As a society we must accept the fact that large-scale food producers are motivated by money, not safety.  They seek low production costs to bolster slim margins, not methods by which to rid food of illness-causing pathogens.  In order to incentivize large-scale producers to make safer products, we must demand more hands-on oversight and a tax system that rewards the producers with the best safety records.  In a profit-driven world, we need to promote safety through better margins.  We must fight money with money.

The food industry is not an easy business to thrive in.  There are high barriers to entry and sizeable production costs.  It’s also extremely difficult for food producers to differentiate their products from the competition.  Sure, you can sell organic yogurt, hormone-free milk, and soy ice cream, but it’s not as if you can reinvent the (cheese) wheel.  To make matters worse, many consumers are currently in dire financial straits.  For many people, feeding their families in the most affordable way possible has become a top priority.  And thus, we’ve ended up with grocery store super-centers packed full of low price, high quantity food products.  Quality, often times, seems like an afterthought.

As consumers, we pay a hefty price for the food industry’s never-ending race toward rock-bottom prices.  To produce products that are continually cheaper and more profitable, the food industry has learned to cut corners at every step of the production process.  This, in turn, has led to more ways that harmful pathogens are able creep into our food supply.  We have seen it again and again.  From fields of leafy greens inundated with cow pasture runoff water to peanut processing plants that ship products regardless of contamination, manufacturers are quick to latch on to any practice that may shave a few cents off production costs.  

Consumers, it should be noted, are not naïve.  With a population that needs to put food on the table, the race toward bargain basement food prices might not seem like such a bad thing.  Really, who can blame them for seeking out affordable food products?  With a combined 2010 agency budget of over $138 billion, consumers should be able to trust the USDA and the FDA to keep our food safe.  We should be able to walk to the corner grocery store and buy a frozen dinner without worrying that the meal could land us in a hospital room on dialysis.

Unfortunately, the assumption that the government will keep our food safe leads to a crucial mental trade-off.  It creates a mindset where American consumers are not prepared to pay more money for safer food.  After all, with the government already spending hundreds of billions of dollars in the name of food safety, who in their right mind would pay more for a pathogen-free bag of spinach; it’s already supposed to be that way!  Likewise, what manufacturer is going to label its food as “pathogen free”?  That’s just a lawsuit waiting to happen.  

The segment of shoppers that actively searches for pathogen-free food is a slim one indeed.  Some more affluent shoppers may shop at upper-end stores that are full of organic produce and meats.  Those shoppers, however, are paying for a lack of chemicals and additives; there is still an implicit assumption that the food, so long as it’s on a store shelf, is safe from foodborne pathogens.  

Educating the public about food safety is one component of a long term solution to the epidemic of foodborne illness.  Another more crucial component is educating manufacturers about the financial benefits of safe food.  If we can create a corporate culture where safe food means higher profits, manufacturers will quite literally race to improve product safety.  It has worked in other industries, and it will work with food producers, given the right incentives.  

Early on, I learned that there are a lot of industries with much worse safety records than the food industry.  Growing up in a small town in eastern Washington, my family’s Friday evening trips to Costco were always a highlight of my week.  As a ten year old, it doesn’t get much better than browsing countless rows of electronics and chasing down free samples of everything from cookies to quesadillas.  But one thing always caught my eye when I was leaving the store.  There was a big sign, likely inspired by similar signs at construction sites, which tallied the number of consecutive days without a workplace injury.  Even as a ten year old, I was curious to see how long the store’s injury-free streak could continue.  The sign represented the ambitions of a company that prided itself on the safety of its employees and wanted to show its pride to the local community.

It wouldn’t be such a bad thing if more companies began to pride themselves on the longevity of their safety records.  Even better, what if food producers began to pride themselves on the safety record of their products?  Why would they do this?  What does a company in a competitive industry that knows it can’t sell safety have to gain from a flawless safety streak?  Well, nothing, until you create governmental incentives that offer monetary rewards to the producers with the best safety records.  This in turn gives producers of safe products a distinct competitive advantage in an industry with extremely narrow margins.

