Through many years in the oleomargarine industry the same effect of producing diacetyl in the product was obtained by growing the starter cultures, these bacteria in skim milk and mixing the skim milk with the oil, during which process the flavor was imparted to the oil, and remained in the finished oleomargarine.

The Administrator went further and permitted the standardization of flavor in oleomargarine by the addition of diacetyl.

If in the opinion of the manufacturer he had not produced sufficient during the process of treating the skim milk, it could be added. Senator CONNALLY. Is there any harmful ingredient in this diacetyl? Mr. LEPPER. No, sir; it has never been established that there is anything harmful. It is a natural product of the milk.

Of course, the addition of diacetyl is to give the flavor of butter. The effect of the yellow color is to make the product have the same shade as butter.

The CHAIRMAN. Is there anything harmful in the color?

Mr. LEPPER. The color that is permitted in foods must be certified, examined and certified, as to suitability for food use by the Food and Drug Administration under the Food and Drug Act.

Senator HAWKES. Might I ask this question. I have listened here and been told that butter itself at certain times of the year has to be colored.

Mr. LEPPER. Butter at certain times of the year is very often colored. Senator HAWKES. What I want to ask you is, Is the coloring matter used to bring butter back to the color that they want it, when it is off color or at certain periods in the year, the same coloring matter that is used in this oleo?

Mr. LEPPER. It is, yes, sir.

"Can consumers readily distinguish

Senator CONNALLY. When they color butter by adding coloring matter, they do not put any tax on it, do they?

Mr. LEPPER. Not that I know of; no, sir.

The coloring of butter is exempted by congressional action in the definition of standard for butter of 1923. There is no requirement that it be declared on the label.

The CHAIRMAN. That is part of the Pure Food, Drug and Cosmetic Act, is it not?

Mr. LEPPER. Yes.

"Can consumers readily distinguish between butter and oleomargarine when oleomargarine has been artificially flavored and colored?" I would say "No."

"Do you believe that it would be desirable to afford consumers some means of distinguishing between butter and oleomargarine."

There are means at the present time in the labeling requirements under the Food and Drug Act. Oleomargarine under that law must bear the name oleomargarine. It must also bear other information, such as the presence of the artificial color, the artificial flavor, and if enriched with vitamins, a statement as to the enrichment.

The CHAIRMAN. There are no provisions at the present time for notice in public places of the sale of oleomargarine?

Mr. LEPPER. Not under the Food and Drug Act; no.

Senator HAWKES. Is it customary to enrich oleomargarine with certain vitamins?

Mr. LEPPER. It is almost universally done at the present time in oleomargarine. We recently made a survey of a large number of oleomargarines throughout the United States, and we found that the oleomargarine is almost universally enriched and that the enrichment fulfills the statement on the label as to the amount.

Senator HAWKES. In your opinion if oleo were not enriched, then these test cases we have heard about where they feed children in one institution with butter and other children with oleo, those test cases probably would not be exactly as they are under the conditions reported to be made?

Mr. LEPPER. I think it is quite obvious, Senator, that if a food is fed that is deficient in vitamins in the place of a vitamin food, there would be some noticeable result on the experimental animal, let us call it.

Senator HAWKES. There is nothing detrimental to the public health by the type of vitamins that oleo is enriched with?

Mr. LEPPER. No, sir.

Senator GEORGE. If some butter is not pretty low in vitamins?
Mr. LEPPER. Butter varies seasonally.

Senator GEORGE. That is what I am saying each year.

Mr. LEPPER. When the animals are on green feed in the spring and summer, the vitamin content of the butter or the milk is going to be higher than it is when they are on winter feed. That has been demonstrated in investigations of the Department of Agriculture.

Senator GEORGE. Yes.

Senator HAWKES. I thought what Senator George meant was that is butter in that off season, when the vitamins are not so high, enriched additionally with vitamins?

Mr. LEPPER. No, sir.

Senator HAWKES. That is what I wanted to know.

The CHAIRMAN. It has been suggested here that the tax be removed, and that there be an offsetting substitute system of regulation requiring posting and maintaining of notices. Would it be practicable for your department to enforce such a regulation if it were adopted?

