This massive Air Force C-17
plane landed in the U.S.
Sunday carrying precious cargo,
£78,000 of hypoallergenic
formula from Switzerland.
These are the first two flights of
Operation Fly Formula as the
Biden administration works to ease
a nationwide shortage.
President Biden invoking the Defense
Production Act.
The wartime law allows the
government to force suppliers to
give formula manufacturers the key
ingredients they desperately need.
If the federal government just
backed off and let the market
function like it's supposed to.
We wouldn't need military
intervention or emergency policies
designed for war to stock grocery
store shelves with baby formula.
This crisis is largely the result
of protectionism, regulation and
central planning of the sort that
both Democrats and Republicans want
more of in Washington.
Why was the Biden administration so
slow to respond to this crisis?
Reporters want to know why the
government didn't respond more
quickly to this shortage.
But the actual solution is for
the government to be less involved
entirely.
I do wonder, Doctor Kayla, if this
is a shortage that you believe could
have been prevented.
Do you think the FDA was too slow
here? Are you disturbed?
A better question is why
didn't the Biden administration
clear the way for the private sector
to react to price signals like it
does in every other industry?
Food suppliers would have started
stockpiling European made formulas
months ago if only U.S.
tariffs and regulations weren't an
obstacle. So how does this work in
practice? First, the federal
government prohibits importing many
European made baby formulas simply
because they fail to meet FDA
labeling requirements.
But Europe is the world's leading
exporter of baby formula, thanks to
major producers based in Germany,
the Netherlands and Britain.
If FDA labeling regulations are so
necessary, why is it that
infants all over the globe safely
consume formula made in Europe?
Meanwhile, about 98% of the formula
sold in the United States is
produced domestically.
We've sealed ourselves off from
a robust and safe global
market. In addition to the labeling
requirements, the government imposes
huge tariffs on foreign formula
to protect domestic manufacturers
and the American dairy industry.
Now, the U.S.
is heroically flying in European
made baby formula.
But just a year ago, Border Patrol
officers were bragging about
heroically seizing it.
These two policies of regulation and
protectionism work in tandem to
scare away foreign suppliers.
For example, let's say you're
running a baby formula manufacturing
firm in Germany.
You would have zero incentive to
spend the money to earn FDA approval
for your labels because high tariffs
would make your product too
expensive to compete in the U.S.
market.
Our retailers need to have the
flexibility to actually sell
and are consumers to buy
whatever type of product that they
have and to do so safely.
So we've got to waive a bunch of
regulations that traditionally make
sense but don't make sense in this
crisis.
Did European made baby formula
suddenly become less hazardous?
Does passing formula through the
hands of the US military magically
make it safe for American babies to
drink? Or maybe the regulations
and tariffs are designed to protect
big businesses, not babies,
and never should have existed in the
first place.
Utah Senator Mike Lee introduced
a bill that would temporarily waive
the tariffs on baby formula and
remove the FDA labeling regulations.
But how about scrapping
them altogether?
There's also an important lesson
here for economic nationalists who
claim that international trade is a
vulnerability excluding even
more foreign made products is
critical for our national security.
Missouri Senator Josh Hawley argued
last year he has suggested
tightening the Made in America rules
that already govern federal
procurement to include the entire
commercial market.
If Hawley got his way, all
industries could become just as
vulnerable to supply shocks as baby
formula. Will we one day have
to replace our $2.5 trillion
international shipping and logistics
industry with emergency military
aircraft criss crossing the skies?
The Biden administration and
Congress get to come off like heroes
rushing to feed American babies left
to go hungry because of the supposed
cruelty of the free market.
But that's all an act.
Don't be fooled about the real
cause of this shortage.