NATIONAL POLITICS TURN THEIR FOCUS TO AGRICULTURE
For many people, the concept of “antitrust law” seems confusing and not important to their own lives. Why should you care?
First and foremost, antitrust law is about keeping the market functioning properly. To function, a free market needs a competitive marketplace, with many sellers and many buyers, and the free flow of information. Under these conditions, no seller will be able to take unfair advantage of the buyers, but rather each seller will be obliged to offer goods on attractive terms and to be responsive to buyers, who otherwise will simply turn to another seller. When a small number of sellers (or buyers) dominate the market, though, that system breaks down.
If it’s about market competition, why is it called “antitrust”? Congress originally established the antitrust laws to check the abuses threatened or imposed by the immense “trusts” that emerged in the late 19th century. These trusts controlled or threatened to control entire nationwide markets for rail transport, steel, petroleum and banking. The antitrust laws were established to ensure that these trusts did not permanently undermine competition in these or other markets.
The people who saw the threat posed by the trusts also saw that the consolidation of economic power would inevitably undermine our democracy, by placing more and more power in the hands of a few entities, who then would have greater control over our laws and regulations.
This is precisely what has happened in agriculture in the U.S. We have a cycle of ever larger companies, who are able to distort the marketplace to their economic advantage, and then get legislators and regulators to write the rules to favor them, gaining yet more economic power and continuing this spiral.
The losers are farmers, consumers and anyone who values open, transparent economies and government. Consider these statistics:
• In the past three decades, the top four largest pork packers have seized control of 71 percent of the market, up from 36 percent. Over the same period, the top four beef packers have expanded their market share from 32 percent to 85 percent. The top four flour millers have increased their market share from 40 percent to 64 percent.
• Today the top four sheep, poultry and fluid milk processors now control 57 percent, 53 percent, and 50 percent of the market, respectively. • The top four grain companies control as much as 90 percent of the global grain trade.
• During just the past two years there has been a wave of consolidation among global seed and crop-chemical firms, so that three companies now control nearly two-thirds of the world’s commodity crop seeds. Those same three companies now also control nearly 70 percent of all agricultural chemicals and pesticides.
• In the United States, the four largest corn seed sellers accounted for 85 percent of the market in 2015, up from 60 percent in 2000. Over the past twenty years, the cost for an acre’s worth of seeds for an average corn farmer has nearly quadrupled, and the cost of fertilizer has more than doubled. Yet corn yields increased only 36 percent over that time, and the price received for the sale of a bushel of corn increased only 31 percent.
• Agribusiness conglomerates are posting record earnings, but the farmers who sell to them are going bankrupt. Median on-farm income was negative in 2017 and 2018, and most likely will be negative again in 2019. Concentration, low prices, anti-competitive practices and other manipulations and abuses of the agricultural economy are driving small family farmers out of business. Eighty-one percent of America’s farmed cropland is now controlled by 15 percent of farms.
These facts are not the result of inevitable market forces, but rather are directly tied to policy decisions made in Washington by legislators on both sides of the aisle whose campaigns are funded by these same companies.
Yet, there is a growing awareness nationally of the problems posed by corporate consolidation in numerous areas of people’s lives. And as concern about the problems in banking, communications and other industries increase, so does the awareness of this problem in the realm of our food supply. It has become a significant topic on the campaign trail for presidential contenders, and there are several bills—some filed, some in the works—that seek to tackle pieces of the problem.
Senator Cory Booker (D-NJ) has introduced the Food and Agribusiness Merger Moratorium and Antitrust Review Act of 2019, S.1596. The bill is co-sponsored by Senator Jon Tester (D-MT) (an organic farmer himself) and Sen. Jeff Merkley (D-OR). The bill would impose a moratorium on large agribusiness, food and beverage manufacturing, and grocery retail mergers. It would establish a commission to review mergers, concentration and market power in agriculture and food sectors, and would identify which actions—including what new antitrust laws—are needed to address the problems.
Another bill, introduced in the U.S. House, looks at another angle of this consolidation issue. At the bottom of the food chain, so to speak, there are still many “family farmers.” Yet they are not the independent sellers that most people envision. In many industries, the farmers have only one buyer for their product in their region, as a result of the corporate consolidation. This is particularly true in the poultry and hog industries, where the companies own the animals from birth to death, and the farmers act as essentially contract labor hired to raise them. Yet because the farmers are raising the animals on their land, they are legally responsible for the pollution in our waterways—even as they are forced to follow the companies’ requirements for how to raise them! This system is unfair, and it contributes to significant water pollution issues near factory farms.
In response, U.S. Representatives Ro Khanna and Mark Pocan have introduced H.R. 3844, the Farmer Fairness Act, which would require big meat and poultry companies to be co-permitted with contract growers, essentially making them liable for the waste their animals create. At the least, if these companies control the means of production, they should be responsible for the results.
WHILE EPA PLANS TO GREEN LIGHT GLYPHOSATE, GERMANY PLANS TO BAN IT
Two very different government actions took place the first week of September, both related to glyphosate, the active ingredient in the most widely used herbicide globally, Roundup. The opportunity for people to submit comments to the U.S. Environmental Protection Agency about regulating glyphosate ended—and the very next day, Germany’s Environment Minister Svenja Schulze announced that Germany plans to phase out glyphosate, with a complete ban in 2023, in order to reverse an alarming drop in insect numbers.
A study in 2017 showed three-quarters of flying insects had disappeared from Germany’s nature reserves over the previous twenty-five years, and scientists widely suspect pesticides have played a role in Europe’s so-called insect Armageddon. And an Australian study this year found that 40 percent of insects worldwide face extinction.
“A world without insects is not worth living in,” Schulze said in a statement announcing the phaseout of glyphosate. “But with the right measures in many areas, the trend can be reversed.”
