insoluble nitrogen must be guaranteed at the 15 percent of total nitrogen level, as in organic materials. 7. That AOAC method 2.047 be used initially to substantiate the fact that "coated-slow release" materials are present. The determination need only be modified by elimination of sample grinding during preparation. When the AOAC committee, working on this problem, comes up with a more specific method it will, of course, be substituted. PROPOSED AAFCO REGULATION (For adoption under State fertilizer laws) Additional plant nutrients, besides nitrogen, phosphorus, and potassium, when mentioned or claimed on the label or container shall be registered and shall be guaranteed. Guarantees shall be made on the elemental basis. Sources of the elements guaranteed shall be shown on the application for registration. When claims for such nutrients are made on the label, container, or application for registration, the minimum percentages which will be accepted for registration are as follows: Guarantee or claims for the above-listed additional plant nutrients are the only ones which will be accepted. Proposed labels and directions for use of the fertilizer shall be furnished with the application for registration upon request. Warning or caution statements are required on the label for any product which contains 0.03 percent or more of boron in the water-soluble form or 0.001 percent or more of molybdenum. Any of the above-listed elements which are guaranteed shall appear in the order listed, immediately following guarantees for the primary nutrients, nitrogen, phosphorus, and potassium. STATEMENT BY THE AMERICAN RETAIL FEDERATION BY DOUGLAS WHITLOCK II, DIRECTOR, FEDERAL RELATIONS The American Retail Federation respectfully submits the following comments in reference to S. 985 for inclusion in the proceedings of the Committee on Commerce. The American Retail Federation is made up of 45 statewide retail associations and 31 national retail trade organizations representing, through their membership, hundreds of thousaands of retail stores of all sizes throughout the United States. The offices of the federation are at 1616 H Street NW., Washington, D.C. It has been reliably estimated that in 1964 approximately two-thirds of the tangible gross national product of the Nation reached the Nation's consumers across the counters of American retail stores. No field of business is more intensely competitive. Probably no other field of private enterprise includes as many family-owned and family-operated businesses. No employer other than government employs as many people in the United States as do retailers. Since everyone, regardless of his employment is also a consumer, retailing has a dual and particular concern for the Nation's consumers, and an unusual opportunity to know the interests and objectives of consumers. In recognition of its responsibilities in the respect, the American Retail Federation has adopted an official statement of policy on the subject of Federal regulation of packaging and labeling, which declares as follows: "The American Retail Federation endorses the principle that consumer goods should be honestly and understandably labeled and properly packaged. However, it is opposed to all further extension of Federal authority which would unnecessarily reduce and restrict the originality and improvement of consumer products through Federal control of labeling and packaging and add considerably to the cost to the consumer. In view of the broad Federal and State authority already existing in the area of labeling and packaging the American Retail Federation contends that, beyond regulations for safety, purity, and disclosure, the incentives of the marketplace will continue to be the consumer's best protection." We do not propose in this submission to discuss the philosophy of S. 985, or to explore the very complex means by which vigorous competition ably serves the varying needs of consumers. We do not doubt that there are some unclear and deceptive packages now on the market, and we do not quarrel with the proposition that some Federal regulation of the production and presentation of consumer goods has in the past proved necessary in the public interest. Our presentation will be limited to two broad subjects. First, we believe that this bill, if enacted in its present form, would have consequences which the Congress would not intend or wish it to have. Second, a method is suggested whereby at least a substantial part of these difficulties could be resolved or reduced. We would like to express our appreciation to the sponsors of this bill for their recognition in section 2(b) that retailers are not primarily responsible for and cannot control the vast majority of consumer goods. America's retailers are, the purchasing agents for the American consumer. The retailer can only offer to his customers what others produce for the market. He shops for these things with much the same standards and objectives as his consumers. His primary means of influencing what is produced, and how it is presented to the public, is by exercising his decision to buy or not to buy the