Pew Initiative on Food and Biotechnology

Thursday, February 13, 2003

 

 

MICHAEL RHODAMEIER:  Good morning everyone.  I’d like to welcome everyone here this morning and also to welcome those who are watching by our live webcast this morning.  We usually have a couple of thousand people who join us so we’re also encouraging them to send us questions by the internet.  So we’ll have participation from those as well. 

            My name is Michael Rhodameier, I’m the Executive Director of the Pew Initiative on Food and Biotechnology.  We’re a non-partisan, non-profit research and education project supported by a grant from the Pew Charitable Trust to the University of Richmond.  We support dialogue and discussion on issues relating to genetically-modified food and agricultural biotechnology.  Today we’re very pleased to host the fifth in a series of public policy dialogues on critical issues relating to agricultural biotechnology. 

While American farmers have largely embraced biotechnology, other parts of the world have approached biotechnology with much greater caution.  No where is this more evident than in the European union, where consumers have largely rejected genetically-modified foods.  And where there are pending proposals to tighten existing labeling and product approval laws.

            We live in a global marketplace and the EU’s actions have had global impacts.  EU restrictions have effected decisions about what American farmers grow and change the way we handle grain for export.  Recently, several southern African nations facing famine rejected U. S. food aid that included shipments of genetically-modified corn at least partly out of concern that corn might be replanted and could potentially jeopardize future trade with the EU.

            Today the U. S. is currently considering challenging the EU’s GM food regulations in the world trade organization as a violation of free trade standards.  But legal merits aside, there are questions whether this is a wise step to take.  Particularly now, given current U. S. efforts to build an alliance with European nations against Iraq. 

            To help guide our panelists through these questions this morning, we’re very privileged to have as our moderator, Ray Suarez, Senior Correspondent for the PBS News Hour.  Mr. Suarez has had 25 years of experience in reporting and in the news business, including a number of years as the host of the NPR call in radio program, Talk of the Nation.   A native of Brooklyn, Mr. Suarez has covered news from posts in New York, London, Rome and Chicago, among many other places.  Please join me in welcoming Ray Suarez.

RAY SUAREZ:  One good or bad thing that webcasting has done is take away the cherished notion that we could keep things in the room if we decided to have a no holds barred conversation.  There are no rooms that you can keep things inside of anymore or a lot fewer than there used to be.

            I was pleased to be asked to be asked to be your moderator this morning.  Not because I need the extra practice before I go to work, but because I find this topic devilishly complicated and thus, fascinating. 

            The question at hand, whether the United States Government should take a complaint to the World Trade Organization over EU trade standards concerning genetically modified foods is one that brings together science, but only sort of, politics, economics, questions of national sovereignty, international law and strategy in the relations between nations and groups of nations.

            I say strategy rather than simply a question of right and wrong because people on many sides of this issue agree if the United States heads to the WTO with a complaint over European treatment of GM food, it will likely win.  That’s not at issue.  Under existing agreements, European handling of these commodities probably cannot be legally defended.  It’s a harder question of “shoulds,” rather than “musts.” 

            And part of the problem comes in the nature of the debate as it has been carried on so far.  What kinds of terms are used in the general public and in the press, interchangeably and often imprecisely.  The man and the women on the European street might gladly eat a farmed fish, modified along the way to preserve color and shelf life, and at the same time, tell the public opinion researcher that she wouldn’t want to buy flour or used cooking oil with a GM label prominently displayed on the front as required by national standards.

            Are there differences between packaged and processed foods with government mandated labels and a sizzling slice of Danish ham finished in a factory style piggery that uses high protein feeds in part derived from GM grains.  How many arm’s length transactions away do you carry these standards?  In law, in biochemistry, in objective measures, there may be little or no difference.  But anyone who spends any time in Europe will tell you that suspicion of American power meshed with continental food anxieties, meshed with worries about whole ways of life being swept away by global markets and labor, food, entertainment and other cultural production.  Put all that together, and you’ve got a debate that easily strays from testable proposition and intellectual rigor.  But not this morning.

            Our panel will take us across the vast and bumpy landscape that is the U.S. EU food fight.  Will a WTO case simply mean the United States is standing up for internationally negotiated rules?  Or cutting of its nose to spite its face. 

            Then panel.  Since I didn’t know what order they were going to sit in, I actually had to look down at my notes here.  Spatially, but not necessarily politically, going from right to left, we have Chris Padilla, who’s the Assistant U. S. Trade Representative for Intergovernmental Affairs and Public Liaison; Julia Moore, a public policy scholar at the Woodrow Wilson International Center for Scholars;  Ron Gaskill, who’s the Director of Regulatory Relations for the American Farm Bureau Federation; and Glyde Prestowitz, the President of the Economic Strategy Institute. 

            Now these are all people I will stipulate at the outset of vast experience and accomplishment but rather than read their entire bios, which would slow things up a little bit, I will instead recommend that you read them, because they’re included in the packets that you got when you came in this morning.

            It’s estimated that U. S. farmers lose about $300 million a year in sales to the EU due to the moratorium on biotech.  Corn, cotton and soy beans are the main biotech crops grown in the U. S., with some, about a third, of corn, three-quarters of soy beans, almost three-quarters of cotton in the fields, genetically modified.  And it’s estimated that some 70% of all packaged foods found in U. S. supermarkets have GM ingredients. 

            The U. S., Canada and Argentina account for 99% of genetic food plantings and EU’s share is .03%.  The value of U. S./European agricultural trade was $6.4 billion in 2001, making the EU the fourth largest single market for U. S. farm products after Japan, Canada and Mexico.  There are 18 biotech food products approved in the EU, but a defacto moratorium on further approvals have been in place since June, 1999 with 13 applications pending approval. 

            According to the Department of Agriculture, U. S. agriculture is more than twice as dependent on exports as the general U. S. economy.  U. S. agricultural exports are set to top $53 billion.  In the most recent year, we have stats for them.  We’re still compiling them, that is, 2002. 

            So let me start by asking the panel to talk a little bit about this moratorium.  What is its legal basis?  What is its political basis and why is it in its fourth year, if it’s supposed to be temporary, negotiable and permeable? 

            Ron Gaskill?  Would you like to get it started?

RON GASKILL:  Well, we certainly think that there isn’t a legal basis for the moratorium.  We believe a moratorium is clearly politically driven result of a political issue that the Europeans have.  We are convinced that the, as you’ve indicated, that the legal basis does not exist.  And that in deed it could be challenged.  And we do believe firmly that it could be legally overturned.  So we’re clearly convinced that there is no basis.  That we do need to go forward and we need to go forward as quickly as we possibly can simply because every day that we wait, we have U. S. farmers who are clearly losing a considerable amount of sale opportunity on this particular issue.  They’ve lost a major market and it’s important for us (INAUDIBLE) to get that market back as quickly as we possibly can. 

RAY SUAREZ:  Julia Moore, I watched a video tape of you involved in a similar conversation over two years ago and yet two years later, we seem to be pretty much in the same spot.  Why?

JULIA MOORE:  Well, I don’t think we’re in the same spot.  I think that a lot has changed.  I think it’s important to reiterate the point you made in the beginning, Ray. 

            For an issue where there is a lot of disagreement, there’s no disagreement about a couple of main facts.  One is is that this is not a trade dispute.  And the second is if the U. S. decided to pursue this case in the WTO, even EU officials have said that the U. S. would win. 

            I think the real question here is should we go forward with the WTO case?  And I think that if we do, it will set back consumer acceptance of this technology in Europe.  This issue is about consumer confidence in Europe in their food regulatory authorities.  It’s about consumers having products that they perceive give them a real benefit.  It’s about the cost in price and quality differentials between GM and non-GM products and there also is a pro and anti-American factor nixed into this. 

            If you want this technology to be more accepted by the European public, unfortunately for trade officials and for American farmers, you’ve got to give this process a little bit more time.  You can look at the situation as being half empty as Ron did and clearly, American corn farmers are losing between $100 million and $300 million a year in lost trade because of the moratorium. 

            But let me say that there are a few half full pieces of this situation that I don’t think have gotten a lot of attention.  One is with the amount of American soy bean exports to the EU, and these are GM soy beans, have increased 14% during the last two years, totaling $1 billion.  I think you are seeing a situation in Europe where European food safety regulators are regaining the confidence lost through crises like the mad cow disease situation.  And I believe that you are beginning to see new GM products with direct consumer benefits;  a peanut that doesn’t carry an allergic reaction; low protein rice that can be more tolerated by patients suffering from kidney disease, that will eventually, not tomorrow, but in the next five years to ten years, result in greater consumer acceptance.

            I think that if we try, at this stage, particularly with all the other political problems facing the U. S. and Europe at the moment, to be perceived as forcing this technology down the European consumer throat, we will delay the acceptance of this technology in Europe and we will also delay it in other parts of the world.

RAY SUAREZ:  Chris Padilla, do you agree with Julia Moore’s point that things are in motion and there are signs of improvement?

CHRIS PADILLA:  I agree with Julia that thing are in motion, but they’re getting worse, not better.  The European union has been telling us for more than four years that a lifting of the moratorium is just around the corner.  In October, 1998, when they first stopped giving approvals, they told our exporters that if you just follow the regulations that we’re about to come out, we’ll approve your products.  They did not. 

