Mike Callicrate | No-Bull Food News

American firms recruit thousands of Mexicans to do the nation’s dirtiest, most dangerous work.

The New Jungle

  “Ninety years after Upton Sinclair published his groundbreaking expose of the nation’s meatpacking industry, illegal immigrants are flocking to the United States to take the dangerous, low-paying jobs most Americans won’t. The difference between now and then: Now there’s a system that keeps the illegals coming and the industry humming-and the plants have come to rely on it.”

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“The people had come in hordes. [The meatpacking plant owner was] speeding them up and grinding them to pieces, and sending for new ones.”

“IBP just chews these people up and spits them out.”

“IBP, we don’t want you.”

“This is the resurgence of the politics of greed,” he says, “something we haven’t seen for 100 years, where big corporations think they have the natural right to import labor on demand.”

In early fall of 1996, journalist Stephen Hedges published a piece in U.S. News and World Report, Illegal in Iowa, about Iowa Beef Packer’s mistreatment of workers, which pulled back the curtain on the dark side of the food system, a terrible human rights record no one was paying attention to at the time. Three months later, in December, Hedges was in the packed Pierre, South Dakota auditorium on a cold December day for the South Dakota Governors Cattle Conference where he heard IBP president and CEO Robert Peterson blame South Dakota’s ranch families for the disastrous cattle price that was taking their ranches.

Hedges, who would continue to research and write about the dangers of an overly concentrated beef industry, probably wasn’t at all surprised by the tone of what he heard. From his research, he was well aware of the kind of leadership personality and stockholder driven company that would be capable of such mistreatment of workers and exploitation of communities. On this day, he was witness to IBP’s disrespectful, even shameful, treatment of its suppliers firsthand.

Despite his efforts, Hedges’ warnings went unheeded. The meat lobby, which included the largest cattle organization in the country, NCBA, as well as misguided land grant and government economists, persisted in reciting the lie that “big is better” and agriculture production should be all about “achieving efficiencies and economies of scale.”

How did this play out? Five years later something happened that even Bob Peterson could not have anticipated. With the meat industry continuing to consolidate, IBP sold to Tyson, the world’s big chicken processor, forming what then became the largest “protein” company in the world, a model that other meat packers would soon follow.

Fast forward to early 2020, and the pandemic arrives. In a few short weeks, the veil is lifted from the propaganda. Everyone can see that the workers we depend on to eat are sick, exhausted, and abused. They are literally dying.  And what about the family farmers Bob Peterson was so dismissive of? They are suddenly locked out of the market, at a time when demand is exploding, people are scrambling to secure meat for their freezers and store shelves are being left empty.

Two years after the beginning of the pandemic and in the wake of the president’s executive order, little  appears to be changing. Small plants, even when they do have the ability to increase capacity, struggle to find and train new workers, and battle daily against an often confrontational, onerous, and ineffective USDA inspection system. Large multinational firms block smaller plants from selling their production through existing channels with predatory practices and pricing. The bigger processors use false, misleading, and deceptive labeling to steal niche markets that should belong to small producers. With meat prices at record highs, big-box stores, restaurants, and institutional accounts still struggle to get product consistently, while cattle producers receive all-time record low income as a percentage of what consumers spend for beef.

A dependable and resilient supply chain: Ranch Foods Direct, a local/regional pasture to plate company, has kept workers safe, shelves stocked, and prices steady.

Post pandemic, the top-four meatpacking firms, still control 85% of the market, and continue to manage and manipulate the price of finished cattle and meat with relative impunity.

In 2001, when John Tyson announced Tyson’s purchase of IBP, he promised the company would not vertically integrate the cattle and beef industries in the same manner as poultry – and he didn’t. For the radically independent and less pliable cattle producer, he had something special in mind: the IBP formula. America’s cattle producers, our best land stewards, are now the cattle equivalent of Tyson’s indentured chicken farmers – and like the slaughterhouse worker, they’ve become a cost to be reduced by whatever means necessary.

How could cattlemen, seeing the plight of chicken farmers, be caught in this trap? Since 1996, after joining the board of the National Cattlemen’s Beef Association, the well-funded packer lobbying group, IBP and the other big packers, have sent their head cattle buyers to NCBA meetings to fraternize and ensure policy decisions would never threaten their interests.

This huge blunder has never been more clear: a globalized, corporate controlled, industrial approach to feeding people doesn’t. Let’s build a better food system that is more than just propaganda, one that is decentralized and builds communities instead of destroying them. Let’s build new local/regional food systems that are actually humane, regenerative, healthy and just. How can we invest in new farm-to-plate pathways that feed people instead of corporations?

