Friday, 27 May 2011

Letter On DEHP Scare


If the now already infamous DEHP is "potentially" harmful to the human body, as described in Thursday's editorial, then is it not fair to say that today's headline piece indicates a potentially hysterical over-reaction, facilitated by apprehension regarding the manufacturer's location in China? Curiously, the absence of any clear evidence of DEHP's toxicity to the human body in the relevant ppm concentrations (2 to 34 I believe), was not mentioned in today's headline piece.

Supposing however, for the sake of argument, that DEHP at such concentrations was proven to be harmful; the salient question would therefore be how best to prevent its use by unscrupulous manufacturers. Under Taiwan's current regulatory system run by the FDA, manufacturers are handed a list of prohibited substances and told to comply under threat of legal action. Enforcement of FDA regulations is achieved by means of inspections, which may either be targetted or conducted at random, but which in either case, are limited to a relatively small percentage of food products. That this inspection regime is limited in scope is a natural consequence of the scale and consequent costs of the task to a government agency with a limited budget.

Is it really so surprising that a few well-dodgy items may slip under the poor FDA's radar seemingly every year? I think not. Can this system be improved upon? I think so...

The consumer electronics industry in the U.S., offers an historical example of high standards of safety achieved by a marketized system of regulation. Companies such as Underwriter Laboratories were expressly set up in order to verify the safety of electronics products - and to do so at a profit derived from the fee which manufacturers willingly pay UL in order to enter the market with the UL brand and the consequent confidence of consumers. The importance of brand reputation for a company such as UL is paramount since a single high-profile failure could be disastrous for their market position.

Were an analogous system allowed to develop in Taiwan, then a well-run regulatory company (or several) could eventually put itself in a position to reliably verify the safety of the vast majority of imported food products, since that company would have a profit incentive to expend far greater resources doing this than those available to the FDA. This profit incentive would be significantly augmented by the policies of retailers such as supermarkets and convenience stores to only stock food products licensed by those regulatory companies with the best market reputations. A government agency faces no such incentive but rather a mountain of costs for which they need to plead to central government for an increased budget.

However, since value trade offs and human error are ever present aspects of life, it is fair to say that no system of regulation will ever be perfect. Perhaps, however, a better system would spare us the continuing scare stories, panic and mistrust of all things Chinese.

Yours freely,
Michael Fagan.

(Sent: Friday 27th May 2011. Unpublished by the Taipei Times.)

Note: I had to struggle a bit to get this thing down to 499 words (my first draft was nearly 600 and I think it read better).

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