This is the most current report dealing with BSE.  Here are links to the report in three formats:
PDF file - 1.8 Mb  Also available as a text tile  (137 kB) or there's a  HTML version via Google

The following are snippets I think are important. I've tried to indicate editorial stuff I've added in italic.   Read the full text for details which may be ommitted.

Cover Letter section "Results in Brief" lists the major problems:

While BSE has not been found in the United States, federal actions do not sufficiently ensure that all BSE-infected animals or products are kept out or that if BSE were found, it would be detected promptly and not spread to other cattle through animal feed or enter the human food supply. With regard to imports, the United States had imported about 125 million pounds of beef (0.35 percent of total imported) and about 1,000 cattle (0.003 percent of total imported) from countries that later discovered BSE--during the period when BSE would have been incubating. In addition, weaknesses in USDA's and FDA's import controls, such as inspection capacity that has not kept pace with the growth in imports, may allow BSE-infected products to enter the country. With regard to animal testing to detect BSE, although USDA has steadily increased the number of animals it tests, it does not include many animals that die on farms. Experts consider these animals a high- risk population. Concerning the feed ban, FDA has not acted promptly to compel firms to keep prohibited proteins out of cattle feed and to label animal feed that cannot be fed to cattle. We identified some noncompliant firms that had not been reinspected for 2 or more years and instances when no enforcement action had occurred even though the firms had been found noncompliant on multiple inspections. Moreover, FDA's data on inspections are severely flawed and, as a result, FDA does not know the full extent of industry compliance. FDA acknowledges that it has not yet identified and inspected all firms subject to the ban. In terms of the public health risk, consumers do not always know when foods and other products they use may contain central nervous system tissue, which, according to scientific experts, could pose a health risk if taken from diseased animals.
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Concerning the health risks, if BSE- infected cattle were to enter the food supply, some people might develop vCJD. However, experts disagree about the number of people who would be affected. While many believe that vCJD is very difficult to contract, so that relatively few people would develop it, some experts believe that, because of the long incubation period, no one can predict whether few or many might contract vCJD.

The United States acted as many as 5 years earlier than other countries to impose controls over imports of animals and animal feed ingredients from countries that had experienced BSE. Similarly, U.S. surveillance efforts to test cattle brains for BSE met internationally recommended testing targets earlier than other countries. However, the United States has a more permissive feed ban than other countries--one that allows cattle feed to contain proteins from horses and pigs. FDA is reviewing whether these ingredients should continue to be allowed in cattle feed. Finally, as in most countries that are BSE-free, including the United States, cattle brains and other central nervous system tissue can be sold as human food.

This report makes recommendations to USDA and FDA to,among other things,strengthen enforcement of the feed ban,develop a coordinated strategy to identify resources needed to increase inspections of imported goods,and alert consumers when products may contain central nervous system tissue.   In commenting on a draft of this report,FDA and Customs concurred with our recommendations.USDA largely concurred but said that labeling and warning statements should be reserved for known hazards.
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The continuing absence of BSE in the United States today cannot be sufficiently ensured by current federal prevention efforts.The introduction and spread of BSE in the United States could stem from cattle and cattle- derived products imported from countries that subsequently developed BSE and from gaps in import controls,animal testing,and feed ban enforcement.  As a result of these problems,consumers may unknowingly eat foods that contain central nervous system tissue from a diseased animal.
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Although federal agencies have acted to reduce the possible ways that BSE-infected animals or products could enter the country,the United States has imported about 1,000 cattle;about 23 million pounds of inedible meat by-products,including meat and bone meal;about 101 million pounds of beef;and about 24 million pounds of prepared beef products during the past 20 years from countries where BSE was later found.  These numbers represent a fraction of total imports in each category —0.003 percent of cattle,0.665 percent of meat by-products,0.314 percent of beef, and 0.728 percent of prepared beef products.In light of the long incubation period for BSE (up to 8 years),the possibility that some contaminated animals or products have entered the United States cannot be ruled out.

