The
AGRIBUSINESS
EXAMINER                            Issue # 41      July 13, 1999

Monitoring Corporate Agribusiness From a Public Interest Perspective
 

A.V. Krebs
Editor\Publisher
 

                                                 Editors Note
Although there is no subscription fee for THE AGRIBUSINESS EXAMINER, donations will, as always, be gladly  accepted. One of my subscribers says he pays $30 a year for 12 issues of a Health  letter, and my weekly will hopefully go up to 52 so he feels it is worth at  least the cost of a monthly newsletter.  I hope you agree. Checks made out to A.V. Krebs, P.O. Box 2201, Everett, Washington 98203-0201 [NOT to "Agribusiness Examiner"] will continue to be received with much gratitude.

To those readers of THE AGRIBUSINESS EXAMINER who have already sent donations I want to express my sincere thanks for your continued support and interest in this venture. A reminder also to those who might wish to receive a weekly  e-mail edition of THE AGRIBUSINESS EXAMINER, please provide your NAME and E-MAIL ADDRESS. At this time THE AGRIBUSINESS EXAMINER is not available in printed form.
 

JUDGE BLANCHE MANNING SENTENCES ADM EXECS:
"WONDERFUL FAMILY MEN,
WONDERFUL MEMBERS OF THE COMMUNITY"

In the end, if in fact it is the end, nobody came out a true winner in the Archer Daniels Midland (ADM) price fixing scandal once heralded as the "best documented corporate crime in American history."

Certainly not ADM ("Supermarkup to the World") which was fined $100 million for its role in a world-wide scheme to fix prices in the $650 million-a-year international lysine market and also in the citric acid market; a company which has already paid out some $90 million in civil and anti-trust lawsuits brought by the users of citric acid and consumers of lysine, a feed additive, in addition to facing a lawsuit involving high fructose corn syrup, used widely in soft drinks, which lawyers say could be the most expensive civil suit so far.

Certainly not three of ADM's top executives --- Michael Andreas, former vice-chairman and heir apparent to the company, and Terrance Wilson, retired chief of its corn processing division  --- who last week were sentenced to two years in jail and fined each $350,000 for their part in conspiring with Japanese and Korean companies in the fixing of said prices. (See Issue #21)

Certainly not Mark Whitacre, the former ADM executive, who for two and one-half years worked as a Government informant secretly recording meets with competitors and company executives, and who was also sentenced to additional months in jail last week aside from the nine year sentence he is presently serving for allegedly taking million of dollars from ADM.

And most certainly not the Department of Justice lawyers who not only failed to convince Federal Judge Blanche Manning that Andreas and Wilson deserved the maximum three years in jail, but  were berated by her as she meted out Andreas and Wilson's fines.

Federal prosecutors had sought a $25 million fine and three years in prison, the maximum allowable, against Andreas, saying the fine reflected the amount of money allegedly reaped from the price-fixing scheme, which spanned from 1992 through 1995. Andreas and Wilson claimed that the $25 million figure didn't equate with the amount of lysine produced in the world during the scheme and sought proof from overseas lysine producers who allegedly participated in the conspiracy.

But Judge Manning said the government merely wrote letters to the lysine producers "informing them that they were not obliged to produce documents." She called the government's action "so incredible that it bordered on being ludicrous."

Judge Manning, also for reasons not explained in her decision to sentence the three executives, determined that Whitacre was a "manager" of the conspiracy and that neither Andreas nor Wilson had "controlling" jobs, whereas the government had contended that the latter two were the masterminds of the price fixing scheme. She also told the court she gave Andreas and Wilson lower prison terms in part because of their community involvement. "Both of them are wonderful family men, wonderful members of the community," she said.

Manning said the many letters she received argued that Wilson and Andreas were upstanding members of the community and good family men and that such letters had persuaded her not to level the maximum sentence in the range she had chosen, which could have been 34 months. Two such letters, vouching for Andreas were sent to the judge by former U.S. Ambassador to the United Nations Andrew Young as well as Robert S. Strauss, former U.S. ambassador to Russia. Both are ADM directors and friends of Andreas's father.

