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Antitrust

The Dairy Antitrust Hearing in Madison

by: Jill Richardson

Sun Jun 27, 2010 at 23:57:07 PM PDT

This past week was the dairy antitrust hearing, held in Madison, WI. Dairy's gone through its biggest crisis since the Great Depression, and corporate consolidation and price manipulation are at the heart of the problems. I recommend listening to an excellent five-minute audio report on the event for a quick summary on the hearing. It features the testimony of Joel Greeno, whose dairy farm I visited a few years ago.

There's also an article by the Milwaukee Journal-Sentinal with the headline "Farmers plead for help as milk prices destroy profits Hundreds gather for hearing at UW-Madison" that includes, of course, pictures of protesters in cow costumes. (Side note: I seriously wouldn't be surprised if one of the cows in these pictures happens to be a friend of mine.) Here's their brief summary of the hearing:

Dairy farmers are being squeezed out of business as other sectors of the food industry demand a greater share of the consumer's dollar, farmers attending a federal hearing testified Friday.

The current system leaves dairy farmers with little or no profit, several said at a U.S. Department of Justice hearing on antitrust issues in the dairy industry. The hearing attracted hundreds of farmers from around the country to the University of Wisconsin-Madison.

"What we are hearing is a consistent message, which has not always been the case. Dairy producers, large and small, are hurting," U.S. Agriculture Secretary Tom Vilsack said at the hearing.

In the past 10 years, the number of U.S. dairy farms has fallen from 111,000 to fewer than 65,000, Vilsack said.

Some of that has come from farm consolidations and voluntary retirements. But much of the loss has come from farmers who have been forced out of business, especially in the past two years.

The article's great and I recommend reading it. Below, I am also featuring a statement by Sen. Feingold (who attended the hearing) and a press release from Farm Aid.

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Obama Makes the World Safe for DuPontcracy

by: Jill Richardson

Fri Jun 25, 2010 at 15:58:14 PM PDT

WTF? Obama just nominated Ramona Emilia Romero as General Counsel of the USDA. Who's she? Well, she's spent the last 12 years working as a lawyer for DuPont. You know, the pesticide company. Among her areas of specialty was antitrust litigation. I am pretty confident that means that she was helping DuPont weasel its way through U.S. antitrust and competition law to keep it from having its mergers denied or getting accused of anti-competitive behavior. This is a strange pick, considering that right now the Dept of Justice is doing a series of antitrust workshops focused on agriculture.

Ramona Emilia Romero's bio is below, taken from the Whitehouse.gov site.

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Awesome New USDA Antitrust Rule on Meat Industry

by: Jill Richardson

Fri Jun 18, 2010 at 21:01:35 PM PDT

The USDA has come out with a new proposed rule and - based on the reaction it has gotten thus far - it's a big fucking deal. In a good way. Here's how the AP described the new rule:

The rules would place the sharpest limits on meat companies since the Great Depression, drastically lowering the bar that farmers and ranchers must meet to sue companies  whom they accuse of demanding unfairly low prices.

The rules would dictate how meatpackers buy cattle on the open market, and prohibit them from showing preference to big feedlots rather than buying from small producers.

They would also limit the control chicken companies have over the farmers who raise birds for them. The companies couldn't require farmers to take on debt to invest in chicken houses, for example, unless farmers were guaranteed to recoup 80 percent of the cost.

The law would also make it easier to file suits under the Depression-era Packers and Stockyards Act by stating that farmers don't need to prove industrywide anticompetitive behavior to file a lawsuit under the act.

Sen. Feingold, a longtime champion for fair competition in agriculture, has already come out praising this rule in a statement I've included below. South Dakota Senator Tim Johnson praised the rule as well, as did R-CALF USA. You can see the USDA's press release about this here and the actual rule itself here.

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Last Week's Antitrust Workshop

by: Jill Richardson

Mon Mar 15, 2010 at 23:08:47 PM PDT

Friday, the DOJ (Department of Justice) held the first of a series of "workshop" to deal with antitrust issues in agriculture. This first one was in Iowa, focusing on issues of concern to farmers. In anticipation of the event, a broad coalition of family farm, anti-hunger, religious, environmental and public policy groups established the website Bust Big Food (obviously in support of government action in breaking up corporations that prevent fair competition in the marketplace).

