Monitoring Corporate Agribusiness From a Public Interest Perspective
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U.S. DEPARTMENT OF JUSTICE
SUMMARILY DISMISSES PUBLIC COMMENTS
RELATIVE TO CARGILL\CONTINENTAL SALE
Rejecting all public comments opposing the pending purchase of Continental Grain's commodity merchandising division by Cargill, the world's largest grain trader, the U.S. Department of Justice, believing that its "Competitive Impact Statement" (CIS) and its response to comments clearly demonstrate that its proposed Final Judgment approving the sale "serves the public interest" has asked that U.S. District Court Judge Gladys Kessler move the Court to enter the Final Judgment.
The DofJ also rejected extending the comment period and saw no need, as was requested in several of the public comments, to hold any kind of evidentiary hearings.
"The expeditious procedures to determine the public interest that Congress envisioned are not possible without reliance upon the Department's good faith execution of its prosecutorial discretion. Evidentiary hearings, therefore, should be used only in extreme cases. . . . In the instant case, an evidentiary hearing would be inordinately time consuming and would not in any way further the Court's understanding of facts relevant to the determination it must make."
In evaluating the responses Judge Kessler, accordingly, with respect to the adequacy of the relief secured by the decree, may not according to the DofJ 's CIS filed on July 23, 1999 "engage in an unrestricted evaluation of what relief would best serve the public."
Legal precedent, according to the DofJ, requires that "[t]he balancing of competing social and political interests affected by a proposed antitrust consent decree must be left, in the first instance, to the discretion of the Attorney General. The court's role in protecting the public interest is one of insuring that the government has not breached its duty to the public in consenting to the decree. The court is required to determine not whether a particular decree is the one that will best serve society, but whether the settlement is `within the reaches of the public interest.' More elaborate requirements might undermine the effectiveness of antitrust enforcement by consent decree.
"The proposed Final Judgment, therefore, should not be reviewed under a standard of whether it is certain to eliminate every anticompetitive effect of a particular practice or whether it mandates certainty of free competition in the future. Court approval of a final judgment requires a standard more flexible and less strict than the standard required for a finding of liability. [A] proposed decree must be approved even if it falls short of the remedy the court would impose on its own, as long as it falls within the range of acceptability or is `within the reaches of public interest.'."
In filing its 60-page "United States Response to Public Comments" brief, the DofJ also pointed out that "if courts acting under the Tunney Act disapproved proposed consent decrees merely because they did not contain the exact relief which the court would have imposed after a finding of liability, defendants would have no incentive to consent to judgment and this element of compromise would be destroyed. The consent decree would thus as a practical matter be eliminated as an antitrust enforcement tool, despite Congress' directive that it be preserved."
According to the brief 67 individuals, eight public officials, 65 individual farmers, and nineteen organizations expressed their views on the proposed Final Judgment. Those individuals and organizations included: Congresswoman Jo Ann Emerson, Missouri Attorney General Jeremiah Nixon, Missouri Farm Bureau Federation, Missouri Soybean Association, Permiscot County Farm Bureau, New Mexico Attorney General Patricia Madrid, Minnesota Attorney General Mike Hatch, Nebraska and South Dakota Attorneys General Don Stenberg and Mike Barnett, North Dakota Attorney General Heidi Heitkamp, John W. Helmuth, Professor C. Robert Taylor of Auburn University, Catholic Charities of Sioux City, Iowa, Jon Lauck, writing on behalf of the Organization for Competitive Markets (OCM), American Agriculture Movement, Animal Welfare Institute, Clean Water Action Alliance, Farmland Co-op Inc., Institute for Agriculture and Trade Policy (IATP), Kansas Cattlemen's Association, Minnesota Catholic Conference, National Catholic Rural Life Conference, Office of Hispanic Ministry, Kansas chapter of the National Farmers Organization (NFO), National Farmers Union (NFU), Rural Life Office of Dorchester, Iowa, Nebraska Women Involved in Farm Economics (WIFE), and this editor.
In general the public comments addressed such issues as the Cargill\Continental sale doing nothing to raise farm prices; that the markets in which farmers presently sell their grain have become so concentrated that the grain companies will be able to depress prices paid to farmers for their grain; that Cargill will be able to monopolize "specialty or niche" markets or lessen competition in grain futures markets, and that there should be a complete ban on mergers and acquisitions in the agribusiness sector.
