March 11, 2010

Because the market knows better than regulators

FDA says Basic Food Flavors knew plant was contaminated with salmonella - washingtonpost.com:
"The company at the heart of a growing recall of processed foods knew that its plant was contaminated with salmonella but continued to make a flavoring and sell it to foodmakers around the country, according to inspectors at the Food and Drug Administration."

As one of our trolls suggested, I wonder if many Republicans don't believe that we have more regulation than we actually do. I am not sure the FDA could order a recall in this situation, but can only suggest one.

This really isn't rocket science. Lots of corporations make these decisions on a cost/benefit ratio where they weigh the risks of future litigation against the cost of a recall. If they decide it is cheaper to risk our health, they will.

1 comment:

steves said...

This is what Ford did with the Pinto. It was cheaper for them to pay out claims for people that died then it would be to fix all of the problems. This was a major factor in the jury awarding a huge amount of punitive damages.

I think this can be a deterrent for some of these behaviors, but I would prefer that it be accompanied by an intelligent regulatory scheme. Lawsuits can be very expensive and I doubt the average person would be able to afford the retainer to go after a major corporation.