Senator Feingold's response to OMB BST report (fwd)
Alan Furchtenicht (FURCHT@macc.wisc.edu)
Thu, 03 Feb 94 07:14 CDT
From: IN%"bcepp@relay.adp.wisc.edu"
To: Multiple recipients of list <bcepp@relay.adp.wisc.edu>
Subject: Feingold response to OMB BS
Subject: Time:1:45
OFFICE MEMO Feingold response to OMB BST Report Date:2/3/94
To UW-Extension County Faculty, and to BCEPP Biotechnology Education and Public
Policy Colleagues.
Having sent you a copy of the executive summary of the report on BST written by
the Executive Branch, here is a copy of a press release from Senator Russ
Feingold critiquing the report.
Tom Zinnen
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Press release from U.S. Senator Russ Feingold
Wednesday, January 5, 1994
Contact: David Sandretti, 202/224-5323
FEINGOLD: ADMINISTRATION'S DRAFT REPORT CONFIRMS THE DEVASTATING IMPACT OF BGH
ON THE FEDERAL DEFICIT AND THE DAIRY INDUSTRY
MIDDLETON, WI-- Senator Feingold issued the following statement in reaction to
the draft report prepared by the Clinton Administration on the impact of
commercial use of BGH, bovine growth hormone, also called BST, bovine
somatotropin.
"Although much of the draft report is written like a promotion piece for
Monsanto, it contains some potentially devastating information, buried deep
beneath its pro-BGH rhetoric," said Feingold. Feingold identified five areas
of substantial concern including: 1) decline in dairy farm income; 2)
reduction in consumer demand; 3) increase in the federal deficit; 4)
competitive disadvantage for U.S. dairy exports; and 5) need for guidance on
voluntary labeling.
"First, according to the draft report, BGH will have a dramatic negative impact
on dairy farm income. It states that over the next six years dairy farm income
will drop by $1.3 billion as a result of BGH production, growing to annual
losses of $546 million by fiscal year 1999 (p. 30). That confirms some of our
worst fears that this product will result in significant loss of income in the
dairy industry and drive dairy farmers, many of whom are already barely
surviving, out of business. The consequences of this loss of income in rural
communities could well be enormous.
"Second, despite the fact that the Administration did not do its own consumer
survey, as it had promised, and although the report clearly attempts to
downplay the likely drop in milk consumption as a result of introduction of
BGH, it confirms the consistently negative views that consumers have expressed
for years regarding BGH in various studies and states that if the results of
previous BGH consumer studies translate into action, consumption among those
surveyed would drop by 4% to 20% and that 'the likelihood is high that
significant reduction in demand for milk and dairy products is anticipated
because of BST.' (p. 43). The effort to minimize the importance of these
facts, by citing surveys that Americans generally favor biotechnology and
expect to benefit from it in their own lives, was fairly transparent and even
the most skillful drafting could not disguise the evidence that consumers don't
want milk or milk products produced with BGH.
"Third, BGH is going to have an even greater negative impact on the federal
budget than we had originally projected. According to the draft report,
federal spending will increase as a result of BGH usage by between $300 million
and $500 million over the next six years. Even those figures are clearly gross
underestimates because the adverse budget projections are based solely upon
increase in milk productions and do not include any estimates of consumer
demand reductions, although the draft report itself acknowledges elsewhere the
likelihood of a drop in consumer demand. The drat report also attempts to
manipulate the budget projections by claiming, without providing any supporting
data, that the increased cost to the milk price support program would be offset
by decreases in costs to federal nutrition programs for low-income individuals
by lower milk prices. In fact, historically, declining milk prices paid to
farmers have had only a slight impact on consumer prices, a fact barely
acknowledged in the report. No matter how hard the draft report stretches,
including trying to use a ten year nutrition program projection against the six
year loss, the bottom line is the cost to the federal government for the milk
support program will go up by at least $65 million in the current fiscal year
because of BGH, and another $116 million in the FY 95 budget, and probably a
good deal more.