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Until February 2001,USDA regulations allowed the import of beef and beef products from countries with BSE or at risk of BSE if the facility that processed the meat did not receive,store,or process ruminant material from a country with BSE or at risk for BSE.   (ed:  graphs of various meat products from the UK, Eurpope and Japan are included in the report)

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At-risk items may also slip through federal inspections at ports of entry.  Customs often finds discrepancies with the accuracy of importer-provided information during its annual reviews of trade compliance and,as a result, BSE-risk products may not be flagged for further inspection.For example, Customs found a shipment of animal feed ingredients incorrectly classified as pet food by the importer.It also found a shipment of animal feed identified by the importer as originating in Canada that inspectors discovered originated in Switzerland.  For fiscal year 1999,Customs reported that importer-provided information on shipments of live bovine animals (e.g.,cattle,bison,and buffalo) was inaccurate in over 24 percent of samples taken.  Information on shipments of fresh or frozen beef was inaccurate in over 21 percent of samples and on shipments of animal feed in over 24 percent of samples.

Additionally,the ever-increasing volume of imported shipments strains inspection resources for both FDA and USDA.In October 2001,we reported (GAO-02-47T) that during fiscal year 2000, FDA inspected about 1 percent of the over 4 million imported food entries under its jurisdiction. Additionally, FDA inspected less than one percent of the more than 146,000 entries of imported animal drugs and feeds.

USDA yesting for BSE in cattle commenced in 1990- primarily adult cattle with neurological symptoms and adult animals that were nonambulatory at slaughter.     a substantial portion of those samples have been taken from nonambulatory cattle since 1994.....  In fiscal year 2001 these animals accounted for more than 90 percent of the 4,870 brains collected and tested.  The remainder includes brain samples from animals rejected at slaughter for signs of neurological disease.....

Although USDA has strengthened its surveillance efforts,  the program does not include many samples from cattle that die on farms.Scientific experts consider these animals a high-risk population because they are generally older and the reasons for their death are often unknown.  USDA told us that efforts to obtain samples more systematically from such animals are limited largely by the dispersed nature of the domestic livestock industry,the lack of adequate laboratory capacity to conduct the tests,and the lack of sufficient staff and time to collect the samples.  When animals die on farms they may be buried on the farm, taken to  landfills,or collected by renderers who recycle animals and other animal tissues into, among other things,animal feed.   In 1998 USDA implemented a cooperative program with the rendering industry to ensure that carcasses of animals condemned at slaughter for signs of neurological disease are held until test results are completed.  Under this program,  USDA may share the expenses to store or dispose of carcasses during the testing period. USDA was not able to provide us with information on how frequently the program has been used,  but it has been used only sporadically,according to USDA officials and the USDA veterinarians and renderers we spoke with in nine states and Puerto Rico.

ed:  The report notes that the Havard risk study concluded that

"excluding from the rendering process those animals that die on farms significantly reduces the potential for cattle to be exposed to BSE through animal feed.  Also, Harvard ’s report also notes that farmers may not be willing to send animals displaying neurological symptoms to slaughter,thereby reducing the likelihood that infected animals would be inspected by USDA at  slaughterhouses."

 The above seems a gapping hole to me, but, how many cows are taken directly to renders and thereby fall through even the "cooperative" (i.e. voluntary) program noted above?)

Federal and state officials and the scientific community agree that if BSE were to be found in a U.S. herd, a well-enforced feed ban would prevent its spread to other herds....  .According to FDA ’s data, more than 12,000 inspections have been conducted since 1997 at more than 10,000 firms, including renderers,feed manufacturers,feed haulers,and distributors,as well as at on-farm feed operations.  According to FDA ’s October 2001 quarterly update that summarized results of feed ban inspections, 364 firms were out of compliance.  In addition, FDA believes that not all firms that should be subject to the ban have been identified and inspected,  at least 1,200 or more based on industry estimates (see table 2).  However,we could not verify these data because we found significant flaws in FDA ’s database,  which we discuss later in this report.

FDA did not take prompt enforcement action to compel firms to comply with the feed ban.  When we began this study,in April 2001,  the only enforcement action FDA had taken was to issue two warning letters in 1999.   The first letter was issued in May 1999 —21 months after inspections began.  However, since inspections began in 1997, FDA has reported hundreds of firms out of compliance —most often for failure to meet requirements to label feed that contained prohibited proteins or for including prohibited proteins in cattle feed.  In our analysis of individual inspection forms, we found several instances in which firms were out of compliance in repeated inspections, yet FDA had not issued a warning letter.  We also found instances in which firms were out of compliance but had not been reinspected for a year or more —and in some cases for more than 2 years....  Five firms also voluntarily recalled mislabeled or potentially contaminated feed during 1999.
(ed:  geez!)

