The Daily Yonder's coverage of rural economic issues, including workforce development and the future of work in rural America, is supported in part by Microsoft.
[imgcontainer right] [img:441px-Coal.jpg] Trust-busting once was part of everyday discourse — but that was a long time ago. Here, Teddy Roosevelt tames the coal barons of Pennsylvania. [/imgcontainer]
Buses will shove off this Thursday from Kansas, the Dakotas and Nebraska, from Gillette, Wyoming, and Billings, Montana. Vans will depart from small towns in Idaho and Mississippi.
They will all be hauling people to Fort Collins, Colorado, for what one livestock group calls the “most important day in the history of the U.S. cattle industry and in rural America!”
The subject of the meeting on the campus of Colorado State University is fairly arcane. Attorney General Eric Holder and Ag Secretary Tom Vilsack will take testimony on antitrust violations in the livestock industry and on new rules proposed under the Packers and Stockyards Act of 1921.
To thousands of people, however, this hearing isn’t about rules and regulations or interpretations of century-old laws. They are driving hundreds of miles to Fort Collins to defend a way of life.
“Everybody in rural America needs to understand that this can be a beginning of a new direction,” Bill Bullard of R-CALF, the Montana-based cattle raisers group, said earlier this month. “This is our opportunity, and everyone who has a stake in rural America needs to be in Fort Collins on that day.”
Bullard has been hopscotching the country trying to convince 25,000 people to come to Fort Collins. That may be a stretch. Every distance in the West is far. It’s August, after all, and Friday is opening night for high school football in many towns.
But Bullard is right. This is a big week. What I’d like to do is sketch out a few ways this cattle drive to Fort Collins is unique, important and misunderstood.
• Fort Collins is reviving a role for government that has been too long forgotten.
Antitrust is so old it’s new again. When most people (journalists and politicians especially) think of antitrust, they probably have a clouded memory of a paragraph in a high school history book. They remember old cartoons of stick-wielding politicians and recalcitrant fat cats.
For most of the last generation, most people thought the market cured itself. We didn’t need government action to maintain competition because the market did that naturally.
During the Bush administration, antitrust action by the government was thought to be ham-handed, intrusive and so, well, 20th century. The antitrust section of the Department of Justice rusted shut and we all put our faith in the market to regulate commerce.
By 2008, however, the market was no longer infallible and the new administration was keen to take on monopoly. Over a year ago, Justice announced it would investigate Big Food — from the dominance Monsanto holds in the seed markets to the growing size of Wal-Mart in retail grocery sales.
Those hearings have been held, three of them so far. But they haven’t been widely reported. This week, the DOJ/USDA investigation becomes overtly political, as antitrust emerges from the musty text for its first appearance as a political issue in the 21st century.
• Fort Collins mixes up our politics.
Think of it. You have thousands of lizard-booted ranchers and Deere-owning farmers, mostly from red states, driving hundreds of miles to support a big government solution proposed by a Democratic president.
Oh, and another thing — the ranchers and farmers are supported by a labor union, the United Food & Commercial Workers Union, which represents more than a third of the people employed in the meat-packing plants. Mark Lauritsen, a vice president of the United Food & Commercial Workers union, is slated to be on a panel Friday afternoon.
We have farmers linking arms with labor in Fort Collins, the Scarecrow walking with the Tin Man. It’s right out of The Wizard of Oz.
The old definitions of left and right don’t matter here. This isn’t an issue that either political party champions. No politician has stepped up to make antitrust his or her issue because nobody is sure how this will play out.
And since this story isn’t about gay marriage or where to build a mosque or whether or not the President is a Christian, journalists don’t know what to write. It just doesn’t fit.
For the past 30 years, the country has been divided between red and blue. Friday, the National Farmers Union asked everyone attending the Fort Collins hearing to wear the same color shirt.
Which color? Green.
• Fort Collins is about economics and morality.
You don’t have to listen to the people pushing the antitrust message for long to be overwhelmed by the mixture of economics and morality.
At the meeting in mid-August of the Organization for Competitive Markets, Randy Stevenson told the group of farmers and ranchers that “the market does not produce its own virtue or happiness Virtue must be imposed on it.”
Competition and open markets aren’t just good for the economy, these folks will tell you. They promote morality and virtue.
• Fort Collins could be just the beginning.
[imgcontainer] [img:WaltonOriginal528.jpg] [source]Bill Bishop/Daily Yonder[/source] Sam Walton began in this store in Bentonville, Arkansas. His legacy now controls more than a quarter of the national market for groceries. [/imgcontainer]
At the OCM meeting, meatpackers union vice president Mark Lauritzen told his largely rancher and farmer audience that “we’re poking the wrong person…Don’t get me wrong. I battle the meatpackers every day. They are tough. They are not the nicest people in the world. They are driven by greed. But we have to look at the larger picture.”
That would be Wal-Mart. Lauritsen said consolidation in the meatpacking business is being driven in part by the growing size of Wal-Mart’s grocery business. Suppliers need to grow larger in order to bargain with Wal-Mart, which now controls 25% of the nation’s grocery business. So, they meat-suppliers merge.
“I think Wal-Mart is the bigger problem,” Lauritsen said.
Others agreed. Wal-Mart is depressing prices across the board, said St. Francis, Kansas, rancher Mike Callicrate. “There is no greater threat to our economic and social well being in this world than that company.”
The numbers bear Lauritsen out. Over the last 30 years, the rancher’s share of meat at the counter has fallen from 63 cents to 43 cents.
At the same time, the share of that dollar going to the meat packers has dropped from 11 cents to 8 cents.
Retail stores — that is, Wal-Mart — have gobbled up shares from both cattle raisers and meat packers.
Looking down the road, you can see a bigger coalition forming that would include ranchers, meat packers and slaughterhouse workers, all of whom are losing shares of the food dollar to Wal-Mart.
How soon might that happen? In December, USDA and Justice will hold its final hearing, this one on competition in the retail grocery business.