WHY Hunger says the following about competition in food and agriculture:

There are 2 million farmers and 300 million consumers in the US. Standing in the middle are a handful of corporations who control just about everything that happens to our food between the farm and our plate -- how much it costs, how it's grown, where it comes from, what's in it, and who sells it. Most of what probably matters to you about why food isn't healthier, safer, tastier, or all around better is affected by that narrow bottleneck of power between producers and consumers.

Standard economics holds that if the top four companies in any industry control over 50% of the market, that industry is no longer freely competitive. Right now, the top four companies control 85% of the nation's beef, 70% of pork, and 60% of the nation's poultry. Three corporations process over 70% of the nation's soy. Just one company controls 40% of our milk supply, and Monsanto holds patents on 80% of corn seed. Our food system has become one of the least competitive sectors of the marketplace.

If you want to send comments to the DOJ, please do so here (the deadline was Dec 31, 2009 but it seems that they are still accepting comments).

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Should Farmers Speak at a Govt Hearing on Farming?

by: Jill Richardson

Wed Mar 10, 2010 at 14:53:17 PM PST

This week marks the first of a series of antitrust "workshops" by the U.S. Department of Justice (DOJ). This first one will be in Ankeny, Iowa, focusing on "issues of concern to farmers," including "seed technology, vertical integration, market transparency and buyer power."

So... silly question: Should a workshop about "issues of concern to FARMERS" include presentations by farmers? Umm, maybe. According to the DOJ anyway. They've now amended the originally proposed schedule to include some farmer representation. Details below.

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Some Thoughts on Seeds

by: Jill Richardson

Sun Feb 14, 2010 at 19:49:03 PM PST

With a few exceptions, every single plant-based food you eat comes from a seed. And the animal products you eat came from animals that ate plants that came from seeds. In fact, the only foods you eat that don't come from seeds are fungi or ferns. Those come from spores. The average American might not give a lot of thought to seeds, but seeds play a pretty big role in his or her life nonetheless. As a sustainable food activist and writer over the past several years, I've had to learn quite a bit about seeds. But it didn't really hit home until I started gardening.

This diary is cross-posted from Firedoglake.  

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Meat Industry to DOJ: "Don't Regulate Us."

by: Jill Richardson

Fri Jan 08, 2010 at 14:17:19 PM PST

The American Meat Institute sent a comment to the DOJ about their antitrust hearings that amounted to: "We can NOT haz regulation? Srsly. Kthxbai."
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Sick of Corporate Control Over the Food Supply?

by: Jill Richardson

Tue Dec 22, 2009 at 18:25:59 PM PST

The DOJ is looking into consolidation in agriculture. They are already investigating Monsanto but they are also doing a number of workshops ("to explore competition issues affecting the agricultural sector in the 21st century and the appropriate role for antitrust and regulatory enforcement in that industry") and taking public comments on the subject. Slow Food USA just put up an action alert that says:

Maybe you've noticed prices rising at the supermarket even while most big food companies made record profits this year;

Maybe you are a farmer who has trouble getting your meat to market because there are no small-scale processing facilities in your region;

Maybe you're concerned about food safety and the spread of bacteria like E. coli-which happens much faster when meat and vegetables are processed in big centralized locations;

Maybe your local farm has gone out of business because it couldn't compete with the prices set by industrial farms and consolidated buyers.

And you probably know consumers having trouble finding good food at affordable prices, as well as farmers having trouble getting good food into mainstream markets. Please reach out to them today: the Department of Justice needs to hear their stories.

Email your comments to agriculturalworkshops@usdoj.gov BY DECEMBER 31.

And read below for more info... including the dates, times, and locations of the workshops, some talking points for your own comments, and the talking points Big Ag plans to use.

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Monsanto Under Fire For Anticompetitive Behavior

by: Jill Richardson

Sun Dec 13, 2009 at 22:27:31 PM PST

As you may already know, Monsanto has come under fire for anticompetitive behavior, and the Obama Department of Justice (DOJ) will be investigating them. With the seed industry, it isn't just about what size market share you have (even though Monsanto IS the Coca-Cola of the seed industry). Even more important are what traits you control. If another company wants to engineer Roundup Readiness (a trait controlled by Monsanto) into their seeds, they need to come to Monsanto begging in order to do so. As Monsanto's spent the past decade or so gobbling up smaller seed companies (see a picture of it here) - and the traits they own - Monsanto controls an awful lot of traits, and thus an awful lot of the seed industry.