The setup for a governmental system that rewards safety is pretty simple.  The first step that the federal government must take is to institute a special tax that applies all food producers that ship products across state lines.  The tax should target large producers, not small local farms.  The funding generated by the tax can be used to pay for more hands-on oversight, including more extensive inspection and traceability systems.  At the end of every fiscal year, companies should be able to, based on their food safety records, apply for a small percentage tax reduction.  Such a system rewards producers that are able to continually avoid foodborne illness outbreaks, increasing their profit margins and giving them an edge in a competitive industry.

Certainly, a system of tax incentives for companies with great food safety records is not without flaws.  For starters, large producers and mid-sized farmers alike would have to be dragged, kicking and screaming, into an industry-wide tax hike.  The large producers would argue that it’s impossible to avoid mishaps in high-volume production facilities, whereas the farmers would argue that more taxes would cut into their already non-existent margins.  For each argument, however, there is of course a counter argument.  Large producers would still retain the competitive advantage of lower production costs as a result of economies of scale, and farmers would still enjoy the benefit of smaller operations with simpler oversight procedures.

The reason why tax incentives could lead to a safer food supply is easy to understand, so long as you look at the food industry from a fresh perspective.  In any discussion of food safety, two simple realities are often overlooked.  The first is that the average consumer is rarely aware of the dangers of contaminated food.  Consumers assume that the food they buy off a store shelf is safe–they are not willing to pay an additional cost for more food safety.  The second is that food producers, like all other corporations, exist to make money for their shareholders.  There is nothing wrong with that, it’s what our country’s economy is based on.  But there is something wrong with assuming that producers will pay more attention to food safety if it does not benefit them financially.  

Putting these two realities together, we can clearly see that the most
effective food safety approa
ch is one in which producers are financially motivated to produce safe food.  Under such an approach, the average consumer can, in fact, purchase any product off a store shelf with the peace of mind that the company that manufactured the product made safety a top priority.  It’s time we reward companies that are trying to create safer food products.  It’s also time we stop paying for industry profits with our lives.

  • Ann Quinn

    As a consumer, my reaction to this article is – without meaning disrespect because we have to do something fast in this country to improve food safety – fooey. You want me to bribe food producers, processors, and importers to make safe food products. Is that your premise? Use tax payer dollars to
    finance what the food industry should already be doing to stay in business?
    Where is this bribery going to stop? Food? Children’s toys? Safe cars? TVs and electronics that work right? Tires?
    You pass food safety laws and fund the government to enforce them completely and make the penalties for peddling unsafe food
    so harsh as to put companies out of business and CEOs and employees in jails for quite a while.
    Still coming out of the taxpayer’s pocket, but I like the presence of an independent third-party regulator better, rather
    than leaving it up to the untrustworthy, non-monitoring
    food industry to comply in any fashion, which they’ve shown no
    indications of doing for about the last four decades.
    As for consumers refusing to pay more for safe food, one way or another we’re going to have to anyway. At least with government inspectors enforcing strict food safety laws there’s
    a small chance we might get safer food.

  • Scott Hurd

    Some interesting thoughts… You point out one big weakness; no one will accept new tax. The idea of using that money for increased inspection is not encouraging. The prevalence of these pathogens is so infrequent, we can NEVER inspect or test the problem away.
    Currently there is a great disincentive for plants to find positive samples. They are concerned the Fed will use it against them or they will have to discard the meat.
    Additionally, the industry has agreed to not make food safety a competitive issue. Your suggestion may go against that trend.
    Unfortunately, I don’t have particularly good alternative suggestion, but wanted to add some data to the debate.

  • Hasn’t this tax already been put in place “with the U.S. Food Safety Enhancement Act of 2009 (HR 2749) having already passed the House and a similar Senate version (S510) on the fast track, mandated, system-wide traceability is coming. While food safety may be the catalyst, the benefits extend beyond food safety and into the supply chain by increasing visibility, and potentially long-term profitability.”?