Other comments addressed the prohibiting of certain other companies, such as Bunge & Born Corp. in Missouri, from purchasing the divested elevators; concern about there being one less significant competitor in the national grain trading market after the transaction; belief that the proposed Final Judgment does not go quite far enough to ameliorate antitrust concerns raised by the transaction; that grain markets are already too highly concentrated and that agriculture industries, in general, are experiencing high rates of vertical consolidation; that the relevant geographic markets as defined in the Complaint is not adequate and that the DofJ Justice should have focused more on overlapping draw areas for country, rail, river or port areas, that the relevant market should be enlarged to include the entire U.S. and that the two firms should not be permitted to merge under any circumstances.
In submitting a comment before his recent death John W. Helmuth, an agricultural economist, set forth his suggested analytical framework for the Department's use in analyzing the transaction. In his view, it is essential for the Department to assess market concentration, the extent of information available to grain traders and farmers in the market, and the potential adverse competitive effects on grain futures markets and other agribusinesses beyond grain trading, such as livestock markets. Helmuth seriously questioned whether the DofJ had made such assessments.
Other comments, including those of this editor believed that the Department's analysis was deficient because it failed to consider whether the transaction will permit Cargill to force its own standards, practices, marketing arrangements, and prices on farmers, processors, and merchandisers in grain markets throughout the U.S.
Professor C. Robert Taylor of Auburn University expressed concern that the DofJ did not adequately consider the extent of vertical integration in the agricultural sector while others voiced concerns about general levels of market concentration in agriculture industries, that the DofJ's analysis did not adequately consider concentration in agriculture markets beyond grain buying, whether declining grain "basis levels" would mean that farmers will receive lower prices for their grain after the transaction, and whether the transaction may facilitate Cargill's exercise of market power in "organic and specialty" markets.
The NFU filed comments opposing the transaction because the transaction does not increase competition in grain markets. NFU also believed that the proposed Final Judgment is deficient because it does not ensure that divested facilities will remain competitive and that the proposed Final Judgment fails to address the roles played by Cargill and Continental in export markets.
OCM's Jon Lauck filed an extensive comment that was critical of the Department's analysis in several respects in that it failed to consider: (1) the impact of concentration in agriculture markets other than grain buying; (2) the continuing potential for anticompetitive behavior in the post-merger market; (3) whether the divested facilities will continue to be competitive forces in the hands of new owners, particularly if the new owners do not have a "network" of elevators that buy grain; (4) the impact on potential entry into grain buying markets; (5) the ramifications of competition in overseas grain markets; (6) the implications of economic disorganization of farmers which can be exploited by powerful buyers; (7) information disparities in agriculture markets; (8) the lack of benefits of the merger; (9) a range of statutes that Congress intended courts to consider when making decisions about agriculture markets; and (10) that the consent decree risks leaving farmers without an effective outlet for legal redress. OCM's conclusion was that the proposed Final Judgment was not an adequate remedy and that the transaction should be prohibited in its entirety.
All the comments, however, were summarily dismissed by the DofJ in their
brief to the Court.
DOFJ DIVESTITURE ORDER:
HELPING THE RICH GET RICHER !!!
In responding to the public's comment about the proposed Cargill\Continental sale, the U.S. Department of Justice revealed just how indifferent, if not unconcerned, about concentration in corporate agribusiness it has become.
Aside from brushing aside the genuine concerns of many relative to the monopolistic control of the marketplace by such corporate agribusiness behemoths as Cargill, the DofJ in a vapid effort to make it appear that it was troubled by such control on the U.S. domestic market opened the door for increased international control of the grain trade by an already select few corporations.
Sections VI and VII of the DofJ's original Complaint refer to overlapping Cargill/Continental draw areas as "captive draw areas," a term used to identify highly concentrated markets in which Cargill and Continental are "two of a relatively small number of grain buyers and in which the transaction is likely to create or enhance monopsony market power for: operators of port elevators.
"In order to prevent the loss of competition for the purchase of grain that would result from Continental's exit from these markets, the Department insisted that Cargill divest either its elevator or Continental's elevator in the markets to a new entrant who would operate the facility as a grain elevator and compete for the purchase of grain from farmers in the facility's draw area."