For its part the government lawyers tried to put up a brave front, contending that because this was "a particularly , reprehensible crime that victimized people throughout the world", that the sentence  "sends a very serious deterrent message to those who may consider engaging in this kind of criminal activity."  But, in the end, they expressed disappointment and confusion as to why Judge Manning ruled that neither Andreas or Wilson  was in charge of the conspiracy.

"I'm not quite sure why the judge did that," Scott Lasser, the U.S. Attorney for Chicago said after the sentencing.

"Mick" Andreas, the son of the long-time politically powerful Dwayne O. Andreas, who recently retired as board chairman of ADM's agricultural empire, reading from a statement at the sentencing for his part in the criminal activity said he was "truly sorry for everything this trial has meant" and that he felt he had been blind sided by the Government's "new" interpretation of anti-trust rules. "I love my country, your honor, and I thought I knew its rules. I did not want to commit a crime and I did not think that I had committed a crime."

Wilson made no attempt to deny his responsibility in the price fixing scheme."When you find yourself in a hole, quit digging, and I have no intention of making it deeper and wider," he told Judge Manning. "I accept total and complete responsibility for my actions."

Mark Whitacre, speaking by phone from his Edgefield, South Carolina federal prison, read a statement to Judge Manning in which he urged the judge to take into account his role in bringing the conspiracy to light. "They [the federal government] would have no case without me," Whitacre emphasized. "I risked my life and my career for them and I have yet to see anything."

Judge Manning, however,  tacked on 20 months to the end of Whitacre's nine-year prison. He was stripped of his immunity in the price-fixing case after prosecutors learned he had allegedly embezzled millions of dollars from ADM, for which he is currently serving time.

Shortly after the FBI raided ADM's offices on June 27, 1995 ADM accused Whitacre, who had been tapping company conversations since November, 1992, of embezzling over $9 million from the company by means of bogus invoices and off-shore accounts and filed suit in Switzerland seeking to recover the funds. Whitacre meanwhile claimed that ADM President Jim Randall had approved all the payments as "special bonuses," with the first one timed approximately at the same time Mick Andreas first insisted that he meet and work with Wilson on the lysine pricing matter.

Evidence of such "special bonuses" probably will never be found since it is reported that Randall made a personal visit to the ADM comptroller soon after the FBI raid and requested specific invoices be pulled. It was also a few weeks after Whitacre had been exposed that ADM "discovered" evidence of his illegal money transfers "almost by blind luck," despite what was purported to be a tightly audited corporate comptroller’'s office and internal audits.

"Life in prison has actually been better than life at ADM," Whitacre told Judge Manning during his sentencing.
 

CARGILL/CONTINENTAL GRAIN PURCHASE APPROVED
DOES "DIVESTITURE" SPELL COLLUSION?

"Divestiture" is what the U.S. Department of Justice's Anti-Trust Division is calling it while Secretary of Agriculture Dan Glickman terms it "taking steps to protect American farmers from the potential adverse effects of the merger." But for farmers like Will Perardi in Illinois and Mark Lambert of the Illinois Corn Growers Association last week's approval by the DofJ of the CargillContinental Grain division purchase has the smell of collusion.  (See Issue #9)

"If you reduce the number of players,” Lambert told the Wall Street Journal's Daniel Rosenberg and Robin Taylor, "you have to be concerned about collusion because it’s an awfully small club."

"If Continental can't make it, how can a small guy make it?" Perardi asked. "How is the small guy going to compete with Cargill and Archer Daniels Midland? This merger opens up all sorts of possible collusion between Cargill and ADM."

In explaining their approval of the sale, however, the Justice Department claims that while the consolidation of Cargill and Continental river elevators along the Illinois River and the Continental port elevator in Chicago would have concentrated ownership of delivery points authorized by the Chicago Board of Trade (CBOT) for settlement of corn and soybean futures contracts under the control of Cargill and one other firm.

This concentration, the division alleged, would have increased the risk of price manipulation of CBOT corn and soybean futures contracts. Yet, the merger still leaves Cargill and ADM ("Supermarkup to the World"), the nation's two largest agricultural commodity traders, as the primary grain firms owning facilities along the Illinois River.

