In the Age of the Internet, State Regulation of Consumer Products is Almost Impossible
When it suits them, nearly all politicians say they support letting states make their own decisions. Take, for example, Sen. Minority Leader Chuck Schumer (D-NY) who has stood for increased federal control over health care and firearms but says states “should have the power to decide what works best for them” when it comes to marijuana. But his counterpart, Republican Majority Leader Sen. Mitch McConnell (R-KY) offers no more consistency. He is all in favor of federalism when it comes to health policy and elections but won’t bring Sen. Schumer’s marijuana bill up for a vote in the Senate.
Suffice it to say, most lawmakers are fair-weather friends to federalism when it suits their policy preferences, even when a tension between federal and state control is healthy, like in areas of transportation, medicine and education. But in one big area of law in the news recently —consumer products — it’s time for a recognition on both sides of the aisle that federalism just doesn’t work in the age of the internet.
In the last 20 or so years, two factors have created the need for setting consumer products law on the national level. First, the explosion of e-commerce means that just about every moveable item can be purchased anywhere. Everything sold in New York is also sold in Des Moines. Second, supply chains for nearly all products — once confined to regions of the United States — are now international in scope. Because these factors increase consumer choice while lowering prices, they benefit most Americans. But it also means that piecemeal efforts to ban consumer products are going to be expensive and doomed to fail from the start.
This, in turn, means that a huge range of efforts such as state-level gun control measures, mandates that try to stop drunkenness by limiting grocery stores to selling weak 3.2 beer, bans on raw milk, and even marijuana laws create worst-of-all worlds situations. They are costly and inefficient to enforce, subject to legal challenges and at their worst have resulted in serious criminal charges against people who had no criminal intent.
But widespread failure doesn’t seem to have stopped politically motivated foolishness. Indeed, when it comes to e-cigarettes, states have recently regulated in ways that are both costly and ineffective. After black market THC cartridges laced with Vitamin E acetate made hundreds of people sick in 2019, eight states rushed to issue executive order bans on all e-cigarettes. The bans didn’t protect anyone since the products that caused people to get sick were already illegal. Since they were often implemented through executive order rather than legislation anyway, furthermore, many of them were overturned in court after states collectively spent millions defending them. Meanwhile, careful scientific analysis of e-cigarette dangers still going on at the Food and Drug Administration — which has a degree of scientific and health expertise no state’s health department could even come close to matching — couldn’t be taken into account since it still isn’t finished.
And as time passes, similar stories are likely to repeat themselves in other product categories. Single state car emissions standards could drive up the cost of automobiles for everyone as production lines have to be retooled. Efforts to ban large soft drinks and other unhealthy foods (already in place in a few big cities) probably won’t be any more effective, either.
The bottom line is simple: America has national markets for just about everything and state regulation of many consumer products is nigh impossible. Where clear federal regulation already exists in areas like pharmaceuticals and tobacco/nicotine products, federal agencies like the FDA should have sway. In other cases around contentious products, such as marijuana, the federal government should, at minimum, work to make sure that people don’t end up with a disqualifying criminal record for doing something that’s legal in many places. Although alcohol markets will have to remain state regulated since the 21st amendment says they must, more standardization, probably via interstate compacts, could do tremendous good. Federalism is good for many things but its day in consumer products markets has passed. As markets have gone national, consumer product regulations must soon follow.
Eli Lehrer is president of the R Street Institute, a free market think tank in Washington, D.C.