We Can't Afford Cheap Meat Anymore

As family farms and ranches fail, consumers suffer, too.

By Dena Hoff

Most Americans view cheap meat as a good thing, but they generally don't understand who pays the high cost of the policies making it inexpensive. More than 80 percent of the beef, pork and poultry consumed in this country comes from livestock fed and processed by only three meatpacking companies: JBS-Swift, Cargill and Tyson. Through deregulation and antitrust practices, these companies have been allowed to devour smaller companies that both feed and process meat.

The giant meatpackers often have contracts with owners of livestock feeding operations and therefore don't bid on the livestock they purchase to slaughter. Independent producers frequently aren't paid enough to pay for the cost of raising their livestock, so they're forced to sell or forfeit their farms and ranches.

Consequentially, local feed, seed, and farm machinery stores shut down because their customers can't pay their bills. Local restaurants, theaters, and furniture stores close when no one has spare funds. Ultimately, rural communities die when their local businesses fold and young people leave to find opportunities elsewhere.

Giant meatpackers and poultry companies hurt consumers, as well. Consumer choice has become more and more limited to meat from livestock raised on questionable feed sources and antibiotics in overcrowded conditions. Furthermore, cattle are slaughtered and processed in some facilities at the astounding rate of 1.5 million head per day.

That unsafe scale and speed increases the likelihood of workers being injured by intense rote activities and deadly implements, not to mention E. coli breakouts through insufficient attention to proper sanitation. This unsustainable system has spread from my home state of Montana and is exported around the world.

The seismic shift in Congress following the midterm elections will make or break the enactment of key regulations in the 2008 farm bill that could benefit both consumers and independent meat producers. At stake is whether the U.S. Department of Agriculture (USDA) will be allowed to implement a rule that limits the influence giant meatpackers exert over our meat supply.

The 2008 farm bill required new rules to interpret the meaning of "undue or reasonable preference" in the 1921 Packers and Stockyards Act. The USDA’s Grain Inspection, Packers and Stockyards Administration (GIPSA) finally released the proposed rules in June.

These rules would help end meatpackers' discriminatory practices, such as paying higher prices for livestock from their preferred feeding operations than for livestock of comparable quality from independent producers. Furthermore, a producer harmed by a meatpacker's action (e.g., unfair pricing) wouldn't have to prove the action also harmed the entire industry before seeking protection under the Packers and Stockyards Act. This is the case under the current system.

Not surprisingly, the largest meatpackers are fighting the proposed rules in a big way. In August, they filled the room in the USDA-Department of Justice hearing on livestock concentration in Fort Collins, Colorado. Now they're flooding USDA and Congress with scores of opposing comments and issuing industry-funded studies claiming these rules will raise consumer prices.

The current system hurts family farms and ranches, rural communities, the environment, and farmworkers. It also endangers consumer health. In addition to those increasingly frequent E. coli outbreaks, feeding operations (a.k.a. factory farms) depend on antibiotics to keep animals alive in unhealthy conditions--increasing human resistance to life-saving drugs.

The USDA's effort to issue these new rules is the first opportunity in decades to rein in the meatpackers and make them play fairly. We have a unique opportunity right now to shift the power in this industry toward consumers and independent producers while setting the stage for fair farm and trade policies in the future.