Thus for many farmers the words of Joel I. Klein, assistant attorney general in charge of the Anti-Trust Division, ring hollow. "This enforcement action demonstrates the Department's commitment to preserve competition in agriculture," observed Klein in announcing his departments approval of the Cargill purchase. "Without the divestitures, many American farmers would have faced lower prices for major crops they produce, such as wheat, corn, and soybeans."

In the DofJ's original complaint, the division asserted that competition for the purchase of grain and soybeans from farmers and other suppliers would have been harmed by combining Cargill's and Continental's competing port elevators in the Pacific Northwest, which purchase corn and soybeans from farmers in portions of Minnesota, North Dakota, and South Dakota. Currently, nearly 40% of Cargill's corn shipments abroad go through their Pier 86 elevator in Seattle.

Yet, in ordering the divestiture of Cargill's 4.2 million bushel terminal in Seattle, presently leased from the local port authority, the nation's largest private corporation will now operate in part the TEMCO three million bushel grain elevator at the nearly Port of Tacoma. TEMCO or Tacoma Export Marketing Corp. has operated the terminal as a joint venture for Continental and Cenex Harvest States Co-op, the latter recently announcing that it plans to merge with Farmland Industries, forming the nation's largest agricultural cooperative. (See Issue #25)

Slightly over 100 miles to the south of Tacoma, Mitsubishi Corp. a leading Japanese trading company, recently announced it has acquired about a 10% stake in the Kalama Export Company LLC equally owned by ConAgra Inc. and Archer Daniels Midland Co. Kalama Export Company LLC operates a grain elevator along the Columbia River in Washington State, with hourly shipping capacity of around 3,000 tons and storage capacity of about 50,000 tons. It also plans to increase storage capacity to 90,000 tons by the end of 2000.

Yet Cargill spokeswoman Lori Johnson said the Justice Department was concerned that her company would have too much business concentrated in the Pacific Northwest because of Continental's leasing of the Tacoma grain-storage facility. "We fought the Justice Department not to include Seattle," said Johnson. "We still need to sit down with Port officials and talk about the options and make it work for everyone," she said. "But we do have an obligation under the lease."

Under the stipulations required by the DofJ, Cargill also will not acquire Continental facilities in Beaumont, Texas; Caruthersville,  Missouri; Chicago; Lockport, Illinois; Stockton, California. and Troy, Ohio. In addition, Cargill agreed to divest itself of grain-handling facilities in East Dubuque, Iowa and Morris, Illinois in addition to Seattle.

The terms of the proposed consent decree also require Cargill to enter into a "throughput agreement" --- an agreement that provides for one grain trader to lease elevator capacity from another --- to make one-third of the loading capacity at its Havana, Illinois river elevator available to an independent grain company. The Havana facility is used for delivery under Chicago Board of Trade futures contracts.

Cargill is also prohibited by the proposed consent decree from acquiring the river elevator in Birds Point, Missouri, in which Continental recently held a minority interest, and is prohibited from acquiring the rail terminal facility in Salinas, Kansas, which was formerly operated by Continental.  Finally, the terms of the proposed consent order make Cargill subject to restrictions in the event it seeks to enter a "throughput agreement" with the future operator of the Seattle facility.

Details of the proposed settlement will be published in the Federal Register to solicit public comment, which will be reviewed by the judge overseeing the sale.
 

"THE GRAIN MARKET IS DEAD"

A U.S.Department of Justice official, speaking on condition of anonymity, to the Wall Street Journal said  the negotiating process where his department approved the sale Continental's grain merchandising division to Cargill, Inc. was hard fought, even "bitter" at times. "Negotiations were protracted and difficult," the official said. "It wasn't acrimonious, but it took a while to work out. The divestitures we got were pretty substantial, and will help American farmers."

The DofJ, according to the official, studied each market where Continental had facilities to see if other facilities nearby offered reasonable alternatives to farmers, the official said. The department's examination became a series of "mini reviews" as investigators sought out local people familiar with the buy and sell levels at different facilities.

