GM Oh No! Part 3
of 3: Economic and political considerations
A
blog of Bridge
Environment, updated most Tuesdays
This
is the final entry in a three-part series about genetically modified organisms
(GMOs)
Over the preceding three weeks, I have discussed human, pig, and environmental health concerns
surrounding genetically modified (GM) foods, also known as GMOs. I argued that,
by focusing on short-term human health considerations, GMO opponents have
distracted us from more realistic and challenging long-term human and environmental
health concerns.
All
of these concerns are exacerbated and potentially eclipsed, though, by economic
and political dynamics. Often, people who bring up economic and political
concerns sound like conspiracy theorists. I promise to keep this discussion
rational and grounded in well-studied human behaviors. To make sense of this situation,
we need to examine monopoly power, intellectual property rights, and the
political influence of money.
In
general, western economies rely on competition to maximize collective benefit.
According to theory and much practice, competition among companies lowers
prices so that more consumers can enjoy them and spurs innovation towards
better products and more efficient production. Even though companies lose
profits from competition, collectively society does better because of the
benefits to consumers. In contrast, companies that secure monopolies can drive
prices up and slack off on in innovation to the detriment of consumers and
society in general. For these reasons, many economic rules and regulations
exist to deter monopolies and encourage competition.
There
is one major exception to this rule: intellectual property, or ownership over
ideas. The idea could be a musical composition, a new drug, or a GM technology.
When it comes to intellectual property, we explicitly allow monopolies for
periods of time, typically 20 years. Even though monopoly conditions allow the
owner of the idea or technology to charge much higher prices than a free market
would sustain, we allow them this reward for investment in innovation. If drug
companies couldn’t recoup costs of research into new drugs (both successful and
failed attempts) by charging a premium for their products, they would invest
less in new cures. Agricultural companies like Monsanto make large investments
in crop improvements using GM and other technology in part because intellectual
property laws allow them to monopolize the market for their new seeds. The US
Supreme Court recently ruled that companies cannot patent naturally-occurring
genes but did affirm the legality of patenting altered genomes of the GM
variety.
Thus,
our effort to spur innovation comes with the cost of monopoly power. Companies
that develop GMOs can use this monopoly power in several ways. They typically
only allow farmers to purchase GM seeds if the farmers sign agreements that
prohibit them from replanting next year’s crops using seeds they produced this
year. Instead, they have to buy new seeds from the company every year.
Companies also charge more than they would under competition. Without
competition, companies can charge a price equal to the net benefit that their
product provides to farmers. Thus, under monopolies all of the benefit of a new
technology goes to the company. With competition, the prices would be driven
down to the cost of manufacturing the seeds without regard to what it cost to
develop them. Thus, under competition farmers and consumers would gain all of
the benefit. Our system of intellectual property rights favors the companies.
A
system with companies as the primary beneficiaries of financial gains has
potential political implications. Though the US political system is driven by
votes, it is incontrovertible that money plays an outsized role. It buys
advertisements that allow a candidate to introduce themself to the public in
the most flattering of lights and to raise concerns, real or imagined, about
their opponent. It also buys complex get-out-the-vote operations, which
identify geographically favorable neighborhoods for the candidate and seek to
register residents and get them to the polls. As a result, the candidate with
the most money typically wins the election, making politicians potentially
susceptible to pressure from contributors. As a result of recent US Supreme
Court action overturning campaign spending legislation, companies can donate
unlimited funds to politicians. In doing so, they may be able to shape laws and
regulations. For example, campaign contributions most likely played a key role
in the recent defeat of US legislation to label GM foods and an unrelated
defeat of widely supported regulations to tighten registration requirements for
gun sales. Monopoly power and money could also affect the science to understand
potential human and environmental health effects. In order to avoid this undue
influence, we need regulatory agencies that are independent of political
influence and sufficiently funded to do their work. My own observations on
political influence on the detailed regulatory process would suggest that it is
relatively mild. However, ongoing government budget cuts do threaten the work
capacity of government agencies.
In
the previous three blog entries, I argued that environmental effects of GMOs
raise important concerns worthy of immediate additional study, and that
long-term human health effects may also be of concern. These conclusions are
based on the idea that the regulatory system is fair and thorough, traits that
monopoly power and political influence may challenge. In order to restore and
maintain the public’s trust in government regulators it is crucial that they
are shielded from political influence and funded sufficiently.
To
conclude, GMOs are an inevitable part of modern food supply and a logical step forward
in the production of better food organisms. Because this technology has the
potential for rapid and drastic change, we need to study carefully the acute
human health, long-term human health, and ecological risks. At present,
evidence suggests that acute human health risks are minimal but the jury is out
on the other two forms of risk. Unless we can maintain independent and
effective regulatory agencies, we run the risk of missing important concerns
until they become major problems.
Even
with effective regulators, the ultimate judgment regarding GMOs will come down
to their contribution to sustaining a human population that has grown
dramatically and continues to increase resource consumption per person. Next
week, I will discuss the “population problem.”
Best,
Josh
For
more information, read our other blog posts and visit us at Bridge Environment.
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