            In July of 2000, they linked the lifting of the moratorium to the issuance of yet a new set of regulations on labeling, saying that when those regulations are adopted, we’ll lift the moratorium.  They did not.  Now they’ve (INAUDIBLE) the lifting of the moratorium to the regulations actually taking legal effect, which probably will not be until sometime in the middle of next year. 

            In the meantime, they have raised new (SOUNDS LIKE:  LEAKAGES).  The French environment minister and the Danish government have said that we don’t think we should approve genetically modified foods until there are new regulations on environmental liability.  Or on regulations regarding how these crops will be planted next to non-modified crops. 

            So I guess my response to Julia’s argument is, how many times do we have to watch this bad movie, before we know how it ends?  The moratorium motivated by politics.  It is not motivated by science.  And if this were only about changing European consumer attitudes, perhaps there might be an argument for delay.  But this is not any longer just about Europe. 

            The effects of the European moratorium are beginning to spread.  And they are spreading with tragic human consequences in places like Africa and India.  The fact is, this is no longer simply a matter of irrational European consumer fears based on a lack of science and a lack of a European food regulatory system.  This is now a matter of life and death. 

            A few weeks ago, about 6,000 hungry Zambian villagers had to break into a warehouse about 300 kilometers outside of the capitol.  They overpowered an armed police man and looted 230 tons of American food aid that had been locked up by the government because it was genetically modified. 

            Now the European union and various European officials have denied any responsibility or complicity in this, but the fact of the matter is, is that European actions speak louder than their words.  And the effects of the moratorium are spreading.  People in Uganda, in Zambia, in Zimbabwe, in India are refusing to adopt biotech crops because they’re afraid that their exports to Europe will be jeopardized.  And they good reason for those fears, because they’ve been told explicitly that they will not be permitted to make those exports to Europe.

            People are starving.  They are not getting access to the benefits of this science and the time for the action is now.  Enough is enough.

RAY SUAREZ:  Isn’t it a little bit of a stretch to go from a mob in (SOUNDS LIKE:  USACKA) to the office of the farm minister in Haig.  Are there really measurable exports of basic food crops from Zambia to the EU?

CHRIS PADILLA:  Well, let me read you a quote from the Ugandan ambassador to the United States who was interviewed on NPR on January 23rd.  She said, “when developed country scientists recommend different things, then people who are not as advanced in that science start wondering.”  She also said, “she worries that if Uganda adopts a genetically modified banana,” which by the way is Belgian technology, “that the European union will retaliate and refuse to buy our food exports.” 

            Ambassador Zelick, the U. S. trade representative traveled to Africa last month and he met with a number of African ministers who told him directly that they feared that if they adopted and used biotech food, whether as food aid or planting in their fields, that their exports to Europe would be jeopardized. 

            The point is that the European union argues strongly that we should all follow international rules and procedures and that they are violating those in this context.  They also hold themselves up in many cases as a model for the developing world to follow.  You can’t have it both ways.  The European union wants to be a leader in the world then it needs to lead through actions as well as words.  And to base its actions on sound science, to deal with the consumer concerns in Europe but to do so in a way that is based on international norms and sound science and not based on fear mongering.

RAY SUAREZ:  Clyde Prestowitz, give us your view of the landscape as it stands before you.  But also give us a little explanation of why you think the situation is where it is.  Into the fourth year, the 10th year of this argument.

CLYDE PRESTOWITZ:  Well, Julie gave my speed in a large part.  Again, I’ll repeat what you said at the opening, Ray.  Nobody can test the law here.  We have the law, that is, the U. S. has the law on its side in this case.  But I would make maybe three or four points.

            One is, Chris mentioned sound science as a basis for going forward.  And, of course, that’s a rational, logical place to be.  But I think we have to also keep in mind that in the last couple of years, the Europeans have been through a difficult time with their food wholly aside from genetically modified foods.  They had the mad cow scare and an interesting thing about the mad cow scare is that sound science told them that there was no problem with the mad cow disease.  All of the scientific experts told them, don’t worry.  It’s not a problem.  But it, of course, turned out to be a big problem.

            And so it may be, and I believe, that the fear of genetically modified foods in Europe is irrational but they can come back and say, okay, but all the experts told us not to worry about mad cow disease and then we had to burn all of our livestock.  So I think that’s a factor that’s conditional.

            The second point I would make is that I think we need to look these things in perspective.  This kind of case doesn’t take place in a vacuum.  It takes place in the context of larger relationships.  And right now we have a lot of things on our plate internationally and clearly a lot of tension with the EU.  So to proceed with this case right now, in this context, seems to me to be just about the worse possible thing to do and, in fact, I think the White House recognizes that and has suspended our going forward.  At least for a while.

            Another thing to keep in mind is that let’s look at our own behavior.  We have an agreement with Mexico called NAFTA.  Under the NAFTA agreement, Mexican truckers are supposed to be able to drive freely into the U. S.  They don’t.  We’ve been in violation of that agreement for some time.  Why?  Well, because we have this fear that Mexican trucks aren’t safe.  They’re brakes don’t work, whatever it is.  Mexicans say it’s irrational.  We say, no, we’re not sure that you guys inspect their trucks as well as well do. 

            So my only point is that let’s look at it in perspective.  Field point would be that when we talk about losing sales, $300 million, I would be willing to be that if we go ahead with this case, the consumer reaction in Europe, not to mention the overall regulatory political reaction is going to be such that not only are you not going to sell $300 million of GM foods, but you’re going to sell $400 or $500 million less of things that we already sell.  Because there’s going to be a tremendous backlash against America and against American goods and it won’t just be food.  There’ll be potentially boycotts of other products that we sell to Europe. 

            So I think that step needs to be kept in line.  As far as the foreign, the African and the Indian reaction, I agree with Chris that this is really unfortunate.  And it is, to some extent, at least in Africa, to some extent a fallout, of the European attitudes.  But I doubt that the, let’s separate India and Africa, because I don’t believe that the Indian reaction to this has a thing to do with the Europeans.  I think it’s pure Indian and it has a lot to do with anti-Americanism generally, but I don’t think it has much to do with Europe. 

            But in Africa, I agree with Chris, it does have something to do with Europe.  But I don’t believe that the European commission or European commission officials or European ambassadors have been going to Africa telling them not to buy the food.  What has been happening is that Green Peace and activists from Europe have been going to Africa.  And that’s unfortunate but it’s not something that you can solve with a WTO case.  And it seems to me that we have allies in Europe.  There are people in Europe who recognize that GM is actually an important technology for Europe.  And that Europe is losing out in the development of that technology because of these crazy attitudes.

            I think what we need to do is to work very hard and patiently and we have been patient, but we need more patience.  And how long shall we watch the movie?  Longer, I would say.  And try to work with our allies.  The best thing here is (INAUDIBLE) talks about soft power.  And the best solution is when your (SOUNDS LIKE:  INTERLOCKETER) wants to do what you want him to do because he thinks he wants to do it.  That’s, I think, where we need to get with the Europeans.

RAY SUAREZ:  Chris Padilla, Clyde Prestowitz brought up the possibility of a (SOUNDS LIKE:  PEERIC) victory.  Respond to that point please.

CHRIS PADILLA:  Well, I don’t think it would be (SOUNDS LIKE: PEERIC) at all.  The European union puts great stock in following international obligations and commitments.  And our friends in Europe have not hesitated to file 13 WTO cases against the United States since 1999.  We’ve only filed four against them. 

            But this isn’t really just a question of numbers.  I mean this is a question of European leadership.  I think everyone on the panel agrees that the European consumer fears here are not based on sound science and as Clyde said, they are irrational. 

            The question is, what is the proper government response to irrational fears among the consumers? Is it to pander to those fears by knuckling under to them and banning products based on no scientific basis and to have this strange situation where European officials publicly say these foods are perfectly safe to eat, the moratorium is illegal under international rules, but we’re going to keep it anyway? 

            Ray, when I was six years old, my grandmother if I ate too many Oreo cookies, my hair would fall out.  And my Uncle Bill also liked Oreo cookies and he was bald and that was good enough for me.  I believed it.  Okay?

RAY SUAREZ:  Did she mention time frame? She might have been right eventually.

CHRIS PADILLA:  She might have been.  (LAUGHTER).  But the point is, my mother eventually responded by saying to me, Chris, that’s silly. One thing has nothing to do with the other.  And I responded by saying, well, yeah, but how can you know for sure? 

            I liken my response to that of European consumers and my mother’s response to that of what the European union and its governments should be doing, which is to base their policies on sound science.  Was the right answer for my Mom to say, “oh, you’re absolutely right.”  Or, “well, I’m not sure there’s any scientific basis for your fear, but I’m going to pander to it because I don’t know what will happen if I don’t.” 