"Farmers located in areas where there will be divestitures shouldn't see much change," the official said. "It won't affect buying levels. If you  have seven elevators in a five-mile radius, one of which was owned by Continental and another by Cargill, there's not much impact going from  seven companies to six."

While the DofJ order was hailed by most members of Congress,  Iowa's Sen. Tom Harkin called the approval "bad policy. This merger will stifle competitiveness and hurt farmers," Harkin said in a statement. "This move has also got to raise concerns about the impact on consumers. When you reduce competition among the middlemen between farmers and grocery stores, consumers pay the price."

And Glenn Krueder of Krueder Farms in Thomson, Illinois, points out the approval helps pave the way toward increasing integration in agriculture and food processing."The food industry is going to be owned by two or three companies and in a few years, you're going to be paying real money for food," Krueder said. "The grain market is dead."

Surprisingly, the approval of the sale drew praise from National Farmers Union President Leland  Swenson "We commend the Justice Department's recognition that this merger, as originally proposed, would have gone too far. The department's careful consideration of the merger and its impact on farm income sends a strong signal to the industry that they can't just go out into the countryside and buy up markets.  It is important to know that the administration is watching the situation in rural America and won't stand idly by when farmers face anti-competitive prices."
 

FUZZY ALLIANCES AND OTHER LINKAGES
HIDE TRUE EXTENT OF MARKET CONCENTRATION AND POWER

Under the U.S. Department of Justice guidelines, any market with a Herfindahl-Hirschman Index ("HHI") above 1,800 is considered highly concentrated.

The HHI is a way to measure concentration.It has more or less replaced the four firm concentration ratio. It is calculated by taking the sum of the square of market shares. A monopoly is 100 squared, or 10,000.  Ten firms, each with 10 percent, would be 10 times 10 = 1,000. A duopoly with equal shares would be 50 times 50  = 5,000. Because small shares don't add up to much, even when squared, it is pretty safe to ignore them.

The DofJ antitrust guidelines consider an industry with an HHI of 1,000 or less to be competitive, and an HHI of 1,800 or more to be pretty concentrated.  An increase in the HHI of 100 is considered important enough to trigger a merger review.

In a recent paper, "Hiding the True Extent of Concentration and Market Power with Partial Ownership and Strategic Alliances ," C. Robert Taylor,  Alfa Eminent Scholar and Professor of Agriculture and Public Policy at Auburn University, has warned "that calculation of the HHI on the basis of reported market shares, which are typically based on ownership and not control, may seriously underestimate market power if alliances, partial ownership and other means of control of facilities are not factored into calculation of the index.

"We are in the midst of an incredibly rapid and incredibly massive reorganization of global agribusiness firms that is unprecedented in the history of agriculture. Mergers, strategic alliances, joint ventures, co-opting of co-ops, and partial ownership of other agribusiness firms makes the emerging structure of agribusiness difficult to describe and to understand.  It is clear, however, that the emerging web of firms with fuzzy alliances and other linkages may hide the true extent of market concentration and market power."

Taylor uses the high fructose corn syrup (HFCS) market as an illustration to underscore his contention.  Applying the HFCS production capacity in 1997, as reported by USDA, reported market shares gives an HHI of 1639, which is below the DOJ threshold for antitrust action.

What the standard statistics do not reflect, however, is that in 1997 Cargill leased the ProGold plant, and that Archer Daniels Midland (ADM) purchased 30% of Minnesota Corn ProcessorsADM also reportedly owned 16% of the British sugar refiner, Tate & Lyle, which owned A. E. Staley.

Leased plants should obviously be included directly in calculation of market shares. Taylor argues, and thus into calculation of the HHI.  In this case, Cargill's leasing of the ProGold facilities would increase the HHI by 160 points (from 1639 to 1799), which exceeds the DOJ threshold for antitrust action.

"How to factor partial ownership, as opposed to leasing, into calculation of the HHI is not clear, however, "Taylor adds.  "One way would be to add to a firm's market share the fraction of firms partially owned.  However, this may not reflect the extent of market power, as partial ownership may lead to complete control of the other firms, so a second way is to add to the controlling firm's market share the full market share of the partially owned firms. With the first approach, ADM's partial ownership of MCP and Staley, along with Cargill's leasing of ProGold,  gives an HHI of 1984, while the second approach gives an HHI of 3421, both of which are above the DOJ threshold.

