Enforce Packers & Stockyards Act

The proposal by Secretary of Agriculture Tom Vilsack to establish rules to finally enforce the 1921 Packers and Stockyards Act is a critical step to strengthening the American free enterprise system in livestock production.

Vilsack would require a meatpacker that offers a premium to one seller for volume, quality, or any other factor to also offer the same premium to any other producer or group of producers that meets the same condition. It’s a fair and reasonable approach.

But the reaction from the meatpackers and mega-livestock interests has been anything but reasonable. They have charged the proposed rules would end premiums for quality, a claim that is false on its face. Purchases of livestock on a grade and yield basis or other measures of quality applied consistently to a packer’s customers have the clear blessing of this proposal.

Perhaps the most troubling charge against the secretary’s proposal is that it is contrary to the American way, which – the big interests claim – is for each of us to use whatever power we have to get our own sweetheart deal; to claim our own unfair advantage to protect us from the rough and tumble of competition on a level playing field. The charge makes me angry because it tries to reduce the American way to something unworthy.

The big interests have confused the American way with crony capitalism – such as took hold in Russia after the fall of Soviet communism. Former government officials and others well connected used their power and influence to gain special deals and advantages, and discourage competition. Like the crony capitalists, corporate farming interests seek not the right to compete, but the right to use their economic power to insulate them from having to compete on a level playing field.

We wish the secretary would go further, that he would block packers from offering volume premiums that exceed the savings from buying from one large producer versus many smaller. Nevertheless, the secretary’s proposal is a big step in the right direction. If smaller producers can earn the same premiums as the mega farms by banding together to pool their production – most will. And maybe ultimately that will bring the whole system of sweetheart deals down.

When the sweetheart deals must be offered to everyone who earns them, they cease be so sweet to the power players who work them and less bitter to those now excluded.

Sweetheart deals and unfair advantages are not the American way. The American free enterprise system is based on fair competition – a fair shot for ordinary folks who work hard and do a good job. That is the only kind of competition that serves the common good. The American way would be strengthened by the secretary’s proposal.

Agree or disagree? Comment to Chuck Hassebrook at chuckh@cfra.org or 402.687.2103 x 1018.

Supporters Stand Tall

Thanks to the 1,883 Center for Rural Affairs supporters who sent letters to USDA urging them to stand strong for family farmers and continue on their present path to make markets function more fairly. Keep up on progress at http://www.cfra.org/competition.

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