Thursday, July 08, 2010


Chicken Littles are Crying Wolf - Again

First it was CODEX alimentarius which, if proposed standards were adopted, was going to destroy the dietary supplement industry in the United States by classifying all our nutritional products as drugs. It passed, and it didn't.

Then there was the FTC's New Business Opportunity Rule which proposed that all business opportunities, no matter what the initial costs were, would be subject to the same level of disclosure as are franchises (currently any required purchases of less than $500 exempts the program from such disclosure). One prominent constitutional attorney spoke frequently on radio shows, conference calls and before live audiences where he matter-of-factly exclaimed that the FTC was enacting this new biz opp rules solely and specifically to "destroy the network marketing industry" and it was being "fast tracked" to expedite our industry's demise - by the Summer of 2007. Instead, the proposed new rule, which was introduced in April of 2006, languished for another year before the FTC eventually exempted all network marketing companies.

More recently it was Senator John McCain's (R-Arizona) "Dietary Supplement Safety Act". Supposedly, this act would have given the FDA authority to unilaterally ban any dietary supplement, or all dietary supplements. A month later, after objections from the supplement industry and discussions with others, such as Senator Orrin Hatch (R-Utah), Senator McCain withdrew his support of the act.

Now we have Congressman Henry Waxman (D-CA) allegedly embedding language in "The Wall Street Reform and Consumer Protection Act of 2009" (H.R. 4173) that will give unchecked power to the FTC (not FDA) to ban any, or taken to its illogical extreme, all dietary supplements. According to the same two or three articles that have went viral throughout cyberspace (creating the illusion there are thousands of opposing commentaries) Waxman added this last minute language, after the bill had already passed the House and was about to go before the Senate, to "terrorize nutritional supplement companies by greatly expanding the power of the FTC to make its own laws that target dietary supplement companies". Here's the problem with this one: It doesn't.

I've searched the original version of this bill (all 1,279 pages) as well as the bill currently before the Senate (all 1,705 pages). You can find both HERE. There is not one word related to dietary supplements, nutritional products, DSHEA, or the word "Health" in any context (other than where Federal Employee Health Benefits is mentioned). Here's what's going on...

Waxman did add language to the already House approved bill, but the language is designed to give the FTC more power by essentially allowing it to write its own laws without Congressional approval. Presumably this is to allow the FTC to act more swiftly when they find evidence of corporate malfeasance (related to "Wall Street"). It appears that only two or three bloggers and op-ed authors within the dietary supplement arena have extrapolated from this that the FTC could use this new found power to regulate without oversight the dietary supplement industry as well. They even go so far as to claim that Waxman's motive for this added language is specifically to that end. Most commentary is titled "Health freedom alert: Congressman Waxman sneaks anti-vitamin amendment into Wall Street reform bill", or words to that effect.

I forgot to mention, the word "vitamin" also doesn't appear anywhere in the revised bill.

So yes, technically, the power to enact law without Congressional approval would give the FTC the power to ban any or all dietary supplements, because it allegedly gives the FTC the power to ban or or all of practically anything! But, in fact, there is not one word anywhere in the bill that even remotely has to do with specifically dietary supplements, or the health and nutrition industry in general. It appears that paranoid conspiracy theorists are assuming this is the real reason Waxman added this language. Their evidence? In the past Waxman has called for additional oversight of dietary supplements by the FDA (see HERE). Along with dozens of other politicians over the past several years.

There's one other thing to consider here... The FTC already has the power to essentially create law without Congressional approval! That's precisely what the New Business Opportunity Rule will do (as far as to whomever it eventually applies to). Right now the FTC requires dietary supplement marketers to "scientifically substantiate" their claims. They can change their standards to meet this requirement at any time, and without congressional approval (although still a lengthy process).

Having said all of that, the practice of sneaking in last minute language to enact a law that has nothing what-so-ever to do with the bill being considered is an abhorrent and not uncommon practice. The ability for the FTC to enact regulations that are, for all intents and purposes, the creation of law, without Congressional approval, is also worthy of our concern and distain. But we all should already be objecting to this, because its already happening, and has been for decades! So when you see all of those email pleas and blooger links sending you to petitions, or informing you how to protest to your representative, absolutely do it. But protest the right thing, for the right reason. The FTC already has enough unilateral power, and no significant revisions, under any circumstance, should be made to a bill that's already passed the House and is now before the Senate. That's what we should be protesting.

Network marketing, and our health and nutrition products, are going to be around for a long, long time. The sky is going to stay right where it is.

Founder & CEO

Magnetic Sponsoring™

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