The Potential Impacts of Mandatory

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The Potential Impacts of Mandatory
Number 54
                                                                                                                                       April 2014

  The Potential Impacts of Mandatory
Labeling for Genetically Engineered Food
           in the United States

No label is currently required for genetically engineered food in the United States. This Issue Paper discusses the potential
legal and economic implications of mandatory GE labeling. (Source photo and artwork from Shutterstock.)

Abstract                                               using GE ingredients are safe. They                     • Public opinion, polls, and methods
                                                       gather factual information to produce a                   used
    Although genetically engineered                    peer-reviewed publication that clari-                   • Consumer choice and interpreta-
(GE) products are used around the                      fies the potential impacts of mandatory                   tions that support both sides in this
world, their use in food products has                  labeling.                                                 respect
become a contentious issue for some                         Proponents of mandatory GE label-
consumers. A key point in the resulting                ing cite the right to know what is in                   • Right-to-know issues—and the
debate centers on proposals regarding                  their food as an important attribute of                   complications inherent with the
the mandatory labeling of GE food.                     a democratic society. Opponents think                     right to know “what” and “at what
    Many U.S. states are considering                   that such a label will increase the cost                  cost”
legislation to mandate such labels. This               of food and confuse consumers with no                   • Food safety and testing—and the
publication examines arguments for                     corresponding improvement in human                        lack of any evidence that GE foods
and against labels, the costs involved                 health or food safety. Seemingly con-                     have harmful effects
with labeling, and experiences in                      tradictory studies are cited to support
countries that use mandatory labeling.                                                                            Many state labeling initiatives
                                                       opposing views—informed discourse
The authors start from the premise                                                                            suggest there are remaining food
                                                       about this emotional issue is hard to
that hundreds of independent stud-                                                                            safety concerns about GE organisms
                                                       find. The authors examine key aspects
ies have determined that foods made                                                                           and, therefore, mandatory labeling
                                                       of the arguments:

Any opinions, findings, conclusions, or recommendations expressed in this publication are those of the author(s) and do not necessarily reflect the views of
CAST.
CAST Issue Paper 54 Task Force Members
                     Authors                     Thomas P. Redick, Global Envi-             Mark Lynas, College of Agriculture
                                                 ronmental Ethics Counsel, LLC,             and Life Sciences–International
                                                 Clayton, Missouri                          Programs, Cornell University,
       Alison Van Eenennaam (Chair),
                                                                                            Ithaca, New York
       Department of Animal Science,                          Reviewers
       University of California, Davis                                                      Gary Marchant, Sandra Day
                                                 Julian M. Alston, Department of            O’Connor College of Law, Arizona
       Bruce M. Chassy, Department of                                                       State University, Tempe
       Food Science and Human Nutrition,         Agricultural and Resource Economics,
       University of Illinois at Urbana-         University of California, Davis
                                                                                                     CAST Liaison
       Champaign                                 Paula Fitzgerald, Biotechnology and
                                                 Strategic Initiatives, Dairy Australia,
       Nicholas Kalaitzandonakes,                                                           A. David Scarfe, Scientific Activi-
                                                 Victoria
       Department of Agricultural and                                                       ties Division, American Veterinary
       Applied Economics, University of          Richard E. Goodman, Department             Medical Association, Schaumburg,
       Missouri, Columbia                        of Food Science and Technology,            Illinois
                                                 University of Nebraska, Lincoln

    should be implemented. Some say               5. Mandatory labeling will increase            The use of GE in the production of
    these products are intrinsically different         food costs.                          these widely used products is relatively
    because they would not have occurred              The authors finish with a call for    noncontroversial; however, the applica-
    in nature through natural processes. To      better communication about this issue:     tion of rDNA technology to produce
    date, no material differences in compo-      “Independent objective information on      GE or transgenic plants and animals
    sition or safety of commercialized GE        the scientific issues and the possible     that are used as food has proved to be
    crops have been identified that would        legal and economic consequences of         highly contentious for some consumers.
    justify a label based on the GE nature       mandatory GE food labels need to be        The purposes of this paper are to (1)
    of the product. Whereas this conclusion      provided to legislators and consum-        explore the scientific, legal, and eco-
    will not satisfy those who consider the      ers, especially in states with labeling    nomic aspects of requiring food labeling
    insertion or manipulation of genes in a      initiatives on the ballot, to help move    in the United States based on the use of
    laboratory a material difference per se,     the national discussion from conten-       a process (i.e., GE) rather than on some
    the science of food safety does not sup-     tious claims to a more fact-based and      attribute of the food product itself, and
    port mandatory process-based labeling        informed dialog.” All legislative refer-   (2) clearly discuss the complex consid-
    of GE food and, by extension, neither        ences in this document were current as     erations that come into play when con-
    does the Food and Drug Administration.       of March 1, 2014, at the completion of     templating mandatory GE food labeling
         This paper examines legal issues—       writing.                                   in the United States.
    the Commerce Clause, the First Amend-                                                        Genetically engineered organisms
    ment, label location, state versus                                                      and products made from them go by
    national jurisdictions—and economic          Introduction                               many names, including genetically
    impacts. The authors conclude the                Genetic engineering (GE) can be        modified (GM), genetically modified
    following:                                   defined as the manipulation of an organ-   organism (GMO), transgenic, biotech,
     1. There is no science-based reason         ism’s genes by introducing, eliminating,   bioengineered, or products made with
          to single out GE foods and feeds       or rearranging specific genes using the    modern biotechnology. Given that tra-
          for mandatory process-based            methods of modern molecular biology,       ditional breeding techniques also result
          labeling.                              particularly those techniques referred     in genetic modifications and hence
                                                 to as recombinant deoxyribonucleic         this term is not specific for the use of
     2. Mandatory labeling based on pro-                                                    rDNA, in this document the term GE is
          cess abandons the traditional U.S.     acid (rDNA) techniques. Genetically
                                                 engineered microorganisms, and prod-       used rather than the more common and
          practice of providing for consumer                                                pervasive, but less precise, term GM.
          food preferences through volun-        ucts derived from them, have found
                                                 widespread use in the pharmaceutical       Typically, food produced using GE food
          tary product differentiation and                                                  processing aids or enzymes, and the
          labeling.                              (e.g., human insulin used by diabetics),
                                                 chemical, and food (e.g., rennin used      meat, milk, and egg products derived
     3. Market-driven voluntary labeling         to produce cheese) industries with no      from animals that have eaten GE feed
          measures are currently providing       documented reports of adverse impacts.     or been treated with GE therapeutics or
          consumers with non-GE choices.         In general, GE labels are not required     vaccines, have not been considered to
     4. Mandatory labeling could have            on these products, or the foods result-    be GE foods.
          negative implications for First        ing from their use in food processing,          A total of 165 GE crop events in
          Amendment rights and trade             in any part of the world (Mansour and      19 plant species (alfalfa [2], canola
          issues.                                Key 2004).                                 [20], chicory [3], corn [38], cotton

