Bad food: “It’s not all China’s fault”

I stopped posting NYT columns a long time ago, but today’s piece by Paul Krugman is directly relevant to our recent conversations. Krugman says this disaster is in part the fault of a free-market, no-regulation mentality fostered by Milton Friedman and taken to dizzying new heights by the Bush administration. Yes, China and others may be exporting bad food, but in the past there was a far greater likelihood of it not reaching your supermarket shelf. You can read the entire piece here. (Word file.)

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Richard Burger is the author of Behind the Red Door: Sex in China, an exploration of China's sexual revolution and its clash with traditional Chinese values.

The Discussion: 26 Comments

How ironic! Here is China the top leadership recognizes the need to have government food-chain watchdogs in place but doesn’t yet have the infrastructure to do it. In the US, President Bush has the infrastructure but doesn’t recognize the need to use it effectively.

May 22, 2007 @ 11:53 am | Comment

This is so low. Milton Friedman, who IMHO could be quite over the top sometimes, passed away a while ago and can’t defend himself.

This is quite easy to settle. Have there been more American dead or ill due to the food quality in the past 6 years? Facts and figures, anyone?

May 22, 2007 @ 12:38 pm | Comment

I dont care whose fault this is. Chinese Food production/inspection system needs complete overhaul. Some people need to get their ass kicked. Its no secrecy to many chinese that most food producers, including farmers, food processing companies, etc, add addictives to their products to make them look fresh or to improve production volume. Many incidents have been exposed and Chinese consumers have being calling for reform and legal involvement, yet food posionaing continue to happen at an alarming rate.
Its time to wake up and teach these bastards some lesson!

May 22, 2007 @ 1:21 pm | Comment

Over the past six years there has been a general decline in the quality of people overseeing government agencies, and I wouldn’t be surprised if the same is true with the FDA. It is well documented that the agencies were stuffed with Bush cronies often with literally no corresponding experience. (“Brownie,” the former horse trader made head of FEMA remains the crowning example, but by no means the only one.)

Friedman being dead doesn’t mean no one should criticize him (or any other author who passed away). Mao’s dead and he can’t defend himself. Should I not criticize him? Ronald Reagan? Jeffrey Dahlmer? We should only criticize the living?

May 22, 2007 @ 1:23 pm | Comment

Why blame just the US government? Why is nobody talking about how Western companies (which either knew or should have known what goes on in China) not being implicated. Should they not have an obligation to monitor?

My firm is right now working on an “audit” for one of our clients, going through various areas of the business to make sure that its name is never associated with such events. If this were a public company (and not my client), I would invest in it, because I see actions like this as smart in the same way it is smart to change the oil in one’s car. Forget government, let’s talk individual responsibility.

May 22, 2007 @ 1:42 pm | Comment

CLB, exactly. Individual responsibility.

If you look at how government employees work every day up close and personal, you will realize these people aren’t your uber-protectors but rather a drain of you money.

With all the food scare, are more Americans dying the past several years?

May 22, 2007 @ 2:42 pm | Comment

China is taking the blame because of all of the hype that China and its MNC and panda-hugging academics minions have generated for it as “the future manufacturing and R&D center of the world!”

Now we see what happens when you put all of your outsourcing in one basket.

Still, China deserves lots of scolding for its toxic air and water emissions and JXie is completely unable to argue that with me.

It is the MNCs and outsourcing agents who deserve to be sued into destitution and driven into the woods.

Everyone should go out onto the streets and bars of china and find some outsourcers to beat up on. Especially chinese because these shifty outsourcers are bringing more shame onto their country (and this time it is mostly undeserved).

CLB; its time for your clients to pay the price for their lack of vision and to be crushed under the slowly turning stone wheel of litigation. The families of the executives should also suffer because they lived off of ill-gotten money made by poisoning the world and by allowing slave wages from their source factories.

May 22, 2007 @ 3:16 pm | Comment

May 22, 2007
China Questions 2 Companies in Contaminated Toothpaste Exports
By DAVID BARBOZA and WALT BOGDANICH
DANYANG, China, May 21 — Chinese authorities are investigating whether two companies from this coastal region exported tainted toothpaste as more contaminated product, including some made for children, has turned up in Latin America.