available items; just as the customers' preferences ultimately control both the retailer and the producer. S. 985 therefore does not presume marketing influences which the average retailer simply cannot exercise, nor impose policing responsibilities on the retailer. We therefore submit that 2(b) is an essential and praiseworthy element of any legislation on this subject. However, despite 2(b), the bill in its present form, would impose direct regulation upon many retailers. It would affect so-called private label goods, produced or packaged expressly for retailers, in the same manner as it would affect the manufacturers' goods distributed under their own labels. In increasing numbers, small retailers are meeting their larger competitors by offering their own private label products, either through custom suppliers or through buying office or cooperative buying programs. To the extent that this bill creates at the level of the retailer, administrative, legal, or liability costs with regards to consumer goods, it might well result in higher retail prices on goods offered by retailers. This bill could also eliminate or reduce the effectiveness of many of the consumer cost savings now possible through private brand retailer programs, particularly as far as smaller retailers are concerned. There are many other activities of retailers, where the retailer becomes the packager and labeler of consumer goods. For example, food products of almost every kind have long been packaged and labeled by retailers. Bulk delivery and repackaging produces sizable savings to consumers from food chains to the -corner grocery store. In addition to cost advantages, these practices also improve cleanliness, reduce spoilage and theft, and add convenience for the shopper. They can reflect purely local market conditions, as suggested by the differences in typical package size from communities of predominantly adult shopping areas to those with many large families. "Packaging to a price" is an important retail practice. It serves as a meaningful service to both consumers and producers. For example, if labor or material costs increase beyond a practical point for a certain commodity, experience has taught the retailer that customers would rather purchase a 10-cent package of goods even though it may have one or two fewer units in it than pay 11 cents for the original quantity. Further, this price packaging .often provides a significant discipline against price increase. Whether or not the retailer directly controls the packaging or labeling of the goods he sells, the form, size, and content of the package will surely have a material effect upon how well the customer will receive it, and how well it serves her wishes. We also believe that honest competition in packaging and labeling is a healthy, productive, and entirely legitimate part of the marketplace. Reusable .containers often provide a very real value to the customer. The volume pro-duction and distribution which results can put attractive and useful objects in the hands of many who could not otherwise afford them, and make them available with little or no added cost. If the ability of producers or packagers to in. novate in this area is curtailer or disadvantaged by stringent or unclear regulation, the effect will undoubtedly be felt by consumer, producer, supplier. and retailer alike. We are concerned that the broad grant of regulatory authority which this bill seems to provide could have some of these adverse results. We feel sure the bill would affect many of the foregoing and other activities of retailer which, we suspect, the sponsors of the bill would not have expected or necessarily intended. We believe that facet of the bill deserves somewhat greater attention than it seems to have received to date in the testimony submitted in reference to S. 985 and its predecessors. The American Retail Federation hereby extends to the committee its full cooperation and assistance in further exploration of this important aspect of the bill. Our major concern, however, is the lack of clarity regarding the specific application of the bill in many areas of merchandise. The assortment of consumer goods changes, and usually increases, literally every day. Many widely used products and packages in today's home were totally unknown and unimagined in their present form just a few years ago. Vast quantities of scientific and productive effort and knowledge are involved in the development and improvement of each category of goods. Retailers know that broad generalizations in dealing with this variety and change simply will not work. The present-day authority of the Food and Drug Administration and the Federal Trade Commission in the production and distribution of consumer goods has increased inherently with the variety and diversification of those goods. Opponents of S. 985 have frequently contended that the bill would add nothing significant to the powers of those agencies to prevent deception or misrepresentation, but that the resulting procedural requirements would unduly burden commerce and stifle ingenuity. Proponents claim the added