Of the seven U.S. elevators and terminals that Continental was ordered to divest itself of in the DofJ's Competitive Impact Statement and proposed Final Judgment, the recently filed "United States Response to Public Comments" brief reveals that in two cases (Salina, Kansas rail elevator and Birds Point, Missouri river elevator) it simply decided to not renew its minority interest lease.
Of the five remaining elevators it was ordered to divest three were sold to the Louis Dreyfus Corp. (Lockport, Illinois river elevator, Caruthersville, Missouri river elevator, and the Beaumont, Texas port elevator). The other two facilities (Troy, Ohio rail elevator and the Stockton, California port elevator) were sold to the Mennel Milling Company and the Penny Newman Grain Co. respectively.
Among the three elevators Cargill was ordered to divest itself of, the East Dubuque, Illinois river elevator has been bought by CBG Enterprises Inc. (formerly Consolidated Grain & Barge) and the Morris, Illinois river elevator has been purchased by the Louis Dreyfus Corporation.
The third Cargill facility. a port elevator leased from the Port of Seattle, Washington since 1970, was recently leased to Louis Dreyfus who will assume the remainder of Cargill's five-year lease. The Port will continue to receive more than $1 million a year in rent, including 50% of all dockage revenue generated from the facility. Dreyfus will have the option of renewing the lease once it expires in November 2005. Cargill will now assume 50% control of a nearby Tacoma, Washington port terminal while some 100 miles to the south on the Columbia River, ConAgra, Archer Daniels Midland (ADM) and the Mitsubishi Corp. a leading Japanese trading company, operate the Kalama Export Company LLC, affording western Washington State a who's who of the international grade.
Thus, of the ten facilities ordered divested by the DofJ, half of them have are now part of the Louis Dreyfus corporate structure.
The Louis Dreyfus Corporation, with world headquarters in Paris, France and U.S. headquarters in Wilton, Connecticut, traditionally has been ranked among the four largest grain traders in the world, behind Cargill, Continental and the Bunge & Born Corporation. In 1999 the privately-owned company generated $18 billion in revenue.
Dreyfus's acquisitions of the divested facilities raises an interesting question as to its relationship with the other major U.S. grain traders. In 1993 Dreyfus and ADM ("Supermarkup to the World") reached an agreement to establish a joint venture under which ADM assumed operational control of most U.S. grain elevators owned by Dreyfus. That transaction involved 46 facilities, including 12 terminal elevators, two port facilities, nine river facilities, three subterminals and 23 country elevators.
In the DofJ's aforementioned response to public comments on the Cargill\Continental sale, they state:
"The Department's investigation indicated that each of the proposed acquirers has the financial capability, expertise, and incentive to become a vigorous, independent competitor in the relevant market. Louis Dreyfus and Consolidated Grain & Barge are major grain companies who will use these acquisitions to expand into markets that they do not presently serve. Mennel and Penny Newman are smaller, but they are experienced grain traders who presented sound business plans for assimilating the Troy rail elevator and Stockton port elevator in their respective grain distribution businesses.
"In summary, the divested facilities will be controlled by new entrants with the background, expertise, and incentive to compete effectively for the purchase of grain produced in these markets. With these divestitures, therefore, it is not likely that this transaction will create or enhance the exercise of market power by Cargill or other grain companies [ Ed.Note: !!!!! ] enabling them to depress prices paid to farmers for their crops in any market." (emphasis added)
No mention is made by the DofJ of the ADM-Dreyfus "joint venture."
"CAPTIVE DRAW AREAS" AND THE HHI
Although Cargill has from the outset sought to minimize the monopoly situation its pending purchase of Continental Grain's merchandising division would have created within the grain trade, the facts are that farmers typically sell their crops to rural grain elevator operators, many of which are owned by cooperatives and small companies.
These elevators then either export the grain or resell it to flour mills and other food processors with much of it being sold to grain trading corporations such as Cargill, Continental and Archer Daniels Midland and it is these companies that own and operate the larger grain elevators, rail links, terminals, barges and ships needed to move grain around the country and the world.
The role of the grain trade in a nation that is constantly touted as being "the world's breadbasket" cannot be over emphasized.
In discussing the nation's grain network the U.S. Department of Justice in its "Complaint" notes that in each instance, the geographic area from which a country elevator, river elevator, rail terminal, or port elevator receives grain is limited by transportation costs and is known as the "draw area" for that facility. Draw areas, they conclude, expand and contract only slightly in response to normal economic fluctuations in crop supply, crop demand, and transportation costs.
