Food-Safety Policy: Balancing Risk and Costs

The United States is often said to have the safest food supply in the world, yet some consumers and policymakers counter that it is still not safe enough. The U.S. Department of Agriculture (USDA) and the Food and Drug Administration (FDA) of the U.S. Department of Health and Human Services are continually examining ways to reduce the risk of foodborne illnesses. But regulatory actions come at a cost to the Government, industry, and consumers. These costs can in turn raise prices for consumers. On the other hand, greater safety may not cost significantly more if it can be achieved through stricter control of existing practices. With budgets stretching ever tighter, tradeoffs are involved. Those concerned with food safety are asking: How much risk does each individual actually face from foodborne illnesses? And, how much should society pay to reduce that risk? Although it is difficult to determine the total amount spent on food safety by the Federal Government, local and State authorities, the food processing and distribut-ing industry, and consumers, the total is high. Many Federal agencies are involved in ensuring the safety of the U.S. food supply. Expenditures on food safety by FDA alone totaled $206.3 million in fiscal 1992, up from $93.8 million in fiscal 1980. USDA's Food Safety and Inspection Service (FSIS) spent about $473.5 million in fiscal 1992, down from $530.7 million in fiscal 1980. Furthermore, Government expenditures are a small part of the total, because most of the cost of regulation is paid by private partiesprocessors, retailers, and foodservice operators-complying with health regulations.