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The meat packer monopolists are circling

By Robert Schubert
CropChoice editor

(March 20, 2002 – CropChoice opinion) – The meat packer monopolists are on the scene as Congress considers, as part of the Farm Bill negotiations, whether to curb their ownership and control over the livestock industry.

Understandably panicked over the implications for power and profit, Sparks Companies, Inc., the National Pork Producers Council (NPPC) and the National Cattlemen’s Beef Association (NCBA) trotted out the industry position earlier this week in a report ( http://www.agweb.com/news_show_news_article.asp?file=AgNewsArticle_20023181446_2211&articleID=86403&newscat=GN) bemoaning the various tragedies such a ban would visit upon farmers.

Among other points, the report argues that such a move to protect access for small and mid-sized family producers would lead to inefficiencies in the market.

But monopolists, or "dragons," as Michael Stumo, of the Organization for Competitive Markets (http://www.competitivemarkets.com prefers to call them, deliberately use the term efficiency to cloak their insatiable appetite for unfair and unfettered access to economic power.

"When dominant firms drive down farm gate prices to subcompetitive levels and profit from it, that’s market power, not efficiency," says Stumo, noting Adam Smith’s belief that "regulation of economic power is required to ensure the preservation of the free market system."

The role of government is to maximize the health and well-being of the greatest number of people, Stumo says, which includes facilitating a market that is fair, accessible, transparent, and competitive.

What the corporate meat packing industry has built with control of prices and access to the market is not fair. It’s a monopoly.

For a welcome relief from the industry spin, refer to the report, "The ban on packer ownership and feeding of livestock: Legal and economic implications;" http://www.competitivemarkets.com/library/academic/Connor-etal.031202%20(1).htm