Why Kraft's Opposition to Food Safety Fees is Brain-Dead

(MoneyWatch)  Kraft Foods' swift rejection of the Obama Administration's proposal earlier this week for increased FDA fees reads like something crafted by a company in deep denial about the rising tide of food safety problems.

Obama wants food and drug makers to pay an additional $250 million in fees to the FDA. For food companies, this would help cover enhanced efforts to rid America's food supply of killer bacteria and other nasty contaminants, a big priority in Washington this year. Kraft says it supports increased funding for the FDA -- it just doesn't want to pony up the funds, and instead thinks taxpayers should foot the bill. In an era of trillion dollar deficits and corporate bailouts, this is hardly a smart calculation.

For one thing, those fees are less than some AIG executive bonuses, and Kraft -- the country's largest packaged food company -- would be foolish to stir up a fight over what amounts to chump change. Less than half of that $250 million would come from food companies, and spread among dozens of food manufacturers that amounts to an average of several million a piece. With net earnings of $2.4 billion, companies like Kraft aren't going to break the bank paying the FDA.

Other large food companies seem to understand this and have come out in support of the president's plan, putting their money where their mouth is. In an emailed statement, a General Mills spokesperson said, "Ensuring food safety is the highest priority of our industry, and we believe it should and must be funded." You really can't say that you wholeheartedly support food safety and then ask for somebody else to pay for it. Especially when that somebody is the strapped American taxpayer. Big food safety reforms are all but inevitable. For years, the tragically underfunded FDA has lagged in inspections of food facilities, outsourcing the effort to often dubious third party inspectors. This week, Consumer Reports released a report on packaged leafy greens. Their tests revealed high levels of "indicator organisms," which are bacteria that don't tend to make people sick, but are common indicators of poor sanitation.

It's understandable that companies harbor a deep disdain for government fees, and attempts by past administrations to to get the food industry to cough up additional FDA funding have always been beaten back. This year, that's not going to work.

Photo by Angel Caboodle, Wikimedia Commons