A team of government investigators arrived here Sunday afternoon and closed the factory of the Danyang City Success Household Chemical Company, a small building housing about 30 workers in a nearby village, according to villagers and one factory worker. The government also questioned the manager of another toothpaste maker, Goldcredit International Trading, which is in Wuxi, about an hour’s drive southeast of here.

No tainted toothpaste has been found in the United States, but a spokesman for the Food and Drug Administration said yesterday that the agency would be taking “a hard look” at whether to issue an import alert.

Authorities in the Dominican Republic said they seized 36,000 tubes of toothpaste suspected of containing diethylene glycol, an industrial solvent and prime ingredient in some antifreeze. Included were tubes of toothpaste marketed for children with bubble gum and strawberry flavors sold under the name of “Mr. Cool Junior.”

Toothpaste containing the toxic solvent was also found in Panama and Australia in the last week.

Bautista Rojas Gómez, the secretary of health of the Dominican Republic, said the toothpaste, with diethylene glycol listed as an ingredient, was found in stores and warehouses across the country, including near the Haitian border.

Diethylene glycol is the same poison that the Panamanian government unwittingly mixed into cold medicine last year, killing at least 100 people. In that case, the poison falsely labeled as glycerin, a harmless syrup, originated in China, shipping records show. Diethylene glycol is generally less expensive than its chemical cousin glycerin.

Panamanian authorities said they believed the tainted toothpaste found in their country, containing up to 4.6 percent diethylene glycol, came from China.

Executives from both companies under investigation in China denied in interviews on Monday that they had exported any toothpaste containing diethylene glycol to Panama.

“We didn’t do this; we didn’t make the bad stuff,” said Shi Lei, a manager at Danyang City Success. “It was probably someone else.“

But Ms. Shi and other toothpaste makers in this region said that diethylene glycol had been used in toothpaste in China for years and that producers believed it was not very harmful.

Government investigators arrived here just days after customs officials in Panama said that they had discovered diethylene glycol in 6,000 tubes of toothpaste. The toothpaste was being sold under the English brand names Mr. Cool and Excel.

There have been no reports of deaths tied to toothpaste containing the chemical.

Dr. Douglas Throckmorton, deputy director for the Center for Drug Evaluation and Research at the F.D.A., said diethylene glycol levels found in some Panamanian toothpaste was nearly 50 times greater than what is deemed safe. “Kids swallow toothpaste,” Dr. Throckmorton said. “That is going to be a concern to you.”

Suspicion over China’s role in the tainted toothpaste and cold medicine comes just weeks after investigators blamed two Chinese companies for intentionally shipping pet food ingredients contaminated with an industrial chemical to the United States, leading to one of the largest pet food recalls in history. The cases are fueling mounting concerns about the quality and safety of China’s food and drug exports and threatening to turn into a trade dispute.

After initially rejecting any Chinese role in the tainted pet food, Beijing officials banned the use of melamine, an industrial chemical used in fertilizer and plastics, from vegetable proteins. Melamine and several related chemicals had been discovered in contaminated pet food ingredients. Chinese officials also promised to overhaul its food safety regulations and tighten export controls.

Indeed, the government seems to have responded quickly to reports last weekend about contaminated toothpaste. Hu Keyu, the manager at Goldcredit International, said investigators had talked to him over the weekend because his company was the first to sell and export toothpaste under the brand label Mr. Cool. But he and his staff insisted that Goldcredit never exported to Panama, and that this year the company had exported only a small amount of Mr. Cool toothpaste to Australia. Goldcredit executives said they did not sell toothpaste under the Excel brand name.

Mr. Hu said his company exports toothpaste, toothbrushes, glue and other goods to the United States, Europe and other regions but that his company no longer uses diethylene glycol. He said, however, that most toothpaste makers in this region use diethylene glycol because it is considered a cheap substitute for glycerin.

“You know, if you’re in the export market, the margins are small, so people use the substitute,” he said. “Even one percent or half a percent price difference can matter to people here.”

Executives from Goldcredit and Danyang said the brand Mr. Cool had been copied by several other companies and that numerous trading companies could be exporting the products.