            This is a question of leadership and if were only about Europe, well then maybe we could all agree, let the Europeans go be Europeans.  Let them be unique and talk about the cultural value of food and so on and so forth.  But people are dying in Africa as a result of this policy.  That cannot be avoided.  You can’t simply stick your head in the sand and say that one thing has nothing to do with the other.  And argue that (OVERLAPPING REMARKS) (STOPS)

CLYDE PRESTOWITZ:  Chris, do you believe that if you win this case, you take this case to WTO, do you believe that Green Peace is suddenly going to stop sending people to Africa telling them how (OVERLAPPING REMARKS) (INAUDIBLE) foods are terrible?

CHRIS PADILLA:  No I don’t.  But I do believe that African governments follow the examples set by European governments. (OVERLAPPING REMARKS)

CLYDE PRESTOWITZ:  Well, they follow examples set by the U. S. Government? 

CHRIS PADILLA:  Well, they would like to adopt our food aid. Some have.  But some haven’t because they’re concerned about their exports.  The Ugandan ambassador stated the case (OVERLAPPING REMARKS)

CLYDE PRESTOWITZ:  Yeah, but the Europeans (OVERLAPPING REMARKS) but (INAUDIBLE) in the European commission has told them that they need to be concerned about their exports.  I mean, they’re looking at (OVERLAPPING REMARKS)

CHRIS PADILLA:  That’s not true Clyde.

CLYDE PRESTOWITZ:  Looking at statement and they’re looking at (OVERLAPPING REMARKS)

CHRIS PADILLA:  They told Zimbabwe that if they didn’t (OVERLAPPING REMARKS)

CLYDE PRESTOWITZ:  Who told them?

CHRIS PADILLA:  The European commission told (OVERLAPPING REMARKS)

CLYDE PRESTOWITZ:  Which European commission said that (OVERLAPPING REMARKS)

CHRIS PADILLA:  The European commission told Zimbabwe (OVERLAPPING REMARKS)

CLYDE PRESTOWITZ:  Who said that?  Which European commission, who said that?  Officially?

CHRIS PADILLA:  Yeah.  Yes.  They gave a message to the (OVERLAPPING REMARKS)

CLYDE PRESTOWITZ:  What was the statement?  (OVERLAPPING REMARKS).  Who gave the statement and what was the statement?  (OVERLAPPING REMARKS)

CHRIS PADILLA:  Clyde, the European commission, I have the statements, and I can read them to you if you want, but why do you think the Zimbabweans (INAUDIBLE) the corn?

CLYDE PRESTOWITZ:  Zimbabwe is a very funny place.  I don’t know what the Zimbabwe (OVERLAPPING REMARKS)

CHRIS PADILLA:  How about Botswana?  (OVERLAPPING REMARKS)

CLYDE PRESTOWITZ:  (OVERLAPPING REMARKS)  Look, obviously some Africans are taking, some are not.  And they may be swayed by various European statements, but they may not be official statements that are swaying them.  (OVERLAPPING REMARKS)

CHRIS PADILLA:  But the moratorium is an official European policy.  And that’s what they are reacting to.  If you say on one hand, and what Europeans are saying is, “well, you know, we’re not going to eat the food, but you can sure have it because you’re starving.”  (OVERLAPPING REMARKS)

CLYDE PRESTOWITZ:  Well, the Americans eat the food.  I mean (OVERLAPPING REMARKS)

CHRIS PADILLA:  Exactly.  (OVERLAPPING REMARKS)

CLYDE PRESTOWITZ:  (OVERLAPPING INAUDIBLE REMARKS)

CHRIS PADILLA:  And the Americans (INAUDIBLE) (OVERLAPPING REMARKS)

CLYDE PRESTOWITZ:  We look at the Americans.  The Americans eat the food.  So they can decide, who, you know, which side (INAUDIBLE) is healthier? 

RAY SUAREZ:  Well, I’m just going to take my moderator’s prerogative and say that the reason that Zimbabwe is in severe food deficit right now is far more complex than whether or not there’s modified genes and (OVERLAPPING REMARKS)

CHRIS PADILLA:  I agree.

RAY SUAREZ:  In pioneer corn.  Ron Gaskill, if you take it to the WTO and you win, are Europeans any more likely to eat GM food because you’ve won?  Clyde Prestowitz brought up the example of losing as much as you gain or perhaps more in sales.  Julia Moore said look for it to shoving down their throats.  What’s the prospect of a real victory?  A victory that you can take back to your members?

RON GASKILL:  Well, we think there actually really will be a real victory.  In a couple of different ways.  First off, it’s important to realize is that this is not a shove it down your throat approach.  If you win a WTO case, it doesn’t absolutely, there’s not requirement whatsoever that any consumers have to eat biotech products.  In fact, we think this whole issue should be moved out of the political spectrum and put into the marketplace, which is really where choice, ultimately, if you’re really talking about consumer choice, that’s where consumer choices truly decide it.

CLYDE PRESTOWITZ:  Yeah, but you’re not going to get that choice.  Because what’s going to happen is you’re going to go to the WTO and you say it’s not going to be pushed down their throat, but in fact, it’s going to be presented in the European press at the big bad Americans, one more time, hitting us in the face.  They hit us with steel tariffs, they subsidized their big farm bill, talk about starving people.  Our foreign subsidies of cotton are killing west African farmers.  Why aren’t we upset about that?  Well, because it’s our farmers.  (OVERLAPPING REMARKS)

CHRIS PADILLA:  (INAUDIBLE) subsidies Clyde, (OVERLAPPING REMARKS)

CLYDE PRESTOWITZ:  Well, they’re not being eliminated, Chris and you know they’re not going to be eliminated. 

CHRIS PADILLA:  (INAUDIBLE)

CLYDE PRESTOWITZ:  But your administration (OVERLAPPING REMARKS) has the biggest subsidy farm bill we ever had.

CHRIS PADILLA:  We propose to eliminate every one of those (OVERLAPPING REMARKS)

CLYDE PRESTOWITZ:  Who proposed?

CHRIS PADILLA:  (INAUDIBLE) subsidies and (OVERLAPPING REMARKS)

CLYDE PRESTOWITZ:  Who proposed that?

 

CHRIS PADILLA:  Ambassador Zelick proposed that.  (OVERLAPPING REMARKS)

RON GASKILL:  (OVERLAPPING REMARKS) getting back to what we were talking about.  The fact is is that we do have a responsibility.  We as U. S. farmers (INAUDIBLE) producers do have a responsibility to work with EU consumers.  To work with the EU institutions to help them understand and get the message that indeed biotech products are not inherently unsafe to human environmental health.

            We have an opportunity, we have a responsibility.  We fully recognize that.  Sure, there at first is going to be some backlash.  I’m not going to suggest that there’s not going to be.  Yes, there’s going to be all kinds of rhetoric.  But we feel at some point, the rhetoric will dissipate.  We feel that there provides an opportunity for us to again interject a reasonable message and to bring some rationality back to this entire issue.

RAY SUAREZ:  Well, Ron, you began your remarks by saying that European consumers, you said it’s a market place question, that European consumers can choose whether or not to eat these foods.  That’s a testable proposition, I think.  Can an American choose not to eat GM food?  I mean, in the course of a normal day.  I got up this morning, I put my shoes on, I walked outside.  Can I choose now in the market place to not eat GM food?
JULIA MOORE:  As soon as the organic regs with the Department of Agriculture is putting in place now are fully operative.  You will have a choice in the United States.  Any organic food will be non GM.

RAY SUAREZ:  But if I go to the Wall Street Deli, a couple of blocks away from here, and get a ham on rye, will I be able to say to the man, “no, no, don’t give me the GM rye, I want organic rye.  Please don’t give me cheese that has (SOUNDS LIKE:  RENNIT) and cultures that are genetically modified.  Give me the cheese that doesn’t have that.  And when you give me the soft drink, which is sweetened by high fructose corn syrup, please don’t give me HFCS that has genetically modified corn as a base stock.”  Can you really, truly (OVERLAPPING REMARKS).

JULIA MOORE:  It is increasingly difficult in the United States to avoid eating genetically modified foods. 

RON GASKILL:  And that’s largely because we have (INAUDIBLE) system at this point that is not really processed based.  It’s result based.  The fact of the matter is that, to this point, there is no peer reviewed, scientific risk assessment that suggests that GM products are any different than their traditional counterpart.  Therefore as a result of the fact that there is no proven safety problem, we don’t have, at this point, a need to have to label food products as GM or non-GM> 

RAY SUAREZ:  But that’s a different question, isn’t it?  I mean you said that Europeans could choose not to eat this group.  I don’t think I can choose to eat this group, not to eat this group.  So I don’t know if Europeans are going to be able to.

RON GASKILL:  Well, (OVERLAPPING REMARKS)

RAY SUAREZ:  (OVERLAPPING REMARKS) use, exercise informed consent.  (OVERLAPPING REMARKS)

CLYDE PRESTOWITZ:  One thing to remember, they do eat GM food.  As Julia pointed out, they’ve got GM soy beans and all the rest of it, so they’re already essentially in your position. 

CHRIS PADILLA:  And I would argue a lot of French cheese that does not carry and probably would not carry under the proposed European regulation any label that identifies the fact that genetically modified enzymes were used in the production of that cheese. 

