President Obama ran for office in 2007 based on, “hope” and “change.” He offered hope for a better future and promised immediate change in the way agribusinesses market their product to the American consumer. This included country of origin labeling as well as labeling for genetically modified or, genetically engineered food sources. Last week, President Obama signed into law HR 933, otherwise known as the, “Monsanto Protection Act.” This refers; specifically to Section 735 of the spending bill that roughly states that bio-engineered seeds can be used without labeling while the court system decides whether or not they’re safe.
Presidential accountability notwithstanding, the real issue is safety, safety for the people, safety for the environment. The safety issue can be broken down into three general categories. The group against GMOs is citing a paper published last fall in France titled, “Long Term Toxicity of a Roundup Herbicide and a Roundup-Tolerant Genetically Modified Maize.” This article has been championed by the naturalist group and vilified by the scientific community. I’ve read the paper, the charts and several rebuttals regarding sample size, experiment design, control validity and conclusions. The general consensus is that this paper should never have been published. The very short version shows that all of the rats in the study had tumors by the end of the two- year period. The first strike against it is that 96% of the strain of rats used will develop tumors in two years on their own. The science goes downhill from there.
Environmental safety focuses on the side effects the, “unintended consequences” of genetically modified corn and soybeans. These are the two primary recipients of Monsanto’s expertise because they are the two biggest cash crops in the US. The issues include runoff and leaching issues as well as any impact on local wildlife. The initial poster child for this was the Monarch butterfly. The Monarch butterfly only feeds on milkweed during its larvae stage. Milkweed is predominately found near cornfields. Considerable research led to a paper published in the Proceedings of the National Academy of Sciences of the United States (PNAS) in 2001. Their two-year study found a negligible effect between the exact modification of the seed and its effect on the Monarch butterfly population.
The science appears to be on the side of Monsanto. This is based on the third party studies into the seeds and the reviews of peer journals. The third party sources are necessary because of the billions of dollars Monsanto has wrapped up in proving the validity of their product. Meanwhile, activists of the pure food group are so full of personal feelings towards the issue that their opinions, stated with the highest degree of certainty, come to be accepted as fact even though there is no science behind them.
The President himself is a great example of the way this plays out in the public. We just stated that he signed HR 933 into law and this bill included what has become known as, “The Monsanto Protection Act.” However, why would a family who eats solely from their own organic garden, like the Obama family, sign something that limits food labeling? The answer is that they can afford to. Organic food is far more expensive. The President and his family will always be able to afford the luxury of locally sourced produce. Therefore, signing the Act won’t have the slightest effect on his family while his signature guarantees campaign contributions from agribusiness giants.
It’s a shame that a piece of legislation written by a former Monsanto employee, Senator Roy Blunt(R) from Missouri was literally, snuck in to HR 933. This ties in directly to last week’s discussion of the capitalist version of the Golden Rule. Monsanto and agribusiness have the gold to empower electoral candidates from grass root campaigns right on up to the President of the United States. If the President won’t allow food to be labeled for the rest of us, what shall we label him? Has the populist President been turned to the dark side? He clearly isn’t afraid to treat his family to the best while the rest of us fuel the cash registers of big business and their next election candidate.
This blog is published by Andy Waldock. Andy Waldock is a trader, analyst, broker and asset manager. Therefore, Andy Waldock may have positions for himself, his family, or, his clients in any market discussed. The blog is meant for educational purposes and to develop a dialogue among those with an interest in the commodity markets. The commodity markets employ a high degree of leverage and may not be suitable for all investors. There is substantial risk of loss in investing in futures.
