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Mugged by the State Mugged by the State, by Randall Fitzgerald

The Maine Fish Processor

(The following is an excerpt from Randall Fitzgerald's book, Mugged by the State, (Regnery, 2003). This book is available from the Cato bookstore.)

For nearly a century the McCurdy Fish Company had been an employment mainstay in the village of Lubec, Maine, processing smoked and salted herring caught by local fishermen. Ownership had passed down from grandfather to father and then to son John, who was sixty-four years old when the problems began. Herring smokehouses had been a foundation of Lubec's economy since 1797-at one point in the nineteenth century thirty were in operation-but by 1975 America's eating habits had changed and McCurdy's was the last commercial smoked herring processor in the nation.

At least once a year, the U.S. Food and Drug Administration inspected the McCurdy Fish Company's facilities, and never in the company's history had it ever been cited for a serious violation of health and safety regulations. In May 1990, just a few weeks before the fish season would begin, an FDA official visited John McCurdy and handed him an FDA Policy Guide regulation labeled 7108.17.

Three outbreaks of botulism in 1981, 1985, and 1987, produced a total of eleven illnesses in New York City, had been traced to Great Lakes Whitefish which had been processed by layering ungutted fish in salt and then air-drying it. Acting on the assumption that the process was a life-threatening acute health hazard, the FDA banned the distribution of any fish that was salt-cured and air-dried prior to being gutted.

As McCurdy read the regulation he knew immediately that it would put him out of business. His smoked herring had been processed this way by hand for eighty-eight years. To comply with the regulation he would have to purchase gutting machines and refrigerated salting tanks costing more than $200,000. That sum was far out of reach for a company with just twenty employees.

Then the timing of the two-page regulation captured McCurdy's attention and the implications baffled him. The regulation was dated October 27, 1988, a full nineteen months earlier. If he was producing such a "life-threatening acute health hazard," in FDA terminology, why had the agency waited nearly two years to inform him and "protect" the public? The FDA investigator shrugged. "Possibly because you're such a small processor."

With his economic future hanging in the balance, McCurdy phoned FDA officials in Washington, D.C., to explain how there could be no possible comparison between the whitefish targeted by the agency and the herring he processed. Whitefish was larger and caught from freshwaters, while herring was an ocean saltwater species whose natural saltiness, combined with McCurdy's salting process, prevented the growth of botulism spores. Besides that, as the FDA conceded, not a single case of botulism had ever been reported in sea herring.

Totally unmoved by McCurdy's logic or his pleas for understanding, an FDA official restated his agency's position. If McCurdy tried to distribute any of the most recent herring catch he had already contracted for, the FDA would seize the fish and take legal action against him. Faced with bankruptcy, McCurdy appealed to then-U.S. Senator William Cohen of Maine, who contacted the FDA and succeeded in securing a temporary stay of execution until that season's catch had been processed.

Over the next four months FDA inspectors made eight unannounced visits to McCurdy's plant, spending two and three days each time monitoring his processing methods. No evidence of contamination was found. But it would be McCurdy's last season because the FDA refused even to consider an exception to its blanket ruling.

The day McCurdy hung a large "For Sale" sign on the side of his processing plant was the saddest day of his life. He had to say goodbye to his twenty employees, who were his friends and neighbors. Many of whom, like him, had grown up working in the plant.

Years later McCurdy remained understandably hurt and angry about his forced retirement. Those feelings are only compounded by the continued sale in the U.S. of Canadian herring using the exact process the FDA outlawed for American producers. FDA officials told me they had no way of certifying which processing methods are used by Canadian suppliers. The McCurdy mugging illustrates the FDA's insensitivity toward the realities of operating a small business, and the one-size-fits-all nature of its ruling in this case shows how inflexible regulatory agencies can inflict an economic toll far beyond any reasonable justification for its actions.