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A shuttered baby formula plant and protectionist trade policies are responsible for the current baby formula shortage, experts say. But incumbent politicians are likely to pay the price for it.

President Joe Biden hit a new low in the most recent Associated Press-NORC Center for Public Research poll, with just 39 percent approval.

“The findings reflect a widespread sense of exasperation in a country facing a cascade of challenges ranging from inflation, gun violence, and a sudden shortage of baby formula to a persistent pandemic,” according to the AP. Biden’s approval among Democrats — typically 85 percent or higher for an incumbent president within his own party — has fallen to just 72 percent. And many political observers say the panic over baby formula is contributing to concern, even among Democrats, that the Biden presidency is in over its head.

As a result, more Democrats are acting on their own. Rather than defending the White House, New Hampshire Sen. Maggie Hassan joined a group of 32 senators urging the Biden administration to act. “It is absolutely unacceptable that families are struggling to meet the most basic needs of their children, and we urge you to do everything you can to quickly address the crisis— and ensure this type of shortage never happens again,” they wrote.

The administration responded by invoking the Defense Production Act. However, that merely makes the baby formula industry a priority customer, it does not create more ingredients or products.

A major cause of the crisis came from the Food and Drug Administration’s mishandling of reports of four consumer complaints of Cronobacter contamination. In response to the FDA inquiry, Abbott stopped production at its biggest factory, taking about 20 percent of the nation’s formula out of the supply chain.

On Sunday, National Economic Council Director Brian Deese defended the administration’s actions. “The FDA did what it was supposed to do, which was assess safety and shut down a facility in the United States,” Deese said.

However, according to The Wall Street Journal, “the four cases of Cronobacter sakazakii infection in infants that the government cited could not be traced to the factory’s products. No contaminated baby formula was found; Cronobacter was identified on the factory grounds but lacked a genetic match to samples from affected infants.”

Now the Biden FDA has entered a consent decree with Abbott to get the factory back online. But even if the plant gets up in running in the next two weeks, it could be six to eight weeks before the baby formula reaches store shelves, according to the company.

Democrats are touting 78,000 pounds of formula flown from Europe by the U.S. military that landed in Indiana on Sunday, part of Biden’s “Operation Fly Formula.” That represents just a fraction of the approximately $4 billion U.S. baby formula market.

And none of these efforts address the trade regulations and government subsidies that have warped the baby formula market and contributed to the shortage.

The market was floundering before the February recall. The U. S. makes 98 percent of the baby formula it consumes thanks to strict regulation and trade policies that keep European and Canadian formula from getting to the market. Tariffs also make baby formula ingredients too expensive for American manufacturers to import.

According to trade expert Scott Lincicome, the trade agreement pushed by President Donald Trump blocks Canadian formula from getting into the U.S. and kept the Canadian industry from growing.

“Because USMCA effectively capped possible exports of infant formula to the United States, it discouraged investment in new Canadian capacity—capacity that we sure could use right now,” Lincicome wrote.

Add the cumbersome regulatory scheme to the COVID economy with labor shortages and rising prices, and the shortage seems inevitable once the recall went into effect.

White House press secretary Karine Jean-Pierre told reporters last week that the Biden administration is already asking embassies worldwide to help during the shortage. Importantly, she said the FDA will now allow foreign companies to apply to supply baby formula to the U.S. market, but only with approval subject to the drug regulator’s safety standards. It was not clear how long the approval process will take.

Lincicome writes the FDA has kept safe and commonly-used European baby formula produced in the Netherlands, France, Ireland, and Germany from reaching the U.S. over a labeling issue. Many American parents prefer the European formula, and this has created a black market for baby food.

“Yet, when parents here have tried to import European formula, it’s been routinely subject to seizure by the FDA. In fact, formula made by two of the most popular European brands—HiPP and Holle—is on the FDA’s red list and thus only arrives here via unofficial, third party channels,” according to Lincicome.

More than half of the baby formula bought in the U.S. is bought by the government for the Special Supplemental Nutrition Program for Women, Infants, and Children program, also known as WIC. Through WIC, manufacturers sell their products to state governments at steep discounts, and the formula is essentially resold to poor families.

That has resulted in companies being untouched by the regular laws of supply and demand. Prices have continued to go up over the rate of inflation, and the market is not sensitive to changes that would normally trigger more production.

Dr. Erik Shessler, a pediatrician at Dartmouth Health Children’s and president of the New Hampshire chapter of the American Academy of Pediatrics, said families should not panic. So far, New Hampshire parents can still find formula even if they must scramble.

“I am not aware of any local emergencies,” he said.

Shessler said most infants can switch between baby formula brands without too much trouble.

“Most formula companies have the same options for classes or kinds of formulas. For example, most have a regular cow milk-based as well as a cow milk-based but lactose-free and soy formula. Most infants will be able to switch between companies as long as we stay in the same class or kind,” he said.