For many country elevators, river elevators, railroad terminals, and port elevators, draw areas overlap. Cargill and Continental often operate facilities that have overlapping draw areas, and they therefore compete with one another for the purchase of wheat, corn, and soybeans from the same producers or other suppliers. In some areas within these overlapping draw areas, Cargill and Continental have been two of a small number of competing grain trading companies.
By acquiring Continental's facilities that purchase grain from these "captive draw areas," the DofJ observes in their "Complaint," Cargill would have been in a position "unilaterally, or in coordinated interaction with the few remaining competitors, to depress prices paid to producers and other suppliers because transportation costs would preclude them from selling to purchasers outside the captive draw areas in sufficient quantities to prevent the price decrease."
In evaluating concentration is these "captive draw areas" the DofJ uses a criteria based on the Herfindahl-Hirschman Index (HHI), a commonly accepted measure of market concentration. The HHI is calculated by squaring the market share of each firm competing in the market and then summing the resulting numbers.
For example, for a market consisting of four firms with shares of 30, 30, 20, and 20%, the HHI is 2,600 (302 + 302 + 202 + 202 = 2,600). The HHI takes into account the relative size and distribution of the firms in a market. It approaches zero when a market is occupied by a large number of firms of relatively equal size and reaches its maximum of 10,000 when a market is controlled by a single firm. The HHI increases both as the number of firms in the market decreases and as the disparity in size between those firms increases.
Markets in which the HHI is between 1000 and 1800 are considered to be moderately concentrated, and markets in which the HHI is in excess of 1800 points are considered to be highly concentrated. Transactions that increase the HHI by more than 100 points in highly concentrated markets presumptively raise significant antitrust concerns under the Department of Justice and Federal Trade Commission 1992 Horizontal Merger Guidelines.
In their "Complaint" the DofJ vividly shows that even prior to the purchase announcement Cargill and Continental were two of a very small number of grain trading companies competing to purchase grain in four key "captive draw area" including: the Pacific Northwest port range, which include western Minnesota, eastern North Dakota, and northeastern South Dakota; the Central California port range, which include the areas around Stockton, California, to West Sacramento, California; elevators in the Texas Gulf port range, which include portions of Texas and Louisiana; elevators along the Illinois river, stretching from Morris, Illinois, to Chicago, Illinois, and on the Mississippi river in the vicinities of Dubuque, Iowa, and New Madrid/Caruthersville, Missouri, and the captive draw areas for rail terminals in the vicinities of Salina, Kansas, and Troy, Ohio.
While the potential combination of Cargill and Continental would have dramatically and substantially increased concentration in already highly concentrated grain markets, it should be emphasized each of the aforementioned "captive draw areas" was already highly concentrated based on HHI figures even before the news of the Cargill pending purchase.
Yet, in their response to public comments the DofJ asserts, "the Department has concluded that the restructuring of the transaction as required by the proposed Final Judgment resolves these competitive concerns. The divestitures required by the Final Judgment should preserve the competitive conditions that existed before the acquisition and ensure that farmers in the affected markets will continue to have effective alternatives to Cargill when selling their crops."
In the Pacific Northwest, for example, port range markets for corn and soybean purchases are highly concentrated, with the top four port elevator operators accounting for 100% of all corn and soybean purchases in these markets as Cargill alone accounts for about 44% of all soybean purchases and 23% of all corn purchases. Continental, in a joint venture with Cenex Harvest States, accounts for about 50% of all soybean purchases and 30% of all corn purchases in the same port range.
After the proposed acquisition, Cargill would have accounted for about 94% of Pacific Northwest soybean purchases and about 53% of Pacific Northwest corn purchases. The approximate post-merger HHIs for purchases of soybeans and corn in the Pacific Northwest port range would be about 8868 and 5004, with increases in the HHIs of 4400 and 1364 points, respectively, resulting from the proposed transaction.
Likewise, the Central California port range market for wheat is highly concentrated, with Cargill and Continental accounting for virtually all wheat purchases in this market. The approximate post-merger HHI for purchases of wheat in the Central California port range would be about 10,000, with an increase in the HHI of 7,888 points resulting from this transaction.
