Let me suggest this to you. If 99% of the population wants their society/government to be run in a utilitarian, pragmatic sort of way, and you want it to be run in a principled, absolutist sort of way, what right do you have to force your view upon them? Personal morality aside, don't we all have the ability to make our own decisions, and to use that power collectively?
"Regulation is easy to evade due to eventual regulatory capture, that benefits the big corporations and disadvantages those smaller businesses involved in the trade"
It isn't inevitable. Look at how big tobacco was thrown out of Congress. Unfortunately, our culture has changed since then. Although since prop 37 is at the state level, this actually might work.
"Labeling costs money and therefore hurts taxpayers"
Labeling costs, very, very little money. It costs the money of applying the label to the food providers. Labeling may cost money that it may lower demand for a product when people find out what is in it...which will lower supply and thus increase prices more than what the lowered demand would lower them. However, this is the EXACT point of the legislation. Economically, individuals will just move their money into GMO-free food, bringing prices down in the exact opposite effect.
"Labeling hurts the farmers, who have to go through even more bureaucracy before they can sell their products, which ends up driving up the cost of food"
Tough. Firstly, how much more bureacracy is really there? It is fairly simple: if you have GMOs, label you food. There may be a little dispute about what constitutes GMOs, though my gut would be that if you are trying to hide it, it is probably unsafe.
According to downsizinggovernment.org, federal regulation accounts for 14% of the food industry's costs...this includes everything. For example, milk without federal regulation would costs around 20 cents cheaper than regulated milk. Not a huge difference.
"Prop 37 in particular is full of loopholes and exemptions, including one for foreign GM food"
Makes sense since the regulation of foreign food would fall into a federal area. In any case, the answer is not to not pass 37; the answer is to close the loopholes and exemptions.
Plan for eliminating the national debt in 10-20 years:
Specific cuts; defense spending: http://rolexian.wordpress.com/2011/01/03/more-detailed-look-a