2   COUNCIL FOR AGRICULTURAL SCIENCE AND TECHNOLOGY
[27], creeping bentgrass [1], flax [1],
melon [2], papaya [3], plum [1], potato
[28], rice [3], rose [2], soybean [19],
squash [2], sugar beet [3], tobacco [1],
tomato [8], and wheat [1]) have been
approved in the United States (ISAAA
2013), although not all of these events
are being grown commercially, and no
GE animals have yet been approved
for food purposes as of the time of this
writing.
      The first GE food product to come
to the U.S. market in 1994, the Mac-
Gregor’s brand of tomato grown from
GE seeds, bore a voluntary GE label.
It was branded with the Flavr Savr®
name and was accompanied by in-store
information about the delayed-softening
characteristic. Since that time, grow-        Figure 1. Adoption of GE crop varieties in the United States, 1996–2013
ers have adopted approved GE crops                      (HT = herbicide-tolerant; Bt = Bacillus thuringiensis). Data for each crop
extensively. For example, in 2013 GE                    category include varieties with both HT and Bt (stacked) traits. Sources:
                                                        USDA–Economic Research Service using data from Fernandez-Cornejo
varieties were planted on 95% of sugar                  and McBride (2002) for the years 1996–1999; USDA–National Agricultural
beet, 93% of soy, and 90% of all cotton                 Statistics Service, June Agricultural Survey for the years 2000–2013.
and corn hectares in the United States                  (Figure adapted from USDA–ERS [2013a].)
(USDA–NASS 2013a), and similar
rates of adoption were observed in other      many food products in the United States          At least 25 states have considered
major agricultural producing countries        include ingredients such as corn oil, soy   proposed legislation to require GE
such as Argentina, Brazil, Canada, and        protein, or beet sugar that might have      labeling (see Figure 2). Many of these
South Africa.                                 been derived from a GE crop variety. It     were bills that progressed through
     In 2013, approximately 175.2 mil-        has been estimated that at least 70% of     the legislative process to hearings, or
lion hectares (433 million acres) of GE       processed food items in the supermarket     even committee or floor votes in some
crops were cultivated worldwide (James        contain at least one ingredient derived     cases, but were eventually defeated,
2014) by 18 million farmers. More than        from a GE crop, often the additive soy      withdrawn, or held. Three statewide
90% (>16.5 million) were small-scale          lecithin or various oils (Cornell Coop-     initiatives requiring labeling—one in
resource-poor farmers in developing           erative Extension 2003).                    Oregon in 2002 (Measure 27), one in
countries. This planting was greater
than a 100-fold increase from the 1.7
million hectares that were planted in
1996, making GE the fastest-adopted
crop technology in recent history. Farm-
ers have planted these GE varieties to
enable the adoption of improved agro-
nomic practices (e.g., no-till agriculture,
decreased insecticide applications,
use of less toxic herbicides) provid-
ing environmental, economic, and
food security benefits (Ali and Abdulai
2010; Burachik 2010; Carpenter 2013;
Fernandez-Cornejo et al. 2014; Huang
et al. 2010; Kathage and Qaim 2012;
Qaim and Kouser 2013). For the period
1996–2011, it has been estimated that
the cumulative economic benefits from
cost savings and added income derived
from planting GE crops was US$49.6
billion in developing countries and
US$48.6 billion in industrial countries
(Brookes and Barfoot 2013).
                                              Figure 2. Food labeling activity—2013. (See Table 1 [Appendix] for sources that
     As a result of the widespread use of               provide details, including selected text and exemptions from proposed
this technology in agriculture (Figure 1),              and defeated legislation.)

                                                                          COUNCIL FOR AGRICULTURAL SCIENCE AND TECHNOLOGY            3
California in 2012 (Proposition 37), and     • CON: Consumers in the United            and any intended changes in composi-
    one in Washington in 2013 (Initiative           States who want to avoid GE prod-      tion as well as evaluating if any poten-
    522)—were not supported by a majority           ucts already have that choice avail-   tially harmful unintended changes have
    of the voters. The only mandatory label-        able through voluntary non-GE and      occurred. It is accepted that all breeding
    ing law enacted to date is an Alaskan           organic labeling. In countries that    produces unintended changes; however,
    law that requires labeling of GE fish           have implemented mandatory GE          the great majority of these are without
    (none of which has yet been approved            labeling, GE products have gener-      safety implications. Thus, changes per
    for food purposes by the Food and Drug          ally been removed from the market;     se are not considered to pose new risks.
    Administration [FDA]) sold in the state.        so choice has decreased (Marchant,     Questions that must be addressed in
    Connecticut and Maine have passed               Cardineau, and Redick 2010).           such regulatory evaluations include the
    bills with limitations (e.g., one border-       Right to Know                          following:
    ing state and three other states with a                                                  • Does the GE food, and/or the
    total population collectively exceeding      • PRO: People have the right to know
                                                    what is in their food (Raab and            newly introduced substance, have
    20 million people must enact similar                                                       a traditional counterpart that has a
    labeling rules), and several others are         Grobe 2003). Mandated calorie and
                                                    nutritional content panels on pack-        history of safe use?
    still pending (Wattles 2013).
         Proponents of mandatory GE label-          aged foods are examples of labels        • Have any toxins or allergens been
    ing cite the right to know what is in           to inform consumers about food             introduced and has the concentra-
    their food as an important attribute of         composition.                               tion of any naturally occurring
    a democratic society. Opponents have         • CON: The right to know what is in           toxins or allergens in the food
    countered that such a label will increase       food is different from the right to        changed?
    the cost of food and confuse consumers          know how it was produced. Further-       • Have biologically significant com-
    with no corresponding improvement in            more, this uniquely singles out GE         positional changes occurred and,
    human health or food safety. Various            technology—not other production            in particular, have levels of key
    seemingly contradictory studies are fre-        methods and processes—for right to         nutrients changed?
    quently cited to support opposing views,        know.
    and civil, informed discourse about this                                                    According to the American Associa-
                                                     Polls suggest consumers would like    tion for the Advancement of Science,
    important and frequently emotional is-
                                                to see label information about many        GE crops are “the most extensively
    sue is hard to find. There are three main
                                                production methods and processes (e.g.,    tested crops ever added to our food
    themes that are associated with manda-
                                                sprayed with pesticides) (CSPI 2001).      supply” (AAAS 2012). During the past
    tory GE labeling, with the following
                                                There is, however, no prima facie case     20 years, the FDA has found that all
    arguments for and against it:
                                                that consumers have the right to know      148 transgenic gene/crop combinations
        Public Opinion                          everything through mandated labels         evaluated by the agency (including all
     • PRO: Polls show an overwhelming          or that labels be required at any cost     biotech crops commercialized to date,
        majority of people support manda-       (Kalaitzandonakes 2004). Mandating         despite the fact that this premarket safe-
        tory labeling of GE foods when          process-based food labeling is a very      ty review is technically voluntary) are
        specifically asked if “the federal      complex topic with nuanced market-         equivalent to their conventional coun-
        government should require labels        ing, economic, and trade implications      terparts. Japanese regulators indepen-
        on food saying whether it’s been        depending on how the labeling laws are     dently reached the same conclusions for
        genetically modified, or ‘bio-          written and how the market responds.       189 submissions they reviewed. These
        engineered’” (Langer 2013).                                                        submissions spanned biotech corn,
     • CON: In unprompted polls in which        Food Safety                                soybean, cotton, canola, wheat, potato,
                                                                                           alfalfa, rice, papaya, tomato, cabbage,
        participants are asked what ad-             The premarket food safety assess-
        ditional labeling they would like                                                  pepper, raspberry, and mushroom,
                                                ment of GE foods and feeds evaluates       and they included traits of herbicide,
        to see on food, more than 99% of        risks that might be associated with
        respondents do not volunteer a de-                                                 drought and cold tolerance, insect and
                                                newly introduced nucleic acids, novel      virus resistance, nutrient enhancement,
        sire to see mandatory labeling of GE    proteins encoded by the inserted genetic
        foods (IFIC 2012).                                                                 and expression of protease inhibitors
                                                material, and both intended and un-        (Herman and Price 2013).
        Consumer Choice                         intended changes in composition that            There is also an extensive body
                                                might be associated with the develop-      of scientific research performed by
     • PRO: People should have a choice
                                                ment process (CAST 2001; Chassy            independent scientists from around the
        regarding what types of products
                                                2010; Chassy et al. 2004). There is        globe on this topic (Nicolia et al. 2013).
        they purchase and consume. Many
                                                general agreement that novel compo-        Hundreds of peer-reviewed publications
        believe that this should include the
                                                nents introduced through GE, as well as    involve GE feeding studies on a wide
        choice to “vote with their wallets”
                                                any changes in endogenous metabolites,     variety of species—including laboratory
        about how the food was produced
                                                must be demonstrated to be safe for        rodents, chickens, quail, pigs, sheep,
        even if it does not result in any
                                                humans and animals to consume.             dairy cows, beef cattle, goats, rabbits,
        change or consequence for the food
                                                    Safety assessment focuses on the       buffalo, and fish—measuring feed
        product itself.
                                                safety of newly introduced components      intake, nutrient digestion, performance,

