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Economy / Regulation

Truth in Advertising

By Dave Roland on Mar 25, 2008

The St. Joseph News-Press has a report today (spotted via John Combest) about two bills before the General Assembly that would prohibit certain truthful labeling on dairy products. As the story points out, these bills have nothing to do with the contents of the milk bottles — they just prohibit how milk producers would be allowed to label their products.

This is a very important matter for many smaller dairy producers because, with so many large dairies utilizing hormones or other chemicals to increase their cows’ output, the smaller operations want to assure consumers that their milk is not produced using such methods. It’s a selling point that both helps the farmers differentiate their product from similar products and helps consumers make informed decisions about the food they are buying for their family. If a customer would prefer to purchase products that have not been produced with the use of certain hormones or chemicals, why on earth would the General Assembly try to prevent dairy farmers from providing the relevant information?

Special interests. And, unfortunately, they seem to be well-served by the bills currently under consideration. These bills are essentially geared to prevent large hormone- and chemical-using dairies from unwanted competition by the smaller guys — but they also specifically exempt dairy producers using "organic farming," as defined by the state. Organic farmers will love this, because they can continue to realize the benefits of differentiating their products from the large producers without having to compete for consumers against small non-organic dairies. Thus, the bill’s advocates can achieve their goals while minimizing opposition.

In addition to being terrible policy, this scheme is unconstitutional. Both the First Amendment of the U.S. Constitution and Article I, section 8, of the Missouri Constitution protect freedom of expression — including commercial speech. These constitutional provisions safeguard the right to advertise truthfully about a product, so long as the product itself is legal and the advertisement does not mislead consumers about its attributes. The labels that would be banned by these bills are well within the constitutions’ protections because they merely make an accurate statement about the contents of the products therein. And even if it were found that a dairy producer’s labeling was false, the proper solution would be to punish the falsehood rather than to prohibit other producers from placing truthful labels on their products.

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Dave Roland

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