A lot of people go completely ballistic anytime the government ever does anything. How dare they try and influence the decisions that people make. A lot of those same people, however, seem to completely ignore other outside agents which have been working to influence that decision for years. Whether that is corporations pushing formula, hospitals trying to turn birthing into oil change shops, companies not wanting to provide for the needs of nursing mothers, or the social mores of people who are terrified by the sight of boobs.
Hospitals and formula companies have a monetary interest in promoting formula over breastfeeding. That isn't right, especially considering that health-wise, breastfeeding is the better option. Preventing others from influencing this decision is all they are really trying to do. They aren't mandating breastfeeding, they are just saying to let the mom decide before handing her a formula gift-basket.