4   COUNCIL FOR AGRICULTURAL SCIENCE AND TECHNOLOGY
and health (Flachowsky, Shafft, and            labeling should be required. In the             sumer would not expect to be present in
Meyer 2012). These studies, includ-            United States, the Food, Drug, and Cos-         a specific type of food. As an example,
ing some long-term research spanning           metic Act (FDCA) grants authority for           if a peanut protein was inserted into a
multiple generations and many years,           food labeling to the FDA. The FDCA              tomato, the product would need to be
generally support the conclusion that          Section 403(a)(1) states that a food is         labeled to warn individuals allergic to
there are no detrimental effects from the      misbranded if its labeling is untrue or         peanuts that the GE tomato may present
consumption of the currently available         misleading, whereas Section 201(n)              an allergenic risk unless the developer
biotech crops (Snell et al. 2012).             states that a label is misleading if it fails   could demonstrate that there was no
    Additionally, no differences in            to reveal “material facts” about a prod-        allergy risk from that peanut gene. To
the composition of animal products—            uct. Material facts have been interpreted       date, no GE products have required
including meat, milk, and eggs—have            by the FDA to mean (1) changes in               such a specific label.
been observed between animals fed con-         health or environmental safety posed by              It should be noted that the FDA al-
ventional or biotech crops or their prod-      the product, (2) statements that might          lows voluntary process-based labeling
ucts (CAST 2006). A 2011 summary               mislead the consumer in light of other          as long as it is not false or misleading. In
report from the European Commission,           information on the label, and (3) a food        2001, the FDA put out a draft guidance
covering a decade of publicly funded           label that might cause a consumer to ex-        that set forth requirements for industry
research, 130 research projects, and 500       pect that the product closely resembles         as to acceptable language for voluntary
research groups, similarly concluded           a food product from which it differs            labels on products not containing any
that there is no scientific evidence           in one or more significant characteris-         GE ingredients (USFDA 2001). The
of higher risks from GE crops to the           tics. The FDA would require labels on           guidance stated that it is not possible to
environment or for food and feed safety        products that demonstrably pose novel           demonstrate a zero level of GE ingredi-
(European Commission 2011). This               hazards that might affect safety or have        ents and therefore prohibits claims that a
report found no evidence that GE foods         significant unexpected differences in           food is GE “free.” It also advised that “a
have any harmful or long-term effects          composition. These are material facts.          label statement that expresses or implies
over multiple generations. Although a          In contrast, production methods that            that a food is superior (e.g., safer or of
handful of widely publicized small stud-       create no material difference in products       higher quality) because it is not bioen-
ies have claimed to find some adverse          require no special labeling.                    gineered would be misleading” given
health impacts of GE foods on animals,              The FDA has stated that it has no          the lack of evidence that GE foods are
these studies have been retracted and/or       basis for finding that GE foods “dif-           materially different from non-GE foods.
severely criticized by government and          fer from other foods in any meaning-            It was also considered that it would be
mainstream scientific organizations as         ful or uniform way, or that, as a class,        misleading to label a food or ingredient
poorly designed and unreliable.                foods developed by the new techniques           as being non-GE, when in fact no com-
    The U.S. National Academy of               present any different or greater safety         mercialized GE varieties of that food or
Sciences concluded in 1987, and reaf-          concern than foods developed by                 ingredient exist on the market.
firmed in 2000 and 2004, that GE poses         traditional plant breeding” (USFDA                   Although the food safety of GE
no new or different risks to food safety       1992). Therefore, since GE production           crops and animals, and ingredients
(NAS 2004). Likewise, the American             methods create no material difference           derived from them, has been reviewed
Medical Association wrote the follow-          in products, no label is required for GE        by the FDA prior to introduction of all
ing in 2012: “There is no evidence that        foods. In the two decades since this            new GE varieties commercialized to
unique hazards exist either in the use of      initial finding, the FDA has not encoun-        date, some have expressed concerns that
rDNA techniques or in the movement of          tered any evidence or data that have            GE crops are inherently less safe than
genes between unrelated organisms.…            caused it to change its position despite        those produced by other plant-breeding
The risks associated with the introduc-        having reviewed regulatory packages on          techniques. Their major safety conten-
tion of rDNA-engineered organisms              more than one hundred GE events (Her-           tion is that the process of GE per se can
are the same in kind as those associated       man and Price 2013).                            produce unintended changes resulting
with the introduction of unmodified or-             If a new GE process changed a              in long-term adverse consequences.
ganisms.” The association then went on         product such that it differed significant-      Advocates of mandatory labeling have
to conclude that “... there is no scientific   ly from its conventional counterpart, the       argued that GE foods are by definition
justification for special labeling of bio-     FDA could require labeling for those            altered in composition by virtue of the
engineered foods, as a class” (American        specific qualities. For instance, since         presence of genetic material introduced
Medical Association 2012).                     high omega-3 and high oleic vegetable           through rDNA methods. A key driver
                                               oils differ significantly in composition        of concern about GE food safety is that
Food Labeling                                  from their conventional counterparts,           these products are intrinsically different
                                               the FDA could require that these oils           because they would not have occurred
    Despite these scientific assess-           be labeled—not because they were pro-           in nature through natural processes.
ments by independent and authoritative         duced using GE, but because there is a               Charles Darwin observed that very
scientific organizations globally, many        material difference in the oil products.        few of the world’s cultivated crops arise
of the state labeling initiatives have              The FDA could also require label-          from nature; most have been extensive-
included text suggesting that there are        ing for potential allergenicity if the food     ly genetically modified by human in-
remaining food safety concerns about           contained a novel allergen that a con-          tervention. First, genetic modifications
GE food and, therefore, mandatory