The report notes that between Fec and Nov '01, warning letters were issued to another 48 firms and 17 firms voluntarily recalled feed.

As of November 30,2001,  FDA or states had reinspected 33 of the total of 50 firms that had been issued warning letters (2 in 1999 and 48 in 2001).  Six of the firms were still out of compliance on reinspection.  FDA has no enforcement strategy for feed ban compliance that includes a hierarchy of enforcement actions,  criteria for actions to be taken,  time frames for firms to correct violations,  and time frames for follow-up inspections to confirm that violations have been corrected.

According to FDA, rather than taking enforcement actions, it has emphasized educating firms subject to the feed ban about the ban ’s requirements and working with those firms to establish cooperative relationships.
(ed: It sure appears the FDA is run by Bush appointees given the above!)

The report goes on to detail how lacking the FDA's database and notes:.  "FDA has not placed a priority on oversight of the feed ban.  From the implementation of the feed ban in August 1997 until early 2001,one person in FDA ’s Center for Veterinary Medicine was responsible for feed ban management."  FDA turned cleaning up the database over to a contractor in 10/01...
 

...most consumers would  not realize that central nervous system tissue could be found on many beef cuts and in several beef products.  For example, bone-in meat cuts, such as T-bone steaks, are stripped directly from the animal ’s vertebrae and may contain portions of the spinal cord. Many other edible products, such as beef stock, beef extract,and beef flavoring, are frequently made by further processing (e.g.,boiling) the skeletal remains (including the vertebral column) of the carcass after most of the meat has been removed. USDA officials told us that they would expect to find central nervous system tissue in these foods.

The report goes on to state that nevous system tissue extract via  advanced recovery processes  is prohibited by the USDA in products labeled as meat based on food quality and not food safety concerns   The stuff is used in things like hot dogs and sauges.  The punch line:  "Because it is not a food safety issue, USDA has not rigorously enforced its prohibition against the presence of central nervous system tissue in meat extracted by using the advanced meat recovery system technology.  Since 1997, USDA has tested a total of 63 beef samples from 18 of the plants that use this technology.  Of those samples,12 (ed: about 20%) tested positive for central nervous system tissue.  USDA has not tested beef samples from the other plants that use the technology in at least 4 years.  When its tests found central nervous system tissue in samples, USDA did not track to ensure that the processing plants relabeled the contaminated meat products as something other than meat."   (ed: what about making the processing plants fix the problem?)

The Harvard study notes that a ban on the use of spinal cords, brains, and vertebral columns in human food or animal feed significantly reduced the risk of exposure in its simulation model.  As part of its evaluation of the implications of the study, USDA will issue a Federal Register Notice after January 2002 to solicit comments on,among other things,the safety of the advanced meat recovery technology and any meat that comes from the vertebral column.

The reports notes that a FDA committe recommended banning central nervous system tissue  from all human food and the FDA said it was considering this as well as a ban on the stuff in cosmetics and over-the-counter drugs.

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Figure 8 lists the sectors and some of the likely qualitative impacts within each sector in the event of a BSE outbreak in the United States.

To date, however ,there are no comprehensive economic studies of the total direct and indirect economic impacts of a potential BSE crisis in the United States.A complete assessment of these impacts is difficult to forecast given the uncertainties surrounding key assumptions,such as the source of the BSE,the number and timing of cases,and the public ’s reaction.For instance,if BSE were to enter the country through the importation of meat and bone meal rather than live cattle imports,the economic consequences could be more pervasive,because the meat and bone meal could potentially contaminate many cattle.Another difficulty in estimating impacts is the problem of determining how the increased costs of BSE would be passed on from the farmer to the final consumer in the beef-marketing channel.Moreover,studies that estimate losses due to BSE from other countries may not be totally applicable to the United States.

