Monday, December 12, 2011
Meat industry criticizes USDA's new antitrust rule
The U.S. Department of Agriculture released a new but stripped-down antitrust rule Thursday regulating meat companies that's far less sweeping than initial reforms that ran into strong opposition from businesses and Congress. The department published the final version of the rule after more than a year of heated debate that pitted the nation's biggest meat companies against many farmers and ranchers. Congress voted last month to prohibit the USDA from passing most portions of the reform. The companies had claimed the rule could increase costs and raise the price of meat. The final version requires that meat companies give farmers the right to opt out of mandatory arbitration clauses in their contracts. Those clauses have upset many farmers, who thought they should have the right to take poultry companies to court for alleged contract violations. The other measures have been abandoned or changed into guidelines for the agriculture secretary to consider when judging if meat companies have violated a decades-old antitrust law called the Packers and Stockyards Act. Tyson Foods spokesman Gary Mickelson said the company was disappointed in the final rule because it would impose millions of dollars in additional costs on the poultry industry. The USDA estimates it could cost the poultry industry between $9.8 million and $55.5 million a year. The cost to all industries could be between $21.3 million and $72.1 million a year, according to USDA. "From the outset, we agreed with others that the GIPSA rule originally proposed in 2010 was bad for farmers, processors and consumers," Mickelson said in an email. National Chicken Council President Mike Brown echoed those thoughts, and called the rule "especially burdensome" in light of the high costs companies are paying for grain. Activists and farmer representatives who pushed for more regulations said they wished the rule had gone further...more
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These rules are the equivalent to telling Bernie Madoff that all his past frauds
are forgiven and he has a $50,0000 limit per person fraud in the future (with a
bunch of loopholes to avoid that limit).
Tom
Personally, I think the 50,000 is an automatic industry give away. If this
was the starting point of whether economic holdup could happen, then the
companies automatically have a 50,000 free be on the farmer's dime. I
personally could care less what "upgrades" these companies came up with to be
competitive in the market place. My problem was they were MAKING their family
farmer "partners" pay for these costs and not giving them the rewards from the
market. In essence all of these family farmers become an automatic lender to
these giant corporations who use it to extract value from the growers and put
the benefits in their column of either advancement with respect to their
competitors or pocket profits. Did Bernie Madoff have a $50,000 freebee with
his investors? Does each stock broker have $50,000 worth of fraud they can
commit per person before they are held accountable?
This was a huge give away from the start.
This is the problem I have with this administration. They start with a
compromised number and then whittle away principles right and left. They are,
in essence, only selling out at a slower rate than their political competitors
but still selling out parts of the economy to large campaign contributors. This
isn't competent government-- it is just slowing the rate of wealth transfer to
corporations raping the economy.
Don't get me wrong--- these rules are a LOT better than nothing, which is what
we had for the longest time. They are still hugely compromised positions and
everyone should recognize this. I am not so easily sold in a political sales
pitch when I am being screwed.
In addition, the frauds that have already occurred in the industry have
seemingly been wiped clean with a get out of jail fraud card and allow these
companies the ability to whittle down the enforcement of these rules as they
stand. We will still have to rely on the political will of the Sec. of
Agriculture for relief. The tools he has are very weak when it comes to
enforcement. The poultry industry was under a licensing agreement type system
before it was deregulated. This would be similar to a stockbroker having a
license to do business in stocks. They can yank a stock broker's license out
from under him if he does not follow the rules. The Sec. of Agriculture doesn't
have that power and it still must be reviewed by judicial review which can be
and has been rigged.
We asked for juice and it seems we are getting a drink with 10% juice.
We all have to understand that the watering down of these rules came directly
from Congress who the meat packers got to put a rider in the appropriations
spending. This was nothing less than Congress selling out family farmers and
making the administration eat the rules they had originally proposed.
We have the best Congress that money can buy. They can do nothing, it seems,
but make policy for the 1%--- and take political payoffs to do it.
Tom
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