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The Baby Formula Crisis: When Necessities Become Commodities

May 19, 2022

Many of us learned about the baby formula shortage when it made headlines in mid-May, but before the headlines plenty of working parents had the annoying experience of seeing empty shelves in their local drug store, followed by the frightening experience of discovering that it wasn’t just one store, it was every store. As the crisis has intensified it has become clear that this is not just another “supply chain” snarl, like toilet paper. Parents are enlisting the aid of friends and families to scour stores near them, local food pantry shelves are empty, speculators are engaged in price-gouging, and social media is full of discussions of home-made formula “alternatives” that range from some that lack nutritional value to others that are downright dangerous to a baby’s health.

How did we get here? How did the wealthiest country in the world suddenly put millions of children at risk of their lives because it could neither produce nor import an adequate supply of baby formula? There has been no shortage of finger-pointing, but some writers like Derek Thompson at The Atlantic have done a good job of explaining the evidence of a bacterial agent that led to the Abbott recall of large quantities of Similac, the wildly fluctuating market for formula during the pandemic, and the bad trade policies that prevent the United States from importing formula from Europe.

The fact remains that at the heart of this crisis there is an uncomfortable reality. Abbot, the largest US producer of baby formula, says on its website that “We promise to give babies a strong start by helping to keep them fed, happy, and healthy.” That “promise,” however, is what lawyers call puffery, or what one court described as a statement “so vague that it can be understood as nothing more than a mere expression of opinion.” In other words, it’s advertising that no one claims is literally true or that creates any legal duty of the seller or legal right of the buyer.

On the other hand, Abbott’s real, legally enforceable promise is not to parent or child. It is the promise that every Board of Directors makes: that every decision they make is in the best interests of their company’s stockholders. There is only one way of measuring whether Abbott’s Board of Directors is keeping that promise: does its decisions create more profit.

Three companies – Abbott, Mead Johnson, and Gerber – make almost all of the baby formula sold in the United States. If the directors of those companies make bad decisions that cause profits to go down they may be fired, sued, or maybe even sent to jail. But if the directors make bad decisions that cause widespread shortages of baby formula, no court in our legal system can hold them accountable.

Maybe it shouldn’t trouble us if a company that makes television sets or shoes or dish detergent is under a legal duty to put its profits ahead of everything else. But here, when it comes to baby formula, we are seeing what happens when a human necessity becomes a commodity. Even if corporations “promise to give babies a strong start by helping to keep them fed, happy, and healthy” they are under no legal obligation to do so.

Right now, the news coverage of the baby formula shortage treats it as an unfortunate circumstance, a perfect storm of recall, supply chain, and policy. No one asks the question, “Why do parents have to buy formula?” But as parents struggle to provide a critical food item for their babies it seems likely that more and more of them will be looking for an answer.

Because, more and more, people are saying it doesn’t have to be this way. It could be a social obligation that companies produce enough formula to guarantee that babies are fed. It could even be an obligation that the government make formula available for parents at a fixed cost, a low cost, or no cost. If we had the kind of democracy that in moments like these permitted us to poll the parents who are affected by this shortage and ask what they think, it’s pretty clear that most would want their children’s lives to be ranked as more important than corporate profits.

Peter Goselin has practiced labor and employment law in the Hartford area for more than 25 years. He is a member of the Connecticut chapter of the National Lawyers Guild and a co-chair of the Green Party of Connecticut.