                                                                              COUNCIL FOR AGRICULTURAL SCIENCE AND TECHNOLOGY                 5
resulting from spontaneous mutations         York, Pennsylvania, Rhode Island, or         cussed earlier, the federal FDCA grants
    were selected by breeders based on           Vermont) that enacts such a law must         the FDA authority over food labeling
    their effect on phenotype; then, in more     collectively have a total population of      and expressly prohibits states from
    recent times, genetic modifications were     more than 20 million people. In passing      imposing labeling requirements that
    created through mutagenesis breeding         such conditional laws, states likely rec-    are different from the FDA’s require-
    techniques (exposing seeds to chemicals      ognized the potential threat of litigation   ments. The FDA has taken the position
    or radiation in order to generate muta-      to overturn a single state GE labeling       that process-based labels would not be
    tions). New genes have been acquired         law and perhaps also the difficulty com-     required for GE food products that are
    by plants through horizontal gene            panies might face complying with food        comparable in composition to similar
    transfer throughout evolution and more       labeling laws that differ among states.      food products. At a 2010 hearing to
    recently have been introduced through            Whatever the scope, the passage of       reconsider GE labeling, FDA officials
    plant breeding among related species.        state-based GE labeling laws is likely       suggested doing so would open the
    New genes have arisen spontaneously—         to be associated with legal challenges.      door to any number of processes that
    at least three new plant genes in the last   There are three major legal issues           interest consumers. It is likely that state
    century (Weber et al. 2012). Domes-          associated with state laws mandating         GE food labeling requirements would
    ticated plants are thus not unchanged,       process-based GE labeling.                   be preempted by the FDCA because
    nor would they exist today without                                                        the FDA has explicitly decided not to
    extensive human intervention. There are      Commerce Clause of the                       require labeling of GE foods. In recent
    no published scientific studies provid-      U.S. Constitution                            court cases, the potential preemp-
    ing evidence that passive or natural                                                      tive effect of the FDCA has also been
    genetic and phenotypic changes pose               The Commerce Clause of the U.S.         discussed. Most notably, the Ninth
    fewer hazards than those introduced by       Constitution grants Congress the power       Circuit, which covers the West Coast
    in vitro rDNA methods. In fact, some         to regulate interstate commerce and          (California, Oregon, Washington, etc.),
    studies have found that plant mutagen-       forbids individual states from unduly        has recently ruled that the FDCA pre-
    esis induces more changes than rDNA          burdening interstate commerce (U.S.          empts unfair competition claims (Pom
    GE technologies (Batista et al. 2008;        Const. art. 1, sec. 8, cl. 3). So even if    Wonderful LLC v. Coca-Cola Co. 2012)
    Ricroch, Bergé, and Kuntz 2011).             consumers in a given state vote to sup-      in a decision that could be applied to a
         To date, no material differences in     port mandatory GE labeling legislation,      state’s attempt to label GE food.
    composition or safety of commercial-         federal law may not allow it. In general,
    ized GE crops have been identified that      a U.S. state violates rules on interstate    The First Amendment Protec-
    would justify a label based on the GE        commerce if it passes laws mandating
    nature of the product. While this conclu-    that food manufacturers who create           tion of Commercial Speech
    sion will not satisfy those who consider     products for national and international           This legal barrier was actually used
    the insertion or manipulation of genes       markets must label them for a single         to stop a state (Vermont) from imposing
    in a laboratory a material difference        state. Pending cases are defining the        mandatory labeling for a process used
    per se, the science of food safety does      boundaries—generally, a state law may        on dairies in the production of milk in
    not support mandatory process-based          not discriminate against out-of-state        1996 (administration of recombinant
    labeling of GE food and, by extension,       products or unduly burden interstate         bovine somatotropin [rBST], a type of
    neither does the FDA.                        commerce. Courts will limit a state law      growth hormone). The First Amend-
                                                 that impedes trade and forces compa-         ment prohibits government compulsion
                                                 nies to label their products to comply       of commercial speech unless the speech
    Legal Issues                                 with only a few U.S. states’ laws.           is factual, uncontroversial, and reason-
        No comprehensive GE labeling law         Although the oldest of the legal barri-      ably related to a legitimate government
    has yet passed in any state. Alaska’s law    ers, this one may be weaker than those       interest. Although commercial speech is
    requires labeling of any GE food made        that follow in light of recent decisions     accorded less protection than political
    from a GE fish—although none is yet          (e.g., a California federal court recently   expression under the First Amendment,
    available on the market in the absence       allowed Alameda County to maintain a         “the right not to speak inheres in politi-
    of a regulatory decision from the FDA        drug take-back program) [Karst 2013],        cal and commercial speech alike, and
    regarding the approval or otherwise          and a similar challenge to California’s      extends to statements of fact as well as
    of the fast-growing GE AquaBounty            low carbon fuel standard may be surviv-      statements of opinion” (International
    Salmon (Anthes 2013). In Connecticut         ing legal debate [Griffin 2014; Rocky        Dairy Foods Association v. Amestoy
    and Maine, conditional legislation has       Mountain Farmers Union v. California         1996).
    been passed stipulating that GE labels       Air Resources Board 2014]).                       As noted earlier, Vermont’s manda-
    would be required to appear on prod-                                                      tory process-based labeling of a prod-
    ucts in the state’s supermarkets only        Supremacy Clause of the                      uct produced using a GE protein was
    after two conditions are met: (1) four                                                    found to violate the First Amendment.
    other states, including a bordering state,
                                                 U.S. Constitution and FDCA                   Dairy manufacturers contested a law
    must enact similar labeling rules; and       Preemption                                   that read “if rBST has been used in the
    (2) the aggregate population of any              Under the Supremacy Clause of the        production of milk or a milk product for
    Northeast states (Maine, Massachusetts,      U.S. Constitution, federal law prevails      retail sale in this state, the retail milk or
    New Hampshire, New Jersey, New               in any conflict with state law. As dis-      milk product shall be labeled as such.”