Mr. LEPPER. It would be practical to enforce it. It would be a question of manpower. That is something of course that the Food and Drug Administration does not consider. It would be practical of enforcement, just as other features of the law are practical of enforcement, the same as it was practical to enforce that provision of the law which you referred to as the Sullivan case where there was an over-the-counter sale by a retail druggist of a dangerous drug, a conflict with the law, which the Supreme Court ruled that the Food and Drug Act reached. It reached that sale at that point, and in the light of that decision it is believed that the Food and Drug Act can be interpreted to reach the distribution of the product at the table in the restaurant, where the ultimate consumer obtains it.

An expression of this committee for regulation of that distribution would of course go far in convincing the courts of the scope of the Food and Drug Act.

The CHAIRMAN. There was some little question in the Sullivan case as to whether that case could be used as a precedent in the case of food products.

Mr. LEPPER. Yes.

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The CHAIRMAN. But there was nothing in the decision as I recall it that threw any doubt on the constitutionality of a regulation that would carry the decision into the food field.

Mr. LEPPER. That is correct.

The CHAIRMAN. How many employees do you have? Let me first ask you how many agencies are engaged in enforcing the oleo tax provisions at the present time?

Mr. LEPPER. The Bureau of Internal Revenue enforces the tax provision.

The CHAIRMAN, What do you folks do about it?

Mr. LEPPER. The only work that we do with Internal Revenue would be in a case where, as occurred in 1931, there was quite a widespread activity on the part of several people at Boston selling oleomargarine for butter. Many of them went to jail for conspiracy. We cooperated with the Bureau of Internal Revenue and brought in the angle of the violation of the Food and Drug Act, in that conspiracy, as well as of the Tax Act.

The CHAIRMAN. How many people do you have in your organization whose business it is to investigate violations of the Pure Food and Drug Act?

Mr. LEPPER. I do not know exactly, Senator.

The CHAIRMAN. Give me a rough guess in round numbers.

Mr. LEPPER. I should say five or six hundred.

The CHAIRMAN. How many people are there in Internal Revenue, if you know, who busy themselves in this particular matter? Mr. LEPPER. That I do not know.

The CHAIRMAN. Mr. Stanley, would you find that out for us, please. Proceed.

Senator THYE. Would I be out of order if I asked one question at this point?

The CHAIRMAN. Go ahead, please.

Senator THYE. If the tax were removed entirely, the Internal Revenue Bureau would not in any sense have a responsibility in checking this?

Mr. LEPPER. I understand they would not.

Senator THYE. They would not have any responsibility whatsoever in checking on the product, whether it was improperly labeled or not? That would have to fall entirely upon the Food and Drug department. Mr. LEPPER. That is my understanding; yes, sir.

The CHAIRMAN. Does the Department of Agriculture have anything to do with the subject matter?

Mr. LEPPER. No, sir. The Food and Drug Act is no longer under the Department of Agriculture. It is now in the Federal Security Agency.

The CHAIRMAN. Then the two agencies concerned are your agency and Internal Revenue.

Mr. LEPPER. Correct.

"Am I correct in understanding that you opposed the addition of artificial flavor to oleomargarine?"

The answer is "yes," at that time.

Senator HAWKES. May I interrupt there? You say "Yes, at that time." How do you feel now?

Mr. LEPPER. At the time that that proposal was made it was in the beginning of the development of the use of diacetyl as a butter flavor. I took the position then that the use of diacetyl may give to the purchaser an impression that butter was present in the oleomargarinethat there was the possibility of an abuse in that respect.

Since that time, which was in 1941, when the standard was passed, we have no reason to believe that such belief exists on the part of the purchasing public, that there is butter in oleomargarine. We base that belief of course on the correspondence we received and our contacts with consumers which we continually carry on to develop consumer reactions.