Danyang City Success Household Chemical, however, said that while it did not export to Panama, it has used diethylene glycol in its toothpaste, and that the government does not have a clear regulation on how much can be added. Danyang City Success is a small company in a village in Danyang, a city whose entrance boasts that it has been designated one of China’s “national sanitary” cities for its cleanliness.

Danyang City Success produces both Mr. Cool and Excel and exports toothpaste around the world, including to Europe and Africa, company executives said. But this afternoon, villagers and one young factory worker, who declined to give her name, said that investigators had arrived Sunday night and closed the factory to investigate possible contamination in its exports. Ms. Shi, one of the managers along with her husband, met a reporter at the entrance to the factory and insisted her company had nothing to do with the case in Panama. Inside the gate a team of investigators could be seen meeting with company officials and then departing with a bag of documents. Villagers said the investigators were provincial and local officials, including the village’s Communist party secretary.

The sister of the party secretary, who only gave her name as Miss Hu, said Danyang City Success had been around for four or five years and that it was run by a former salesman and his wife, Ms. Shi, who grew up in the village.

“He used to sell packaging materials. Then he saved up his money and started this toothpaste company,” she said. “But lately the company has been struggling.”

Mr. Hu at Goldcredit said that while he did not produce the toothpaste shipped to Panama, diethylene glycol had been used for years at very low levels in Chinese toothpaste as a glycerin substitute. “If diethylene glycol were poisonous,” he said, “all Chinese people would have been poisoned.”

David Barboza reported from Danyang, China, and Walt Bogdanich from New York. R. M. Koster contributed from Panama; Guangming Xu and Rujun Shen contributed from China.[/quote]

May 22, 2007 @ 3:19 pm | Comment

GAH…JXie, please don’t tell me you’re one of those Libertarian types who thinks that the market is going to fix everything. That’s the opposite conclusion that anyone who has looked at the consequences of the last six years of Bush should be coming to…under Clinton, we had a FEMA that actually, you know, helped people when there was a disaster.

I am soooo tired of the whole demonizing of government. Government has its functions and it can do certain things well. Protecting the food supply should be one of them.

But I also totally agree with CLB that everyone along the supply chain shares responsibility for these disasters…and I’ll further restate that there is something wrong with the way the manufacture and distribution of food has become globalized. I don’t have a problem with iPods and shower curtains and what have you. But I want to get my meat and fish and fruit and vegetables from sources as close to where I live as possible.

Bring on the carbon tax. That ought to fix some of these problems.

May 22, 2007 @ 3:28 pm | Comment

Richard, just out of curiosity…why did you stop posting NYT columns if they’re one of your most respected newspapers? I’m not being sarcastic.

May 22, 2007 @ 4:02 pm | Comment

CLB, interesting point. How much of the onus is on the buyer to test products he has purchased? I go back to a once-famous case of a meat processing company in which a butcher failed to clean his machine after grinding pork; he then ground beef, which mixed with the pork leading to several deaths from trichinosis. It wasn’t the supermarkets that were punished, but the meat company, as they misrepresented their product (albeit unintentionally). They ended up closing and bankrupt from the lawsuits. Most of us presume when we purchase something that it will be what the seller tells us. How much of the burden is it on the customer to prove their vendor isn’t lying to them? These are serious questions, and I’d really like to understand. Were the pet food companies and gthe toothpaste negligent for believing they were being sold what their agreement with the Chinese vendor stated, or did they then have a further obligation to test to make sure the vendor wasn’t lying? In the past in the US this hasn’t been much of an issue, since any vendor caught selling poison would be finished forever and faced with jail. On whom does the onus lie? My immediate instinct is to say the poisoner (like the meat company), not the retailer at the final point of sale. But from your post, it sounds like it’s not so black and white. That said, no matter who is ultimately responsible, selling tainted products is a loathsome thing to do, and if the receiver gets some of the blame for not testing adequately it doesn’t lessen the odiousness of the exporter’s crime.

