Missouri Corn Association sponsored the learning event that brought together a group of FFA students from all over the state. These young adults will be high school seniors this coming year, and they came together to learn about current issues facing agriculture. The group of students I worked with discussed issues surrounding the Country of Origin Labeling, better known as the COOL law. They realized that COOL is a national topic of concern that very well may significantly impact every state, including Missouri. Although other commodities are involved to a lesser degree, the main concerns have always been fresh beef, pork, and lamb. This summer the United States Congress, along with the Obama Administration, could decide the ultimate fate of the U.S. Country of Origin law.
COOL was first passed in the 2002 Farm Bill under Title X of the Farm Security and Rural Investment Act. Five years later, in the 2007 Farm Bill, COOL was expanded, becoming mandatory in September of 2008 with enforcement to begin in March of 2009. With its enforcement, COOL became a law that required all beef and pork products sold in retail stores to be labeled to show where the animal was born, raised, and harvested. The original intent of this law was good; however, it simply became another government mandate, with little to no effect on food safety. In the time period that COOL has been in effect, farmers and ranchers have seen no significant benefit from it. In fact, the USDA has estimated that the COOL law actually cost the United States’ beef industry approximately $8 billion during this time. Perhaps more importantly, current studies show that consumers really don’t factor in the country of origin when purchasing meat products.
From the very beginning, COOL laws have been a source of contention with our two largest trading partners—Canada and Mexico. They believe that the U.S. Country of Origin Labeling of meat is discriminatory to their products, somehow saying that theirs is inferior to the US grown product. Consequently, they have taken this issue to the World Trade Organization (WTO) and presented their case before them. In 2011, the WTO found that the mandatory COOL law violated international trade obligations with Canada and Mexico by discriminating against livestock from these nations. The U.S. government appealed the decision only to have the WTO again rule in favor of Canada and Mexico. In 2014, the USDA updated the COOL rules in an attempt to bring the U.S. into compliance with WTO; however, that was unsuccessful and was again rejected by WTO. This in turn opened the door for retaliation from both Canada and Mexico by placement of tariffs on U.S. products coming into their countries, and not just meat products, but other products as well. Last month, Canada, in retaliation, set $3 billion of tariffs as the amount in response to the meat labeling rule of the U.S. Mexico has not yet set any figures of retaliation, but under the WTO, they would have the ability to do so.
The WTO is the only global international organization that deals with the rules of trade between nations. They meet in Geneva and their approximately 160 members oversee 95% of all world trade. Agreements, associations, and negotiations between trading partners are under the oversight of the organization, whose main function is to ensure that world trade flows as smoothly and freely as possible. It is important that the U.S. comply with this international trade organization. Non-compliance with the WTO on the U.S. COOL laws could possibly have a devastating economic impact on the U.S. industries of food production, agriculture, and manufacturing. The possibility of tariff retaliation from Mexico and Canada could potentially have a major economic impact on Missouri.
The U.S. House of Representatives overwhelmingly voted 300 to 131 in June to repeal the COOL laws. The U.S. Senate has heard the bill in committee and will be voting on the measure soon; then the Obama Administration will make its decision on the law. Missouri’s congressional delegation voted 7-1 to repeal, and many are encouraging our state’s two senators to follow suit.
The COOL law started out with good intentions for both consumers and producers, but it has since lost its appeal and has created major world trade problems. Now the only real solution to this dilemma is to repeal the Country of Origin Labeling laws.