In the enforcement of the law like the Food and Drug Act it is very important often to be able to demonstrate to the court that you have a measure of consumer reaction as to the understanding of the identity of food, so that the Food and Drug Administration does attempt through its inspectors and through its contacts with consumer groups to understand the consumer opinions and beliefs, regarding food, and as the result of that I no longer feel that the use of diacetyl actually gives the consumer a belief that butter is present in oleomargarine.

Butter could be present legally. Many years ago butter was present in oleomargarine. It is many years, however, since any has been used in that way.

Senator BUTLER. Why would it change? Why would the custom change? Why did they stop using butter?

Mr. LEPPER. That I do not know. Of course, we must recognize, and do recognize, that oleomargarine is a butter substitute. It is used by those who purchase it in place of butter, and the endeavor of those oleomargarine manufacturers is to make their product satisfying in every respect they can as butter.

Among the things that are concerned in this

Senator HAWKES. You do not mean as butter; you mean to replace butter.

Mr. LEPPER. To replace butter, that is, to have as many properties as butter has for the person who wishes to use it in place of butter.

The manufacturer, one of the properties of butter which the olemargarine manufacturer endeavors to simulate is the texture and its spreadability, let us say, and its use in the customary consumption of the food.

At the time the oleomargarine was first perfected or invented difficulty was experienced in getting those properties into the product, and it may have been at that time that some butter was incorporated to give some of the texture properties that were desired.

I do say that for many years there is no record of butter being used that I know of in oleomargarine, and those properties are obtained by treatment of the oil, rather than through the addition of butter. The CHAIRMAN. Proceed, please.

Mr. LEPPER. "But notwithstanding your testimony the Federal Security Administrator at that time, Paul McNutt, included diacetyl in the standard."

Yes.

"Have you recently looked over the testimony which you gave at that hearing?"

Yes.

"Do you remember saying this:

"If you will take oleomargarine, and this uninformed group, who don't know a great deal about what it is composed of, and color it, immediately the consumer gets a false conception of what that product might be. In other words, he probably would accept it without question for butter.""

The rest of the question is, "Do you still hold that view?"

Naturally the addition of artificial color to white oleomargarine makes it resemble butter, and removes one of the distinguishing features between the two products.

"Why did not the Food and Drug Administration oppose the use of artificial color in the definition and standard for oleo-Was it because the revenue laws permitted colored oleo, though taxed?"

The second part of the question answers the first part. The Federal Administrator certainly had no authority in setting up a standard to deny in oleomargarine that which Congress had permitted either with or without the levying of a tax.

"Do you believe the difficulty of preventing fraud and deception in the sale of oleomargarine as and for butter will be enhanced if the revenue laws are repealed?"

As one engaged in the enforcement of the Food and Drug Act for 35 years, I frankly feel that insofar as interstate commerce is concerned, the fraud and deception in the sale of oleomargarine as butter can be controlled. Of course, that has nothing to do with the sale of the product made in a State and maintained and kept within its boundaries.

The CHAIRMAN. The question of alternatives is squarely before us through the amendment proposed by Senator Fulbright. I should like to suggest that you gentlemen get to work on the propositioon and get your counsel at work and whoever else might be useful to you, and suggest an amendment which in your opinion, without committing yourselves to the philosophy of the thing, would serve the purpose which you have just mentioned.

Mr. LEPPER. Yes, sir.

"Would you expect that if the tax regulation were removed, a greater enforcement burden will be placed on the Food and Drug

Administration?"

I would say that there would be a greater enforcement burden; yes, sir.

"The legislation which we are considering would remove the 10 cents tax on oleomargarine when it is artificially colored yellow. The oleomargarine manufacturers want this restriction removed. In your opinion, is this because of a desire on their part to manufacture oleomargarine the same color as that which consumers associate with butter?"

That question is asking me to think for someone else. Just what is in the mind of the oleomargarine manufacturers in removing the 10 cents tax can be speculated on in many ways. Certainly the color that they wish to give oleomargarine is a butter color.

Senator GEORGE. The grower of fats and oils might be interested in increasing his sales, also.

Mr. LEPPER. Speaking of the grower of fats and oils, Senator George, I heard a statement made here this morning that you could not make an oleomargarine naturally yellow from oil.