The incoming Biden administration has an opportunity to take a stand against corporate control of agriculture and food markets, according to family farm and economic fairness groups.
Advocates are calling for a re-invigorated Packers and Stockyards Act with legal action to challenge corporate monopolies in 2021.
It’s been a long time since any administration, Democrat or Republican, has put a major focus on corporate monopolies, advocates say.
“Administration after administration has really failed to address corporate consolidation in the food system, to the detriment of American farmers and consumers alike,” said Mike Stranz, vice president of advocacy for the National Farmers Union.
“Every step in between [farmers and consumers] is dominated by just a handful of corporations, resulting in a food supply chain that is less resilient, something that’s become especially clear during the pandemic,” Stranz said.
Temporary closures of a few meatpacking plants earlier in the year in response to Covid-19 outbreaks reduced processing capacity, stranding farmers with nowhere to process livestock and causing meat shortages at grocery stores, he said.
Concentration in the meatpacking industry hurts competition with or without disruptions caused by the pandemic, Stranz said. In 2020 there have been numerous instances of anticompetitive practices that “come down to corporations wielding their market power to underpay farmers and overcharge consumers, all while raking in record profits and often mistreating their own workers,” he said.
Numerous farm and rural organizations, allied with like-minded environmental and fair economy action groups, have called for stronger legal action against corporate agribusiness.
These concerns went nowhere in the Trump White House, with Trump going so far as demoting the Grain Inspection, Packers and Stockyards Administration (GIPSA) to a subagency under the U. S. Department of Agriculture’s marketing programs. GIPSA administers anti-monopoly regulations that have been on the books for a century. The Trump administration also rolled back livestock and poultry contract reforms that the Obama administration tried to enact at the 11th hour.
President-elect Joe Biden’s victory–and rural platform during the campaign–raised expectations for action among some anti-corporate advocates. Biden’s rural plan included a directive to strengthen the antitrust enforcement.
“From the inputs they depend on – such as seeds – to the markets where they sell their products, American farmers and ranchers are being hurt by increasing market concentration. Biden will make sure farmers and producers have access to fair markets where they can compete and get fair prices for their products – and require large corporations to play by the rules instead of writing them – by strengthening enforcement of the Sherman and Clayton Antitrust Acts and the Packers and Stockyards Act.”THE BIDEN-HARRIS PLAN TO BUILD BACK BETTER IN RURAL AMERICA
Implementing these market reforms would fall largely on the shoulders of Biden’s pick for Secretary of Agriculture, Tom Vilsack.
Many reformers say because of his track record, Vilsack’s selection does not bode well for prioritizing fair markets and agribusiness accountability.
“I would expect a Biden administration to pick up GIPSA and make some reforms,” said Claire Kelloway, senior researcher at the Open Markets Institute. “The question is whether they intend to use the full legal power and authority of USDA to take significant action against monopolistic practices, or whether they intend to take a much less aggressive position.”
Kelloway said that one of the central questions Biden’s USDA should be dealing with is a “loss of trust by farmers, who want to see clear rules about market conduct and corporate agribusiness abuses of power.”
“[Vilsack] is quite literally the same person who has caused much of this loss of trust,” Kelloway said “That’s not helpful. That’s not promising for the prospects of meaningful reforms” to curtail corporate agribusiness power.
New research, commissioned by Family Farm Action Alliance, supports calls for more aggressive USDA action against corporate concentration.
“We find that the agrifood system is globally connected and consolidated with few multinational corporations holding decision making power and calling the shots,” research co-author Emily M. Miller said via email.
The new report weaves together impacts of corporate concentration on farmers, workers, communities, and the environment through two current examples: meatpacking and the drift to adjoining properties of the herbicide dicamba, known better under the brand name Roundup.
“What becomes clear is that: 1) a concentrated food system is brittle at all times, and especially so in major supply chain disruptions; and, 2) multinational corporations care about profit, sure, but what they really use concentration for is to accumulate and protect power,” Miller wrote.
Miller said that researchers based the report off of a “mode of power” approach that says “economic and political power are so entwined to a point where they cannot be separated or distinguished from one another.”
It translates to cooperation between multinational corporations and state governments that allows them to shape the markets, from who gets to farm and what they grow, all the way to where the harvested goods are sent, she said.
NFU’s Stranz is confident that President-elect Biden could signal a significant change in philosophy at the USDA regarding corporate agribusiness.
“Given the fact that strengthening antitrust enforcement is featured prominently among President-elect Biden’s priorities, it seems like the era of legislators overlooking corporate abuse of power may be over — which is undeniably good news,” Stranz said.
But stronger enforcement alone won’t be enough to protect consumers and ensure farmers are treated fairly, he said. According to Stranz, Biden’s administration should reinvigorate the Packers and Stockyards Act of 1921 and restore its original intent.
It could be accomplished by giving farmers more power to challenge packers in court, banning harmful practices and the ability to offer preferential pricing, and abolishing the tournament system for contract poultry growers, said Stranz.
Open Markets Institute’s Kelloway agrees that the Biden administration could—and should—take aggressive administrative action against corporate agribusiness power. But Kelloway notes that legislative fixes have been proposed, such as the Farm System Reform Act, introduced by Senator Cory Booker of New Jersey. The bill would put a moratorium on large confined animal feeding operations (CAFOs), require country-of-origin labeling, and strengthen the Packers and Stockyards Act.
“[The bill] includes pricing and contract reforms that will support family farmers and consumers while holding agribusiness companies accountable for their abuses of market power,” Kelloway said.