May 22, 2007 @ 4:35 pm | Comment

Canrun, I stopped because I decided it wasn’t a healthy practice to draw readers by posting copyrighted information that the Times charges for. There was no pressure for me to do so, and it made my site traffic soar but I thought long and hard and felt it wasn’t the right thing to do. If i see an occasional must-post column directly related to this blog’s discussions, like this Krugman piece, I’ll consider putting it up, but I didn’t want TPD to be known as a cut-and-paste site.

May 22, 2007 @ 4:40 pm | Comment

JXie – you seem to think that this isn’t an issue until someone dies or gets seriously ill as a result of these contiminants.

Results of poisoning from contiminated goods may not always manifest straight away, if at all. That doesn’t mean that there is no damage. The UK is currently facing a CJD timebomb, as nobody really knows how long it takes to manifest or how many people are affected.

Issues like these should spur governments into action, like BSE did for the UK. Passing the buck or sweeping it under the rug will achieve nothing.

May 22, 2007 @ 5:52 pm | Comment

Clearly Chinese exports killing people in Panama is the American President’s fault. It makes perfect sense.

May 22, 2007 @ 8:54 pm | Comment

Of course Krugman is right, but I fear it will not make any difference. People have stopped caring about the truth.

The reality of “Self regulation” is that the rich will figure out ways of protecting themselves and their own food supply, and to hell with everyone else. If they are happy to let the poor die in hurricanes, why should they care about food poisoning from dodgy Chinese imports? As long as they don’t have to eat it themselves. This is what bush and co’s libertarianism means in practice.

Welcome to the new world order.

May 22, 2007 @ 9:37 pm | Comment

“Bring on the carbon tax. That ought to fix some of these problems.”

American regulatory issues aside, this tainted Chinese exports story ultimately comes back to the problem of those exports being artificially cheap. And no, I’m not talking about an undervalued yuan or unfair trade practices- rather, I’m talking externalities and environmental damage.

If companies are increasingly forced to internalize the cost of environmental damage as part of a more general shift paradigm shift in economic thinking, then this mania for producing everything but the kitchen sink halfway across the world will be quickly cooled, to say the least. With true cost becoming more and more apparent, trade patterns won’t emerge unscathed. I mean is it any coincidence that China (addicted to exporting artificially cheap goods) and the US (addicted to importing artificially cheap goods) are two of the most glaring foot draggers on environmental and climate issues? Trade makes sense as it does today only because of its glaring omission of true cost.

And even if you believe that is nonsense or that, while an admirable goal, shifting paradigm towards environmental sustainability is not for tomorrow (thank you, retrograde politics), there is another problem looming on the horizon: ports in North America are increasingly gridlocked to the point where some are advising that companies should rethink their China sourcing strategy purely on a “classic”, logistical basis.

Link

So again, I’m hesitant to blame China too forcefully on this one. Yes, they need to sort out their real and very serious mess- but much more for the sake of their own people than ours. This is more reflective of our groggy encounter with the consequences (environmental mess, logistical gridlock) of a drunken import binge of our own making, not China’s.

May 22, 2007 @ 11:02 pm | Comment

Completely agree, Patrick and glad to see that these issues are getting more serious attention.

Well, I disagree on one thing, and that is that, somewhere in all of this, the manufacturers of tainted goods really have to be held directly accountable – I don’t want to let very real culprits off the hook because the system is ultimately flawed and needs change.

May 23, 2007 @ 1:18 am | Comment

Lisa/Patrick

I will second your comments on the true cost factor. Eevery one must realised that markets by their nature is competitive and it is up to the consuming/importing countries to set minimum acceptable standards to guide the sellers/exporters. Otherwise a few importers/buyers setting their own standards will quickly be under cut by those who cut corners and will be able to price these quality conscious importers/buyers out of business. This is where EU is doing a better job than the USA. It will of course raise prices but true cost of producing a minimum standards and quality can be achieved and the end consumer can feel confident about products that enter in to their countries hence your point about regulations and oversight is right on.

May 23, 2007 @ 11:32 am | Comment

Further to my comments comes the part about enforcement as without proper enforcements the best regulations are pointless

May 23, 2007 @ 11:34 am | Comment

Patrick, I accidentally deleted the link you gave us in your last comment – it was throwing off the margins and i tried to embed it. Sorry about that – feel free to post it again.

