One of the most nauseating aspects of Maple Leaf Foods' contamination problems is the political BS that is leeching into the issue. This is inevitably exacerbated by mounting election fever. The outbreak of bacteria-borne listeriosis is a tragic accident. Maple Leaf's CEO, Michael McCain, has responded quickly and earnestly, and has wisely erred on the side of caution in closing down the plant outside Toronto from which the contaminated cold cuts allegedly came. He has also withdrawn many products which have not tested positive for the bacteria. Nevertheless, the company's share price has been hammered, wiping some $300-million off its market capitalization in the past ten days. Note that this is many multiples of the $20-million or so that the company estimates its direct actions to counter the problem will cost.
Nothing more clearly indicates the power of market discipline and the value of business reputation than the dive in the company's stock price. And yet, typically, this tragic accident is being treated as --or at least implied to be--an example of corporate fecklessness and market failure, and as a justification for more regulation. Stephen Harper yesterday claimed that Canadians have the "right" to uncontaminated food, but even the socialistic UN Declaration of Human Rights never promised a bacteria-free world. Expectation, yes. Right, no.
The most overblown comments have come from Liberal leader Stephane Dion, who has suggested that the Maple Leaf situation reflects that of the tainted water tragedy at Walkerton eight years ago, when seven died and several thousand became sick.
The link came when Mr. Dion was castigating Tony Clement, the Conservative health minister, for being at the Democratic convention in Denver rather than taking on-site command at Maple Leaf in a Hazmat suit. Mr. Dion pointed out that Mr. Clement was part of the Mike Harris Ontario government that was allegedly "partly" to blame for the deaths at Walkerton. The Liberal leader went on to accuse the federal Conservatives of "wanting to take the same deregulation approach to food." The linking of Walkerton to deregulation is totally inaccurate. Mr. Dion should be ashamed if he doesn't know that. He should be even more ashamed if he does.
The inquiry into Walkerton fingered lazy, unqualified and incompetent government employees. Private testing was one of the few parts of the system that worked. The problem was getting the test results through the barrier of government sloth and buck-passing.
Mr. Dion sought to widen his attack beyond Mr. Clement to other former Ontario Ministers John Baird and Jim Flaherty, painting them as champions of privatization. Apparently they weren't just responsible for Walkerton, they were to blame for last week's explosion at Sunrise Propane, too! According to Mr. Dion, "they want to do something equivalent about food inspections."
Now it is true that a leaked cabinet document indicated earlier this year that the government was considering changes to the Canadian Food Inspection Agency to make oversight more efficient and allow industry to "implement food safety control programs." But it does not follow that the case of Maple Leaf automatically undermines such notions. All Maple Leaf indicates is that no matter how rigorous one's system, there is always a possibility of contamination. The surest protection for the consumer is the fact that any company that produces a contaminated product puts its own existence in peril.
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