            And that’s one of our concerns about the idea that a labeling regime is the answer here.  It’s not.  Because the labeling regime will not be based on science.  It will be based on fear.  And it will be discriminatory.  Under the proposed regulations that the European union is looking at right now, American vegetable oil may have to carry a label, even if there’s no detectable trace of genetically modified DNA in that vegetable oil.

            But French cheese, or French wine, made with genetically modified enzymes, would not carry such a label.  That’s plainly discriminatory. 

RAY SUAREZ:  So Julia, this is being portrayed as really a communications challenge.  Some of the largest food processors in the world are European based multinationals.  How do they talk to their consumers and how do the governments talk to their consumers in a way that’s different from what they’re doing now, that helps us get over some of these humps that several panelists had mentioned. 

JULIA MOORE:  Most of the major food manufacturers in Europe tell their publics what any smart business man tells its customer.  We’ll give you what you want.  You want GM, we’ll give you GM.  You want non GM?  We’ll give you that.  At the same time in Europe they’ve therefore mostly taken or tried to take GM ingredients out of their products and put in non-GM substitutes.  But most of the time they’ve also said that they believe in biotechnology.  They think it’s an important factor in the future that could have very potential positive environmental impact and result in less use of pesticides and environmentally harmful fertilizers. 

            I think in the market place what this new labeling traceability regime offers the European consumer is great confidence that its food regulatory authorities are beginning to do their job.

            I’d like to just correct something that Clyde said.  The perception in Europe during mad cow disease was that the scientific community was saying that beef in Britain was safe.  That is absolutely the perception.  The reality was at their ministry of agriculture, the scientists were telling the politicians at the time, we don’t know if this disease which in the early projections was projected to kill, over the next 30 years, 500,000 people in Britain.  We don’t know whether this disease can jump from cattle to humans.  We don’t think so, but we need to do more research.

            What the politicians, what the government officials did with that information was go out to the public and say, this is safe.  We’re going to take certain measures and we’re going to do more research, but don’t worry.  Keep eating British beef. 

            So regrettably, in this whole Donneybrooke of the mad cow disease, science got a bad rep and as the scientific research increasingly showed that, in fact, mad cow disease could jump from cattle to humans, the government officials did not, in fact, change their rhetoric.  And that’s part of the reason of why we’re here.  This was not only a phenomena  in Britain, in the late 2000, when just a few cases of mad cow disease, more than anticipated, were discovered in Germany and France and a few other countries, beef consumption in those countries almost overnight dropped 40 to 60%.

We’re not talking about supercilious European who may be have some funny ideas about science.  In fact, they probably know as much about the science about genetically modified food now as they know about economics and trade.  And they feel just as confident in making decisions about what they buy at the supermarkets as whether or not to support their government’s current policies on trade or not. 

            And I think we have to respect that.  I think Africa is a problem.  But as Clyde pointed out, the food politics of Africa go well beyond GM food and what’s happening in Africa in terms of exacerbating the famine there is not just because Green Peace is telling people in Zambia that your markets may be closed in Europe if you use this food.  Particularly in Zimbabwe, food is part of a war, a civil war, within that country or political war within that country.  And to blame GM food and the issues surrounding GM food for that crisis is, I think, wrong.

CHRIS PADILLA:  Well, we’ve never blamed GM food or the European policies for the famine in Africa.  What we have said is that there is a direct contribution to the exacerbation of the problem when you’ve got people who can’t get food that’s been donated by the United States because of fears over GM crops that are exacerbated by the actions of the European union, we think that is wrong and that that is in fact scandalous.

            With regard to the mad cow issue, I would say that it’s somewhat instructive in understanding current controversy over GM crops, but there are not direct parallels.  In this case, unlike the case of mad cow, I don’t think there’s really any ambiguity in the science.  European union officials, member state officials have stated publicly that there is not scientific basis for the moratorium and that all, as I would point out again, all we’re asking is for the European process that they have in place to consider these applications on an individual basis be used. 

            We’re not demanding that they accept every single GM crop, we’re not trying to force anything down anyone’s throats.  We’re asking them to follow their own laws.  And they’re own international obligations.  We think that’s entirely reasonable, particularly given by their own admission, there is no scientific evidence of any kind to indicate that there are risks to either human health or the environment from using GM crops. 

RAY SUAREZ:  Ron Gaskill, have EU restrictions in any measurable way, in any way that the Farm Bureau knows about, slowed the willingness of farmers in the United States to plant biotech products?

RON GASKILL:  Very, very little.  There has been some question.  Certainly there are some farmers who concerned.  Who do have some interest in being sure that they are responding to the market measures.  But for the most part, the technology and benefits that are offered by that technology far outweigh any of the detractions.

            Certainly there are farmers who freeze organic products.  They are very concerned, want to be sure that indeed that they are not commingling.  Not getting mixed ingredients into the production of organic products.  But I would say for the most part the acreage continues to go up in terms of corn, soy beans, cotton.  It looks like commercially wheat will soon be genetically modified and the benefits to the environment, the economic benefits to produce them, seem to far outweigh, so far, any concerns.  I’d say no, acceptance is actually in fact growing and I would even say that soon we are to see commercially GM products that are going to resist other kinds of diseases that we traditionally haven’t been dealing with. 

            I think the next generation of GM products as well are going to present a set of consumer benefits.  Increase vitamins, increased nutritional enhancement, so no, I don’t see too much at all resistance on the part of the U. S. farmers to adopt GM crops.

RAY SUAREZ:  And what about on the next step, when your members go to market?  Has the (SOUNDS LIKE:  AN) affected the willingness of food processors in the United States to buy these crops when they hope to have export markets in the EU?

RON GASKILL:  There’s not question about the fact that under terms of trade, food processors have been challenged with the dilemma.  There are some major customer in the EU that are requiring the food processors to sort of found that indeed they do have GM free ingredients. That’s a very, very difficult thing for most U. S. food processors to be able to absolutely certify simply because of the systems that we have to handle farm products and farm commodities in this country are so massive, that it’s extremely difficult.  Virtually impossibly to absolutely guarantee that there isn’t some kind of a GM kernel of corn or soy bean or something of that nature, in a particular shipment.

            So food processors are doing the best they can. They can’t, in most cases, certify it unless they contract with a specific grower to be absolutely sure that grower’s product is (INAUDIBLE) specification that the processor needs.  For the most part for major processors who are really producing the majority of food products in the world, that still is very, very difficult (INAUDIBLE) to be able to accomplish.  (INAUDIBLE) as feasible (INAUDIBLE).

JULIA MOORE:  I think the real lessons for the farmer here is don’t start to grow a product in the United States that hasn’t received wide-spread, global approval.  The reason that the soy bean growers are able to continue to sell their products virtually unabated in Europe now to the tune of over $1 billion per year, is that they made a decision early on that they would not grow in the United States GM products that were not approved in Europe.  And those products enjoyed European approval before the moratorium and it has not disrupted, therefore, much of their trade as a result.

CLYDE PRESTOWITZ:  I’d like to enforce one thing, Ron said, which is the consumer benefit.  Part of the problem that we’re having now is that it’s hard to say to European consumers what’s the benefit of this.  It looks to them, and I mean again this is all again, PR politics, but it looks to them like the Americans are trying to, as Julie said, push something down their throat that’s to the benefit of the Americans.  It doesn’t taste better, it doesn’t make you healthier, why would you do it?

            What’s interesting is if you look at drugs, for example, Europeans don’t balk at going to whatever the latest technology is.  In fact, Europeans are much more risk taking in terms of going immediately the latest medical technology if it looks like it’s going to cure cancer.  So if you have a cancer-curing GM corn, I don’t think you would have any problem selling it in Europe.  And I think the emphasis here going forward really needs to be on demonstrating the consumer benefits and there are also industrial benefits.

            And I come back to the point that I’ve had many discussions with European commission official who themselves are incredibly frustrated with their own policies.  Because they recognize that it is undermining development of the GM industry in Europe, which they know will be toward their long term benefit. 

            So, to me, it seems like it’s a matter of time.  We know these things do have benefits.  Both for producers and for consumers.  And because the argument is irrational, in the long run, it’s not going to stand.  So therefore why not be patient, watch the movie a little bit more, because you’re going to win. 

RAY SUAREZ:  But isn’t it also a mandate at this point if you term some of this behavior, some of this reaction is irrational to shape your behavior to it, just because it makes more sense to go along than keep stamping and saying, “no, no, I am right. And I am going to keep on stamping until you admit that I am right.”  Some of it may go to things like saving heritage varieties, segregating seed in a way that allows you to preserve old genetic lines and keep them free of the taint. 

            There’s a lot of suspicion of this part of the agricultural world because there’s a suspicion that there’s a kind of genetic aggressions at work and eventually, even by accident, GM drives out other things.  That even if you have crops that you want to assure the market place are GM free, once you try to test it, you find, no, well, actually there is because nature is like that and butterflies and bees and the wind and all that makes it impossible to say, “no, no, well, no pollen’s been moving around my fields.”

            Well, of course, it’s impossible.  In Mexico, far, far from where the nearest large stands of, for instance, genetically modified corn have been planted, there is evidence that in the native varieties of corn, there’s now presence of these genetically modified strains. And you have to adapt to that  behavior rather than just say, “oh live with it.”  Or, “get over it.”  Or “leave me alone.”  Don’t you?