This week the AP wrote up Monsanto's role in the seed industry and Monsanto responded on their blog.

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Monsanto Doesn't Think Trust Busting is Necessary

by: Jill Richardson

Wed Nov 04, 2009 at 08:00:00 AM PST

In my view, the #1 most important significant change we can make in our food system is breaking up anticompetitive businesses that control too much of the market of whatever they are selling. And I'm not alone in thinking that the U.S. government needs to look at consolidation in agriculture. In addition to rumors that the DOJ is looking at market concentration in the seed and the dairy industries, the NYT recently ran an editorial calling out Monsanto for dominating the seed industry:

Following a decade of unchecked consolidation, it is time for the Justice Department to take a hard look at potentially anticompetitive behavior.

A good place to start is with Monsanto, which is trying to block DuPont from adding its own genetic traits to Monsanto's Roundup Ready technology to produce soybeans that would be resistant to multiple pesticides. Seeds carrying Monsanto's genes can resist Roundup, the ubiquitous weedkiller. They are the dominant standard in American fields - present in 97 percent of the soybean crops and 79 percent of the corn, akin to Microsoft Windows on computers.

They conclude that "No company should dominate such an essential business."

Yesterday the New York Times printed Monsanto's response. They basically say that we must make better seeds in order to feed the world in a sustainable way, and Monsanto invests more in this than anyone else - including their competitors. Therefore, Monsanto concludes, we oughta leave them alone and let them do their thing.

That's bullshit. Monsanto has a big chunk of the market share in the seed industry. When the top 4 companies control 40% of the market, they can manipulate the market unfairly. For seeds the top 4 companies control 75% of the market. There's no question that Monsanto's size is a problem for fair competition.

Discuss :: (1 Comments)

Obama Admin Antitrust Action Meets Opposition

by: Jill Richardson

Sun Jul 26, 2009 at 12:29:54 PM PDT

Obama's antitrust chief Christine Varney promised to look at monopolies in ag during the confirmation hearings. Now, according to the NYT, Varney is looking into monopolies in dairy and in other industries. Here are a few key paragraphs from the article:

The more aggressive antitrust policy was described in interviews with officials at the White House, the Justice Department, other agencies and Congress. It is a major policy reversal from the Bush administration, which did not prosecute cases in which some dominant companies engaged in potentially anticompetitive behavior, often because those officials maintained such behavior was not harmful to consumers.

Democrats have spent years trying to gain the support of businesses, and the policy changes under way may have long-term political implications for their party. Some companies would like to see more aggressive antitrust enforcement against their rivals, while others could be hurt by it.

In some cases, though, the new approach is being opposed by administration officials. Some fear that the crackdown is coming at a bad time, as corporate America reels from the recession. Other officials embrace the Bush administration's view that larger companies and industry alliances can provide consumer benefits by making their businesses more efficient.

So are we going to get reform, or not? Because we NEED it. Badly.

Discuss :: (3 Comments)

Another Reason for Strong Anti-Trust Laws

by: Jill Richardson

Thu Jun 25, 2009 at 11:50:26 AM PDT

I've been listening to a series of the radio show Deconstructing Dinner called "Packaged Foods Exposed" and they make a very important point. Obviously one of the reasons why media outlets that rely on ads do not like to criticize packaged food companies is because they do not want to alienate their advertisers.

The show on Kraft pointed to Philip Morris' decision to buy Kraft as a means to keep TV shows from criticizing their cigarettes. After cigarettes were no longer allowed to advertise on TV, they had no way to threaten TV networks with the loss of their advertising dollars if they were a tobacco company only - so they went into the food business by purchasing Kraft. Now the TV networks would know that if they criticized cigarettes, they would lose Kraft's advertising money.

This applies beyond the example of Philip Morris and Kraft (and, in fact, they have not owned Kraft for a few years now). Our grocery stores are filled with products by Nestle, Kraft, PepsiCo, Unilever, and a few other companies. The loss of just ONE of these advertisers would be a major blow to any media outlet. That keeps them quiet about reporting on all of the brands owned by these companies. If we didn't allow such consolidation of our food companies, then our news shows would have more freedom to tell the truth about individual brands without fearing the loss of ALL of their advertising dollars. Alternatively, we could move to a new model in which advertising was not needed because our news shows were funded publicly (like PBS and NPR) but even PBS and NPR take money from "sponsors." All of this serves to reduce the amount of information we are getting from our "news."

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