It’s a wet and sleepy Sunday afternoon, so nothing too heavy here. Simple point: although I usually talk about rule of law in China within the context of unpopular criminal cases or intellectual property issues, I should emphasize more often that it touches a great many subjects and has a very profound impact on society in general, even the organic food movement.

In speaking of US-China relations, Elizabeth Economy, an IR guru currently with the Council on Foreign Relations, recently said that the lack of effective rule of law in China is at the root of most conflicts it has with the United States. I’m not sure if a stronger rule of law in China would solve all bilateral friction with the US, but it would sure go a long way.

Rule of law even has an effect on food purchases. UPI had an article today on the organic food movement in China, stating that because there was so much concern by folks over here about food safety, organic foods are making fast inroads to the market.

Some of the statements made in the article are interesting. For example:

“The Chinese people are very aware that their food is rubbish,” said Romuald Pieters, director of Sustainable Development & Agriculture Creation, a consulting firm working in China.

I hope that was a misquote or something, because that just sounds awful. There have been a lot of food safety issues here, particularly in recent years, but wow, hyperbole much?

But OK, we get the point. Enter organic foods:

Fearful of the sludge, pesticides and chemical fertilizers, a small group of growers have established organic farms to sell produce and educate the public about healthier food[.]

As more organic produce comes to market, more people people will begin to trust food suppliers again, said Terry Yu, who owns organic stores in nine locations in China,

“Customers don’t trust the chain, and the chain doesn’t trust its supplier — no one trusts anyone,” Yu said.

The goal here is nice, but Mr. Yu there actually (and probably accidentally) lit on a real problem with this market sector. Yes, non-organic foods (that sounds odd, but I don’t know a better term to use) have major quality problems, and yes, folks might be looking for a safe alternative. But if “customers don’t trust the chain,” what makes Mr. Yu think that customers will necessarily trust his suppliers/chain instead?

Why is this a problem? Rule of law.

The country has a Food and Drug Administration and lots of regulations on the books. Many of these rules are not enforced properly, for a variety of reasons. People know the products are not always safe, and they also know they cannot trust the regulators to do their job with 100% effectiveness.

With so much distrust, will people trust organic farmers and the “organic” label? I doubt it in most cases. Indeed, there have already been mini-scandals concerning the use of dyes and other chemicals by food suppliers looking to get a leg up on the competition by using the magic word “organic” and (one assumes) artificially making their produce appear fresh and wholesome.

Certainly local suppliers and brands may be able to attract a customer base familiar with the quality of their product. But this is rather limited geographically. It is difficult to see how an organic foods movement could really spread over here until people can actually trust industry regulators.

One final thought. If you don’t trust the quality of your food, what else won’t you trust? These are the little things (perhaps even more than questionable criminal sentences) that undermine the faith of people in the rule of law.

And it can become extremely widespread and damaging to a nation as a whole. Consider what’s happening in the US as people are faced with bank bailouts, weak health care reform, and inadequate environmental legislation — Americans are losing faith that the system can adequately address the concerns of the average citizen. This was summed up quite nicely in the Saturday New York Times by columnist Frank Rich:

What disturbs Americans of all ideological persuasions is the fear that almost everything, not just government, is fixed or manipulated by some powerful hidden hand, from commercial transactions as trivial as the sales of prime concert tickets to cultural forces as pervasive as the news media.

Rich is talking about business as well as government. As to the latter, in the US this is much more about lawmaking as it is about its application, in some ways the inverse of the challenges we face here in China.

So is the organic food movement doomed in China until things change? Not necessarily, and you never know how effective a good advertising campaign can be (a lot of expats will be the first to be hoodwinked, I would guess). On the other hand, if I had a couple million RMB to invest, I wait keep my eye on enforcement trends and public opinion before jumping into the market.