Savr tomato was the first genetically modified product to come to market, in 1992.) However, the organisms also potentially carry health and environmental risks. After reading about these dangers, Hiatt wondered how the US Department of Agriculture (USDA) decides which GMOs to approve—and how agribusiness influences the process.

Traditional theories break down

As Hiatt began investigating, he found that traditional theories of capture such as lobbying and campaign contributions had little effect on whether any particular GMO was approved. Even more direct means of influence such as scientific articles funded by industry or letters written by industry-friendly congresspeople were equally ineffective.

What did seem to affect the approval process, however, was the influence of third-party groups separate from Congress and industry, to which the department looked to justify its decisions.

We may think the primary goal of agencies such as the USDA is to protect public health and safety; based on previous economic theory, however, Hiatt started with a different assumption—the primary goal of an agency is really to protect its own legitimacy. After all, it's the perception of an agency's effectiveness by Congress and the White House that will determine its budget and the career trajectory of its top officials. Of course, there is an overlap between the appearance of doing a good job and actually doing one. "If the USDA weren't doing its job, it would have very little legitimacy," says Hiatt. But that subtle difference in perspective also has the potential to distort the agency's reliance on pure science in its approval of GMOs.

In his working paper "Lords of the Harvest: Third-Party Signaling and Regulatory Approval of Genetically Modified Organisms, written with Sangchan Park, an assistant professor at the National University of Singapore, Hiatt identifies two types of legitimacy important to the USDA. The first, "consequential" legitimacy, is the perception that the process produces effective results; the second, "procedural" legitimacy, is the perception that it is fairly following the rules of the process.

In both cases, the researchers found that the department looked to outside stakeholders in order to establish that legitimacy.

In the case of consequential legitimacy, Hiatt and Park found a strong influence of farmers associations, such as the Iowa Soybean Association or the Kansas Corn Growers Association, which have the power to judge whether the GMOs are performing as intended without side effects. While these groups might have some industry members, they are separate from the agribusiness companies that are introducing GMOs. In cases where they supported a particular organism, there was an 84 percent increase in the likelihood of approval.

"If a company can get enough farmers to support the product and they write letters, then the USDA is going to listen to that and say, 'We have to keep our stakeholders happy,' " says Hiatt.

Other agencies influence approvals

In the case of procedural legitimacy, the researchers found a strong influence from an unlikely source—the USDA's sister agency, the Food and Drug Administration. In the process of approving GMOs, companies have the option of consulting with the FDA to design nutritional labels for their products, earning a certificate of approval when they address FDA concerns. "They get these consultations and they are somewhat meaningless—they have little to do with the USDA approval process," says Hiatt.

Regardless of that fact, however, Hiatt and Park found that a positive endorsement by the FDA had a huge effect on USDA approval, increasing the likelihood by 157 percent.

Hiatt hypothesizes that in addition to receiving nutritional information on the GMOs, getting the green light from another agency might help insulate the department from criticism. "The USDA could be looking for a scapegoat," he speculates. "A positive signal from a fellow bureaucratic actor could diffuse the blame and provide political cover were the department to approve a faulty product."

These effects seemed to be even higher during instances where there was significant controversy or uncertainty. In cases where there were protests by activists over a particular GMO, the researchers found that the overall percentage of approvals went down, but the degree to which a positive endorsement by farmers associations increased the likelihood of approval by117 percent.

Results were even starker during a congressional election year, in which a heightened political environment presumably casts more scrutiny on agency decisions.

In those cases, farmers associations' influence increased the likelihood of approval by a whopping 400 percent. In addition to increasing the likelihood of approval, says Hiatt, third-party endorsements shorten the approval period. With farmers' approval, agricultural companies shaved about 162 days off the average approval time; with FDA consultation, they cut it down by about 257 days. That can translate to big bucks for companies.

"The average seed company earns about $2 million per day of revenue for high- selling GMO crops such as soybeans," notes Hiatt. "That's a substantial amount."

He stresses that these findings only concern the USDA, and only GMO approval; more research is necessary to determine whether the effect of third-party stakeholders on the USDA has an effect on other agencies or other policy issues. Conceivably, the same findings could hold true for other agencies: for example, the influence of doctors associations on the FDA drug approval process or consumer bureaus on rate increases by public utilities commissions.

Regulators must recognize influencers

To the degree these third-party stakeholders do have influence, it complicates the traditional models of regulatory capture. On the one hand, it is perhaps a relief for democracy if companies don't have such direct influence on the process. On the other, it opens up the possibility that firms could capture these third-party actors instead—for example, drug companies influencing doctors with incentives for prescribing drugs or sponsoring medical conferences.

Perhaps the larger lessons from Hiatt and Park's research, however, concern regulators themselves. It's important that agencies such as the USDA realize their susceptibility to these outside influences, less they short-circuit their reliance on scientific procedures. That is just what happened with the approval of GMO alfalfa and sugar beets: both received positive signals from farmers and the FDA, and were approved by the USDA. But environmental groups protested that these products were approved without a full environmental review, successfully suing to take them off the market. (Alfalfa was subsequently reapproved after a multi-year delay. Sugar beets are still pending approval.)

"Regulators need to be aware of the influence they are putting on these stakeholders and other regulatory agencies," says Hiatt. "In those cases, it's even more important they follow the same scientific procedures they usually do. If they find themselves cutting corners, they could run into problems."

About the author

Boston-based writer Michael Blanding is a fellow at the Edmond J. Safra Center for Ethics at Harvard University and author of The Coke Machine: The Dirty Truth Behind the World's Favorite Soft Drink.

Read More