Iowa Public Television


Country of Origin Labeling

posted on March 20, 2009

Hello, I'm Paul Yeager – Mark Pearson is off this week. Government regulators and the Federal Reserve printing presses had yet another whirlwind seven days. Fed Chairman Ben Bernanke began the week predicting America's recession could subside by the end of 2009 IF banks begin lending again.

Only days later, the Federal Reserve announced it would leave the nation's benchmark interest rate unchanged at historic lows between 0 and .25 percent.

The Fed also announced as much as $300 billion in long-term government bond purchases will be made over the next six months. The so-called economic "wisemen" hope purchasing massive amounts of government bonds could encourage business, auto, credit card, and education lending at lower interest rates.

American consumers, already uneasy in the wake of turmoil on Wall Street and growing unemployment numbers, witnessed the largest rise in consumer prices in seven months. The consumer price index, or CPI, rose 0.4 percent in February – largely affected by a jump in gasoline prices.

But costs at the pump and checkout counter are only a portion of consumer concerns.

The American beef industry was shaken in spring 2008 by the controversial processing of so-called downer dairy cows at a California plant. The fallout continues well into 2009. This past week, the Obama Administration permanently banned downer cattle from entering the American food supply.

The move was hailed by some food safety groups as a step in the direction of more progressive federal policy.

Another long-debated issue in the halls of USDA pertains more to a product's original site of production than safety. The landmark Country of Origin Labeling law took affect this week but critics and advocates are still unsure what effect, if any, new labels will have on the quality of food products.

Country of Origin Labeling

New labels showed up in grocery stores across the nation this week because of regulations passed last year as part of the 2008 Farm Bill. Country of Origin Labeling, or COOL, has been a divisive political issue for more than 10 years. Some food groups argue consumers deserve to know where their food is produced while opponents have criticized COOL as a costly government regulation.

Art Jaeger, Assistant Director, Consumer Federation of America: " Consumers may wish to avoid meat or produce from a certain country based on news reports on the conditions in that country, pesticide use, or whatever."

Under the new regulations, meats and perishable fruits and vegetables will carry country of origin labels. Processed meats, such as bacon or ham, and canned vegetables, fruits or roasted nuts, are not required to carry COOL labeling. Mixtures such as trail mix and bagged salads are also exempt.

Senator Charles Grassley, (R)-Iowa: "I'm satisfied that it's being implemented for the first time but there is still some dispute and some leeway and some unsettled issues about meat coming in from Canada. Could it be labeled for two countries instead of one country? I'm of the view that the consumers of America are entitled to know specifically where their food comes from like they know specifically where their t-shirts come from."

According to a 2007 Consumer Reports Poll, 92 percent of Americans felt imported foods should be labeled by their country of origin. Opponents to the new regulations say that knowing food was produced outside of the United States demonstrates few details regarding its quality or safety. Grocers and meat packing companies believe the labeling is a burden that could lead to higher prices. Retailers and suppliers that fail to fulfill the new regulations can be fined up to $1,000 per violation.

Jerry Fleagle, President Iowa Grocery Industry Association: "It's a good program as far as showing where meat, produce and all the covered commodities come from. But, it's also a very expensive proposition. We are talking just by USDA estimates, it's a 2.5 billion dollar a year change. And, I think our industry feels it's even a bit more expensive than that, which ultimately consumers are going to end up paying for."

Canada and Mexico have filed a complaint with the World Trade Organization. Both countries believe that their exports will suffer under COOL because American meatpacking firms may be less inclined to purchase their livestock for slaughter,

Jerry Fleagle, President Iowa Grocery Industry Association: "I think most everybody in the industry has been gearing up to make sure we were all in compliance on March 16th. So, once you train an entire industry on it, to make another change takes another six months. So I think it's important that we make sure this works well before we make any other changes."

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