power and procedures are necessary. It seems to us that many of these apparent conflicts could be resolved-or at least more meaningfully evaluated—if the definitions of the bill were made more specific. It would appear that by far the greatest number of products likely to fall within the scope of S. 985 would be defined in the bill as "other consumer commodities." There seems to us to be considerable justification for concern over the yet unborn consumer commodities which might be consumed or expended in household use and for which power would be granted to two regulatory agencies to establish reasonable weights or quantities in which they are to be distributed. We wonder whether a small manufacturer seeking a larger place in a competitive market would be able to relinquish the flexibility advantage his size now provides over his better financed competitor, and still hope to compete successfully despite the burdens and delays inherent in this nascent power to regulate whatever his ingenuity contrives. The power to prevent deception is now abundantly present in both the FTC and the FDA. The power to preclude products may be present in S. 985. We submit that consumers, and indeed all elements of the productive and distributive facilities of the Nation, need a better definition of what this bill would do, what it would affect, and in what respects it would enhance the constructive ability of these agencies to protect without confining the essential ingenuity of the marketing process. Certainly, the American Retail Federation is primarily charged with representation of the interests of its constituent retailers. In a narrow, but real, sense this involves the representation of self-interests. However, in this very basic and broad subject, the interests of retailers will be less directly affected, it appears, than those of producers and consumers of goods in which retailers deal. If this bill would assure meaningful and nondeceptive packaging and labeling, and do nothing more, we would not be concerned. We are, instead, concerned that its unprecedented scope and administrative procedures would at least delay and complicate the introduction of new products, and at worst could regiment them and stifle initiative. These latter factors are the essence of the competitive process and work in the very direct interests of consumers as well as producers and resultantly of the entire national economy. Through a more precise definition, the real question of the scope of any expanded regulatory powers could be explored in much more specific and measurable terms than is now possible. We know from hard and costly experience with consumers and consumer commodities that generalizations applied to the constantly changing marketplace will too often discard the baby with the bath water. As the purchasing agent for the consumer we most heartily applaud the announced purpose of truthful and useful packaging and labeling, but in that same capacity we are concerned that without further specification the unintended costs to the consumer and the economy could be much greater than the subject warrants. Therefore, while we can appreciate the announced basic purposes of S. 985, we are unable to endorse this legislation. We do not believe a viable result, or even a meaningful evaluation of its merits, can be expected until its scope and the identification of the objects upon which it would operate have been materially clarified. We believe that the bill would affect retailers much more directly than is generally understood. For this reason the American Retail Federation urges a full exploration of its implications before the committee acts. Our greater concern is the effect the bill may have upon the retailer's continued ability to serve his customers and the economy with the ingenuity, imagination, and vigor they have a right to expect. Therefore, we believe S. 985 must be made considerably more specific before its effect on the consumer and the economy can be effectively and safely evaluated. We stand prepared to assist the Congress with any information which may be of value to that purpose. Thank you for the opportunity of presenting these comments. DEAR SENATOR MAGNUSON: Liberty Lobby wishes the following statement to be forwarded to Mr. Edward Jarrett, chief clerk, for inclusion in the record of hearings. Respectfully, W. B. HICKS, Jr, Executive Secretary. BIG SISTER IS WATCHING YOU (A statement for the record of hearings on S. 985, truth-in-packaging bill, May 1965, prepared by Liberty Lobby on behalf of the 137,000 subscribers to its legislative reports) In Russia, the consumer spends 50 percent of his take-home pay for food. In England, 29 percent is spent for food.1 In the United States, however, the consumer is paying for the purest, most nutritious, easiest to prepare food the world has ever seen. It is brought to him under a system of far less Government regulation than in any of the nations listed above. It would seem, following the logic of the proponents of S. 985, that the unprotected American consumer must be paying more for its superior products than any of the other