.....In particular,since the United States exports nearly 10 percent (by volume)of its total beef production (about 25 percent of total world beef exports),the trade sector is also critical in estimating total economic impacts.

In terms of the health risks,if infected cattle were to enter the food supply, some people might develop vCJD;however,scientific experts disagree about how many people could develop the disease.Many experts believe that vCJD is difficult to contract and,therefore,that relatively few people would develop the disease.However,other scientific experts believe that, because of the long incubation period,no one can predict whether few or many might contract vCJD....  In addition to these direct health implications,an outbreak of BSE in the United States would carry an emotional toll on consumers who believe federal regulators will protect them from this devastating disease.  Moreover,according to a National Institutes of Health scientist,the appearance of vCJD could cast doubt on the safety of organ donations and the U.S.blood supply.
 

The United States prohibited the import of cattle and other ruminants 3 to 5 years earlier than many other countries.  Its surveillance program to test cattle brains for BSE also met international targets for the number of animals tested earlier than many other countries. However, the United States has a more permissive feed ban than other countries —one that allows cattle feed to contain proteins from horses and pigs.  (ed: see below for info)   FDA is reviewing whether these ingredients should continue to be allowed in cattle feed.  Finally,  as in most countries that are BSE-free, including the United States, cattle brains and other central nervous system tissue can be sold as human food.

The reports notes a 2001 EU study that assessed the US as "unlikely to get BSE,   but indicated that the possibility could not be excluded".   Canada (which got it's first confirmed case of BSE in 2003) was also listed in this category in table 3 of the report.    It was also noted that the study  "most often recommended that countries improve surveillance largely by including tests of high-risk populations, such as animals that die on farms".

The report states the US is in the minority of the countries studied in that it allows at least some mammalian protein in feed for cattle (a practice the EU urged it's members to adopt on a temporary in 2000) and that the US and Canada allowed cattle feed to contain protein from horses and pigs- with the footnote: "FDA allowed these exemptions either because scientific evidence had not shown infectivity in the protein sources or because the species involved were not known to contract BSE or other TSEs."
 

FDA:
• Develop a strategy,working with states,to ensure that the information FDA needs to oversee compliance is collected and that all firms subject to the feed ban are identified and inspected in a timely fashion.
• Develop an enforcement strategy with criteria for actions to address firms that violate the ban and time frames for reinspections to confirm that firms have taken appropriate corrective actions.
• Track enforcement actions taken by states.

 

 
 
 
 
 

USDA

• consider whether some interim action,such as public service announcements or caution labels or signs, might be appropriate to advise consumers that certain beef cuts and beef products may contain central nervous system tissue
• better enforce the existing labeling requirement for products that contain beef extracted using advanced meat recovery technology and contain central nervous system tissue.
• consider whether the products it regulates,including food,cosmetics,and over-the-counter drugs,should be labeled to advise consumers that the products may contain central nervous system tissue.
• increase the number of tests from cattle that die on farms in the BSE surveillance program.

 

The FDA did not agree that it had misled Congress and the public in reporting on compliance and disagreed with the conclusion that it had not placed a high priority on oversight of the feed ban..
USDA said it would use additional homeland defense funds to increase BSE surveillance and it planned to more than double the number of animals sampled and to obtain more samples from animals that die on farms.

On the labeling recommendation:

USDA stated that labeling and warning statements should be preserved for known hazards, which BSE is not in the United States.  GAO objected with "In light of the experiences in Japan and other countries that were thought to be BSE free, we believe that it would be prudent for USDA to consider taking some action to inform consumers when products may contain central nervous system or other tissue that could pose a risk if taken from a BSE-infected animal.T  his effort would allow American consumers to make more informed choices about the products they consume.USDA ’s comments and our detailed responses are presented in appendix III" (ed: appendix is on page 58 of PDF file- it notes existence of a Inter-Agency BSE Steering Committee.  USDA letter states that the Havard study says the US is "highly resistant" to the introduction and spread of BSE in US cattle herds .  ).
.(ed note- Now that BSE is in the US- why hasn't the USDA required such labeling )

The prion hypothesis is not universally accepted.  Some scientists believe a virus or other conventional agent,  as yet undetected, gives rise to TSEs.  (no ref. given in report).