To understand more about what went wrong and how we can fix it, please listen to the following podcast: https://heritageradionetwork.org/episode/understanding-what-went-wrong-cattle-markets

“When the markets are gone, and the game of monopoly is over …”

“Why would we pump precious fossil water from the Ogallala Aquifer to grow corn we don’t need?”

“Only an effective government can keep the predators at bay, while we build this new infrastructure.”

August 18, 2000

By Mike Callicrate

It’s clear now that packer concentration vs. a free competitive cash market has divided the nation’s cattlemen. And the cattlemen are losing, big time. Nowhere was this deep division and capitulation more evident than at the recent NCBA Live Cattle Marketing Committee meeting in Denver, CO.  Instead of the leadership that is so desperately needed today, with disastrously low $64 live cattle, in spite of record high consumer demand and prices for beef, we saw a sickening display of grown committeemen cowering and selling out the cattle industry to big meat packer pressure. At no time in the last one hundred years have the independent cattlemen been under such a dire threat of extinction than by the seemingly unstoppable juggernaut meat packer monopoly and in such desperate need of courageous leadership from its National organization.

“… we saw a sickening display of grown committeemen cowering and selling out the cattle industry to big meat packer pressure”

Many of those committee member cattle feeders, while still suffering the ill effects of the ‘open bar’ from the night before, argued against a much-needed resolution brought by the Colorado Cattlemen’s Association (CCA). CCA requested that the NCBA poll its membership (rather than take another bloody and futile run at the big packer-feeder NCBA policy stonewall) on whether the four big packers should be allowed to continue the illegal control they have over the live cattle market with captive supplies, or whether the big packers should be forced to compete and be banned from owning and/or controlling livestock for more than fourteen days prior to slaughter, as required by the Packers and Stockyards Act.

Standing up and speaking for independent cattle producers, were long time cattlemen and competitive market advocates: Tom Spencer, Pueblo, Colorado and Bill Haverlah, Santa Rosa, New Mexico – who are both old enough to remember a competitive market and are willing to fight to restore a fair market today. They were whipped soundly and shot down sixty-nine to nineteen by the virulent NCBA bloc of big-packer-feeding interests under the watchful eye of IBP procurement chief Bruce Bass.

“Only Bruce Bass and his NCBA member feeder friends know how highly profitable their preferential secret captive supply deals are … ”

Only Bruce Bass and his NCBA member feeder friends know how highly profitable their preferential secret captive supply deals are to those insider cattle feeders who collude with them. They were there because their monopoly and preferences must be protected at all costs.

This sharp dichotomy between those who care about the land, livestock, families on the land, and sound rural economies; and the shortsighted and the packer monopolists who care only about power, money, and control is on the brink of resulting in total victory for the packers if nothing is done to effect an immediate turnaround.

Yet, at this crucial moment in our history, we continue to hear and read about platitudes and soft-soap regarding the so-called “progress” being made by grassroots interests within NCBA. What this really amounts to is just a lot of hot air, designed to lull us into complacency while our economic heads are being chopped off.

Above all, cattlemen must remember that without solid steps to restore a free and competitive market nothing else that the NCBA leadership concocts matters.

Never has it been more clear that the influence of IBP and the other big packers over NCBA has to go—otherwise, the independent cattlemen is gone!

When the markets are gone, and the game of monopoly is over

What Happened Grandpa?

The big-four meatpackers income will be regulated and limited to the drop credit value of the animals they slaughter.

Big food retailers and food service companies will be limited to whatever is leftover after the producer is compensated 65% of the consumer beef dollar as reported by USDA’s Meat Price Spreads.

The largest firms in all animal feeding, slaughter, meat processing, and all food distribution categories will be given two years to downsize to a level not to exceed seven percent for any one firm in the national market, assuring four-firm concentration, unless a public utility, does not exceed 28%.

In the interest of food sovereignty and food security, USDA, guided by a set of new policies, will facilitate the building of new local/regional food, and food related, infrastructure.  Aggressive enforcement of the existing Packers and Stockyards Act and antitrust laws will protect the new investments and consumers from current market predators. Animals will once again be processed in owner/operated multi-species plants close to where they’re raised by a newly trained, more efficient workforce. Carcass break down and value-added processing will be done by skilled meat cutters in newly developed marketplaces near the consumer.