“As this example illustrates," Taylor concludes, "it is imperative that strategic alliances, joint ventures, partial ownership of other agribusiness firms, and other fuzzy arrangements be considered by the Department of Justice, the Federal Trade Commission, and other entities when they assess concentration and market power."
 

SWEETGRASS RALLY:
NOT AN END, BUT A BEGINNING

Stephen Anderson, an Alma, Kansas cattleman, pushing a wheel barrel full of animal ordure, a hand-lettered sign stuck in its midst reading "U.S. Farm Policy" probably best summed up the prevailing attitude of some 1000 farmers and farm activists on July 9 in Sweetwater, Montana as they rallied and blockaded cheap agricultural imports coming through Canada into the U.S.

The rally and blockade was sponsored by the Campaign to Reclaim Rural America and was carried out in conjunction with support rallies in some dozen other locations around the U.S. including a similar blockade at Portal, North Dakota.

Rally organizers were quick to point out that their protests were not aimed at Canadian farmers dumping low-price wheat and livestock in the U.S. market,  but were rather aimed at calling attention to the necessity for a radical revision of global trade policies and the need to restore a fair price to farmers for U.S. crops. Participating in the rally were a number of Canadian farmers including Cory Ollikka, President of the Canadian National Farmers Union.

Ollikka noted, "Net farm income on both sides of the Canada-U.S. border is approaching depression-era levels. Some would have farmers blame their counterparts across the border. Farmers, however, know that the problem is not other farmers, the Canadian Wheat Board, or policies that support agriculture. The problem is increasingly powerful agribusiness corporations, trade agreements that undermine farmers' interests, and a marketing and distribution system that fails to pay farmers a fair and adequate share of the consumer's grocery-store dollar."

One sign seen frequently during the rally read: "60 lbs of wheat $2.50 - 60 lbs of Wheaties $212.40 - See Anything Wrong?"

Dena Hoff, a Montana rancher and chairperson of the National Family Farm Coalition's trade task force underscored the point that the rally protesters were not blaming the Canadian families.

"We won't let agribusiness divide farmers to make us forget that corporate manipulation destroys the family farm economy in both countries."

Generally, the Campaign to R eclaim Rural America is demanding investigations into market competitiveness for crops and livestock, renegotiation of trade agreements so U.S. farmers are on a level playing field with their foreign competitors and implementation of legislation to stabilize the nation's agricultural producers' incomes.

"We have to tell the story. We have to put a face and put names to this so people know what's happening in rural life," Dale Pfau, chairperson of the Campaign, declared.  Speakers at the rally came from a broad and unified spectrum of rural life.

"We can't save Montana's wildlands by ourselves, and you farmers can't save your farms by yourselves," Bob Decker, Executive Director of the Montana Wilderness Association told the crowd. "Montana is made of whole cloth. You cannot cause damage to one part of it without hurting others." Acknowledging the issues that have divided environmentalists and agriculture producers, Decker said that environmentalists and agriculture producers still needed each other to protect Montana's cultural and natural landscape. Decker argued that the forces threatening family farms are at basis the same forces threatening Montana's wilderness.

"When a store or a factory closes down," Don Judge, executive secretary of the Montana AFL-CIO stressed, "the press makes note of it, but when a farm forecloses, nobody notices. Don't walk away from here thinking this is the end. This is just the beginning. Organize, organize, organize and we'll work through this together."

Representing the Western Organization of Resource Councils, Gilles Stockton, talked about captive supplies of cattle, and how meat packers use them to hurt beef producers on both sides of the border. He said, "Herman Schumacher, a South Dakota auction barn owner said that he knows of instances when cattle coming from Canada were 2 to 3 dollars per hundredweight more expensive than if they were bought in South Dakota. Why would that be? Why would the packers buy cattle in Canada and truck them all that way--and pay more for them? Captive supply and market control, that is why!"