Families that are having trouble finding what they need should contact their healthcare provider and pediatrician, he said.

Matt Mowers, his wife Cassie, and their 10-month-old son Jack got up early on Mother’s Day and rushed to their local drugstore on a mission: Find one of the last few available containers of baby formula. 

“She literally ran into CVS while I waited in the car with Jack. Happy Mother’s Day,” Mowers said.

The Mowers family has been scrambling for baby formula for months, and the situation keeps getting worse. Mowers, who is running in the GOP primary to unseat Democratic U.S. Rep. Chris Pappas, has been using his downtime on the campaign trail to search for baby formula. One recent day of campaigning had Mowers checking three different stores in three different towns. And he still came up empty-handed.

“It’s very difficult to find what he needs,” Mowers said. “We usually use one of the sensitive formula brands because it’s easier for him to keep it down.”

The Mowers family isn’t alone. Nationwide, 40 percent of baby formula brands are now simply out of stock. Major retailers are restricting the amount of baby formula people can buy. The shortages and buying limits reverberate to people in desperate circumstances.

Alyssa Dandrea, with the New Hampshire Coalition Against Sexual and Domestic Violence, said women with infants who flee an abusive home for a shelter don’t have the formula they need.

“We’ve heard from our crisis centers throughout the state that survivors are having an increasingly difficult time finding baby formula for their children,” Dandrea said. “Although not all of our programs have infants in shelters, advocates shared that new store policies now limit how much formula one person can buy and that has added to this challenge. Survivors of domestic violence already face so many economic barriers, and the lack of food and other essential products present additional challenges for survivors seeking to reestablish their lives.”

Kevin Daigle, president and CEO of the New Hampshire Grocers Association, said customers are anxious as the supply is inconsistent.

“It’s hard to come by. Grocers are getting customers out there inquiring about it, and they’re worried and concerned. They’re not able to get their hands on it,” Daigle said.

While there are the familiar COVID-19 supply chain issues, like labor shortage and supply chain slowdowns, Daigle said there is more to the baby formula crisis.

A big part of the problem is the February recall that shut down a major manufacturer, Abbott Nutrition. It makes formula under several brand names, including generic brands. After the bacteria Cronobacter sakaaakii was found in one brand, Abbott shut down its Michigan plant. It still has not reopened.

“They still haven’t found the sourcing for it,” Daigle said.

However, Daigle said, the problems with the baby formula supply were known before the recall. Inflation and difficulty in sourcing ingredients were already impacting the industry.

Economists lay part of the blame at the feet of the federal government — in particular the Women, Infants and Children (WIC) program that supplements food for poor families. As part of the program, WIC essentially subsidizes the baby formula industry, warping the free market in the process.

“The overarching problem is that price signals in the baby-formula market don’t work well to begin with,” wrote National Review’s Dominic Pino. “A 2010 study from the USDA’s Economic Research Service estimated that 57 to 68 percent of all baby formula sold in the U.S. was purchased through the Special Supplemental Nutrition Program for Women, Infants, and Children (WIC)” Pino wrote. “That means over half of the baby formula that’s consumed in the U.S. isn’t really bought and sold on a free market at all.”

Libertarian Reason magazine finds the government’s trade and tariff policies also partially to blame. Tariffs mean key baby formula ingredients are too expensive for American manufacturers, and American consumers are locked out from buying formula made overseas because of FDA regulations.

“Last year, for example, the FDA forced a recall of approximately 76,000 units of infant formula manufactured in Germany and imported into the United States. The formula wasn’t a health or safety risk to babies but merely failed to meet the FDA’s labeling standards. In this case, the products were banned for not informing parents that they contained less than 1 milligram of iron per 100 calories,” Reason states.

President Joe Biden’s administration claims it will solve the problem by having government officials working with manufacturers to ramp up production.

Mowers said his family goes through at least one container of formula a week for their baby and prices have more than doubled. He recently paid about $30 for a 32-ounce container of baby formula.

“We try to be careful. We don’t want to buy out the store because you want to leave some for other families. But that means every week you’re always running around looking for it,” Mowers said.

They tried doing an internet order, but that hasn’t worked either.

“We’re waiting weeks for one can,” he said.

Mowers said the last time he experienced a baby formula shortage was his time working in the State Department and the U.S. was getting food aid to Venezuela.

“This is something you see in failed states, not America,” Mowers said. “The FDA should have seen it coming. The recall happened in February, and they knew it was going to lead to shortages. This isn’t getting any better.”

Who has final say over New Hampshire’s abundance of regulations put forward by state agencies? That’s the latest battle at the State House, where a legislative committee says it is in charge, not Gov. Chris Sununu, of the process to decide on the need for administrative rules.

