Once in a while Congress takes on a powerful corporate lobby that has over-reached and is squeezing the little guys. Remarkably enough, the Senate has already passed a farm bill that prohibits meat packer ownership of livestock. Since four giant companies control 83% of the nation’s cattle slaughter and about 63% of the hog slaughter in the country, this ban is directed at the vertical integration of this industry at the expense of small farmers, consumers and the environment.
The bill now goes to the House of Representatives where it invites grass roots support from all citizens and carnivores who care about the domination of our economy by big business.
The Organization for Competitive Markets (OCM) (Competitivemarkets.com) – a civic advocacy group composed of farmers and university academics — has documented the disturbing trend that rebut the industry’s claims of efficiency through ever growing Bigness. Farmers prices are plunging while consumer prices for meat are rising at three times the rate of general food price inflation.
How is this so? First, rapid consolidation of meat packers, through mergers and acquisitions, has meant fewer buyers for livestock at the farm gate. In fact, today, many small and mid-sized farmers in this country have one bidder for their production. Moreover, these large meat packers are also moving into livestock production like those massive hog farms that lead to environmental havoc and pollute water. This vertical integration facilitates supply manipulation in order to engage in price declines for the produce the meat packers purchase.
The packers then turn around and pocket the growing spread betweenfarm gate prices and what is sold to wholesalers or chain supermarkets. The meat packers have reported record profits in the last four years as the rate of family farm loss continues to increase. Consumer beef prices rose 9 to 11 percent from November 2000 to November 2001 — three times the rate of general food price inflation. The consumers are not receiving the benefits – whether by lower prices or higher quality — of the asserted efficiencies of Bigness.
A majority of Senators came to the conclusion that prohibiting packer ownership of livestock is a necessary first step towards regaining competition and reducing barriers to new competitors in the food chain system. Many decades ago, Congress prohibited railroads from owning coal mines for much the same reasons.
The Senate farm bill contained an overall “Competition Title” which also required country of origin labeling, a ban on agribusiness-imposed arbitration clauses in livestock contracts and a limited prohibition on agribusiness-imposed confidentiality clauses in livestock contracts. Over 200 organizations across the nation have signed a statement in support of these pro-competition provisions.
There is an unprecedented crisis in rural America that has nothing to do with locusts and droughts. It has everything to do with monopoly, duopoly and oligopoly. As OCM’s recent letter appealing for support writes: “Biotech seed companies like Monsanto and DuPont/Pioneer have more monopoly power than ever as they buy up competitors, patent seed and make agreements with one another. Retail chain supermarkets are increasing their market share, increasing profits, and forcing down the farm share of the consumer dollar. The two dominant milk processing firms in the country, Suiza Foods and Dean Foods, were allowed to merge by the U.S. Department of Justice last December.”
The takeover of farm production through enormous hog farms, or through “contract agriculture” which has produced the poultry peonage of chicken farmers to the giant processors like Tysons and Perdue, sketches the future end of a small farm economy and its regenerative rural culture.
We should never forget that the greatest political reform movements, the producer cooperative subeconomy, much of our music and festivals and other connecting traditions came from rural America.
Lend a hand is one of those traditions between farm neighbors. So lend a hand and call your Representative (202-224-3121) to support the “Competition Title” in the farm bill.