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Regulation Is Killing Biotech Innovation : EPA: Policies that treat garden plants as pesticides keep small companies from competing.

Henry I. Miller is a senior research fellow at the Hoover Institution. E-mail: miller@hoover.stanford.edu

America learned long ago that what’s good for General Motors isn’t necessarily good for the country. This axiom also applies to the biotechnology industry.

The industry’s major trade association--the monolithic Biotechnology Industry Organization--has readily accepted and even proposed regressive, overregulatory policies that act as a market-entry barrier to smaller, highly innovative companies. BIO supports EPA policies considered hopelessly unscientific and regressive by the scientific and professional communities.

For example, the Environmental Protection Agency recently turned its sights on a whole new area of biotechnology. The agency will regulate garden and crop plants as though they were pesticides. Case by case regulatory review will be required when these familiar, innocuous plants are genetically improved using gene-splicing methods to enhance their pest-resistance. Under the new EPA policy, these new varieties of plants like corn, cotton and marigolds are “pesticidal plants” and not only will be regulated more stringently than other plants but also more stringently than chemicals similar to DDT or sarin. The regulations will require gene-spliced plants to be labeled as “pesticides.”

The EPA’s policy ignores that plant varieties long have been selected by nature and bred by humans for enhanced resistance to external threats to survival and productivity, such as insects, disease organisms and environmental stresses. All plants contain resistance traits or they would not survive. Thus the issue is not one of the presence or absence of pesticidal properties, but one of degree.

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Plant breeders, farmers and consumers possess extensive experience with crops and foods genetically modified for pest resistance. In recent decades, using techniques that predate the new biotechnology, genes have been transferred widely across natural breeding boundaries. This process has yielded commonly available food plants that, from the first tests in the field to consumers’ plates, have required no governmental evaluations of any kind.

It is ironic that the EPA is heaping discriminatory regulatory burdens on genetic improvement of crops for pest resistance, which has the potential to replace many chemical pesticides and is likely to be less environmentally hazardous and more publicly acceptable than the manufacture and spraying of chemicals.

The EPA’s plant-pesticide policy stimulated unprecedented action by the scientific community. Eleven major scientific societies representing more than 80,000 biologists and food professionals last month released a report excoriating the EPA’s policy. It calls attention to the policy’s unscientific rationale and warns of negative consequences for agriculture and consumers, including increased regulatory burden on research and development of pest-resistant crop varieties; sustained need for chemical pesticides, and competitive disadvantage to U.S. plant breeders, farmers and food processors using the new biotechnology.

BIO and the Monsanto Co. not only have supported EPA’s policy in the face of potent scientific and economic arguments against it, but also have actually tried to persuade some of the societies to disavow the report. Alan Goldhammer of BIO and Monsanto’s chief Washington lobbyist, Chet Dickerson, have pressured representatives of the agronomy, crop science, food technology and weed science societies that collaborated on the report.

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Industry leviathans plotting with the Clintonites to crank up the level of regulation? The key to this paradox is self-interest. Consider who benefits from EPA’s regressive policies. EPA gets to create a costly new bureaucracy for regulating garden and crop plants. The agricultural chemical/biotechnology corporate giants thrive while their smaller competitors struggle against artificially high market-entry barriers. Monsanto and other companies that control BIO’s positions on agricultural issues are among the world’s largest producers of agricultural chemicals--Monsanto’s sales of crop protection and lawn-and-garden products in 1995 were $2.47 billion. These companies have a vested interest in slowing the development of competing products.

Consider the consequences, however. Red tape, long delays and astronomical costs will delay field validations of improved varieties of plants for food and fiber. U.S. agricultural research will be irreparably damaged: The new policy could virtually extinguish university research on the nature of pest-host interactions, which is essential for developing alternatives to agricultural chemicals. Entrepreneurial companies will fail. Ultimately, there will be fewer product choices for farmers, food processors and consumers.

BIO’s and Monsanto’s collusive, anti-competitive behavior corrupts the basic principle of the free market. It is this kind of industrial strategy that antitrust laws are intended to discourage. But because the Clinton administration is a collaborator in promoting a higher level of government intrusiveness, its officials have neglected their role as the “umpire” that enforces compliance with society’s rules.


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