nations. And yet the proponents of this bill fail to explain the anomaly that the American consumer spends only 19 percent of his take-home pay for his superior produce.2 There are two reasons for the superior quality of American produce at the lowest cost in the world: sensible regulations already on the books, and competition-the heart of the free enterprise system. Thousands of food processors compete in the wooing of consumers by offering them goods which have dropped in percentage of cost from 26 percent in 1948 to the present rate. They have done this through competition which has spurred them to develop new and improved products, as well as new and improved methods of production, packaging, and delivery. Inflation, the tattletale of a poorly administered economy, has forced rising labor costs to narrow the profit available to the industry or doubtless the consumer would be spending even less than 19 percent of his budget. Increases in taxes have had a similar effect. And now, despite the evidence that S. 985 will work great increases in packaging costs, as well as significantly reduce the incentive of competition, Congress is being asked to tamper, in a major way, with 1 See Look magazine, Jan. 26, 1965, "Let's Keep Politics Out of the Pantry." 2 Ibid. this basic industry, an industry that, instead, should be tendered the heartfelt thanks of a well-served nation. On a purely practical basis, Liberty Lobby objects to this move because it will cause a rise in production costs and a loss to the consumer. Will the agencies of our Government never pay heed to the basic economic truism that an industry can't pay taxes, or lose money? Only the consumer can provide the money for such expenses. On behalf of our 137,000 subscribers, we object to the consumer having to pick up still another tab for expensive bureaucratic meddling. Implicit in the spirit of S. 985 is the stale, 19th century concept that business and its consumer-customers are two basically antagonistic and incompatible classes needing a gigantic den mother to keep them from fighting. Implicit, too, is the misleading impression that there is profit to be gained, by established food manufacturers, in the deceiving of their housewife customers. In this spirit, the bill is needlessly indicting an industry which is very conscientious in keeping a good reputation for reliability. This is an unwarranted, condescending denial of the American housewife's ability as a shopper. A smarter, more careful, better informed class of consumers has never existed. The American housewife can hold her own on the free market. Yet we are led to believe that she needs the aegis of a big sister agency to protect her as she ventures into the wonderland of the modern supermarket. In the name of our subscribers, we repudiate that assumption on the part of the administration. We wish to go on record as expressing thanks to an industry which has done so much while diminishing the cost to us. We wish to express confidence in our ability to pick and choose among our marketplaces and buy what we want for what we feel to be a good price. We wish finally to express confidence in the continued honesty of our food processors. We know they will keep themselves honest. It is good business if they do. They stand to lose too much if they don't. In contrast, we fear the breakdown of efficiency that marks nearly every intrusion by the Federal Government into the private sector. We do not have the same confidence in the good return on the dollar that we have in our business leaders, for we have seen too many times when this interventionism has cost us dearly. We urge you to reject this maternalistic measure; it is arrogant in its failure to provide for congressional review of the arbitrary powers which the bill provides appointed officials. We urge you to reject the big sister intrusion into our neighborhood supermarkets, inherent in S. 985. Mr. SIERT F. RIEPMA, MAY 3, 1965. President-Treasurer, National Association of Margarine Manufacturers, Washington, D.C. DEAR MR. RIEPMA: I am, of course, very concerned at the objections which you raise in strong opposition to the so-called fair packaging bill. I want you to know that I and the other members of the committee will subject each and every provision of this legislation to intense scrutiny before we take any action which might impair the functions of our free market economy. I shall be very glad to have your letter made a part of the official record of the hearings, as you request. Sincerely yours, WARREN G. MAGNUSON, Chairman. NATIONAL ASSOCIATION OF MARGARINE MANUFACTURERS, Washington, D.C., April 29, 1965. Re statement of National Association of Margarine Manufacturers relative to S. 985, 89th Congress, 1st session. Hon. WARREN G. MAGNUSON, Chairman, Committee on Commerce, U.S. Senate, Washington, D.C. DEAR SENATOR MAGNUSON: On behalf of the National Association of Margarine Manufacturers, I respectfully submit, for inclusion in the record of hearings, the enclosed statement relative to S. 985, 89th Congress, 1st session. Respectfully yours, SIERT F. RIEPMA, President-Treasurer. |