New policies designed to improve food safety, working environments, and animal welfare, will encourage a new decentralized regional carcass trade between small rural slaughter plants and independent owner/operated butcher shops, employing well-paid, skilled meat cutters.

In sharing equitably in the wealth created from a developing livestock centered, family farm agriculture, Rural America will begin to rebuild. Consumers everywhere will be able to depend on a healthier, higher quality, affordable, and safer food supply from many sustainable and resilient sources. Workers, and their valuable trade, will be respected and rewarded with living incomes.

With farm and ranch families returning to the land, stewardship and animal husbandry will guide the way to better resource management, soil health, and animal welfare. Rural communities and the environment will begin to recover from the decades of industrial ag’s mining operations.

“Walking backwards into the future”- welcome to 1970 when markets were competitive and America could feed itself.

Before The Meat Trust (to the small farmer): My friend, why don’t you raise a few cattle each year? The price of beef is high. You will make good money.

After The Meat Trust (to same small farmer): The price I offer for your cattle is low, is it? Well, you may take it or leave it, my friend. There is nobody else for you to sell to.

[Udo J. Keppler. Tweedledee and Tweedledum. 1913.]

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“In 1979 a beef producer’s share of the consumer dollar was 64%. The Producer’s share has declined to an all time low of 49%.”

Bringing producer share up to date

Producers have lost around $1,500 per head of their share of the consumer beef dollar to the meatpacker/retailer cartel. Rural America is now living off the waste stream of the national economy via dollar stores on it’s way to third-world status.

May 25,1999

‘After-The Fact’ Price Reporting is No Solution to Cattle Crisis 

Analyzing the Proposed Price Reporting Bill

The present Packer-NCBA proposal is a disgrace and disservice to cattle producers and should be completely discarded. In some ways this proposal is worse than the current voluntary reporting system. Today, sellers have immediate access to whatever voluntary information is available. Under the Packer-NCBA proposal, information would be old news, and would be available only at the packer’s control, most likely after the week’s trade is over. The Packer-NCBA proposal still maintains secrecy of the terms of formula, contract and other possible anti-competitive packer supply control methods.

The packers and their “captive” representative, the NCBA, have announced the following goal:

“The goal of mandatory price reporting is to improve market transparency and allow the producer to have more information available to base marketing decisions on.” If only the information allowing cattlemen to make timely decisions was facilitated by this bill, there would be no complaint. Unfortunately, it does not.

Cattlemen won the policy fight at the NCBA convention for mandatory price reporting only to be sold out…

While it may sound good, it means nothing when the actual proposed language is analyzed. Cattlemen won the policy fight at the NCBA convention for mandatory price reporting only to be sold out by the packer-friendly faction within NCBA and NCBA staff in the drafting of the proposed legislation. Collusion is evident and widespread. What has been produced under the guise of “price reporting” is a sham.

As you know, the meat packing industry is highly concentrated. The big packers are now in a position of total control of the industry. Through various methods of controlling supply and demand, the big packers are able to maximize their profits at the expense of both producers and consumers and threaten our nation with the loss of a dependable food supply. The big packers need immediate restrictive emergency regulation to prevent them from doing any further damage to the industry and livestock producers. Packers or their representatives should have no say in this legislation. When they have, such as in this so-called price reporting bill, you see the result – a further strengthening of their monopolistic control.

This Monopoly game is over – Packers have all the money, control, and information

The goal of a mandatory price reporting bill should be to establish special rules and regulations for only the big packers now controlling the markets, and to dissipate that control, such as:

• Restoring price discovery and a more fair and equitable distribution of the consumer meat dollar back to the producer.
• Providing full and complete, timely, on the spot market information on a daily basis of all purchases or sales of cash cattle, beef and beef by-products whether imported, exported or domestic.
• Providing full and complete, timely, on the spot market information on any and all contract, formula, captive or otherwise packer-controlled cattle supplies beyond seven days of delivery.
• Providing all details of the agreement to the public on any captive supply, formula, contract or otherwise packer-controlled supplies of cattle.
• Providing the public and law enforcement officials better access to information, enabling more effective enforcement and prosecution of applicable antitrust laws.
• Providing enforcement officials with clear and mandated orders to guarantee strict adherence to the law.
• Providing strong penalties and deterrents for noncompliance.

It is urgent that a new bill be written embodying these provisions with only livestock producers in mind, giving them the protections against packer ‘anti-competitive’ actions as guaranteed in the Packers and Stockyards Act.