The Joint Legislative Committee on Administrative Rules unanimously sent a letter to Sununu on Friday saying the committee and the process that already exists “accomplishes many of the goals of your letter seeking a reduction in governmental rules and regulations.”

During his inaugural address, Sununu called for a 90-day moratorium on new regulations.

“There are a lot of regulations in this state, for such a small state,” he said. “It is unbelievable. Let’s take a pause. Let’s take a step back and figure out what we are doing and why we are doing it.”

The next day, Sununu sent a memo to agency heads and department commissioners asking them to “immediately establish a pause on any proposed adoption, amendment, re-adoption or re-adoption with amendment of administrative rules until March 31, 2017.”

The request did not apply to any proposed rule mandated by law or that was “immediately essential to the public health, safety and welfare.” By March 31, he asked the agency heads to review “each and every regulation under the agency’s jurisdiction that is currently being proposed” or is already in effect.

The bipartisan joint committee includes five state senators and five House members and is authorized, according to state law, to have final say over rules proposed by state agencies, following a detailed approval process.

In their letter to Sununu, the committee members say they’re who oversees the rulemaking process.

“The majority of rulemaking is mandated by statute, and agencies cannot choose not to adopt rules when a statute says that they shall,” the letter states.

Sen. John Reagan, R-Deerfield, who chairs the committee, told WMUR that no rule or regulation can “exceed the authority of the legislation.”

“There seems to be a lack of understanding in the corner office about what the process is to create rules,” he said. “It seems that he was trying to do what everyone promises to do in Washington, stop passing laws that proliferate bureaucratic rules.”

In fact, President Donald Trump’s chief of staff, Reince Priebus, issued a very similar memo to Sununu’s on Friday telling federal agencies to not issue any more regulations.

He told the federal agencies not to send any regulation to the Federal Register until the rule is reviewed and approved by the new head of that respective agency, who is appointed under Trump.

But Reagan said New Hampshire is different than the federal government. Rules in the Granite State expire every 10 years and must be reauthorized. This year alone, 250 rules and 41 interim rules will expire, he told WMUR.

The agencies must hold public hearings on proposed rules, which are then submitted to the committee, and the committee’s attorneys determine if a proposed rule exceeds its legislative authority.

“What we’re saying to the governor in the letter is, let the process go on because we’re already doing what you want done,” Reagan said. “As chairman, I felt it was incumbent on me to state for the sake of the committee’s reputation to say that we already do this. This is what we have been doing for all these years. We’re not challenging anybody. I just had to make a statement for the sake of the committee.”

Emily Corcoran, a law professor at the University of New Hampshire, said the committee is “reasserting their belief that they have jurisdiction [over rulemaking] and then the courts would be the arbitrator” if the moratorium were to be challenged.

“You also see some changes in power here,” she told NH Journal. “It’s the change we have when a new person with a different political view is trying to separate themselves from what their predecessor did. You also have renewed power struggles among the different branches of government vying for power.”

Corcoran also clarified that Sununu announced the moratorium through a memo instead of an executive order. While both methods essentially produce the same result and are legally binding, the memo method could send a non-confrontational message, she said.

“Executive orders are a way to reverse existing policies,” she said. “If you want to reverse a position from a previous administration, you have to do that through an executive order. To put a policy on hold or not do anything right now to reassess, it signals that there is a new sheriff in town who wants to see where things are and where things are going. It doesn’t send the signal that we are ending anything quickly or completely switching gears.”

“He’s exercising his power to give agencies guidance,” she added. “It could be that he wants to appear measured and also signal to people that voted for him that it will be different under his term than [former] Gov. [Maggie] Hassan.”

Sununu has not issued his first executive order yet.

And Sununu is not alone for calling a halt in new regulations. Missouri Republican Gov. Eric Gretiens issued a similar action this month, except through an executive order, to freeze new rules and regulations.

Arizona Republican Gov. Doug Ducey issued a continuing moratorium through an executive order on Monday. Arizona has had a moratorium on new regulations since 2009.

Even Massachusetts Republican Gov. Charlie Baker issued a similar executive order halting new regulations in 2015.

While it seems like Republicans are the only ones who halt new regulations, it’s actually not partisan. Former President Barack Obama issued a moratorium, through a memo when he took office on Jan. 20, 2009, telling federal agencies to refrain from sending any new or proposed rules.

“You do tend to see that happen with new administrations,” Corcoran said. “He [Sununu] made campaign promises and he’s acting out on them.”

Sununu’s office responded to the committee’s letter on Monday, saying, “New Hampshire is an over-regulated state with too many rules stifling opportunities for economic growth.”

“As the state’s chief executive, he is leading a collaborative effort with department heads and commissioners to foster an environment in which businesses can more easily grow jobs,” said David Abrams, Sununu spokesman, in a statement to WMUR. “His carefully thought-out request has been met with enthusiasm and cooperation and we are confident that the information we have gathered will lead to meaningful reform.”

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