Energy Drinks, Regulation, and Equality

Monster Energy is getting out of the dietary supplement business. But its customers shouldn’t panic: It’s going into the beverage business—with the same products.

The change, you see, has nothing to do with what Monster makes or its customers buy. It’s simply a question of regulatory classification. Monster thinks its energy drinks can qualify as either supplements or beverages, and it’s switching in order to change its regulatory burdens.

Meanwhile, Democratic Senator Dick Durbin of Illinois is trying to increase the regulatory burdens on dietary supplements.

It’s not uncommon for a businessman’s burdens to depend on how his product or service is classified. Thomas Depping got out of the “banking” business so he could focus on making loans to small businesses. Specialty secondhand shops in Washington, D.C., were nearly forced to report every purchase and sale to the police because of their classification. Roll-your-own-cigarette operations were profitable in part because conventional cigarette manufacturers had higher regulatory costs ; they had trouble competing when the burdens were equalized.

But Monster’s ability to sell exactly the same product in either of two regulatory classifications calls our attention to one question: Is there any principle behind the way our government classifies products and services? Indeed, we should ask: Should the government ever separate products and services into different categories and place different requirements on each?

These are important questions, not only because having numerous regulatory classifications creates costs and risks of its own—you have to figure out which rules apply to you, and rules you might not expect may apply to you —but because segregating activities into categories subject to different rules makes it easier for government to impose special burdens on certain people: Most other people may not notice, let alone protest.

Yet when the government can impose special burdens on a specific group of people, be it those of one sexual orientation, of one religion, or in one industry, without a principled reason, it can do similarly to everyone—one group at a time. It’s in this sense that a governmental injustice to some of us is a threat to all of us.

And that’s a key reason to insist on equality before the law: It protects all of us from targeted injustices.

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