6   COUNCIL FOR AGRICULTURAL SCIENCE AND TECHNOLOGY
They demonstrated a likelihood of pre-       trade law. Many of the GE labeling laws      ers are doubly verifying their certified
vailing on a First Amendment challenge       in the 64 countries around the world         organic products with the Non-GMO
to a law requiring them “to identify         that require GE labeling likely violate      Project Verified and other non-GE certi-
products which were, or might have           the World Trade Organization (WTO)           fication programs (Gallo 2013).
been, derived from dairy cows treated        and its 1994 Sanitary and Phytosanitary           Some U.S. food merchants have
with a synthetic growth hormone used         Agreement, which frowns on process-          gone even further. In March 2013, the
to increase milk production,” arguing        based labels mandating disclosure of         retail chain Whole Foods Market set a
that the compelled speech violated their     information on production-process            deadline that all products sold in its U.S.
First Amendment rights and that the          issues that do not relate to food safety     and Canadian stores must be labeled to
state had not advanced a governmental        (CSPI 2000).                                 indicate if they contain GE ingredients
interest sufficient to require the speech.        Indeed, the United States has lost      (using a ≥ 0.9% GE content threshold
The state did not argue that the require-    two recent WTO decisions that ruled          for labeling) by 2018 (Robb and Gallo
ments were to raise public health, but it    against U.S. laws requiring production-      2013; The Organic and Non-GMO Re-
instead argued that Vermont citizens had     process labeling on dolphin-safe             port 2009). Altogether, these voluntary
a right to know whether or not the milk      products and country-of-origin labeling      measures provide consumers with non-
products were produced using rBST.           (COOL). Both laws were designed to           GE choices in the U.S. marketplace at
The court held that gratifying “customer     inform consumers about process or ori-       commercially achievable standards (The
curiosity” by mandatory labeling of an       gin information not impacting the food       Organic and Non-GMO Report 2007).
accurate factual statement was insuf-        itself. These interests could have been           In February 2014, the Grocery Man-
ficient to compel speech if it “involves     better served by voluntary international     ufacturers Association announced the
neither health concerns nor other            standards, if the market justified them.     creation of a 33-member group called
substantial interests” and thus failed to    These WTO decisions point toward             The Coalition for Safe Affordable Food
demonstrate a substantial government         potential future challenges of GE label-     (www.CFSAF.org), which is calling for
interest (International Dairy Foods As-      ing laws that disrupt trade (Jurenas and     federal legislation that would require
sociation v. Amestoy 1996).                  Greene 2013).                                mandatory premarket approval of GE
     Genetic modification labeling                The United States has not challenged    food ingredients by the FDA and grant
advocates argue that the FDA has previ-      a GE labeling law at the WTO, despite        authority to the agency to label products
ously mandated labeling for a produc-        calls from major U.S. commodity trade        that raise safety concerns, set up a vol-
tion process, irradiation. This mandate      associations to do so and the fact that it   untary program for food companies to
was based not on safety concerns             is estimated that European Union (EU)        label foods for the absence or presence
about irradiated food, but rather on the     labeling laws prevent billions of dollars    of GE ingredients, and define the term
fact that the irradiation process can        in U.S. trade to the EU (Bernauer 2003).     “natural” for its use on food and bever-
cause changes in flavor or shelf life of     Canada and Mexico could similarly as-        age products.
finished foods. These changes could be       sert that a U.S. GE labeling law violates
significant and material in light of the     the WTO, just as they challenged U.S.        Location of the Label
consumer’s perception of such foods as       laws on dolphin-safe and COOL. Both
unprocessed. This distinction explains       the WTO and U.S. interstate com-                 A final issue is that of the GE label
the differential FDA policies toward the     merce laws favor voluntary standards,        placement. Some of the proposed
use of mandatory labels for irradiation      and the existing voluntary Non-GMO           legislation requires the GE designation
and GE processes.                            Project (www.nongmoproject.org) and          to be conspicuously present on the front
                                             other similar certification and labeling     of the package or retailer’s display (for
                                             programs provide a “less burdensome”         raw produce). For example, the failed
National GE Labeling Law                                                                  Washington State initiative (Washing-
                                             alternative to mandatory labeling.
    An alternative to state-by-state              Indeed, in recent years a large         ton Initiative Measure No. 522 2012)
laws would be the implementation of          number of food products indicating           required the following:
a national GE labeling law. In 2013, a       the absence of GE ingredients through            In the case of a raw agricultural
proposed federal labeling bill entitled      non-GE or organic labels have also               commodity, on the package offered
The Genetically Engineered Food              been offered in the U.S. market. Food            for retail sale, with the words “ge-
Right-to-Know Act was introduced             manufacturers and retailers have volun-          netically engineered” stated clearly
simultaneously in the Senate (S 809) and     tarily labeled such products, and often          and conspicuously on the front of
House (HR 1699) to require the FDA to        third-party organizations have certified         the package of such a commodity,
mandate GE labeling. The bills have 9        the accuracy of the claims and labels.           or in the case of such a commodity
cosponsors in the Senate and 22 cospon-      More than 14,800 food products and 800           that is not separately packaged or
sors in the House.                           brands are reported to have been certi-          labeled, on a label appearing on the
    There are some international trade       fied as meeting the Non-GMO Project              retail store shelf or bin where such
implications that would result from the      standard alone (Brown 2013). Another             a commodity is displayed for sale;
passage of such a law. If the United         option consumers have is to buy organic          In the case of any processed food,
States were to mandate labeling of GE        products, because the use of GE is not           on the front of the package of such
food, the United States would have to        allowed in certified organic production          food produced by a manufacturer,
show a scientific health threat in order     systems. Additionally, some manufactur-          with the words “partially produced
to be in compliance with international