In the Texas Gulf port range markets for soybeans and wheat are also highly concentrated, with the top three purchasers accounting for 100% of all purchases of soybeans and the top four purchasers accounting for 79% of all purchases of wheat in these markets. Cargill accounts for about 16% of all soybean purchases and 25% of all wheat purchases in the Texas Gulf port range. Continental accounts for about 33% of all soybean purchases and 9% of all wheat purchases in the same port range.
After the proposed acquisition, Cargill would have accounted for about 49% of Texas Gulf soybean purchases and about 34% of Texas Gulf wheat purchases. The approximate post-merger HHIs for purchases of soybeans and wheat in the Texas Gulf port range would be 5105 and 2611, with increases in the HHIs of 1056 and 451 points, respectively, resulting from this transaction.
Other geographic markets in which Cargill and Continental
compete for purchases of corn, soybeans, and wheat are also highly concentrated.
These markets include river elevator markets on the Illinois River and the
Mississippi River, authorized delivery points on the Illinois River for corn and
soybean futures contracts, and rail terminal markets in Kansas and Ohio.
REP. HELEN CHENOWETH-HAGE:
CONCENTRATION OF POWER CREATES A CARTEL
MONOPOLISTIC BY NATURE, REWARDS POWER & GREED
"Mr. Speaker, few realize that approximately four companies control most of the processing and distribution of all beef, pork, chicken, and grain in the United States. Even further, on the distribution and retail side, there are only a few companies that control the United States grocery industry.
"What has happened is that today, these giant concentrated companies, with their economic market power, have usurped the farmers' and ranchers' share of the retail dollar, draining the lifeblood from the family farm and threatening our safe, sustainable, and dependable American food supply. This is unacceptable.
"In the livestock industry, for instance, four meatpackers control over 80% of the beef market, and are using captive supplies and abusive market power to drive down the prices paid to producers. Specifically, family farmers and small cattle producers are providing approximately 88% of the total investment it takes to put a steak on the consumers' plate. At the same time, packers and distributors are providing about 12% of the remaining investment. Unfortunately, while these big packers and retailers overpower the industry, cattle producers and consumers are losing big time every day on price, quality, consistency, and food safety.
"The current situation in the cattle market is analogous to economic theories presented by the Nobel Prize winning economist Friedrich August von Hayek over fifty years ago. Mr. Hayek points out that market capitalism is at its strongest when resource owners who are close to the economic circumstances of time and place make economic decisions. Such a market structure results in the most efficient use of resources and competitive markets.
"On the other hand, Mr. Hayek demonstrates that the concentration of economic decision-making in the hands of a relatively small number of individuals is extremely harmful, and counter intuitive to capitalistic principles that have built this group nation. It does not matter whether those individuals are government bureaucrats in a Soviet-style Communist regime or are corporate executives in large companies.
"We must not let American agriculture concentration fall into this trap. This concentration of power creates a cartel that is monopolistic by nature and rewards power and greed. This must stop, Mr. Speaker."
Excerpt from a speech delivered on the floor of the U.S. House by Rep. Helen
Chenoweth-Hage (R. Idaho) on March 15, 2000.
DOT'S SURFACE TRANSPORTATION BOARD
IMPOSES 15-MONTH MORATORIUM ON RAIL MERGERS
Curiously, while U.S. Department of Justice was dismissing the growing concentration in corporate agribusiness another government body --- the three-member Surface Transportation Board --- was taking the unprecedented step in a related business of imposing a moratorium on mergers in the nation's railroad industry while it struggles to develop regulations governing future combinations.
The 15-month moratorium came immediately prior to the Burlington Northern Santa Fe Corp. and the Canadian National Co., plans to filing a merger application which would have created the biggest railroad in North America, with 50,000 miles of track stretching from Halifax, Nova Scotia, to Vancouver, British Columbia to New Orleans, Louisiana. Combined with a 16-month period the board has to review proposed mergers, the moratorium effectively blocks any rail marriages for two years. The companies said that they will challenge the moratorium in federal court.
In the intervening 15 months the STB board will seek to rewrite its merger rules, possibly changing the way it deals with the broader effects of mergers on the economy, farmers, small railroads, customer service, labor and other issues.
The Chicago Tribune's John Schmeltzer reports that Industry officials had predicted the merger would set in motion a new round of consolidation, ending only when the continent's seven largest carriers had merged into just two giants spanning the United States, Canada and Mexico. Those two would have been supplemented by regional operators.