CHRIS PADILLA:  Well, my concern is that it’s exactly this.  It will be raised as the new argument for why we’ve got to keep watching this bad movie.  That having admitted now that there’s no scientific basis for the moratorium, having admitted that the food is safe to eat, that it has environmental benefits, the next argument would be, well, we can’t allow it in because it might “contaminate” the crops next door.  Well, contaminated with what?  With food that’s safe to eat and that has environmental benefits? 

            Again, I think our skepticism of these arguments is there’s always one more step that the Europeans are saying needs to be taken.  There’s always one more step.  If we find cancer curing corn, then Europeans will eat it.  Well, the fact of the matter is that biotech corn and soy and cotton and (SOUNDS LIKE:  CASAVA) and other crops do have tremendous benefits. 

            (SOUNDS LIKE:  NORMAN BORLOG) the Nobel Prize Winner, the father of the Green Revolution, credited with saving millions of people in Asia from starvation said, in The Wall Street Journal a few weeks ago, “the affluent nations can afford to adopt elitist positions and pay more for food produced by so called natural methods.  But the 1 billion chronically poor and hungry people of this world cannot.” 

We’ve got people like Florence (SOUNDS LIKE:  WONBOOGOO) who’s a Kenyan scientist who says, “Europe has surplus food and has never experienced recently hunger and mass starvation on the scale that we regularly witness in Africa.  Africans can speak for themselves,” and she says, “more than any other continent, we need agricultural biotechnology.” 

            So I’m skeptical of arguments, Ray, that we have to wait for the next step.  The labeling regulation or the regulation on planting GM crops next to so called organic crops.  Or the regulation on traceability.  Or the regulation on environmental liability.  Or the cancer saving corn.  There’s always one more obstacle that can be raised and I think our view is that we’ve waiting quite long enough.

RAY SUAREZ:  So this is just obstructional gamesmanship.  It’s not anything legit.  When people (OVERLAPPING REMARKS).

CHRIS PADILLA:  We believe so.  In the United States, we have been able to promulgate regulations and the FDA and the Department of Agriculture have been very aggressive in promulgating regulations that show how GM crops can be grown in areas in a safe way that don’t spread particularly crops grown for pharmaceutical reasons to other crops.

            There are ways to do this.  Proper regulations can address these concerns.  Our fear is that rather than adopting proper regulations and then following them, European union is raising more obstacles and excuses.

JULIA MOORE:  I think that, again, the big divide here is whether you see this as a trade problem or a consumer issue.  I think the consumer confidence in the regulatory system is paramount in this question.  In the United States we trust the FDA to keep our food supply reasonably safe and our drug prices unreasonably high.

            So we speak about GM in a way that’s different from the European continent where they just this year have instituted the equivalent of the “F” in “FDA” in Europe and it’s not even really up and running.  In every major country in Europe, over the last three years, you have had to establish a new food safety agency in order to try to regain public confidence in the government’s ability to regulate safe food.

            Incidents like (SOUNDS LIKE:  STARLINK) or the recent (SOUNDS LIKE:  PRODIGENE) episode where corn experimentally genetically modified to produce a diarrhea drug inadvertently slipped into the food supply in Nebraska.  A real set back in terms of European confidence that these genetically modified products, which may in fact be safer for us than conventionally grown food, are well regulated.

            We still are grappling in this country with regulations which are usually well followed by industry but are voluntary rather than mandatory.  I think that we should not just sit by and watch this movie.  We should be involved as the United States in setting up a very tough regulatory process for these foods that will engender not only our own consumer confidence in them, but consumer confidence in them world wide.

RAY SUAREZ:  I was interested in something that Chris had to say about price.  We are talking about community of about 275 million people in the current EU and a whole big boatload about to come on board, who already pay a much higher percentage, prevailing percentage of their household income on food than Americans do.  They are citizens of democracies that have elected national governments and an EU super government that continues to pool oceans of tax money to subsidize agriculture as a job inside that trade zone. 

            Is price as potent an attraction in the EU as it would appear to be in the United States where we’ll drive an extra 50 miles to go to WalMart?  If people are voluntarily choosing to elect politicians who pool their tax money to provide an efficient way of life for a small percentage of their citizens, is price going to be the trigger that pushes this forward or is there a cultural divide over which we’re trying to shout at them about prices and they don’t care?

            Europeans have told me, yes, you spend less on food, but your food stinks.  If they really believe that, isn’t it more complicated than just saying, hey, you can get cheaper safflower oil.

JULIA MOORE:  Price is a factor.  All the history we have of labeled genetically modified food product is that once labeled, the consumer in Europe makes a decision based on some factor other than GM.  And the strongest, the most potent factor is price.

            In the UK, in 1996, there was a genetically modified tomato paste that was the best and fastest selling new product that (SOUNDS LIKE:  SAINSBURY) and Safeway Supermarkets had ever introduced.  It had a bright yellow label on the front of the can that said, “genetically modified.”  The big difference between that tomato paste and conventionally grown tomato paste in Britain was that you got 40% more tomato paste for the exact same price.  Consumers love that product. 

            And my own view is if we can allow the EU to put in place labeling laws that both governments and consumers can stand behind and have confidence in, that you will see the decisions made in the EU about buying or not buying GM to be based on price.  And the projections based on USDA figures and granted making some assumptions about how quickly Brazil either legally or illegally will move to produce in GM soya, show that between now and the year 2010, the price differentials for GM versus non-GM may be anywhere from 5% to 40%. 

CHRIS PADILLA:  I would agree with Julia’s comment about when markets are allowed to work I think consumers will make choices based on more than just whether the food is GM or not.  

            I live up in northwest Washington near the Fresh Fields where you can go and pay more for an organic banana if you want to.  You can also buy a so called conventional banana for less money. 

            I think our concern in the U. S. government about the traceability and labeling regulation is that particularly the traceability aspects of the regulation may be so burdensome and may require so much record keeping, I believe it’s up to five years worth of record keeping.  And as I mentioned earlier, may wind up being discriminatory in that it wouldn’t require certain labels or records for French cheese and wine, but would for American vegetable oil.

            Our concern is that you might remove one illegal WTO measure, the moratorium, and replace it with another illegal measure that might have practically the same or maybe even a worse effect.  Particularly on American farmers, but also on developing country farmers.  Imagine farmers in Latin America or Africa or India trying to comply with the traceability regulation that requires record keeping out to the fifth arm’s length transaction.  Would that not have the same practical effect of banning their exports to Europe with all of the negative consequences?  That I think is our concern. 

JULIA MOORE:  I think that this is a legitimate concern.  I believe that the labeling and traceability measures as they currently stand are unworkable.  I think the European commission recognizes that Tony (SOUNDS LIKE:  VONDERHARGEN) is here in the audience, he can correct me, I think normally these types of regulations are reviewed every five years to see if there needs to be changes. 

As currently outlined, the regs that are being proposed will be reviewed in two years.  Because I think there are very great concerns that these regulations are simply unworkable.  But I, again, for the sake of the consumer in Europe, I think it’s important to allow a European solution to try to work at this issue and not come in with an American imposed one.  I think we will have a much better effect in terms of our ability to sell our product and this technology to be accepted.  If Europe itself finds its way rather than having us try to impose it.

RAY SUAREZ:  By implication, we’ve had several different suggestions.  Head to the WTO, don’t head to the WTO because this thing is the edifice of exclusion.  Is crumbling on its own.  Just let it crumble.  Maybe head to the WTO but not right now because it just doesn’t seem to be a good time to do it.   

            From here on out, with the shadow of possible war, what’s the policy prescription for now?  And I’d like to hear especially from Clyde and Rob about this.  What do you suggest we do right now?

CLYDE PRESTOWITZ:  I’d like to go to the movies (LAUGHTER).  No, I think that what we ought to do is not go the WTO right now and maybe never.  Because I’m not convinced that winning the (SOUNDS LIKE:  LOL) will win you the victory.  I do think that there are, because it’s irrational, it’s not going to stand.              There are already forces working against the European regulations.

I think more creative diplomacy would be helpful.  We have this great technology that we don’t use.  You can put together a video conference very easily.  You can have Bob Zelick over here talking, having town meetings in Europe.  Talking via televideoconference with European consumers.  You can have Anne (SOUNDS LIKE:  VENEMAN), you’ve got to have Julia (Moore), people here.  And doing that in conjunction with our allies in Europe.  I think this is a case where sunshine is likely to be more powerful than the north wind.

RON GASKILL:  Well, I think there’s not doubt about the fact that nobody wants to go to the WTO.  I mean, farmers don’t want to have to go to the WTO, but we feel at this point in time that so far, the Europeans have not really come forth with what we consider to be meaningful solutions to the problem. 

            So the only thing for the WTO from our perspective is simply a lever.  It’s a lever that tries to force some kind of rational action on the part of the EU to resolve their problem.  The WTO case, if we win, will not force, I mean the U. S. won’t be forcing the EU into a particular solution.  All the decisions simply in our favor would suggest that their current position is not WTO compliant. 