In addition to labor and farm organization representatives, such as Ken Maki, President of the Montana Farmers Union and Mike Callicrate of the Cattlemen's Legal Fund, the rally also was addressed by Bishop Mark Ramseth, Montana Synod of Evangelical Lutheran Church of America; Ken Moore, president of the Montana Association of Churches, and Brother David Andrew, Director of the National Catholic Rural Life Conference.

While no member of the Montana Congressional delegation was present at the rally or blockade, petitions outlining the Campaign's eight-point platform with approximately 13,000 signatures were presented in absentia to state politicians to be delivered to President Bill Clinton, Secretary of Agriculture Dan Glickman and U.S. Attorney General Janet Reno.

Attending the rally, however, were Montana candidate for the U.S. Senate Brian Schweitzer and House of Representative candidate Nancy Keenan, who both emphasized their strong solidarity with the efforts of the Campaign to achieve economic and social justice for rural Americans and family farmers.

"We need to start over," said Schweitzer. "It was a grand experiment to empower the farmer in the market. But we don't have a market. We have monopolies. It took us  two years to go from $5.50 wheat to $2.50 wheat." Schweitzer noted that four companies mill 62%  of the wheat in the United States and that four cereals companies have an 88% market share of the ready-to-eat cereal market while returning on the average between 20% and 30% on stockholder equity. "What we need is competition," he said. "These are the same monopolies worldwide. What they want is cheap grain and large volume."

Schweitzer, a Montana farmer, lamented, "When you lose your farm, you lose apiece of your heart." Yet, while rural America is presently struggling to survive Wall Street is booming. "More wealth has been created in the U.S. in the last 10 years than in the previous 100. This wealth has been produced on the shoulders of commodity producers, who are producing below the cost of production." Schweitzer added that he recently bought a box of Wheaties for $3.69. "About 7 cents of that was for the wheat. So, in effect, I paid $196 a bushel for the wheat in a box of Wheaties."

"I see unrest and anger in the countryside.  We are tired of all the unproductive talk," declared Helen Waller, a Circle, Montana wheat farmer and a representative of the Northern Plains Resource Council and past president of the National Family Farm Coalition. "For decades we've talked with our Congressmen here in Montana.  We've talked at field hearings and we've talked at Congressional hearings in Washington, D.C., testifying repeatedly before numerous empty seats.  And what has it brought us but more shamefully low prices.  It's time for action."

Waller, one of the rally's key organizers, emphasized that key to changing the present inequities in agriculture, are actions to insure that  farm and ranch producers are represented at the 1999 World Trade Organization negotiations in November and December in Seattle, Washington.

In addition, the Campaign to Reclaim Rural America is specifically  requesting:

* An emergency price support and safety net system be implemented for all agricultural products.
* The start of vigorous anti-trust investigations into the concentration of ownership in meat  packing, grain handling, and retail.
* A block of the proposed merger between Cargill and Continental, the nation's two largest grain exporters.
* Country-of-origin labeling on agricultural products and use of the USDA approved stamp on U.S. products only.
* Mandatory price reporting of livestock and grain.
* A shift of responsibility for regulation enforcement of the Packers and Stockyards Act from U.S.D.A. to the Justice Department.
* Inspections of imported agricultural products to ensure they meet standards equivalent to U.S. standards for food safety, environmental, and worker protection.
 

ON THIS DAY

Remarks by
A.V. Krebs, Editor\Publisher, The Agribusiness Examiner
Campaign to Reclaim Rural America Rally & Blockade
Sweetwater, Montana, July 9, 1999

It is both an honor and a privilege for me to join you my friends and colleagues here in Sweetwater, Montana THIS DAY!