"While the government frequently has blocked mergers on antitrust grounds," he points out, "it never has ordered a `breather' to give it time to develop regulatory provisions."
"Our current rules are simply not appropriate for addressing the broad concerns associated with reviewing business deals geared to produce two transcontinental railroads," the three-member Surface Transportation Board noted in handing down their ruling.
The STB's decision immediately drew fire from not only from the railroad industry but also from the board's "parent," the U.S. Department of Transportation. "We do not believe a moratorium on mergers is the right response," DOT Secretary Rodney Slater told the board.
"There is no justification for the STB to refuse to review the CN/BNSF combination promptly on its merits," Paul Tellier, chairman and chief executive officer of the Montreal-based Canadian National told Schmeltzer. "The notion that the two most efficient railroads in North America cannot combine now to improve their business because the other major railroads are having trouble running theirs has the effect of protecting competitors, not rail competition, and clearly is against the public interest."
Robert D. Krebs, chairman of BNSF, said he was "extremely disappointed. If the STB action survives judicial review, the result of the STB decision is to penalize BNSF and CN, the two major North American railroads who are taking care of their customers, because of the failures of other railroads whose mergers have resulted in debilitating and costly service failures for shippers," Krebs told the Washington Post's Don Phillips.
Aaron Gellman, director of the Northwestern University Transportation Center, termed the decision "outrageous; there is a large issue of whether a moratorium like this is reasonable because it undermines the value of the shareholders' holdings," he said.
Competitors to the CN/ BNSF merger, however, welcomed the moratorium. "Although a longer pause would have been preferable, the board's action clearly reflects the unstable nature of the industry," said John W. Snow, chairman and chief executive officer of the Richmond, Virginia.-based CSX Corp.
The past two rail consolidations became an immediate disaster for shippers.
Union Pacific's takeover of Southern Pacific in 1996 led to a
service "meltdown" that closed some plants briefly in the West and raised
shippers' costs. CSX Corp. and Norfolk-based Norfolk Southern
Corp. are still in the throes of service problems after they split
Conrail between them last year.
FAMILY FARM RALLY IN WASHINGTON, D.C.
TO PRESENT FIVE-POINT PLAN
FOR SAVING RURAL AMERICA
Faced with disastrously low commodity prices, unfair competition and bad government policy, family farmers from across the country will converge on Washington, D.C. today and tomorrow carrying a five-point plan for fixing what ails rural America.
At the Rally for Rural America farm families will demand that the USDA and Congress accept a five-point agenda adopted by more than 40 grassroots family farm groups earlier this year in response to the economic devastation facing our nation's family farmers and rural communities. The plan addresses critical farm issues, including the need for a new farm bill, enforcement of anti-trust laws, consumer and environmental protection, referenda on mandatory pork and beef checkoffs and negotiation of fair trade agreements.
Chief among these proposals is a call from family farmers for a new farm bill that provides a fair, open and competitive market and a fair price for their commodities. Specific recommendations include establishing non-recourse loans at near cost of production levels to ensure that farm income is derived from the marketplace and not from taxpayers, creating farmer-owned reserves to ensure food security, and maintaining planting flexibility.
Sponsors of the rally include: AFL-CIO, National Association of Farm Service
Agency, American Agriculture Movement, County Office Employees, American
Beekeeper Alliance, National Catholic Rural Life Conference, American Corn
Growers Association, National Family Farm Coalition, American Sugar Alliance,
National Farmers Organization, Burley Tobacco Grower Cooperative, National
Farmers Union, National Rural Electric Cooperative, Campaign to Reclaim Rural
America, Evangelical Lutheran Church in America, Presbyterian Church (USA),
Rural Coalition, Rural Action Caucus, Farm Aid, Rural Telephone Finance
Cooperative, Federation of Southern Cooperatives, Southwest Peanut Growers,
Institute for Agriculture and Trade Policy, United Methodist Board, Mennonite
Central Committee Church and Society,
National Association of County Officials, Virginia and Carolina Peanut Growers, National Association of Agriculture Educators, and Women Involved in Farm Economics
Family farmer and National Family Farm Coalition President Bill Christison will speak on behalf of family farmers at the Tuesday rally. He says the farmers' five-point plan will be the core of his message.