            It’s still up to the EU to come to kind of solution.  So we wouldn’t, as the U. S., be imposing (SOUNDS LIKE:  DISSOLUTION), but we certainly would be suggesting to the EU that the current situation is unacceptable and it’s not WTO compliant.  So therefore, let’s move forward.  I think the point’s been made that it’s been four years, there’s been milestone after milestone after milestone where we’ve been waiting for some action.  And those milestones come and they go and nothing happens. 

            So status quo is certainly something that is not acceptable.  We would prefer certainly not to go to the WTO.  But frankly, at this point, we feel as if, from a farmer’s perspective, our back is against the wall.  We just don’t have a choice but to force the process forward and the only way to force it forward, that we can see reasonably, at this point, is to move it to a WTO case.  And move it as soon as we possibly can. 

RAY SUAREZ:  Does the WTO provide for any kind of enforcement mechanism that gives you any confidence that if American farmers prevailed there, there would actually be some teeth in that judgment?

RON GASKILL:  No.  And in fact unfortunately the mechanism is based upon basically a retaliatory opportunity.  If we, in fact, U. S. farmers really don’t have a lot of faith that a WTO decision would necessarily be complied with.  Certainly if you look at the beef hormone case of a few years ago, you did not comply with that adverse ruling, (OVERLAPPING REMARKS)

RAY SUAREZ:  Remind people what that’s about.

RON GASKILL:  In that particular case, the U. S. took the European union to  the WTO over its ban, basically, on hormone treated beef.  Again, from their perspective, it was a health issue.  From our perspective, it was not.  According to WTO rules, the WTO indeed did decide ultimately that the European position on that particular case was non-compliant.  The choice then, at that point, is for the EU to either comply, to change its system so that it is compliant or the aggrieved party in this case, the United States, can ask for, and in this case we did receive, permission to establish retaliatory tariffs on products coming from the EU into the United States in an amount that was about equal to what we felt the damage was or what the damage was forecast to be, from the loss of sales.

            In this particular case, we would still have that same opportunity.  U. S. farmers simply want to be in a position that if the EU is not going to be willing to comply with the standard of international trade law that we’ve all agreed to, then we need to have some remedy.  If we don’t take the case, we don’t have any remedy.  We sit here, exactly where we’re at, losing more than $1 billion in sales, to markets that we really absolutely need. 

            So we would have an opportunity if indeed we do get our favorable ruling at the WTO, should the EU not comply with it and change its regime, we would have an opportunity to request and hopefully receive permission to invoke retaliatory tariffs on EU products coming into the United States.

RAY SUAREZ:  We have a microphones set up at either end here for you to join the conversation and add your own questions.  We’ve also been getting questions via email and while you clamor to the microphones, I’ll use them as a programming device to provide for a little window. 

            Ted (SOUNDS LIKE:  AGGRESS) from The Scientist in Washington, D.C., asks “how does the uncertainly of regulating GM foods effect research activities into biotech funding for research by organizations and by the government?  It is being held back by this fight.”  Chris (Padilla)?

CHRIS PADILLA:  Well, I’m not aware of any figures regarding the use or the spread of biotech research.  I am aware that biotech crops or the use of biotech crops is growing in double digit figures.  So clearly farmers, not just in the United States, but in places like Argentina and Australia and China and South Africa and other countries are adopting these crops.

            But I think it raises a good question.  If we continue to allow a moratorium to be effect on products that is not scientifically based, and we have a situation in which the European union essentially acquiesces in the irrational and non-science based fears of consumers.  Does that have a chilling effect on science?  I think it’s a useful question to ask.

CLYDE PRESTOWITZ:  Actually, it is interesting aspect of this.  I think Chris is probably right in the overall but, but in fact, the immediate effect has been, there’s been a (INAUDIBLE) from Europe to the U. S.   European scientists and technical people who are interested in doing GM research, it’s harder to do in Europe than are coming to the U. S., so we are the immediate beneficiary, technologically, of the European moratorium. 

JULIA MOORE:  I think it’s a three-fold response.  As Clyde said, in Europe, there is a great concern that industry research is coming to the United States.   That government research is going down.  In the United States, it’s had very little impact on our research investment.  I talked to an executive at a major biotech firm recently who said that the moratorium hasn’t all impacted their research program, but it certainly has impacted their marketing strategy.  And they are looking to release product in a way that will hopefully be directed at increasing consumer acceptance rather than stiffening consumer resistance. 

            In the third world, I think there’s a hunger for this kind of technology and the real question is going to be whether international aid agencies and their own governments and also private sector foundations are going to made the investment in this technology in the products that the third world needs that are unlikely to be of high commercial value to U. S. and European multinationals. 

RAY SUAREZ:  Ron, do you know if the (SOUNDS LIKE:  CONGILS) and (SOUNDS LIKE:  CONAGRAS) and the Montsantos are doing business differently because of these limitations?

RON GASKILL:  Well, I think it’s for a number of the indications that Julia pointed out.  That there is some difference in terms of the way they’re doing business.  I think there will certainly be more diligent in the way that they certainly introduce the new technologies.  I think they’re trying to be more cognizant of market demand.  But there is still a limitation as to what they reasonably can do in terms of the way that they handle bulk amounts of grain.  You’re talking about some of the major grain traders in the world.  And our systems just aren’t made to segregate into very, very distinctly assure that we don’t in some cases have biotech ingredients in some of the commodities that (INAUDIBLE).

RAY SUAREZ:  What about research?  Full speed ahead?

RON GASKILL:  In terms of research, not so much actually the (INAUDIBLE) in that but certainly the (SOUNDS LIKE:  LAND GRANT) universities are clearly accelerating research.  The (SOUNDS LIKE:  LAND GRANT) universities in terms of new products, in terms of new ways to use biotechnology, whether it be in animals, plants, otherwise I think they see a wonderful opportunity that the technology will provide the society and I don’t see it slowing down.  I see it considerably accelerating. 

RAY SUAREZ:  Tell us who you are and where you’re from?

AMY BURDETT:  Yes, my name is Amy Burdett and I’m with the U. S. Department of Agriculture’s Foreign Agricultural Services. I work in the Grain and Feed Division and I’m also on the Biotechnology Staff.  I’m the administrator there.  And first I have a question and then some comments.

            My basic question is to Julie (Moore) and Clyde (Prestowitz).  Is this issue really a consumer issue or is it a government issue that’s using the consumer to blame a trade issue?  Is it just a front thing that the consumers really, the reason why the moratorium is in place?  I’ll give some examples.

            The Europeans, when they put the moratorium on, were big corn importers.  They need corn to feed animals and livestock.  They don’t have enough domestically so the Europeans still import corn. They still import genetically modified corn from Argentina.  The reason why Argentina’s selling corn and not the U. S. is because the moratorium that’s put in place keeps the new varieties that the U. S. is growing from being approved, but the Argentines only grow corn which was approved prior to the moratorium.  So the consumer still is eating genetically modified corn.  It’s not that it’s an all or nothing. 

            One impact of this has also been U. S. trade with third countries that trade with the EU, and it’s not just the African example, which is more recent, but things like Brazil.  Brazil is a corn importer.  They no longer import U. S. Corn because its unapproved varieties because they export poultry to the EU.  So another one of our markets is Argentine supplied now because the EU’s laws are in place.

RAY SUAREZ:  Okay.  Good question. 

CLYDE PRESTOWITZ:  Government to government or just using the consumer as a shill? 

JULIA MOORE:  Well, I think I mentioned earlier, one of the big lessons in my view to the American farmer is don’t move with a product that hasn’t received full approval.  I think the (SOUNDS LIKE:  STARLINK) incident was clearly a taste where a product, for example, had not been approved for human consumption. 

The soy bean growers who have traditionally espoused the view that you don’t move with a product until there’s full approval everywhere and for every use, largely basically said this was a mistake.  People knew it was going to happen at some point.  And I think that you can make the same analogy to the international market place. 

            The Europeans are not engaged in traditional protectionism.  If they don’t buy the corn from us, they’ll buy it from the Argentines.  If they don’t buy the soy beans from us, they’re going to largely buy them from the Brazilians. 

            There are no, at this point, major European soy bean growers who are being protected by this measure.  This is a measure that’s based on consumer reaction to problems in food safety in Europe.  Are the governments looking for political coverage?  You betcha!  Have they been as strong as, I think with the exception of Great Britain, as standing up and saying as often as they should, what the benefits are to this technology.  No.  They haven’t. 

            I think, however, what we are seeing is part of the adjustment to a new technological world in the 21st century.  And I think that no country right now is doing it as well as it should be.  Look at the way we’ve dealt with cloning in this country.  There are 40 other countries out there who have laws on the books that ban human cloning and in the United States, we’re still locked up in the Senate and the House, trying to come up with some solution.

            These things don’t happen perfectly.  They happen more like an erratic, electrocardiogram.  It’s going to take some time for governments and for publics to adjust.  But I still think that this is basically a consumer issue and governments trying to deal with consumer sentiments.  And not an effort to keep out U. S. products versus Argentine or Brazilian.

RAY SUAREZ:  Chris (Padilla), quickly (INAUDIBLE).

