Formula for a Shortage | Hacker News Reader

Formula for a Shortage

thezvi.substack.com

34 pointsnokcha31 comments

The author should maybe consider that there are some possible downsides to a totally free market in food and drug products, and in particular look at the historical events which led to the creation and empowering of the FDA. e.g. "The Sulfanilamide Disaster" [0], which killed 100 people because a company used antifreeze to create a liquid form of their drug (and it would have killed more if not for FDA efforts to track down shipments and recover the drug).

The shortage is certainly a terrible thing. It also would be a terrible thing if contaminated formula killed a bunch of babies. It may be that we have not struck the right policy balance between a free market and regulatory controls, but this screed is far from a nuanced reconsideration of the role of the FDA.

[0]: https://www.fda.gov/files/about%20fda/published/The-Sulfanil...

Specifically they should look at the many times baby formula has been adulterated with literal poison and the horrors that nestle commits and then ask themselves if they really don't want some sort of safety.

Remember, this shortage is because a brand was selling dangerous formula and had to take it off store shelves

How about we bust up any company holding more than 20% of the market share for baby formula? And then we bust up any company holding 20% of the inputs for that? Recurse until finished.

Then, when one company gets contaminated, we only lose a maximum of 20% of the market.

Maximally efficient is minimally robust.

Exactly. It's a reasoning error.

They equate "Ensuring any recalled products remains off market" with "keeping formula off the market".

As you said, there are many cases in which it is far wiser stop to ensure safety, than to move forward with risk.

Well said.

What happened to the FDA? Why would they block a healthier option? This must be incompetence or corruption.

European formula is healthier than the dorito mix formula sold in the US. I was shocked to see that some have corn syrup and high oleic sunflower oils as the first ingredient. If I was a parent in the US I'd be looking for an underground formula railroad.

2 quotes from the article address that:

"The FDA does not exist to get products on the market. It exists to keep products off the market. They have no idea how to get a product to market; that’s just not what they do."

"So what they are doing, in an emergency, is allowing, out of the kindness of their hearts, for manufacturers to apply for the ability to temporarily import their products once the FDA explicitly approves them, on a case-by-case basis. When the problem was something completely irrelevant like listing ingredients in the wrong order, the FDA plans to (eventually) approve such an application, which will be good until November. If the issue is a trivial argument over something other than labeling, well, tough."

I highly recommend reading the whole article. It's a really well written "rant". (I say "rant" because you can hear the anger in the writing, but it is well researched and written regardless.)

I gave up on the article about a quarter way through when they trivialized that labels may be in Dutch or German and the intended water to formula ratios are 1:1 instead of 1:2. That would mean an infant getting one half the calories a parent thinks they are, which does not seem trivial to me.

> That would mean an infant getting one half the calories a parent thinks they are, which does not seem trivial to me.

As opposed to none?

Again, there is a shortage. Thus the poorer end of the spectrum will go without.

They could just add a sticker with directions in English, including the formula ratio. The only babies that would suffer are those whose parents don't follow basic directions when preparing their food - and those babies are likely in for a rough time anyway.

It seems crazy to think that a different formula ratio is so important it should necessitate a shortage of vital baby formula.

Once American families get access to European formula, they will demand similar levels of quality from American producers, or parallel import from Europe directly.

American manufacturers will need to do better than releasing junk products, which will impact profit margins.

50% of infant formula in the USA is purchased by the US Government and distributed to welfare recipients. Industry and Government are aligned in ensuring formula is as cheap as possible.

That’s dairy/soy/corn subsidies for you

> Why would they block a healthier option?

Labeling? I mean that's the assinine reason the FDA is giving anyway.

> This must be incompetence or corruption.

Probably that and a bureaucracy that's unwilling to relinquish its power in any way. Really pretty disgusting.

> the dorito mix formula sold in the US.

I couldn't agree more, and I love the wording. The FDA is hardly `protecting` us here.

Just FYI, it's a conspiracy theory to suggest that seed oils and other processed chemicals are somehow unhealthy.

...is this a kind of thing people say? If you have something to argue about the healthiness of certain foods, make your argument.

> is this a kind of thing people say?

Is what a thing people say?

Just point to something and say "that thing you said is something other people have said, and I call those people conspiracy theorists, which presumably means something to me, but probably isn't the literal definition of conspiracy theorist, because there's no actual conspiracy in something being unhealthy inherently, and so don't say that thing."

Basically, completely avoiding the object level and jumping to a meta discussion that can only be political and not further the discussion.

How is a government agency blocking imports of food that parents wish to buy for their children not a political topic?

It would be disingenuous at this stage in our society to make the case that speech is not heavily regulated and often labeled as conspiracy (and worse) when it runs counter to corporate and establishment narratives. Hence, the metapolitical comment.