Good Summary of TSE in the UK:

BSE in cow first reported in 1986 in the UK... In 1996,experts in the United Kingdom reported the first cases of vCJD. They believed the victims contracted it by eating beef contaminated by central nervous system tissue from BSE-infected cattle.Although contamination of meat with central nervous system tissue could occur in many ways during the slaughtering and processing of cattle,the major suspect in these cases was meat removed by a system that mechanically recovered (by squeezing under pressure)the remaining meat left on carcasses after all accessible meat has been removed by knife.Prior to December 1995,when the United Kingdom banned the practice, mechanically recovered meat,which was included in many cooked meat products such as sausages,could legally have contained spinal cords. While scientists believe that at least several hundred thousand people may have eaten BSE-infective tissue,many believe vCJD is difficult to contract.

As of November 2001,112 people have had vCJD,of whom just over 100 had died,nearly all in the United Kingdom.

Most vCJD victims have been young —the average age at death was 28 —and half died within 13 months from the time they first showed symptoms.

A Good Summary of the "Feed Ban"
In August 1997,FDA banned potentially BSE-infective animal proteins in feed for cattle and other ruminants.Proteins are added to feed to promote animal growth and can be derived from a number of sources,including animal meat and bone meal,fishmeal,and plant products.The feed ban prohibits the use of most animal-derived proteins in cattle feed.   It also requires that,among other things,feed and feed ingredients that contain the prohibited proteins be labeled “Do not feed to cattle or other ruminants;” firms that handle both prohibited and nonprohibited feed and feed ingredients have procedures to ensure that the two are not commingled;and firms maintain records sufficient to track feed materials through their receipt and disposition for certain periods.The ban excludes animal blood and blood products,gelatin,plate waste, milk and milk protein,and protein derived from pigs and horses (and other equines). Renderers,feed manufacturers and blenders,and feed distributors are subject to the ban.
(ed: note that it's not illegal to feed labeled "banned" feed to cattle or other ruminants)

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Recent research on the ability of animals to be “silent ” carriers of TSEs from another species raises questions about the advisability of including in feed for cattle, or other ruminants, proteins from animals such as pigs and horses that are currently not thought to be susceptible to BSE and other TSEs, according to researchers at the National Institutes of Health.   Specifically, in November 2001 these researchers reported that even though mice experimentally infected with hamster scrapie did not develop clinical disease, infectivity persisted in the brains and spleens of the mice throughout their life spans. Although available laboratory methods were not sufficiently sensitive to detect the infectivity in these mice,the researchers could infect other mice and hamsters with tissue from the original asymptomatic mice.
(the NIH info:  (R.Race,A.Raines,G.J.Raymond,B.Caughey,and B.Chesebro,“Long-term Subclinical Carrier State Precedes Scrapie Replication and Adaptation in a Resistant Species: Analogies to Bovine Spongiform Encephalopathy and Variant Creutzfeldt-Jakob Disease in Humans,”Journal of Virology,Vol.75,No.21 (2001),pp.10106-12)

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For further investigation:
From page 10:  The EU did an assessment of the geographical risk of BSE in 49 countries- including the US- "experts stated was unlikely to have BSE, but they also stated that the possibility could not be excluded."

What happened on:  "USDA will issue a Federal Register Notice after January 2002 to solicit comments on,among other things,the safety of the advanced meat recovery technology and any meat that comes from the vertebral column"

And:  The reports notes that an FDA committe recommended banning central nervous system tissue  from all human food and the FDA said it was considering this as well as a ban on the stuff in cosmetics and over-the-counter drugs.

In October 2001,FDA officials held a public hearing to elicit comments on,among other things,whether the existing feed ban exemptions should be modified.  As of December 17,2001,  FDA had not announced whether it would propose any changes to the ban.

It is noted that the GAO did not attempt to validate the model nor the assumptions Harvard used in applying the model to the United States. (The Havard study is: Evaluation of the Potential for Bovine Spongiform Encephalopathy in the United States , Harvard Center for Risk Analysis,Harvard School of Public Health and the Center for Computational Epidemiology,College of Veterinary Medicine,Tuskegee University, Nov.26,2001.)