CHRIS PADILLA:  Well, I would just say that clearly the questioner’s point I think was acknowledged by Julia and that is that the EU ban has global effects.  And Julia’s argument is that we should sensitive to that ban.  Our point is that it has global effects and in regard to protection is that the European union is the most protected agricultural markets in the world.  It is very difficult for us to accept the notion that this has nothing to do with protectionism. 

CLYDE PRESTOWITZ:  It’s kind of all of the above.  There are protections in Europe and they’re taking advantage of this.  But this is not being driven, in my mind, primarily by classical protectionists in Europe. 

            It’s also, I think, not being driven, it doesn’t originate as a grass roots consumer thing.  It originates with activists.  It originates with the extreme wing of the environmental movement, which is very strong in Europe, and quasi-religious. But it has gotten a lot of media and the activists are good at media.  And they have begun to condition the consumer.  So it has become a consumer thing by dint of the PR and I agree with Julia.  I think that if there’s one place where I really am very critical of the Europeans it is, is that they haven’t had the courage to, their leaders, their political leaders in Europe have not had the courage to tell the truth.  And I think that’s something where we really should react very strongly.

JULIA MOORE:  I think you have to point out that Tony Blair is a huge exception (OVERLAPPING REMARKS)

CLYDE PRESTOWITZ:  Yeah.

JULIA MOORE:  . . . exception to that.  And had taken an enormous political hit for trying to essentially promote both in the European condition and in his own country, a much more civil dialogue on this.  And had taken positions on the safety of agricultural biotechnology very publicly and to his political detriment. 

RAY SUAREZ:  Yes?

PAUL (INAUDIBLE):  Yes, Paul (INAUDIBLE) with “Inside U.S. Trade”,  and the question is for Mr. Padilla. 

            It’s two parts.  One, is the administration decision on launching a case on hold until the ware with Iraq is over?  And second, what is the message that that sends to the Danes, for example. They support the moratorium, they also support our policy in Iraq.  Thanks very much for your help in Iraq, now here’s a wildly unpopular WTO case.  What does it say to the U.K.?

            They imposed the moratorium, but they also oppose the WTO case as undermining their efforts. 

CHRIS PADILLO:  Well, let me take second part first.  I don’t think the European union has been shy about bringing WTO cases that are wildly unpopular in the United States.  They have challenged a tax law that could effect a number of our largest exporters.  They have challenged laws that passed with well over two-thirds of bipartisan support in the Senate.  That puts us in a very difficult political situation. And that does not seem to have been taken into account when they acted.

            With regard to the first part of your question, I’m not going to get into commenting on where the administration stands in its decision process.  I will simply say this;  I don’t think anyone, including our friends in the European union, should assume that this issue has gone away or will go away. 

RAY SUAREZ:  Yes?

ANNE MARIE (INAUDIBLE):  My name is Anne Marie (INAUDIBLE) and I’m also from USDA.  I’m with the part of the agency that works with the land grant universities.  That Mr. Gaskill alluded to, the cooperative state research extension and education service.  And I have a question for probably for Mr. Padilla.  But before I do that, I would like to comment quickly on the first question about funding for agricultural research and biotechnology.

            At least two European companies cut international agricultural development research programs that were doing biotechnology research.  Because those programs have lost national political support, at the same time they continued programs on regulation biotechnology in developing countries. 

            My question is about something that Mr. Suarez alluded to, which is the expansion of the European union to the east. Eastern Europe is, in some ways, similar to our Midwest in that it has the best agricultural soils in Europe, including the eastern part of Germany.

            And it also has a very strong tradition of agricultural research including transfer of innovations from experimental stages to practice.  That said, they’re not urgently looking for new sources of income, they have to revise all of their agricultural message.  In the long run that means competition for the United States, but it also means that we have some common interests.  And I wonder if the United States is talking with those countries about making common cause on some of these issues as a win-win way of moving forward that might be different from what we’ve talked about so far.

CHRIS PADILLA:  Well, I think the answer is yes.  I think that the excess ion of a number of the countries in central Europe to the European union is going to have profound effects on Europe’s agricultural policy. Not just with regard to biotech, but also with regard to the critical issue of reforming the common agricultural policy.  And I suspect that when countries like France and Luxembourg and Italy become net payers into the system rather than net withdrawers, that perhaps their attitudes might change. 

            But you’re absolutely right about there is greater receptivity in some of the countries in central Europe.  Perhaps that will have an effect.  I do think we should keep in mind that it is a blocking minority of the European union member states that have caused the moratorium to continue for 4 ½ years.  This is not a situation in which you’re talking about a vast majority of European, at least, government opinion.  You’re talking about a relatively small group of countries, and we know who they are.  They are countries that, including those that have banned national imports, like Austria and Italy and Greece, Luxembourg, certainly France and Denmark have raised some concerns in the discussions. 

            But there are others.  As Julia had pointed out, Prime Minister Blair has made some positive statements. So yes, we are trying to do what we can to educate within the European union but at the end of the day, we’re simply asking them to follow their own laws and procedures. 

RAY SUAREZ:   Yes?

CHRIS (INAUDIBLE):  Chris (INAUDIBLE) from BNA Publications.  This question is also primarily for Mr. Padilla, but would be happy to hear from everyone else.

            I was wondering if you could comment on biotech policies in other countries.  We’ve heard a little bit of the concern of Africa, but how concerned is the U. S. government about China and some of its regs and how with that effect, the likelihood of pressing a (INAUDIBLE) case to the WTO case against a European union or would we press one against another country such as China or elsewhere.  Thank you.

It’s a good question.  I think one of the reason s that momentum has built  in side the U. S. Government for proceeding with the WTO case over the past several months is the effects of the moratorium have begun to spread.  Not just to Africa, but also to places like Argentina to, I think, the question you mentioned Brazil, certainly China, certainly India.

            Now as Clyde correctly said, there are different reasons why the effects of the moratorium have spread in different places.  In some cases, I think the fears are being used for more classically protectionist purposes in the case of a couple of countries that are on that list, but I won’t name which ones. 

            So I think the reason we have felt that it is necessary to look very seriously at proceeding with the WTO case is because this issue is broader than Europe. 

RAY SUAREZ:  Another interesting but pretty complex question from Simon (SOUNDS LIKE: VANDEWALLER) at Georgetown University Law Center.  The (INAUDIBLE) has been expressed that the new rules on laboring and traceability are just as bad as the moratorium because they are so onerous to producers.  Isn’t it likely that if the moratorium is challenged, the (SOUNDS LIKE:  EESEE (phonetic)) will lift it in time because the new rules are slated to come into force somewhere in 2003?  That is before a WTO panel would reach a decision. 

            The new rules, however, would seem to be WTO compliant.  Why?  They’re not formulated as healthy measures in WTO-speak, sanitary or phyto-sanitary measures, but as technical regulations under a different agreement.  Those measures need not be based on science, for instance, they can be motivated by consumer choice. 

            So one barrier falls and another one is hastily erected in its place in this scenario. 

JULIA MOORE:  I don’t want to be in position of defending the new rules that are coming into place.  I actually think the new rules are unworkable more because of issues that were alluded to in the case of soy beans and I don’t claim to be the expert. 

            You need to maintain a certain moisture level in soy beans that requires you to mix them up.  It’s not just a question of the way the way that we dump all the mixture of things together in our distribution system, but in order to achieve that optimum moisture, you need to mix.  And it’s virtually impossible with those figures that you mentioned earlier of high GM soy bean growth in the United States that you’re going to be able to guarantee that something doesn’t meet these new (INAUDIBLE) threshold levels which I think are quite low.  

            So I think that these new measures are going to fall less because of the WTO technicalities and more because of the realities of the food distribution system.

RON GASKILL:  One thing that we want to do is begin to start focusing, as far as we’re concerned the conversation on the labor (INAUDIBLE) rules, because we feel that a lot of the discussions have been taken on the moratorium, and if you read the (INAUDIBLE) and you listen to officials talk, once the moratorium is lifted, the problem is resolved.  And, of course, from our perspective, the problem is not resolved.  It’s just as bad.

            But the focus of the issue (INAUDIBLE) at that point with terms of (INAUDIBLE) traceability, we think that time has talked about (INAUDIBLE) is right now.  To recognize that at this point, the (INAUDIBLE) traceability rules are simply proposals.  They’re not, they do not have the force in effect of law, so therefore, you cannot take a WTO case against the (INAUDIBLE) traceability rules.

            We would hope that we don’t have to get there, frankly.  Simply because we would like to be able to take care of that now.  We did have a legal analysis of (INAUDIBLE) analysis done of at least the proposals as they are forward right now.  Indeed our legal counsel analysis suggest that indeed they are not compliant with both the (INAUDIBLE) measures agreement and the technical (SOUNDS LIKE: BARRIERS) trade agreement. 

            Simply because on one hand the rules at this point require labeling of imported products, but not necessarily domestic products.  In another case there’s simply an arbitrary number used to determine at what point labeling is required.  What percentage of an ingredient?  That number, at this point, I think, is .9%, why?  There is no basis for .9% (INAUDIBLE) as is any other number.

