It seems that a German chain of in-store bakery machines is being sued for deceptive advertising; their "fresh-baked rolls" are nothing of the sort. Megan McArdle just doesn't see what all the fuss is about.
I am certainly not against all false advertising statutes--the government's role in ensuring transparency is extremely important. But this seems like an egregious abuse of the statute. The bakers are not altruistically worried that consumers will be hurt by their decision; they're worried about competition cutting into their profits.
McArdle is all about free market competition. Caveat lector, suckers! If, for instance, you happened to buy a copy of The Atlantic because of its reputation for intellectually stimulating work by America's finest writers and you got Megan McArdle instead, that's just too bad. You'll know better next time.
Indeed, it's hard to see how a consumer could be hurt by this.
"Indeed" indeed. How could bakeries possibly be harmed by someone passing off lower-quality products as bakery-level quality, at a lower price?
Fresh baked bread does not have some sort of magic, hard-to-observe qualities like preventing cancer; it just tastes better. Consumers are in a very good position to observe whether the bread they buy at Aldi does, in fact, taste better; if not, they can always go back to their local bakery. What purpose, then, does suing for false advertising serve?
And if you call yourself an econoblogger but don't really blog on economics, your readers will just find another economics blogger. Getting all fussy and demanding regarding quality and truth and whatnot serves no purpose at all. And it damages reputations.
One could ask the same about France's rigid rules about regional naming, making it illegal to call anything Bordeaux unless it comes from a rigidly defined geographical area.
One could also ask the same about Ivy League schools. Why are they so rigid about who can be called Ivy League and who couldn't? Why couldn't my large commuter state school call itself Yale but keep its much lower tuition? Anyone who looked at me would know at once if I were Yale or not Yale.
The US is not quite as bad about this sort of thing as many European companies are, but we have a fair amount of this nonsense, particularly surrounding food--so that there are strict rules, for example, about how much beef a soup must have before you can call it "beef soup with vegetables" rather than "vegetable soup with beef". Yet the amount of meat in a soup is easily observed directly by the consumer, and if they don't like it, they can always buy a different brand of soup.
It's really very simple: If you can see someone trying to rip you off, it's okay to rip you off. Which explains McArdle's belief that if she announces her husband works for a Koch she does not have a conflict of interest when she supports a Koch. Yet another jigsaw puzzle piece falls into place.
Transparency should focus on products that are costly and qualities that are hard to observe--ensuring that kosher food is actually kosher, and low-fat food is low in fat, and that the car alleged to have a v-6 engine and passenger-side airbags actually does. Quibbling over semantic labeling distinctions wastes time and energy--and worse, often serves as a forum for anti-competitive maneuvering.
McArdle just doesn't see the problem with both trading on and undercutting a brand's reputation.
Why are we not surprised?