Gather children, for storytime -- a story of what happens when there is no regulation and no oversight, and when the corporations are trusted to police themselves. No, I'm not talking about an investment industry that stuffed its pockets by creating "securities" (sic) out of bad debt, figuring those who bought those securities would be left holding the bag. I'm not talking about an investment industry that lauds the free market but now wants US to pay so that the people who did this can keep their multimillion dollar compensation.
No, I'm talking about the Great Economic Miracle in China, where the "maximize profit at all costs" mentality has now sickened 53,000 babies in that country and hospitalized nearly 13,000 from dairy products "contaminated" with melamine. I put "contaminated" in quotes because the word implies something accidental, but the presence of melamine in these products is purely intentional, designed to artificially boost protein level readings for the adulterated products after they've been watered down.
While China pledged to tighten food safety standards after the melamine-tainted pet food scandal last year, exemptions were still given to the food industry. And the dairy industry is growing so fast that the growth is outpacing oversight.
Regulation works only as much as inspections are available and conducted, but when taken in combination with the banking scandal in the United States, it blows Adam Smith's invisible hand theory to smithereens.
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