THIS DAY when Montana family farmers, U.S. family farmers, Canadian family farmers join together with farmers and fellow peasants from all over the world who stand in solidarity for economic and social justice;

THIS DAY when we say to Dan Glickman, get off the pot Mr. Secretary and adopt WORC's  (Western Organization of Resource Councils) rules on captive supplies and formula pricing in the cattle market and quit being such a shill for the IBPs, the Cargills, the ConAgras and the Monsantos;

THIS DAY when we say to our Department of Justice, quit being cowards, enforce our nation's anti-trust laws --- justice must not only be done, but be seen to be done;

THIS DAY when we say to our Congress, stop your pimping for corporate America and to that pathological liar in the White House, we didn't elect you to become an errand buy for Carl O. Lindner and Chiquita Banana --- we elect our public servants to serve the public and the common good;

THIS DAY when we say to the Department of Labor, stop the never-ending scandal that allows corporate agribusiness to sell millions of men, women and children every year from here and abroad who harvest our crops into inescapable poverty;

THIS DAY  when we say to the U.S. Department of Agriculture, stop your decades-old discrimination against our rapidly diminishing number of black and minority farmers in this land --- a land that proudly proclaims equal justice under law;

THIS DAY  when we say to the ADMs, the Cargills, the ConAgras, the Monsantos, the Chiquitas, the IBPs, the Smithfields, the corporate century has come to an end, the people's millennium is here --- this land is our land !;

THIS DAY when we are here to honor the memory of Bill Lehman, not just a USDA border meat inspector here in Sweetgrass, but an unsung hero, a concerned citizen who saw his job as one to insure the safety of the meat being imported into the U.S. and for those efforts he earned nothing but contempt from many of his USDA bosses;

THIS DAY when we say to the consuming public --- you are what you eat --- and if and unless you organize to end corporate rule and reinvent democracy, you will assuredly lose the most efficient food producers in the world --- family farmers;

AND FINALLY THIS HOUR  when we gather here to speak truth to power as we serve notice to corporate agribusiness that in the grand tradition of our agrarian populist ancestors we are here to reclaim rural America --- we are here to raise more hell and less corn!!!!
 

PERSONAL COMMENTARY:
NEWS MEDIA --- "ALL THE NEWS THAT'S FIT TO PRINT"
OR ACTING AS A PROTECTORATE OF THE CORPORATE STATE

On July 6 the New York Times published an op-ed essay by Wendell Berry titled  "Failing Our Farmers" in which he rightfully noted in part that "a policy that destroys farmers and farmland cannot be acceptable in agricultural terms. It also directly contradicts our goal of national defense. A country that is heedlessly destroying its capacity to feed itself cannot be defended.  . . .

"I cannot see why a healthful, dependable, ecologically sound farm-and-farmer-conserving agricultural economy is not a primary goal of this country. I know that I am not alone, and that farmers are not alone, in wishing to see such a policy. A rapidly increasing number of urban consumers also wish to see it. Any politicians who now think that only farmers care about farming or have an interest in it are wrong. They will have to think again."

While agreeing with most all that was said in the Berry essay it was troubling to see what he did not say and because of such an omission a letter to the editor was immediately sent by e-mail to the Times. How the Times handled that letter once again provided an opportunity to see how today's mainstream media is not so much interested in reporting "all the news that's fit to print," but rather sees its role as a protectorate of the corporate state.

The text of my original letter stated:

Editor:

Wendell Berry's concern about the plight and future of the nation's family farm system of agriculture is genuine (Op-ed, July 6), but when it comes to the politics of food and agriculture policy he unfortunately fails to consider the forces responsible for demise of America's family farm agriculture.

Throughout his entire piece he never once mentions corporate control, corporate concentration, or corporate manipulation of government policy; rather his main point seems to be that our present state of affairs comes from bad government policy (which it does), but he never delves into who the maker of that policy actually is, almost as if it was created in some sort of political vacuum.

Such is not the case, the policy of ridding the nation of its "excess human resources"  in agriculture was a deliberate, well planned and adroitly executed effort by the likes of Cargill executives William R. Peace and Daniel Amstutz while serving as Richard Nixon and Ronald Reagan's U.S. Trade Representatives. It was they and their fellow corporate agribusiness "robber barons" who shaped the domestic and trade policies that today are taking such a tragic human toll in rural America.

It is time that people who care enough about what they eat and what the world eats look to our corporate boardrooms first and then to our legislatures, who have become merely handmaidens to their corporate masters, in determining who survives and who dies in our nation's farm communities.