                                                                          COUNCIL FOR AGRICULTURAL SCIENCE AND TECHNOLOGY               7
with genetic engineering” or “may        in order to keep such products from          The Costs of Alternative
        be partially produced with genetic       commingling with GE or conventional          Purity Standards and
        engineering” stated clearly and          products across the food supply chain;
        conspicuously.                           and various testing, certification, and      Tolerances
        No rationale or justification has        traceability costs that must be paid to           The incremental costs associated
    been advanced for this label placement,      demonstrate the authenticity of such         with the production and distribution
    which would separate the GE label from       products when they are bought and sold       of non-GE foods are not fixed and are
    preexisting nutritional and ingredient in-   (Kalaitzandonakes, Maltsbarger, and          heavily dependent on the GE purity
    formation. Consumers tend to overstate       Barnes 2001). Suppliers of non-GE and        standards and tolerances used (Gianna-
    the importance of labels that are placed     organic products are compensated for         kas et al. 2011). Purity thresholds and
    only on the front of a package and           their higher costs through price pre-        tolerances are used to recognize that
    separated from nutritional and health        miums they receive from buyers. For          perfect avoidance (or zero tolerance)
    information (Costanigro, Deselnicu, and      instance, the prices received by U.S.        of GE material is difficult to achieve in
    Kroll 2012). Mandating producers and         non-GE corn and soybean producers in         practice. Agricultural land, transport,
    retailers to prominently display such        recent years have averaged 15% more          storage, and processing facilities are
    a label implies that consumer knowl-         than the prices received by conven-          broadly shared in the food sector, and
    edge about GE is more important than         tional commodity producers. Likewise,        perfect segregation of any agricultural
    nutritional content or ingredients. In the   the prices received by U.S. organic          product is typically not possible. Toler-
    absence of an identified material differ-    corn and soybean growers have at             ances set for the presence of GE mate-
    ence in GE products, such prescriptive       times been more than twice the prices        rial are determined with best industry
    compelled speech would likely increase       received by the nonorganic growers           practices in mind and permit small
    the chance of a Constitutional First         (Figure 3).                                  unintended GE amounts that can be
    Amendment objection.                              Premiums paid to suppliers of non-      present in non-GE or organic foods.
                                                 GE and organic agricultural products              When GE tolerances are set to be
                                                 along with certification costs are carried   very low, segregation methods must be-
    Economics                                    all the way to the final processed, pre-     come more stringent. When that occurs,
                                                 pared, and ready-to-eat foods that make      the incremental production, segregation,
    The Costs of Non-GE Foods                    use of such ingredients and are paid by      and certification costs of non-GE prod-
         Adequate information that allows        consumers in the form of higher prices.      ucts increase disproportionally, however,
    consumers to make choices consistent         For example, according to analysis of        because the relative effectiveness of
    with their preferences is an essen-          scanner data, the prices U.S. consumers      more stringent segregation methods
    tial feature of well-functioning food        paid for organic ice cream, margarine        diminishes with lower tolerances (Huy-
    markets. Food labels can contribute          spreads, and eggs were, respectively,        gen, Veeman, and Lerohl 2004; Kalait-
    useful information and can assist in         120%, 100%, and 80% higher than              zandonakes, Maltsbarger, and Barnes
    consumer decision making. Organic            the U.S. average prices of conven-           2001). Increasingly higher production
    and non-GE foods provide interested          tional products for the 2008–2011            and segregation costs are therefore ap-
    consumers information and choices, but       period (Vickner, S. 2013. Personal           plied to a progressively lower volume
    they are more costly than conventional       communication). Likewise, organic            of non-GE products that can meet the
    foods. Non-GE and organic products           fruit and vegetable prices averaged 50       stricter tolerances and purity standards.
    are more expensive in part because of        and 100% higher than conventional            Production and segregation costs for
    lower yields (Seufert, Ramankutty, and       prices, respectively, in 2012–2013           non-GE corn, for instance, are estimated
    Foley 2012); higher average produc-          (USDA–ERS 2014).                             to increase by as much as 20% by lower-
    tion costs; segregation costs incurred                                                    ing the tolerance for any unintended GE

    Figure 3. Prices received for conventional and organic corn and soybean (dollars/bushel), 2011–2013 (USDA–LPS 2013; USDA–
              NASS 2013b).

8   COUNCIL FOR AGRICULTURAL SCIENCE AND TECHNOLOGY
content from a maximum of 1% to 0.5%         choose to maintain the current composi-                  native ingredients (e.g., changing from
(Kalaitzandonakes, N. 2013. Personal         tion of their products, placing GE labels                corn starch to tapioca or potato starch).2
communication) and much more than            on them when necessary. On the other                     Moreover, as discussed previously,
that for tolerances below 0.5%.              hand, they could choose to change the                    non-GE ingredients tend to be more
    It is unclear what tolerance levels      composition of their products in order                   expensive and may have more uncertain
are being used in the various non-GE         to avoid the use of GE labels.                           and inconsistent supplies. The added
products that are currently on the market         The reactions of food manufactur-                   costs of avoiding mandatory GE labels
because they are not always reported.        ers and retailers could be shaped by                     are therefore more or less the same as
Some have argued that a zero tolerance       expectations of negative consumer                        those incurred by products voluntarily
is appropriate. A zero or near-zero toler-   response toward GE labels (Marchant,                     labeled non-GE, as described earlier. In
ance for GE content would be commer-         Cardineau, and Redick 2010), targeting                   effect then, appraisal of the added costs
cially challenging, if not impossible, to    of their products by activists (Gruère                   for mandatory labeling involves (1) an
achieve at a large scale and would great-    and Rao 2007), exploitation of GE la-                    estimation of the share of the food mar-
ly complicate the procurement of food        bels by competitors (Kalaitzandonakes                    ket that might become non-GE, and (2)
ingredients. The legal doctrine of com-      and Bijman 2003), and concern that a                     an estimation of the costs that would be
mercial impossibility could be used to       mandated label might be mistakenly                       incurred to procure non-GE ingredients
render contracts unenforceable, and such     interpreted by consumers to confer a                     and reformulate products.
legal challenges could further increase      food safety warning (Marchant, Cardin-                       If a significant share of the prepared
the costs of non-GE products. These          eau, and Redick 2010). If manufacturers                  and ready-to-eat foods sold in super-
issues are recognized where mandatory        choose to maintain their products and                    markets today were to require non-GE
GE labeling has been implemented in          place labels on them, the cost impact of                 ingredients, the demand for certified
practice. Although a number of countries     mandatory labeling would be the rela-                    non-GE and organic products would
have laws requiring GE food labeling         tively minor cost of the ink to print new                increase well beyond its current levels.3
(Just Label It 2012), none has tried to      labels and the more significant costs                    The markets of non-GE and organic
enforce a zero tolerance (the strictest is   associated with tracking and monitoring                  food ingredients are, in effect, specialty
the EU at a maximum of 0.9%, whereas         to ensure compliance. If manufacturers                   markets, and as such they can exhibit
many Asian nations use 5%).                  choose to substitute GE ingredients with                 noticeable price jumps even under mod-
                                             non-GE ingredients to avoid labels,                      est changes in their demand and supply
The Costs of Mandatory GE                    the cost impact of mandatory labeling                    conditions. Hence, under expanded mar-
Labels                                       would be substantial and associated                      kets and increased demand conditions,
                                             with new product formulation and                         price premiums for such ingredients
     The potential economic impact of        sourcing non-GE ingredients. 1                           could well exceed their current levels.
state and other initiatives that would            Changing the composition of foods                       It is unclear how much U.S. con-
mandate labeling for the presence of         sold in the market today in order to                     sumers are willing to pay for mandatory
GE ingredients in foods has also been        avoid the use of GE labels would in-                     GE labeling, although if a mandatory
of much interest. Opponents of manda-        volve the replacement of GE ingredients                  GE labeling law is enacted there will
tory GE labeling schemes have argued         with others derived from commodi-                        be little choice but to pay the resulting
that they would be very costly and that      ties that have not yet been genetically                  costs, especially if products containing
their costs would be paid by all consum-     engineered (e.g., wheat or rice) or with                 GE ingredients are removed from the
ers, including those who do not wish to      non-GE and organic ingredients. Such                     market. At the beginning of the decade,
avoid GE. Proponents have argued that        changes are both difficult to implement                  77% of the public indicated that they
the implied costs would be minimal. In-      and costly. Changes in ingredients may                   would not be willing to pay more than
deed, a handful of studies has sketched      alter the final product as it is not always
out the potential costs of the mandatory     possible to achieve identical appearance                 2 Processed foods often contain a number of ingredi-
labeling initiatives in California and       and functionality when reformulating                     ents that are derived from different commodities such
Washington. The results have varied          and redeveloping a product using alter-                  as corn, soybean, canola, and sugar beets. Ensuring
from more than $1 billion per year to                                                                 that all ingredients used in any given processed
a few thousands of dollars (Alston and       1 It is worth noting that although mandatory GE
                                                                                                      product come from non-GE commodities can
                                                                                                      complicate their supply chains. For example, chicken
Sumner 2012; Robertson 2013).                labeling is often assumed to enable consumer choice,     bouillon today might include sugar from GE sugar
     The widely differing calculations       mandatory GE labeling laws in other countries have       beets, maltodextrin and hydrolyzed protein from GE
in the estimated costs of the proposed       had the opposite effect in that they resulted in the     corn, and tocopherol (vitamin E) from GE soybean,
                                             virtual disappearance of any labeled GE product from     whereas peanut butter might contain sugar from GE
mandatory labeling schemes are               the shelves, thereby decreasing choice and increasing    sugar beets, molasses from GE corn, and vegetable
explained by fundamentally different         price for those consumers unconcerned about GE           oils from GE canola and corn varieties. If food manu-
conjectures about the responses of key       food (Marchant, Cardineau, and Redick 2010). In          facturers were to reformulate such products, they
players in the food supply chain and the     the EU, Greenpeace and other anti-GE organiza-           would have to ensure that all individual ingredients
                                             tions quickly launched negative campaigns targeting      are certified non-GE. Many highly processed ingredi-
changes they could bring about in the        GE-labeled products and publicized supermarkets or       ents and oils contain no detectable traces of their GE
U.S. food market. Much depends on            food brands carrying GE labels. In response, retailers   origin (e.g., no DNA is present in oil), which further
how food manufacturers, food retailers,      decided not to stock brands with GE labels to avoid      complicates certification of non-GE ingredients.
and other food merchants would choose        the risk of losing sales because of such campaigns
                                                                                                      3 For instance, organic production of corn and soy
                                             and boycotts, and food processors avoided using GE
to act if mandatory GE labeling was put      ingredients to decrease their risk of loss in market     constitute 0.26% and 0.17% of total U.S. production,
in place. On the one hand, they could        share (Gruère and Rao 2007).                             respectively (USDA–ERS 2013b).

