Tom Clyde: Baby formula
The baby formula shortage is one more stepping stone on our path to becoming a third world country. For millions of households with newborns, having the store shelves empty of baby formula is a serious problem. It’s not like you can substitute Jagermeister. There seem to be a lot of problems with the supply, starting with the all-purpose excuse of covid. That covers everything from clogged fuel injectors on the car to the Zombie apocalypse. No matter what goes wrong, it gets the covid shrug.
Putting that aside because it’s a worn out excuse, it turns out there are only about four manufacturers of baby formula in the US. FDA regulations prohibit importation of foreign baby formula because you can’t trust foreign manufacturers to—I don’t know, we import everything else. But there must be some reason we don’t want our infants drinking Irish baby formula. Could have something to do with the four US manufacturers being quite happy with what amounts to a near monopoly on an essential product and not wanting imports threatening their market position.
The crisis came about when a factory owned by Abbott Labs in Michigan was shut down. They had to recall tons of formula because of a potential contamination with a bacteria named Cronobacter sakazakii. That’s not important to know, but “sakazakii” is fun to say. It’s not fun to say that a couple of babies died and several were very sick. The connection with the Abbott formula is not completely certain, but it was enough to trigger the recall. The Michigan plant has been shut down for a couple of months while the FDA and Abbott agree on how to disinfect it so they can begin making sakazakii-free formula again.
Abbott rolled out the usual excuses—supply chain, covid, more covid, and delivery issues with some imported ingredients (we can import ingredients, but not completed formula because—no, it doesn’t make sense). Manufacturing stuff on a huge scale is terribly complicated. If only they had somebody there whose job was to sort through government regulations, work with suppliers, schedule deliveries of foreign and domestic ingredients, and see that the factory gets properly mucked out now and then.
Robert Ford, the CEO of Abbott Labs was paid $22 million last year. I don’t know anything about making baby formula. I’m certain that I could let a factory get contaminated and create a nationwide shortage of a critical product for less than half that. In fact, I could have made this kind of mess for free. I don’t know Mr. Ford, and he may be a very capable person. But when a corporation is paying somebody $22 million a year, what they are paying for is preventing this kind of mess from happening. I’m sure that somebody will get fired over this, maybe several somebodies. But I doubt the $22 million CEO will lose access to the corporate jet.
It happens everywhere. US car manufacturers can’t make cars because of “supply chain” issues. They can’t get the computer chips that perform essential functions like gradually brightening and dimming the dome lights when you open and close the door. They made the decision long ago to import the chips from Taiwan and China. Then covid. But that was two years ago, and they still haven’t figured it out, and they had no contingency plan two years ago because what could possibly go wrong between China and Taiwan? How much are they paid for not figuring it out? Mary Barra at GM makes $29 million a year. Jim Farley at Ford makes $22 million a year. So both of them are making adequate money. What they aren’t making is cars and trucks.
There is a number at which “covid” is no longer an acceptable excuse. I don’t know exactly what that is, but it has to be well below $22 million a year. If you are pulling down $22 million a year, you have lost the right to that excuse, or any other. At $22 million, you don’t have the luxury of failure. The $30,000 a year grocery checker has every right to point to an empty shelf and say, “Covid, covid, covid.”
But at $22 million a year, there are no excuses. If you can’t get it done, you aren’t worth $22 million (actually, there are no circumstances I can think of where anybody is worth $22 million a year, no matter how they sing, act, stuff a basketball, or keep a giant corporation humming). The world is a complicated place, and nothing works very well at the moment. It’s unfair to expect absolute perfection, though for $22 million a year, we should expect something very close to it.
Meanwhile, the FDA has partially gotten out of the way and is preparing to study recommendations allowing some imports of baby formula. By the time the FDA gets new regulations and inspection protocols in place, today’s infants will be old enough to drive themselves to the grocery store.
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