It’s a mad, mad, mad, mad cow world

The market is often accused of under-providing safety. Consider, however, that the Department of Agriculture is refusing to let a Kansas beef producer test its cattle for mad cow disease. Yes, you read that right. The producer, Creekstone Farms, is losing $40,000 a day because it exports its beef to Japan where such tests are required. The testing of individual cattle, however, runs contrary to the DOA/industry message that American beef is perfectly safe without expensive testing.

The mad cow case is a clear example of regulatory capture. By the way, the DOA aquired its power to decide minimum and maximum testing standards test under the Virus Serum Toxin Act of 1913 – it was captured a long time ago.

Don’t be surprised if the DOA requires such testing in the near future. I am reminded of the similar folic acid story that I wrote about with Dan Klein at

In 1992, the federal Centers for Disease Control and Prevention (CDC) recommended that women of childbearing age take folic acid supplements. Studies showed that taking folic acid reduced risks of babies suffering neural-tube birth defects such as anencephaly and spina bifida. The FDA immediately announced, however, that it would prosecute any food or vitamin manufacturer that placed the CDC recommendation in its advertising or product labeling (Calfee 1997). The public did not learn of the importance of folic acid until Congress passed the Dietary Supplement Health and Education Act of 1994, which loosened the FDA’s vise on the advertising of vitamins and other dietary supplements. Within only a few years of its ban on publicizing the CDC recommendation, the FDA made a complete turnabout. Since 1998, the agency has required manufacturers to fortify a variety of grain products with folic acid–that which is not prohibited is mandatory.


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