AFF Sentinel Vol.4#15

Last issue, we briefed you on two organizations' hunt for the phantom Sasquatch, Bigfoot, the "manipulation" that supposedly pulls all the strings in the beef industry. This edition, the "solutions."

Invited to testify before a Congressional committee, Tom Buis, National Farmer's Union president presented "solutions" very similar to John Crabtree, Center for Rural Affairs. You've heard similar ideas from R- CALF and the Organization for Competitive Markets and they are allies on these issues.

Buis reminded the House committee that the Senate had passed a ban on "packer ownership" in 2002 but the provision had been omitted from the final Farm Bill. He did not point out that Congress, in its infinite wisdom, would be claiming the right to determine who could own cattle in America and when.

Crabtree added contracts for more than seven days out and without a base price determined at "point of sale" should be prohibited.

"Meat packers do not need to own livestock to improve meat quality or keep prices affordable, nor will banning packer ownership of livestock lead to market collapse," Buis said.

Buis ignored that alliances and branded programs wherein cattlemen, packers and retailers share ownership of cattle have been the leaders in improving product quality. As for "affordable," anything that raises cost makes beef less competitive with alternatives and reduces profit for the entire production chain. The consumer --based on quality and convenience and their ability to pay - decides what is "affordable."

Regarding market collapse, eliminating buyers for two of the largest feedlot companies on Buis's list of the top four feedyards, would reduce demand for over a million head per turn and certainly damage the feeder market significantly. Whether it was a "collapse" or not might depend on when you were selling your calves. But cow/calf operators would certainly feel the short-term loss of that demand and capital in lower prices for calves.

Long-term, whether that quantity of capital could be replaced -- in an industry damaged and subject to unprecedented socialist-style government interference -- is another question.

Buis also voiced another factor as justification for a "packer ban," or restrictions on who is permitted to own cattle. Because a ban on packer feeding (Iowa) and a corporate farm ban (Nebraska) were declared unconstitutional, Congress must pass legislation, he said. He didn't explain how new anti-trust legislation from Congress could be constitutional if it had already been declared unconstitutional by a federal court.

Buis also called for a ban on cattle feeders negotiating directly one-on-one with packers on contracting cattle. Although he didn't specify the exact forum, he wants contracts to be "traded in an open, transparent and public process." In other words, your business is everyone's business.

He called on Congress to "legislatively reform" the national beef check-off by making it a voluntary program.

Buis asked for implementation of mandatory COOL, presenting a support letter signed by a list of 200 local, state and national activist consumer groups, ag groups advocating more government control of agriculture and the Humane Society of the U.S.

He presented another letter signed by a very similar list of groups designed to cripple cattlemen's confidential business dealings, if efforts fail to outlaw business-to-business contracts common in other industries.

The groups want Congress prohibiting packers from offering better prices for larger groups of cattle than for smaller lots. In other words, they want government to regulate how cattlemen and packers price cattle. Crabtree agreed.

The groups want language specifying that "preferential pricing structures" are "justified only for real differences in product value or actual and quantifiable differences in acquisition and transaction costs." Crabtree agreed again.

Why do they think packers would offer different prices in the first place, if not for "real differences" in value or costs? But that is beside the point, as a later clause specifies that "legitimate business justifications" would not be "recognized packer defendant defenses" if packers use them in court but a "farmer-plaintiff" doesn't have to prove legitimate business justifications do not exist regardless. Crabtree concurred.

In other words, rig the trial rules so farmer plaintiffs can't lose and packers can't win. What's the definition of persecution again?

Such ridiculous attacks on cattlemen and packers doing business with each other are elements of a socialist or communist farce government -- but not America. A free market does not include constant hauling of marketing negotiations to court; outlawing business confidentiality or supply or marketing agreements, dictator-style dispensation from proving your case in court and insular protection from the basic laws of economics.