It's worth calling-out the original article http://www.theamericanconservative.com/blog/chinese-melamine... (Oh my gosh! A nasty right-wing publication.) You need a right-wing and a left-wing to fly. Or, to go from the abstract to the concrete, you should inform yourself from a wide range of sources. Another notable health scandal (in California) first exposed by the conservative, aka right wing, press was MTBE. See http://www.calnews.com/archives/morgan03.htm and http://www.nature.nps.gov/hazardssafety/toxic/mtbe.pdf (search for KSFO).

These kinds of scandals are not consequences of the free-market. This is crony-capitalism. It could just as easily happen under crony-socialism. And as the MTBE scandal demonstrated, progressive politicians are perfectly capable of foisting this kind of stuff on the public.