Agency Capture: Two Examples

Regulatory agency capture occurs when an agency ceases to act in the public interest and, instead, acts so as to benefit industry regulated by that agency. Here are two examples of capture.



A Fishy, but Nonfishery, Example

My favorite example of regulatory agency capture is described by Jonathon Turley, a law professor at George Washington Law School, in an opinion piece that was first published in the Los Angeles Times on 20 April 2004. It is reprinted here.

Turley describes the case of Creekstone Farms, a small slaughterhouse located in Arkansas City, Kansas. Most of the meat produced by Creekstone Farms was sold for export to Japan. The discovery of bovine spongiform encephalopathy (BSE, or “mad cow disease”) in US herds in the early 2000s became a huge problem for Creekstone.

In Japan, all cattle are tested for BSE, rather than a small (less than 1%) sample as required by the US Department of Agriculture. Consequently, the Japanese market for Creekstone’s product began to disappear.

To address this problem, Creekstone built the first BSE testing lab in a US slaughterhouse, hired biologists and chemists to run the facility, and proposed to voluntarily sample 100% of its herd. Creekstone lacked only one thing to put this plan into place: the necessary testing kits.

By law, these kits are available only through the USDA, which refused to provide kits to Creekstone. The USDA argued that testing every animal was unnecessary, was not cost effective, and that allowing Creekstone to test all its cattle would undermine the USDA’s position that random sampling was adequate for maintaining the public safety.

This, perhaps, is true for purposes of monitoring the presence of BSE. However, sampling all animals was necessary if Creekstone was to maintain its Japanese market.

Was the USDA operating in the best interest of consumers, by not allowing a slaughterhouse to test all of its animals? Or was it operating in the interest of the National Cattlemen’s Association, which opposed Creekstone’s plan because, as stated by its president, it might lead to consumer demands that all slaughterhouses be required to sample all cattle?

(Recently, a Federal Appeals Court ruled the USDA did not have the authority to prevent Creekstone Farms from testing for BSE. See here.)


A Fishery Example

Several years ago, I was invited by a state fishery agency to participate in a panel discussion on the status and future of fishing tournaments. I was invited specifically to address the subject of mortality in largemouth bass fishing tournaments. Speakers included tournament anglers and organizers, nontournament anglers, fishing guides, agency staff, an academic (me), and the local state agency’s chief of fisheries.

At the time, the topic of mortality in fishing tournaments was contentious in the state in which this panel discussion was held.

I was the second to last speaker. I discussed the results of a paper I had published on tournament-associated mortality. I observed that recent studies had shown that slightly more than 25% of largemouth bass captured and released in tournaments died and there were ways to reduce this, which would benefit the fishery.

The fishery chief spoke next and stated that his agency had examined the question of whether tournament-associated mortality impacted fisheries in that state- he said they had found it did not. He also stated that regardless of the magnitude of mortality it would not be an issue with him because, by law, tournament anglers could harvest all fish brought to weigh-in, if they so wished.

Wow! First, the agency had not examined the potential impacts of tournament-associated mortality on largemouth bass fisheries in that state. Second, is this how one protects the interests of the public and the fishery resource? By stating the mortality could be even greater than it is, so the current level cannot possibly be a problem?

This fish chief had been around long enough to know that live-release at tournaments came about in response to public concerns about potential and observed fishery impacts of early tournaments.

Were this fish chief’s comments, truly, in the best interest of the public and the resource? Or did they serve the purposes of a special interest group (tournament anglers)?