If I'm reading the response chain right, you're actually not saying it's untrue, just that criticizing veg oils is something that people will call you a conspiracy theorist for suggesting?

Cause if so, I'm kinda with you. I definitely think veg oils are awful for health, and have basically been called crazy for saying so.

Not much conspiracy there though excepting maybe the main thematic one which is that unhealthful stuff is foisted on the populace to keep them dumb and compliant.

Yup, we’re on the same page on both counts.

>If I was a parent in the US I'd be looking for an underground formula railroad

Yep - we found a company in Florida that was importing formula from Germany at a reasonable premium. Keep in mind that this was 4 years ago, so I don't know the state of that pipeline today.

If I've been following this story correctly:

FDA catches conspiracy to recklessly endanger (as in quite possibly murder) a huge number of infants over a vast geographic area. Perpetrators caught then not given sufficient help bypassing FDA procedures nor a reduction in oversight as they resume production and filling out paperwork they previously falsified.

Other competitors apparently non-existent probably thanks to free market forces and this competitor who used illegal methods to have lower costs than legal operation. I.e. bad batch costs saved by falsifying paperwork.

FDA hesitant to allow import of these products as foreign production would be out of its jurisdiction and the lowest international bidder is presumably saving more money than the factory they just closed, somehow..

Can the FDA single out specific EU countries and criticize their regulators or would it face massive pressure to approve all countries the US has a cozy relationship with that have an infant formula?

I.e. the UK which has no regulatory history relevant to it's current restructuring as a non-EU Nation. Should thousands of US infants be among the first to iron out defects in a changing system for regulating potentially deadly products that is focused on being more cost effective for the UK?

> Other competitors apparently non-existent probably thanks to free market forces

The article goes into the reasons for market consolidation. To summarize: there's a combination of steep regulatory barriers (which inherently favor big, established businesses with large lobbying and compliance budgets), single-supplier state purchase contracts that account for roughly half of all baby formula purchases, and effectively cutting off imports. The market forces are downstream of government action, and the market in question is anything but free.

OK, restricted market forces. Plenty of large players bid (or consider risking an entry) keeping in mind the costs of complying with regulations. One that cheats has lower costs than the others calculate preventing competition.

The solution is to remove regulation and testing so thousands of bidders compete on providing an all melamine formula at an exceptional price?

There are options other than "no regulation" and "exactly the level and type of regulation we have now". For example, you could impose expensive liability for selling defective formula (retail or wholesale), and trust that Walmart will choose reputable suppliers and do proper quality control -- because it's cheaper for them than being irresponsible.

The post started off with a seemingly reasonable yet obviously naïve example of flaws in the process, then goes on a rant where it reframes every tweet by the FDA in a gross mischaracterization.

The funniest thing here is that there would be very few people in the world that would count any international trade as a part of the "free market". So any restriction placed by the US government on importing any products would implicitly not have any effect on the "free market" that most people refer to, and most people that would drool over the "free market" would also be the same people to decry any movement towards globalism.

But even then, why wouldn't these European manufacturer just print a second set of labels for selling their product to the US, if it's just a "labeling requirement"? Sounds like a very fishy claim.

You know, there is also Japanese baby formula. Why has the discussion been restricted to European?

The FDA is our most murderous bureaucracy.

If the global warming thing is as bad as some of the scarier predictions are predicting, the Nuclear Regulatory Commission might steal that title from them eventually.

What a funny story.

Most of it is completely disjointed from reality.

But please, keep pushing for the free market fallacy.

Lines such as: [the FDA only keeps stuff off shelves!] is quite naive at best. That’s _exactly_ what the FDA was and is for.

This reads like a first year business kid trying to sound involved.

> Lines such as: [the FDA only keeps stuff off shelves!] is quite naive at best. That’s _exactly_ what the FDA was and is for.

Which I'm quite certain was the author's point.

What's yours other than to mock the author?

I think this is an unpleasantly complicated topic because: 1) The FDA does have glacially slow processes, that limit competition in markets, often keeping prices artificially high (see the US Insulin market), but 2) The FDA has a pretty good track record of stopping companies killing or seriously harming people [1], and baby formula companies don't have a great record...[0][2]

[0] https://en.wikipedia.org/wiki/1977_Nestl%C3%A9_boycott [1] https://en.wikipedia.org/wiki/Thalidomide - Its initial entry into the US market was prevented by Frances Kelsey, a reviewer at the FDA.[7] The birth defects caused by thalidomide led to the development of greater drug regulation and monitoring in many countries [2] https://en.wikipedia.org/wiki/2008_Chinese_milk_scandal

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