                                                                                   COUNCIL FOR AGRICULTURAL SCIENCE AND TECHNOLOGY                             9
$50 per year per household for GE            pend on statistical processes, however,                       Other exemptions have variously
     labeling, with 44% of respondents not        and hence all are subject to some error,                 included alcoholic beverages, foods
     willing to pay anything extra for GE         which increases at very low tolerances                   sold in restaurants, and/or certified
     labeling (CSPI 2001). Furthermore,           (Lamb and Booker 2011). Under some                       organically produced foods. The last
     analysis of the unsuccessful California      state GE labeling laws, this type of                     exemption is particularly important
     and Washington GE labeling initiatives       error could open up firms to potential li-               because it might inadvertently lead to
     indicates that the concern about poten-      abilities for misbranded products. To the                further increases in the cost of food. If
     tial food price increases figured in their   extent that such state laws provide for                  certified organic products do not require
     defeat (The Elway Poll 2013).                citizens to file suit—seeking restitution,               GE labeling irrespective of whether or
                                                  attorneys’ fees, and potentially punitive                not they contain trace amounts of GE
     Potential Changes in the                     damages—they could add to the segre-                     content (whereas nonorganic non-GE
     Costs of Mandatory Labeling                  gation, testing, and certification costs                 products have to be tested and may still
                                                  borne by the food supply chain. State                    be subject to liability if testing reveals
          The cost consequences of any            laws enacting such consumer fraud                        misbranding), then food manufacturers
     mandatory GE labeling scheme could           approaches to enforcing GE content in                    and retailers may favor more expensive
     change over time. The state labeling         the food supply could therefore further                  organic ingredients to avoid any poten-
     laws that have passed in Connecticut         increase the economic impact of manda-                   tial liabilities associated with misbrand-
     and Maine, as well as the proposed           tory GE labeling through litigation on                   ing, thereby further increasing the over-
     2014 Oregon ballot measure, include          food producers and manufacturers. Such                   all cost impact of mandatory labeling.5
     time-limited exemption language that         an effect was seen following the pas-
     originated in the failed California          sage of Proposition 65 in California.4                   Who Pays?
     Proposition 37, which can change the
     labeling standards and their cost im-                                                                      Over time, food prices would rise
     plications over time. Specifically, they
                                                  The Cost Implications of La-                             to cover the incremental costs of any
     state the following:                         beling Exemptions                                        mandatory GE labeling regime in the
                                                      Some of the state labeling bills                     U.S. market. An important question
          Until July 1, 2019, any processed                                                                then is who would be most affected by
          food that would be subject to this      contain labeling exemptions for differ-
                                                  ent categories of food, and these would                  such price hikes. So far, state initiatives
          section solely because it includes                                                               have called for mandatory GE labeling
          one or more materials produced by       affect the cost of mandatory labels (see
                                                  Table 1 [Appendix]). One exemption                       of foods bought at the grocery store and
          GE, provided that the engineered                                                                 consumed at home but do not generally
          materials in the aggregate do not       includes food products obtained from
                                                  animals raised on feed derived from GE                   require the same for foods consumed in
          account for more than nine-tenths                                                                restaurants, cafeterias, catered events,
          of one percent of the total weight of   crops. This is an especially large cat-
                                                  egory because virtually all conventional                 schools, and the like. And, as explained
          the processed food.                                                                              earlier, they also invariably exclude
                                                  livestock industries in the United States
          This clause, a version of which has     (and most other countries) use predomi-                  all organic foods from mandatory GE
     commonly been included in the text of        nantly GE feed. Approximately 40%                        labeling, irrespective of where they are
     other states’ proposed GE labeling legis-    of total U.S. corn production and more                   consumed or their potential GE content.
     lation (see Table 1 [Appendix]), effec-      than 80% of total soy production is                      Given these exemptions and the proposed
     tively introduces a time limit allowing      used for animal feed. Corn grain, silage,                rules on what foods would actually need
     products containing less than 0.9% GE        gluten feed, gluten meal, soybean meal,                  the GE labels, the proposed mandatory
     content to be exempt from labeling for       cottonseed, alfalfa, and sugar beet pulp                 labeling schemes would have a greater
     a few years. This tolerance would have       are common GE components of animal                       impact on low-income households.
     expired on July 1, 2019, after which         feed. Including and tracking products                         Specifically, data from the 2012
     presumably all covered food products         such as meat, milk, and eggs from
     containing any level of GE content (i.e.,    animals that might have consumed GE                      5 It should be noted that there may be other costs
     zero tolerance) would have required GE       feed at some time in their lives would                   associated with mandatory GE labeling that have
     labeling. As explained previously, trying    add a significant level of complexity                    not been discussed in this document. For example,
     to achieve a zero tolerance would lead                                                                there could be costs associated with the use of natural
                                                  and expense to mandatory GE labeling                     resources and the environment if American agricul-
     to greater costs from mandatory labeling     of these animal products.                                ture reverts to using conventional non-GE varieties
     and would be difficult, if not impossible,                                                            of corn, cotton, canola, sugar beet, and soybeans to
     to achieve in practice (Kalaitzandon-        4 Proposition 65 (California’s Safe Drinking Water
                                                                                                           meet an expanded non-GE market. The adoption
                                                                                                           of insect-resistant and herbicide-tolerant GE crops
     akes, Kaufman, and Miller, in press).        and Toxic Enforcement Act of 1986) requires the          by U.S. farmers has resulted in decreased insecti-
          Zero tolerances would also increase     State of California to promulgate a list of chemicals    cide use and has enabled the substitution of more
     uncertainty in the food supply chain.        known to be carcinogens of reproductive toxins. It       effective and less persistent herbicides, respectively
                                                  provides a financial incentive for private enforcers
     When food manufacturers and retailers        to bring lawsuits because it allows them to recover
                                                                                                           (Fernandez-Cornejo et al. 2014). Alston and Sumner
                                                                                                           (2012) discuss these issues in some detail, including
     choose to use non-GE ingredients in          the litigation costs and retain for their own personal   how the reversion to non-GE varieties could also
     order to avoid GE labeling, they depend      benefit 25% of the money obtained in each lawsuit.       impact private and public investment into biotechnol-
     on testing and certification to guarantee    Between 1988 and 2006, more than 1,550 lawsuits          ogy and other agricultural research and development,
                                                  were filed and companies paid approximately $406         and U.S. agricultural competitiveness—especially if
     the authenticity of such ingredients.        million settling Proposition 65 cases (Walsh and         major contenders such as Brazil and China continue
     Sampling, testing, and certification de-     Sanford 2008).                                           to adopt and develop GE technologies.