May 23, 2007 @ 12:29 pm | Comment

Until public awareness and public outcry puts a foot on the neck of this global snake, I doubt the true cost of cheap imports is going to be dealt with. That was a great post, Patrick.

Imports are not new, but the rate of import has accelerated at such a pitch, that part of the problem may also be a lagging adaptive response. So we can spread the blame out democratically, and demand action in the sphere of influence where we actually have some say.

Shoppers are talking to supermarket managers, who are talking to suppliers, who are talking to manufacturers who are talking to importers. “Buy local” advocates are not being snickered at quite so much any more.

I’m having a hard time believing that the top down response will be anything but palliative. I’d love to be wrong about that and actually have China do more than face saving token inspection and regulation. Same goes for our own FDA FTC. And I would love to see some congressional discussion of these matters.

And frankly, despite those highly informative stories in the NYT and WaPo, I think the press is neglecting this issue. I hardly see anything about it on network TV news, which is probably the most important outlet. If there’s anything that qualifies as “hard news” other than the war, this is it.

May 23, 2007 @ 4:31 pm | Comment

Richard –

I am working on a post on all of this that will focus on the legal aspects. Believe me, it has not been easy, not only because the law is complicated, but also because we are working on a couple of related matters and I must keep my mouth shut on those.

But, the short answer is that anyone who is at fault can be found liable and if you are an American consumer and your kid has died from a toothpaste that has poison in it that came from China, are you going to hunt down and then sue the Chinese company or are you going to sue the US company that put it in the toothpaste? And how easy is it going to be for the American company to say, “I didn’t know” or, “I couldn’t test it.”

Our post will set forth the most important things Western companies must do to avoid these sorts of problems entirely and to position themselves so that if something like this does happen, they will be well positioned to prevail in court because they have done everything one can reasonably expect them to do to protect their customers.

The thing is, most companies are already doing these things, which makes it look even worse for those who are not.

May 23, 2007 @ 4:36 pm | Comment

Chinese Catfish Banned in 3 States http://biz.yahoo.com/ap/070516/chinese_catfish_ban.html?.v=1

Wednesday May 16, 5:22 pm ET
By Garry Mitchell, Associated Press Writer
Chinese Catfish Banned in Ala., Miss. and La. Over Antibiotics Use

MOBILE, Ala. (AP) — Chinese catfish treated with a banned antibiotic have been shut out of three Southeastern states over food safety issues.
The U.S. catfish industry, which is threatened by China’s low prices, has praised the move, but it is viewed as political by importers.

Alabama Agriculture Commissioner Ron Sparks last month issued the “stop-sale” order after tests conducted by the state found what he described as dangerous levels of a banned antibiotic — fluoroquinolones — in 14 out of 20 catfish imported from China.

May 23, 2007 @ 6:18 pm | Comment

Food Poisoning Statistics
Food poisoning in Eastern Asia (Extrapolated Statistics)
China
362,913,318 (cases)
1,298,847,6242 (pop)

http://www.wrongdiagnosis.com/f/food_poisoning/stats-country.htm

May 23, 2007 @ 10:52 pm | Comment

“from a toothpaste that has poison in it that came from China, are you going to hunt down and then sue the Chinese company or are you going to sue the US company that put it in the toothpaste? And how easy is it going to be for the American company to say, “I didn’t know” or, “I couldn’t test it.”"

CLB and others:
It’s high time for a witch hunt regarding these dirty exporters, their American clients and Chinese partners. For those who have been damaged by tainted products, they need to form class actions suits then threaten to publicize the names of companies they intend to sue. The threat of “destruction by publicity” will force these companies and individuals to capitulate and pay massive settlements. Guilty Chinese companies with assets in the US are equally vulnerable and should be crushed.

May 24, 2007 @ 12:25 am | Comment

Watching something on BTV right now (noon, Sunday 27th) that’s freaking out my girlfriend- bread being sold to Jenny Lou’s, embassies etc. from German bakery ‘Der Backer’ that has something that burns the stomach lining as well as liver, everything. It’s usually used to clean the floor and is used to give the bread colour. An investigative reporter has worked undercover to find this out.

May 27, 2007 @ 1:13 pm | Comment

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