            So we think those that least begin to establish a foundation for legal challenge to the (INAUDIBLE) traceability proposals as they are right now, I do emphasize that they are proposals, but I think it’s real important that we begin looking at them now and not just assuming that once a moratorium is lifted that the issue is resolved.

RAY SUAREZ:  Yes?

BILL (INAUDIBLE):  My name is Bill (INAUDIBLE) and I’m a research analyst with Friends of the Earth.  I think there are two reasons why Europe is not accepting biotech crops in addition to what was discussed on the panel.

            One, is that they realize that the U. S. has an incredibly weak regulatory system and is full of holes and is largely voluntary.  And the second is that there is suggestive evidence of healthy impacts that require further study. 

            Now just on the regulatory side, because our system is largely voluntary, a company could bring an engineered crop to market with any review by the FDA.  And even when a company does have a  so-called voluntary consultation with the FDA, the agency does not require any specific safety testing that leaves this largely up to the company.

            And finally the FDA doesn’t even approve engineered crops that it does review.  It merely conveys the company’s assessment that the crop (SOUNDS LIKE:  IS SAFE). 

            On the health side, scientific advisors to the EPA have stated clearly that the BT crops, that is the crops that produce insecticidal proteins, could be allergenic.  Unfortunately, there hasn’t been follow up studies to determine whether this is the case or not.  There’s very little funding for such scientific studies by the government.

            And then the biofarm crops were mentioned a while ago.  These crops produce substances like blood clotters, blood thinners, contraceptives, industrial chemicals. Some of these substances have known human health impacts and yet they are not being tested for safety and they’re being grown in secret.  Virtually without regulation and without adequate confinement.  And I think we saw an example of that with the  prodigy incidents in Nebraska and Iowa.

            So given these facts, it seems that the U. S. should be more concerned about putting in place a meaningful regulatory system, rather than mounting a WTO challenge against Europe.

CLYDE PRESTOWITZ:  If I could jump in and respond to your question. You’re very first statement, I think, is not correct. You said Europe is rejecting GM crops, but they’re not.  We know that the Europeans are actually using a lot of GM.  So the issue here is not do the accept or do they not accept.  The issue is kind of how do you deal with this very arcane system that’s set up to kind of discriminate between what they accept and what they don’t accept. 

            If they accepted nothing, that might be rational.  Or if they accepted, but they way they’ve done it, it just doesn’t make sense.  Undercuts your whole statement, I believe.

CHRIS PADILLA:  You know, a lot of the few crops that have been approved for import are not approved for planting were ushered in before the Europeans developed more stringent like safety testing. 

            And actually, you look at (OVERLAPPING REMARKS)

CLYDE PRESTOWITZ:  We’re not talking about (STUMBLE), we’re talking about a moratorium.  A moratorium is not based on safety testing or anything like that. 

UNIDENTIFIED SPEAKER:  The Europeans have much stricter standards that are much more serious about looking at the potential health impacts of these crops.  And for instance, currently commercialize GM crops in the U. S., probably wouldn’t pass world health organization food FAO standards, recommended standards, for safety testing.  That’s just a (OVERLAPPING REMARKS)

CHRIS PADILLA:  I’m sorry. But this is not true.  And this is more fear mongering.  The reality is that the European union commission, Commissioner Burn, who is responsible for health, has himself said that there is no basis for any concern about risks to human health or to the environment. The EU environment commissioner has said the same thing.  They point to more than 81 peer reviewed scientific studies that say that. 

            The French Academy of Science and Medicine said in December, “no particular risk connected with the process of creating GMOs.”  The Royal Society says this.  The American Medical Association says this.  We’ve got a letter signed by 3,200 scientists and 19 Nobel Laureates who say this.

            It is simply not responsible for non-government organizations in Europe, or anywhere else, to promote the irrational fears that are spreading around the world. 

            There’s an article that was in The Daily Telegraph, in London, in January, about a Zambian group that went to the U. K., to investigate whether or not they should accept biotech food aid.  And they were told, a group farming and livestock concerned U. K., which is one of the more radical environmental groups that Clyde described, told this The Zambia Daily Mail, that the virus used to create genetically modified varieties “could form a retrovirus that could produce symptoms similar to HIV.”   That is irresponsible.  It’s not true.  In light of the AIDs crises in Africa, it is scandalous.

RAY SUAREZ:  But given his point, turn it into a (OVERLAPPING REMARKS) question. 

Rather than just rejecting the point out of hand, let me turn it into a question.  Implicit in the point was that if there was a more rigorous regulatory regime in the United States, it would help deal with some of the barriers that currently exist to selling these things in Europe.  Is that possible? 

JULIA MOORE:  I think that we have some clean up work to do on our regulatory system.  I think that, for example, some of the voluntary versus involuntary impositions are something that we ought to do away with.  Because in the United States for liability, for legal liability questions, no reasonable company is going to pursue a product without going through these FDA procedures.  And yet the fact that some of these procedures are voluntary versus involuntary, basically does not give confidence to certain environmental groups and to European public. 

            We have, in this country, a liability system that we saw go into action in terms of (SOUNDS LIKE:  STARLINK) where if someone makes a mistake, by God, the court system is on top of them and generally companies are forced to pay big time.  That parallel system doesn’t exist in Europe. That’s why these labeling and traceability measures are so important to the Europeans.  That too is why you have countries like France also raising the question as to whether or not at some point they need to bring a liability system somewhat akin to the U. S. to bear.

            I think that the research to date has shown that there is no real health and safety impact from these products.  But I think that even Nature Magazine, this week in an editorial, has said that we don’t know all the environmental impacts either of conventional agriculture or of agricultural biotechnology. 

            And there really should be more research into that.  In truth, one of the biggest issues in the U.K., is what impact genetically modified crops might have on the population of (SOUNDS LIKE:  SONDBERGH).  We don’t have good answers to that yet.  One of the things that Tony Blair is doing, if you will, as a confidence building measure with the public, is farm scale field trials of some of these products that will allow him to go in front of the British public that cares a heck of a lot more about their (SOUNDS LIKE:  SONDBERGHS) than we do, and say this is the impact.   And we know it because we’ve studied it.

            But I, again, whether or not you agree with my or Friends of the Earth or you agree with USDR, pretty much is dependent upon whether you see this as a consumer issue, and environmental health and safety issue or simply a trade and agricultural (INAUDIBLE) point.

RAY SUAREZ: Ron, quick response to both Julia’s points and Friends of the Earth?

RON GASKILL:  Well, I think for the most part Julia is pretty well put forth.  We do indeed have some clean up to do but I think for the most part, that at the same part that our regulatory system has work.  If you look at some of our recent cases, probably nationally (INAUDIBLE) it was the regulatory system functioning that actually discovered that particular problem. 

            So while we do need some fine tuning here and there, I think for the most part, the proof is in the pudding.  The regulatory system, so far, as far as I’m concerned, has passed the muster.

RAY SUAREZ:  And sir, last question.

JOHN (SOUNDS LIKE:  NOODLE):  Thank you. John (SOUNDS LIKE:  NOODLE) from the Center for Food Nutrition Policy, Virginia Tech, located in Alexandria.

            I wonder if one of the panelists could comment on the movement within the EC just recently, I believe, in directive 2001 at 18, whereby the role of science will be somewhat expanded in the process within the EU. You bring out earlier, this is somewhat about science were all agreed on it.

            The new process, as I understand it, will, and this comes from a source in the British Embassy that I’d be willing to share with people on a private basis, allows for a process in which if two or three countries agree to and approve a certain (INAUDIBLE) modified food, and the overall majority doesn’t carry the approval, the decision is referred to a scientific panel for consideration and a report back to the commission.  I wonder if we could have a comment on whether or not that process offers hope and what WTO action might mean for it?

RON GASKILL:  The only thing that I might suggest with regard to that, that actually was one of the milestones I talked about.  We had various different points over the past year that we were looking forwards to, hoping would move away from the moratorium. 

            And the enactment of that (INAUDIBLE) was, I think, in October of last year, we certainly hoped that that would be sufficient.  We were disappointed when it wasn’t.  And I think actually from (INAUDIBLE) standpoint, if you will that’s the straw that broke the camel’s back.  When we said, look, enough is enough. 

            Probably the best I can comment on it unless you have any other, but . . .

CHRIS PADILLA: I would agree.  I think it was another promise made, not kept.  No approvals have come forward that I’m aware of.  And my (OVERLAPPING REMARKS) my concern would be, and to be honest, that even if you have referral to a scientific panel, if the scientific panel relies on essentially the precautionary principal that says, well, we’re not aware of any evidence that this in harmful to health or the environment, but you can never be 100% sure in science. 

            Then is becomes, again, a political question.  And I don’t think any responsible scientist would say, you know, we know with absolute certainty every possible effect of every possible mutation.  The judgment has to be made on the balance of the science and the politicians have to allow that to take place.

            My concern is, our concern in, that that would not happen, based on our experience.

RAY SUAREZ:  Any final comments before we wrap?  (SILENCE)  We’ve said it all.  (LAUGHTER).  I know a lot of the people who have left just want to catch the end on the web.  But, I want to thank you for your attention, your good questions, and thank the panel very much for what they had to bring us today. Thank you.

 

(END OF TRANSMISSION)