The published version of the letter, however, reads:

To the Editor:
Wendell Berry's concern about the country's family farm system (Op-Ed, July 6) is genuine, but when it comes to the politics of food and agriculture policy, he fails to consider the forces responsible for the demise of American family farm agriculture. Mr. Berry never mentions corporate control, corporate concentration or corporate manipulation of government policy. His main point seems to be that our present state comes from bad government policy (which it does), but he doesn't note who made that policy. Corporate agribusiness "robber barons" shaped the domestic and trade policies that today are taking such a tragic human toll in the rural United States. It is time that people who care enough about what they eat and what the world eats look to corporate boardrooms first and then to legislatures, which have become handmaidens to their corporate masters.

To add insult to injury three other letters regarding the Berry essay were also published in the same edition; all with the same common theme.

One from a William R. Serpe in New York read in part: ". . . It once took 90 percent of the work force to produce the food we needed. Now we need about 1 percent, and all of the freed-up farmers are building cars and computers, piloting airplanes and doing all the other things that make our standard of living so much higher than it was in the time of Thomas Jefferson. We should not try to prevent the inevitable consolidation of the farming industry. "

A second letter from Michael D. Lockhart from Rembert, South Carolina read in part: "[Berry] says he believes in the `gospel of brotherly love,' yet he would continue to take resources from all Americans (disproportionately from low-income Americans) through higher than necessary food prices to support his family in its traditional life style. This is neither loving nor neighborly. Congress seems to have begun to realize this and, it is to be hoped, will continue to reduce its agricultural supports  . . ."

Finally, a third letter from a Scott Fergusson, a Fort Wayne, Indiana commodities trader  states: "I would challenge [Berry] to come up with a better system than competition and a free market if he wishes to see farming return to its historical roots. Berry no doubt enjoys the fruits of competition in the car he drives, the clothes he wears and the products he buys. Competition in seed companies has taken wheat yields here in Indiana from 50 bushels an acre 30 years ago to an average of more than 120 bushels. Our free market enables us to sell agricultural products to a host of foreign countries. Does Berry really want the Government to protect farming?"

These three letters, in addition to my aforementioned letter, all appear under a headline: "Farmers Must Bow to Change, Too."

- A.V. Krebs
 

JULY 18:
DEADLINE FOR IRRADIATED FOOD LABELING COMMENTS

A comment period for the proposed Food and Drug Administration (FDA) rule that will allow manufacturers to sell irradiated food without any labeling requirements to warn consumers has been extended to July 18th. Agribusiness and the nuclear industry are pressing to label irradiated foods under the heading "cold pasteurization."

Consumer groups, however, are urging the public to tell Congress and the FDA that:

* food treated with radiation must continue to be clearly labeled with the radura (the international symbol for irradiated food) and a statement indicating it was treated with radiation.

* the absence of such a statement would be misleading because irradiation destroys vitamins and causes changes in sensory and spoilage qualities that are not obvious or expected by the consumer.

* irradiation creates a new class of unique Radiolytic products that have never been tested for the possible carcinogenic effects on humans

* the irradiation process creates new volumes of radioactive waste from Cobalt 60 and Cesium 137 which will plague our nation; exposing workers to toxic radionuclides when the nation is already faced with the dilemma of what to do with the nuclear waste it already has.

* Ask that such foods be clearly labeled. Also request that public comments be placed on the Internet so the public can be informed about who is participating.

The groups point out that if the public can generate enough letters to maintain labeling, then despite the government approval for this process, food consumers will be able to avoid buying irradiated products --- but only if they know which foods have been irradiated based on honest, clear labeling.

When writing to the FDA, refer to Docket #98N-1038 "Irradiation in the Production, Processing, and Handling of Food."

Send comments before July 18th to:

Dockets Management Branch (HFA-305)
Food and Drug Administration
5630 Fishers Lane, Room 1061
Rockville MD 20852
or
Send an email to:
FDA Dockets@oc.fda.gov and/or
FDADockets@fda.gov
(Put Docket #98N-1038 in the subject line)

Letters to the FDA should be addressed to:

Dockets Management Branch (HFA-305)
Food and Drug Administration
5630 Fishers Lane, Room 1061
Rockville, Maryland 20852
Re: Docket No. 98N-1038,
"Irradiation in the Production, Processing, and Handling of Food"