10   COUNCIL FOR AGRICULTURAL SCIENCE AND TECHNOLOGY
Bureau of Labor Statistics Consumer              and older consumers would instead pay                       states pass mandatory labeling laws.
Expenditure Survey (USDL–BLS 2012)               more of the added costs associated with                   • Labeling at the national level has
show that low-income households                  mandatory GE labeling while spending                        trade implications and needs to be
across the United States spend a larger          a larger portion of their limited income                    harmonized with international trade
portion of their income on food than             in doing so. Indeed, regardless of the                      agreements that frown on mandatory
high-income households and spend                 reason for price increases, elevating                       labeling for a production process
most of these dollars for food at home.          food cost has a greater impact on the                       when there is no scientific evidence
High-income individuals spend more at            poor as a proportion of their income.                       that the process relates to food safety.
restaurants and eateries. For example,
U.S. households with an annual income                                                                      • Mandatory GE labeling would
of $10,000–$20,000 spend between 21
                                                 Summary and Conclusion                                      increase U.S. food costs. The size
and 26% of this income for food. Two               • All domesticated crops and animals                      of this increase will depend on
out of three such dollars are spent at               have been genetically modified in                       choices made in the marketplace by
the grocery store for food cooked and                some way; there is no science-based                     suppliers and marketers, and what
consumed at home. By contrast, affluent              reason to single out GE foods and                       products are included in labeling re-
households with an annual income of                  feeds for mandatory process-based                       quirements. If, as in other countries,
more than $70,000 spend less than 8%                 labeling. Wide-ranging evidence                         sellers move to non-GE offerings
of their income for food and only about              shows that GE technology is equally                     in response to mandatory labeling,
half of that at the grocery store.                   safe to conventional breeding.                          food costs could rise significantly
    Similar trends exist for older                 • Mandatory labeling based on pro-                        and these increased costs would ex-
relative to younger consumers. For                   cess abandons the traditional U.S.                      act a greater burden on low-income
instance, U.S. households headed by                  practice of providing for consumer                      families. If, on the other hand, food
consumers 65 or older have, on aver-                 food preferences through voluntary                      suppliers choose to label virtually
age, less than $40,000 in annual income              product differentiation and labeling                    all products as containing GE with-
and spend more than 12% of that for                  (i.e., marketing and promotion of                       out testing or segregation, increases
food, and two out of three such dollars              products with specific attributes).                     in costs might be minimal.
are spent for food at home. Younger                • Market-driven voluntary labeling                      • Independent objective informa-
households headed by consumers 35–54                 measures (e.g., organic, Non-GMO                        tion on the scientific issues and the
years old have, on average, 50% more                 Project, Whole Foods initiative) cur-                   possible legal ramifications and eco-
income and spend about 10% of it for                 rently provide consumers with non-                      nomic consequences of mandatory
food, and almost half of such food dol-              GE choices in the U.S. marketplace.                     GE food labels needs to be provided
lars are spent away from home. Finally,                                                                      to legislators and consumers, espe-
research shows that younger, more af-              • Current labeling authority is federal;                  cially in states with labeling initia-
fluent consumers spend more on organic               state mandatory labeling laws may                       tives on the ballot, to help move the
food than older, poorer ones.                        be invalidated for conflicting with                     national discussion from contentious
    Given the proposed rules and                     preemptive federal authority and                        claims and counterclaims to a more
exemptions, younger and more affluent                may also violate First Amendment                        fact-based and informed dialog.
consumers who spend more on organ-                   rights. If courts invalidate such local-
ics and food away from home would                    ly imposed laws, it may be seen that
be least affected by the costs resulting             courts are thwarting consumer will.                 Appendix
from mandatory GE labeling. Poorer                   Litigation seems a likely outcome if                     See Table 1.

Table 1. States with food labeling legislation, selected exemptions from the proposed legislation text, status, and source of text.

State           Legislation Citation                        Selected Text and Exemptions                                           Status

Alaska        Alaska Legislature 2013        Labeling of GE fish                                                     Passed 2005
Arizona       Arizona Senate 2013            Exempts food consisting entirely of, or derived entirely from,
                                             animals that have been fed with any GE feed or treated with any
                                             drug that has been produced through means of GE
                                             Exempts GE processing aids or enzymes
California    California 2012                SB 1381 exempts food derived entirely from animals that are not         11/6/12—Proposition 37 defeated
                                             themselves GE, regardless of whether they have been fed or
              California 2014                injected with any feed or drug that has been produced through           2/21/14—Senate Bill 1381 introduced
                                             means of GE
                                             Exempts “packaged food in which the materials produced through
                                             GE account for nine-tenths of 1 percent” and “food lawfully certified
                                             to be labeled, marketed, and offered for sale as ‘organic’” pursuant
                                             to the federal Organic Foods Production Act of 1990
Colorado      Colorado General Assembly n.d. Exempts food that contains less than 1% of GE material
                                             Exempts food certified as “organic”

                                                                                     COUNCIL FOR AGRICULTURAL SCIENCE AND TECHNOLOGY                       11
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