"It's time for the federal government to enact a new farm bill that works for family farmers, not the expansion of factory farms and the increasing corporate concentration in our food system. Short-term fixes don't work for family farmers, our rural communities or for taxpayers. We still have the opportunity to change direction in federal agriculture policy. The time for action is now," Christison said.
Specifically, the policy agenda for rural America would:
1) Immediately pass a new farm bill that will:
* Establish non-recourse loans at near cost of production levels to ensure that farm income comes from the marketplace and not from taxpayers.
* Enact short-term conservation measures to avoid wasteful over-production.
* Create a farmer-owned reserve to ensure food security in times of scarcity and price stability in times of plenty.
* Maintain planting flexibility.
* Establish national dairy policy to ensure a farmer's cost of production plus a return on investment.
2) Restore competition to the marketplace through strict enforcement of
* Place a moratorium on mergers and acquisitions in agribusiness,
transportation, food processing manufacturing and retail companies.
* Require a strict enforcement of the Packers and Stockyards Act to end price discrimination.
* Enact a ban on packer ownership of livestock.
3) Protect consumers and the environment.
* Require labeling of meat and other foods imported into the U.S. to give consumers the right to know and choose the country of origin of their food.
* Stop the expansion of large-scale factory farms.
* Protect environmentally fragile lands and habitats.
4) Hold referenda on the mandatory pork and beef checkoffs as petitioned by independent producers.
5) Negotiate fair trade agreements.
* Ensure that all countries retain the right to develop farm programs that respond to the needs of their farmers and consumers.
* Put an end to export dumping (the sale of commodities below the cost of production), that undermines our domestic economy.
* Ensure that environmental protection, fair wages and worker rights are part of every trade agreement.
In conjunction with the Washington rally, a solidarity action, sponsored by the Agriculture Action Network (a working group of the newly formed Minnesota Action Network) and Upper Midwest Grain RAGE (Resistance Against Genetic Engineering) is planned for Tuesday near Cargill's Minnetonka, Minnesota headquarters.
The unprecedented action against Cargill is to draw attention to the intimate link between the demise of rural livelihoods across the world and the global consolidation of corporate agribusiness.
"Such unprecedented and monopolistic concentration of resources in a small
number of multinational corporations like Cargill has drastically reduced
farmer's capacities to make basic decisions about production, use ecologically
sound practices, and earn a sustainable living. Cargill has grown too
big, and controls too much of the global food supply. We call for the
revocation of Cargill's corporate charter on the grounds that they no
longer serve the public good," the Network's media spokesperson Jeannie
Zanetti points out.
More information on the Rally for Rural America can be found on the Internet at
CORPORATE AGRIBUSINESS RESEARCH PROJECT
WEB SITE POSTED ON WORLD WIDE WEB
The Corporate Agribusiness Research Project (CARP) web site is now posted on the World Wide Web featuring: THE AGBIZ TILLER, THE AGRIBUSINESS EXAMINER and "Between the Furrows."
THE AGBIZ TILLER, the progeny of the one-time printed newsletter, now becomes
news feature of the Project. Its initial essay concerns one Hillary Rodham Clinton, the newly
declared candidate for a U.S. Senate seat in New York State.
In "HILLARY RODHAM CLINTON'S $99,537 MIRACLE: IT'S THE PITS!!!" now available
through THE AGBIZ TILLER you'll learn some of the messy details behind her cattle futures
"miracle." You will also find in this section the archives for past editions of the THE AGBIZ
By popular reader demand THE AGRIBUSINESS EXAMINER section includes not only
issue-by-issue and verbose index of this weekly e-mail newsletter, but an archive of all the past
In "Between the Furrows" there is a wide range of pages designed to inform
and educate readers on
the inner workings of corporate agribusiness. In addition to CARP's "Mission Statement,"
"Overview" and the Project director's "Publication Background," the viewer will find a helpful "Fact Sheet" on agriculture and corporate agribusiness; a "Fact Miners" page which is an effort to assist the reader in the necessary art of researching corporations; a "Links" page which allow the
reader to survey various useful public interest, government and corporate web sites; a Feedback"
page for reader input, and a page where readers can order directly the editor's The Corporate
Reapers: The Book of Agribusiness.
The CARP web site was designed and produced by ElectricArrow of Seattle,
Simply by clicking on either of the addresses below all the aforementioned
features and information
are yours to enjoy, study, absorb and sow.