Rural America Deserves Better

At the Great Bend Farm show – Standing up for rural prosperity – Brian Hale, Darren Dale, James Fenoglio, Steve Stratford, Mike Callicrate, and Justin Harris

Thanks to show organizer, Darren Dale, for the invitation to present at the Great Bend Farm Show. It was a pleasure presenting with fellow Kansan Steve Stratford. Steve is a welcome voice of reason and truth, and powerful defender of fair cattle markets.

On the 250-mile drive from St. Francis to Great Bend, I was reminded of the amazing wealth creation capacity of Kansas, but also of how little of the wealth stays in the state. Across Western Kansas, the big corporate feedlots were full, while the lower cost, more efficient farmer feeder lots were empty or abandoned. Three Dollar stores — yes, three — were open for business across the road from the motel in Hoisington, while franchise and retail chain stores lined the east-west thoroughfare through Great Bend. Like the coal mining towns of Appalachia, Kansas creates the wealth, but keeps very little. How insulting is it for the farmers, ranchers, and workers of rural America, after seeing their communities decimated by corporate extraction, to be left with only Dollar stores hawking the leftovers of the wealth they created?

Following are the slides from my presentation at Great Bend.

Great Bend April 9, 2022

Click on arrows in lower left corner of image to advance slides.

 

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Perhaps the Biggest Folly – Ignoring the Water Crisis

In 1985, Barbara W. Tuchman wrote the book, March of Folly: From Troy to Vietnam. Tuchman defines folly as the pursuit by government of policies contrary to the people’s interests, despite the availability of feasible alternatives.

The growing dominance of the industrial food system since 1985 could easily add another, even more alarming, chapter to Tuchman’s book.

Will today’s extractive globalized model of agriculture be written into history as the biggest folly of all?

  • DAY ZERO – TRAILER 2021 – is a documentary about the impending global water crisis and how that is one of the most serious and pressing issues of our lifetime.

At times of the year, the Arkansas River no longer delivers snow melt from the Colorado Rockies into Kansas, and the South Platte River, after watering much of the expanding Front Range of Colorado, barely makes it into Nebraska, resulting in the Ogallala Aquifer losing two of its main traditional sources of recharge. Meanwhile, we keep on pumping and transferring the value of this precious and declining resource into the bank accounts of the world’s biggest agribusiness corporations, leaving dried-up and broken farming communities across the high plains.

Day Zero is coming fast for many of us. Like the marinas on Lake Powell, farm fields, livestock wells, and communities above the Ogallala Aquifer are running out of water. I wish the disappearance in our underground aquifers was as visible as in the above ground structures like Lake Powell and Lake Mead. Would we react differently?

“Aquifers belong to everyone, and especially to future generations.”

Quote from the December 2021 Atlantic article, The Next Disaster Coming to the Great Plains:

“When groundwater runs out, myths of growth and profit collapse into dust. Drying aquifers can result in starvation, migration, and violence. Or they can prompt us to rethink our relationship to one another and to the irreplaceable natural resources that we share. Aquifers belong to everyone, and especially to future generations.”

According to the producers, Day Zero should be releasing soon on Amazon Prime Video.

Fore more, see: The Current State of U.S. Agriculture and Food Infrastructure, and Solutions and VICE: Meathooked and End of Water

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‘Broken systems raise costs far faster than resilient ones.’

Farm and Food File for the week beginning Sunday, March 13, 2022

‘Broken systems raise costs far faster than resilient ones.’

Alan Guebert

One of the most beautiful–and inexplicable–aspects of economics is how its practitioners never seem to be wrong.

Indeed, almost every school of economic thought, from John Maynard Keynes’ demand-driven economics on the left to Arthur Laffer’s supply-side economics on the right, is crowded with disciples defending their leader’s theories and just often, if subtly, attacking their theological foes.

One such fistfight broke out in, of all places, the Feb. 28 editorial pages of the New York Times. In it, writer and editor David Dayen undressed one of the most famous economists of the last 40 years, Lawrence Summers, for his role in building one of the most efficiency-centered, imbalanced, and fragile economies in history.

“For decades, economists like Mr. Summers advanced policies like globalization, deregulation, and markets that valued efficiency over competition,” says Dayen. “They promised that these trends would deliver lower prices. And they did, for a time. But they also left the system vulnerable.”

Vulnerable to what we see today–broken global supply chains impossibly slow to repair; a domestic economy that, somehow, is both quickly growing and mired in inflation; and a consumer culture so treasured that we gladly trade regulation and competition for lower prices and higher economic growth.

It’s the manifestation of Nobel Prize-winning economist Milton Friedman’s “marketized economy,” explains Dayen. “(T)he sole social responsibility of business is to increase profits. Cut regulations, cut taxes and allow companies to structure markets, people like Friedman maintained, and watch the economy take off.”

In short, markets are most important and government–regulation, taxes, antitrust–are far less important.

That’s been a solidly bipartisan tenet for 50 years. While Republican administrations–Reagan, Bush II, and Trump–cut taxes and nearly eliminated antitrust, Democratic administrations, especially Carter and Clinton, deregulated trucking, airlines, railroads, banking, and agriculture.

And most of this was accomplished by the early 2000s to lay the foundation for globalization–ever bigger free trade deals; the rapid rise of unregulated financial derivative markets; easy access to cheap, plentiful labor; and sophisticated, just-in-time supply chain management.

A Summers’ acolyte, Dayen reports, once likened it to how Walmart initially impacted the U.S. economy: The giant retailer might not have been good for local communities or local job markets, but there “is little dispute” Walmart’s cutthroat business model helped the other 120 million Americans not employed in local retail.

As such, “The trade-off was clear: sacrifice resiliency, wage security, and community for the promise of a five-dollar pack of tube socks.”

We may not like the comparison but we know it’s spot-on because, by golly, a pack of tube socks for $5–even if the socks were made by children working 70 hours a week in a pollution-riddled sweatshop–is still an easy, smart buy, right?

Until this year, when those socks–like our long-ordered television, new dishwasher, or car–were trapped somewhere in a global supply chain with too few manufacturers, too few shipping companies, too few ports, too few railroads, too few truck drivers, too few retailers, and too few solutions on how to fix the whole bloody mess.

American farmers and ranchers know the feeling. Two years ago a global pandemic, predicted though it was, fouled the food system because no one thought it could happen so no one had any plans for when it did happen.

And when it did happen, what was our first instinctive reaction? Give market giants like exporters and meatpackers even more market power; power it will take decades, if ever, to get back.

Today, war is ripping through integrated markets from Odessa to Omaha. No tax cuts, fewer environmental rules, more deregulation or less antitrust enforcement will lower crude oil prices or cut U.S. potash costs.

But none of this should be news because, as Dayen reminds us, “Broken systems raise costs far faster than resilient ones.”

America’s too few farmers and ranchers, too many broken rural communities, and too much cheap food are testament to that inarguable economic fact.

© 2022 ag

The Farm and Food File is published weekly throughout the U.S. and Canada. Past columns, supporting documents, and contact information are posted at farmandfoodfile.com.

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Post pandemic, we’re still captive to a flawed formula

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.”

Jungle Article Mike

Click on bottom of image to read full article. Zoom to make more readable.

“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.”

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NCBA Policy and Packer Monopoly Ride Herd on Independent Cattlemen

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!

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