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Out of sight, out of mind

March 9, 2016

The trend in consumer protection seems to be “what you don’t know can’t hurt you.” For example, look at Senate Bill 2609, nicknamed the DARK Act (“Denying Americans the Right to Know”), legislation that would void state laws passed in Vermont, Connecticut and Maine that require labeling of genetically modified foods, and would even make it illegal to label products GMO-free until guidelines are developed at some unspecified future date. Last week the Senate Agricultural Committee approved the bill for a full vote. Numerous polls show that most Americans believe GMO foods are unsafe and 93% believe GMO labeling should be required. I can see why big agriculture and the legislators whose campaigns they fund would oppose mandatory labeling, but this legislation implies that the way to cure consumers’ concerns is to make it impossible for them to make informed choices.

Next, consider “bespoke tranche opportunities.” What sounds like an ad for custom-made shoes is in fact Wall Street’s rebranding of the reckless CDO, or collateralized debt obligation, the bundles of risky subprime housing loans that went bad in 2007, precipitating a worldwide financial crisis. That meltdown could have been avoided if SEC regulators hadn’t looked the other way and credit rating agencies hadn’t given the investments fraudulently high ratings. We are still struggling to recover from the resulting global recession, but Wall Street is busy creating the next economic train wreck without a peep from the regulators.

Lastly, look at the Federal Energy Regulatory Commission (FERC) and PHMSA, the Pipeline and Hazardous Materials Safety Administration, part of the Department of Transportation. They oversee 2.5 million miles of U.S. pipelines operated by 3,000 companies, but ordinary Americans who assume that public safety is a key concern of these agencies are mistaken. Aside from minimum safety regulations for workers, PHMSA has no involvement in issues such as location of pipelines, compressors, metering stations or gas storage facilities; they don’t even maintain an inventory and have no role in monitoring environmental impacts such as emissions or noise. Funded by the industry, FERC accepts computer modeling rather than field documentation of emissions, averaging of projected exposures instead of peak emissions data, and improper segmentation of projects—making it impossible to measure the cumulative environmental effects. These blinkered agencies operate in a closed loop that gives them plausible deniability when it comes to the health impacts of the industry they are supposed to regulate.