What Does Fairness Have to Do with the Price of Eggs?

The starting point of business ethics is contractual: I agree to provide a fair product (or service), and you agree to pay me a fair price.

After that, the arguments start.

What's a "fair" price?

When we're on the provider side of the equation, we generally want the price to be as high as possible; as consumers, we want the price to be as low as possible.

In an effort to maximize sales and minimize costs, some producers are willing to go very low indeed.

And what's a "fair" product?

At the very least, it would be safe.

I've been following, as I'm sure many of you have been too, the ongoing story of the recall of eggs from two leading U.S. producers, Wright County Egg and Hillandale Farms. Since 13 August, when the recall began, more than half a billion eggs have been recalled, and since this spring, some 1500 cases of salmonella have been linked to affected eggs.

Today's New York Times carries an article by William Neuman that outlines some of the findings from federal inspections at the Iowa egg farms: "Barns infested with flies, maggots and scurrying rodents, and overflowing manure pits" were among the appetizing details reported.

"Both companies said that they had acted quickly to correct problems and were continuing to cooperate with regulators," the article claims.

But the problems reported as so egregious that management at Wright County Egg and Hillandale Farms must have been aware of the situation. For example, at Wright County Egg, inspectors found "pits beneath laying houses where chicken manure was piled four to eight feet high." Not something you're likely to, um, overlook.

Wright County Egg is owned by Austin ("Jack") DeCoster, who is no stranger to run-ins with federal and state regulations. As reported by Mary Clare Jalonick for the Huffington Post, fines into the millions of dollars have been assessed against DeCoster for health and safety violations at his Maine operations as well as labor violations at his Iowa "farms" (full article here).

I use quotation marks around "farm" because what I think of as a farm bears little resemblance to the industrial complexes that are, for example, Wright County Egg.

In the meantime, the FDA has released a new "draft guideline" for the prevention of salmonella in shell eggs (many egg producers sell shell eggs to consumers and also send eggs to "breaking plants" where the eggs are pasteurized -- which kills the salmonella bacteria -- and sold in liquid form, usually to food manufacturers). Will these new guidelines prevent another huge salmonella outbreak?

As long as there are producers out there like DeCoster -- who seems to think of fines as merely another cost of doing business -- I suspect the FDA's efforts will be insufficient.

Egg production can be done humanely and safely, but .... it will come at a higher price. That seems fair.