This article originally ran at Forbes and has been republished here with permission.
A recent Wall Street Journal editorial concluded: “The overriding problem [with economic growth] continues to be a lack of business confidence and investment, which leads to slower growth, which gives the U.S. economy a lower margin for absorbing growth shocks from around the world.” True enough, but the crisis in business confidence and investment is only a symptom. Arguably, the underlying disease is the panoply of anti-innovation policies, actions and attitudes of the Obama administration, which has been an outlier–to the high side–of “economically significant” regulations (those that are expected to cost Americans $100 million or more annually).
According to Daniel Pérez of the Regulatory Studies Center at George Washington University, “From the beginning of his term until the end of December 2015, executive agencies had published 392 economically significant final rules, surpassing the total number published during the entire terms of the [George W.] Bush Administration (358) by the end of August and the Clinton Administration (361) by September.”
And there are plenty more rules in the pipeline. The most recent of the administration’s semiannual regulatory “unified agendas,” released last November, revealed that more than 2,000 regulations are now being written, of which 144 are deemed economically significant, a new record.
They encompass a vast spectrum of the American economy, including labeling requirements for pet food, new test procedures for battery chargers, mandated paid sick leave for contractors, and speed governors for trucks, as well as a host of new rules that will limit energy consumption (and increase the price) of household appliances.
It is not only the recent rules and regulations-in-waiting that are a problem; regulatory agencies’ implementation of older ones has also inhibited innovation. Consider, for example, the effects of the federal government’s oversight of various applications of genetic engineering, a microcosm of the Obama administration’s war on innovation.
The basic tenets of government regulation are that similar things should be regulated similarly, and the degree of oversight should be proportionate to the risk of the product or activity. For new varieties of plants, risk is a function of certain characteristics of the parental plant (such as weediness, toxicity, or ability to “outcross” with other plants) and the introduced gene or genes.
In other words, it is not the source or the method used to introduce a gene but its function that determines how it contributes to risk. Under USDA’s Animal and Plant Health Inspection Service (APHIS), however, plants made with the newest, most precise techniques have been subjected to more extensive and burdensome regulation, independent of the risk of the product. As a result, the cost of discovery, development, and regulatory authorization of a new trait introduced between 2008 and 2012 averaged $136 million, according to Wendelyn Jones of DuPont Pioneer, a major corporation involved in crop genetics. That is far more than the costs for plants with identical traits but made with less precise, less predictable genetic techniques.
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Under its discriminatory and unscientific regulatory regime, APHIS has approved about a hundred genetically engineered traits, and farmers have widely and quickly adopted the crops incorporating them. After the cultivation worldwide of more than 4 billion acres of genetically engineered crops (by more than 18 million farmers in 30 countries) and the consumption of more than 3 trillion servings of food containing genetically engineered ingredients in North America alone, there has not been a single documented ecosystem disruption or a single confirmed tummy ache.
With this record of extensive adoption and use, one might have thought that APHIS would reduce its regulatory burdens on genetically engineered crops, but there has been no hint of that. APHIS continues to push the costs for regulatory compliance into the stratosphere while its reviews of benign new crops become ever more dilatory: Evaluations that took an average of six months in the 1990′s now take three-plus years, and APHIS’s performance compares unfavorably with its counterparts abroad. Based on data gathered by the U.S. government and confirmed by industry groups, from January 2010 through June 2013, the average time from submission to decision was 372 days for Brazil and 771 days for Canada, versus 1,210 days for the United States.
These plants have fared little better at FDA, which performs reviews that are supposedly “voluntary” for industry—about as voluntary as surrendering your wallet when a mugger points a gun at you. Instead of what should be routine, rapid evaluations of new varieties of genetically engineered plant varieties, FDA’s reviews have been excruciatingly prolonged. Recent examples include two and four years, respectively, to evaluate bruise-resistant potatoes and non-browning apples, even though the genetic changes were well circumscribed and minimal and did not involve the insertion of foreign or uncharacterized genetic material.
The EPA’s reviews of plants that contain “plant incorporated protectants” likewise have been overly prolonged. And as at USDA, the definitions of which new organisms require extensive, case-by-case reviews are unscientific, arbitrary and discriminatory.
Making things even worse, many products are subject to reviews by more than one regulatory agency, further complicating and delaying the process.
Product approvals are trickling out from U.S. regulatory agencies, but incompetent, dilatory and at times corrupt regulation has damaged or even eliminated entire once-promising sectors of genetic engineering. These include genetically engineered animals and “biopharming,” the production of high-value molecules in plants. Thus, in these sectors, we won’t reap the humanitarian or financial benefits of the Next Big Thing.
Henry I. Miller, a physician, is the Robert Wesson Fellow in Scientific Philosophy & Public Policy at Stanford University’s Hoover Institution. He was the founding director of the FDA’s Office of Biotechnology. Follow him on Twitter @henryimiller.