"Fourth, the draft report confirms that our three leading competitors in dairy
exports -- Australia, New Zealand, and the European Union -- are poised to
seize a competitive advantage over the U. S. because they have not approved
BGH; indeed, the draft report acknowledges that approval is not ever expected
in either New Zealand or Australia, two countries that together have a combined
share of about one-fourth the world dairy product exports (p. 52), and that the
European Union continues to resist approval because of the potential impact
upon the social and economic survival of the European small dairy farm
structure. The draft report tries to rationalize away the reasons that our
primary competition in the dairy export market are rejecting this product for
their dairy industries, but the facts remain clear: for the foreseeable
future, our major international competitors will be touting that their milk
exports are free of BGH and where consumer preference for products not produced
with BGH is translated into marketplace reaction, those countries, not the US,
will benefit.
"Fifth, the draft report, consistent with the initial FDA announcement of
approval of BGH, appears to accept the right of producers who chose not to use
BGH to engage in voluntary labeling. Indeed, the draft report suggests that
voluntary labeling is critical to allowing consumers concerned about BGH to
purchase milk and dairy products from untreated cows (p. 43) and that given the
consumer interest in having milk labeled as to whether it was produced with
BGH-treated cows, a 'market for labeled milk will develop'. (p. 42)
Unfortunately, there are signs of pressure being placed on FDA to back down
from its earlier statements regarding voluntary labeling. I have yet to
receive a response from a letter I sent on November 23, with Senators Leahy and
Kohl, and Representative Obey, asking the FDA to clarify its policy on
voluntary labeling so that processors and producers will know what is or is not
permitted to meet FDA requirements. Whether or not the Clinton Administration
is prepared to follow-through on its initial commitment to permit voluntary
labeling is a critical issue that will be decided in the coming weeks.
Feingold also stated, "Perhaps what was most disturbing about this draft report
is the utter lack of expressed concern for the economic consequences for the
dairy industry in the U.S. resulting from the $1.3 billion decline in dairy
farm income.
"Last August, when the Administration agreed to submit this report to Congress,
they also promised to include policy recommendations to help mitigate the
likely adverse impact that BGH approval would have on dairy farmers. The draft
report doesn't even address this issue, although it does express deep and
seemingly misplaced concern about adverse impact the 90 day moratorium had on
Monsanto Company by denying this particular company the opportunity to gain a
market share before competing products were put on the market and asserts that
further delays could cost as much as 400 jobs in the industry that produces
BGH.
"What about the number of dairy farmers who will be put out of business when
the dairy industry suffers a 1% decline in income over the next several years
as a result of BGH?
"Why doesn't this report which was supposed to focus on the impact on the dairy
industry provide comparable job losses for dairy farmers?
"Why is there no analysis of the impact on rural communities when farm income
drops by 1%?
"Why is there so much focus in the report on the importance of the public
accepting BGH and the adverse consequences that market place rejection of BGH
would have for the biotechnology industry?
"Several weeks ago, documents were released to the media indicating that
Monsanto had developed a plan to reach the highest levels of the Clinton
Administration to dissuade them from preparing a report that focused upon the
adverse social and economic consequences of BGH. It is clear from the most
cursory reading of the draft report, that they may well have succeeded in that
effort. A report which was to have focused on the dairy industry has become a
public relations piece for the politically powerful Monsanto Corporation.
Instead of helping to develop proposals to deal with the economic consequences
of this product on America's dairy farmers, the draft report reads like it was
prepared by the cheerleading squad for one particular industry, while dairy
farmers and the federal taxpayers pay the price."
Feingold issued this statement in response to media coverage of the draft
report. Feingold's office received an embargoed copy of the draft report on
the condition that it not be released to the public. For a copy of the report,
contact the Office of Management and Budget's Public Affairs Office.
(End of Feingold press release).
Typed by Tom Zinnen, University of Wisconsin Biotechnology Center and
UW-Extension, from a faxed copy of the press release.