Ryan ChartrandThe year isn’t 1984, but Big Brother is indeed watching.
Smiling sweetly, he hands out stimulus checks aimed at getting consumers to spend more, saying it is their American duty to kick-start the economy by continually buying more junk from China.
On the other hand, he slyly tries to pass euphemistically-named legislation like the FDA Globalization Act of 2008 – a bill he claims aims to ensure “the safety of the Nation’s food, drug, medical device and cosmetic supply in an increasingly globalized marketplace.”
The FDA Globalization Act, drafted by Rep. John Dingell (D-MI), will empower the Food and Drug Administration to raise an army of regulators and indiscriminately charge exorbitant registration and regulatory fees for any companies under the oversight of the FDA.
Moreover, what this act really does is target small businesses that are already struggling to get started in a downed economy. For example, it charges a $2,000 annual “registration fee” per cosmetic company: an amount that no doubt can be the make-or-break difference for any small at-home business just attempting to get on its feet.
As if taxing the incomes of self-starters isn’t enough, the government now steps in to arbitrarily fine them for their attempts at the American Dream. With the passage of this act, the Food and Drug Administration will be at least two grand richer for every business it regulates and that much more empowered to do so.
Two thousand dollars is a drop in the bucket for the massive corporations that support these regulatory bills, but for any mom-and-pop store trying to make it in under the watchful eye of the FDA, it can mean the end.
Whenever the government interferes with free enterprise, my mind immediately goes to the many promising young business men and women we have at Cal Poly and at universities around the country. I can only imagine that slapping what is in effect a several thousand dollar fine onto their start-up costs will kill many dreams.
What will happen to the chemistry student looking to start her own line of organic soaps and shampoos? Or the young business student who sees the potential in an import-export business to bring European food supplements into the States?
The FDA Globalization Act of 2008 will force small businesses to pay an additional fee just to stay in business, yet it yields neither them or consumers any additional benefit.
Certainly the reasoning that will be sold to consumers is that their elected officials are only watching out for their best interests by passing ever-stricter regulations on personal care products. The congressional leaders behind this will undoubtedly say they’re only concerned about the “good of the people” (as if it’s the government’s job to regulate commerce in the first place).
But any reasonable person will understand the true incentives behind this act. It has no built-in guidelines to ensure that consumer products will be safer; it’s just a small business penalty orchestrated by politicians who are in cahoots with L’Oreal, Maybelline, Revlon and others (companies which began as little independent businesses themselves some decades ago).
Just reading the reader comment sections of several small business blogs gives an idea of the panic the Globalization Act is inducing in entrepreneurs:
“This will put almost every small business, myself included, out of business,” writes one commenter.
“I am in the process of starting my own hair care business and can barely afford the fees to get it up and running,” says another small business owner.
Another, “I am a working mother of a young child and I am struggling to make my very small business grow enough so that I can be at home for my son. If this act passes, I am dead in the water. I want my son to know that with hard work, anything is possible. But if this act is passed, all he will see is that hard work doesn’t matter anymore… only money does.”
Every time the government gets its hands dirty by interfering with free enterprise, it sets off a ripple effect that reverberates throughout the entire American economy. When the FDA steps in and slaps a fine on small personal care product companies, it’s also negatively affecting any other small company that may do business with them.
My former employer, for example, is the owner of a small but successful public relations firm that does PR for several young companies in the health and fitness industries. I can only imagine that if one of her clients started to suffer financially as a result of these exorbitant FDA fees, her services would be the first place they would cut costs.
As another example, my dad owns his own Web design and computer consulting company. If the FDA’s fees prove to be the last straw on the camel’s back for his clients, he too will suffer.
The last thing an economy teetering on a recession needs is another blow to the small businesses that drive it. Our high gas prices do that already.
Small businesses know what’s coming if the FDA Globalization Act of 2008 passes: their very existence will be at stake. Meanwhile, the big cosmetic and drug companies can lean back and smile; a $2,000 fee and several thousand dollars in campaign contributions is a nominal price to pay for extinguishing your competitors.
Marlize van Romburgh is a journalism senior and the Mustang Daily editor in chief.