DNA - it's changing the whole economy
ONCE upon a time in the United States, there were clearly drawn lines of distinction between chemical, pharmaceutical, energy, and food companies. No more. This ``old'' demarcation of industrial activity is being obliterated by a potent new alchemy of mergers and biotechnology. What is troubling about the emergence of this new corporate form is the lack of countervailing institutions to control it.
Since 1981, mergers of huge proportion have been restructuring society. Big chemical companies have been buying up big energy companies; some energy concerns have acquired agribusiness corporations; and a few agribusiness giants have bought up pharmaceutical or food companies. Elsewhere on the corporate landscape, deals are being consummated in out-of-the-way place like the seed, feed, and livestock genetics industries.
These mergers and acquisitions are more than simply one company buying another because of the nature of the businesses being combined - energy, food, medicine, and chemicals - the ``life necessities'' industries. But mergers and acquisitions in these fields are now made doubly profound for another reason: DNA, or deoxyribonucleic acid. DNA, the molecular repository of genes, is rapidly becoming a pivotal raw material for industry.
What is emerging is the making of a new, unprecedented institution of economic and political power: the multifaceted, multinational ``life sciences'' conglomerate, a huge company that will use genes just as earlier corporate powers used land, minerals, or oil.
In many ways, DNA is the ideal corporate resource: It can be patented and wielded as a property right; it can be manipulated and ``instructed'' in the laboratory; it can replace or reduce the reliance on ``old,'' cumbersome raw materials like farmland or bulk feedstocks; it can eliminate or reduce labor costs; it can help to circumvent worrisome or finicky variables such as weather; it can produce copious quantities of scarce and hard-to-make products for pennies; and finally, because of its ``value added'' possibilities and high potential margin, it can be very profitable.
Yet, what is happening with mergers and biotechnology should not be mistaken for a new form of efficiency or economic vibrancy that will ensure healthy competition, fair pricing, and socially valuable innovation. Rather, some companies are using this technology only to extend their current market positions - as in the case of pesticide-makers genetically engineering crops to resist pesticides, not pests. Other are carefully picking lucrative drug and diagnostic markets, with patent-protected high prices.
Nor should this ``revolution'' be mistaken for a new fount of entrepreneurism. New companies have formed, and new ideas have advanced. And a few newcomers may survive. But the old companies will retain control.
``Of all the technologies coming to agriculture,'' says the congressional Office of Technology Assessment, ``the biotechnologies will have the greatest impact, because they will enable agricultural production to become more centralized and vertically integrated.'' Other industries will be similarly ``gathered in.''
Thus, the key question becomes one of control and accountability.
Who will control the giant companies that wield such a powerful new technology?
How will society manage a life-sciences conglomerate that has the power to patent the genes of food, health, and energy?
The universities have flung themselves willingly into the corporate/DNA maelstrom. Congress and the White House aren't much better, bending over backward in recent years to write new law and overturn old practice - liberalizing antitrust laws, freeing up drug export restrictions, pushing for longer patent terms, and balking at new regulation.
Much economic and political power is being shifted toward super life-sciences corporations built upon DNA. But few institutions recognize this profound shift. In one sense, the recent developments in the biological sciences, patent law, and corporate mergers have, in combination, outrun and overwhelmed such institutions' ability to offer remedy or guidance.
Yet the US needs to soon devise an appropriate set of controls and oversight that will not bridle economic performance abroad, but not endanger or shortchange people at home, either. While world markets and the advance of technology are important, the US should not recklessly sacrifice or cast aside traditional safeguards and checks on power.
If we do, we may find ourselves facing the biogenetic equivalent of the 19th-century Trust Era, when industrial behemoths like the Oil, Steel, and Money Trusts dominated the economy, Congress, the White House, and practically everything else. Only this time, it will be genes and the life sciences that are monopolized. That could be a far more ominous prospect than the domination of mere commodities.
Jack Doyle, author of ``Altered Harvest'' (Penguin, 1986), is with the Environmental Protection Institute of Washington, D.C., a nonprofit, public-interest organization that works on energy and natural resources policy.