Schulze also announced an annual fund of one hundred million Euros for insect research and protection, half of which will be spent on insects like pollinators in agriculture and coastal areas. The ministry will spend another twenty-five million Euros to launch a nationwide system to monitor insect populations and change pesticide laws to keep synthetic chemicals at least five meters from watercourses.
Glyphosate is the subject of a fierce debate on both sides of the Atlantic about whether it causes cancer in humans. Bayer, which last year acquired Roundup’s original maker Monsanto, is fighting thousands of legal cases in the U.S. in which plaintiffs say glyphosate caused their cancer. Bayer denies glyphosate is dangerous for humans and points to the findings of the European Food Safety Authority (EFSA) and the European Chemicals Agency (ECHA), neither of which classed the substance as carcinogenic.
However, a 2015 monograph by the WHO’s International Agency for Research on Cancer said it is “probably carcinogenic to humans.” And each of the three American juries to consider the issue so far has found that, not only is it carcinogenic, but that Monsanto covered up the evidence of that fact—awarding hundreds of millions of dollars in punitive damages.
Austria recently notified the European Commission of its intention to ban glyphosate completely, and France intends to ban it fully in 2022.
In contrast, the U.S. EPA’s approach is to continue allowing extensive use of glyphosate, with no warning labels and very few restrictions on its application. The agency published its proposal and accepted public comments over the summer—and soon we shall see whether they heed any of the thousands of comments they received in response.
PRIME ACT NEWS
In the last issue of Wise Traditions (Summer, 2019), we reported that the PRIME Act had just been refiled. The Processing Revival and Intrastate Meat Exemption (PRIME) Act, HR. 2859/ S.1620, would allow states to permit the intrastate distribution of custom-slaughtered meat to consumers and wholesale outlets. Current law exempts custom slaughter of animals from federal inspection regulations only if the meat is for personal use; to sell cuts of meat to consumers, even at local farmers’ markets, farmers and ranchers must send their animals to one of the often far-away slaughterhouses that meets USDA regulations.
H.R. 2859 continues to gain new co-sponsors, now totaling thirteen Republicans, five Democrats and one Independent, in addition to the original filers (Rep. Massie (R-KY) and Chellie Pingree (D-ME)). On the Senate side, S. 1620 was filed by Sen. King (I-ME) and has been joined by three Republicans: Senators Rand Paul, Lamar Alexander and Marsha Blackburn.
We need to get more sponsors to get this bill to move forward, whether as a stand-alone or, as is more likely, an amendment to some other larger bill. You can help by calling your U.S. Representative and both Senators, and urging them to co-sponsor H.R. 2859/ S.1620.
See the sidebar on page 92 for a sample message for calls/emails: Use the same script for calling both of your U.S. Senators to urge them to co-sponsor S.1620.
The quickest option is to talk to whichever staffer answers the phone. To have a greater impact, if you are a livestock producer, take an extra minute and ask to speak to the specific staffer who handles agricultural issues. Briefly explain to the staffer any problems you have faced with lack of access to inspected slaughterhouses, and how the PRIME Act would help your business and benefit your customers. Personal stories about the positive economic impact the bill could have are the most effective way to get their attention.
Whether a producer or consumer, you can ramp up the impact of your call by picking the talking points that are likely to appeal to your legislator. What do they care about? The great thing about the local food movement in general, and about the PRIME Act in particular, is that it can be seen as positive by people from every spot on the political spectrum.
Take a moment to visit your Representative’s website and take a quick look at his or her bio and the list of issues discussed. What angles appeal to them? If you don’t have the time to do that, the next best option is to make assumptions based on their party, and angle your letter or phone call accordingly.
That may sound complicated, but the whole process can take less than ten minutes. You go to house.gov and type in your zip code. Click on your U.S. Representative’s name, and skim the bio—or just look on the home page for the parentheses (D) or (R) to tell you which party they are in. Click on the contact option, call their office and talk to the staff for two to three minutes, using the sample script and picking your talking points based on what you saw on their website. That’s it. Repeat the process for both your U.S. Senators (by visiting senate.gov).
This article began with a discussion about the problem with corporate consolidation—that it affects not only the marketplace, but also our political system. One way to counter that is through better antitrust laws. And while we work on those, we can also counter it by being active, engaged citizens. Passing good laws, like the PRIME Act, is an uphill battle in the face of corporate power, but it is possible. . . with enough people power. Please add your voice to this effort!
SAMPLE SCRIPT ON THE PRIME ACT
My name is , and I live in [town]. I urge Representative __ to co-sponsor H.R. 2859, the PRIME Act. This bill will make it easier for small farms and ranches to succeed financially and to provide consumers with greater access to locally-raised meats. The bill simply removes the federal ban on the sale of meat from custom slaughterhouses directly to consumers and venues serving consumers within a state, subject to state law.
The PRIME Act has multiple benefits. (Then pick some of the talking points below, based on your legislator’s interests and/or party):
If your legislator’s website talks about these issues and/or he or she is a Republican, focus on the benefits of the PRIME Act in:
• Reducing federal regulatory overreach, by returning greater flexibility and control to the state governments;
• Reducing unnecessary regulatory burdens on small businesses. If your legislator’s website talks about these issues and he or she is a Democrat, focus on the benefits of the PRIME Act in:
• Reducing transportation miles and greenhouse gases, by supporting local infrastructure for farmers and ranchers;
• Reducing stress on the animals from long-distance hauling;
• Supporting small farms, instead of factory farms—and by reducing the costs for these small farms, we also increase affordability and access for consumers. You can conclude by saying, “Please support our local farmers and consumer choice by co-sponsoring H.R. 2859.”