Monitoring Corporate Agribusiness From a Public Interest Perspective
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U.S. SENATE VOTES 71-27 TO REJECT
WELLSTONE AGRIBUSINESS MERGER MORATORIUM
By an overwhelming 71-27 vote the U.S. Senate last week defeated an amendment by Minnesota Democrat Senator Paul
Wellstone to impose an 18-month moratorium on mergers within corporate agribusiness.
The moratorium would have applied to all mergers where one company had net revenue of more than $100 million and the
other had more than $10 million. Farmer-owned cooperatives would have been exempt from the measure.
Vowing to lead the nation's "Prairie Populists" next year to fight for broader antitrust laws Wellstone, while expressing
disappointment that the expected 40 Senate votes supporting the moratorium failed to materialize, emphasized that, "we
have to have thousands of farmers and ranchers and rural people here to shake up the Capitol."
Lamenting how his colleagues had caved in to what he called food industry lobbying,. Wellstone told Successful
Farming's Dan Looker, "They dont want to offend any of the big conglomerates for anything. I do. I want to take on the
Supporters of the moratorium stress that they will be targeting those Senators who voted against the amendment as
Republicans also blocked Wellstone from making last-minute changes intended to attract additional GOP votes.
(Rollcall Vote No. 366 Leg.)
November 17, 1999, 10:46 AM
BILL NO.: S.625
AMENDMENT NO.: S.AMDT.NO. 2752
TITLE: Wellstone Amdt. No. 2752
REQUIRED FOR MAJORITY: 1/2
RESULT: Amendment Rejected
Akaka Feingold Kohl
Baucus Grassley Lautenberg
Boxer Harkin Leahy
Bryan Hollings Levin
Byrd Inouye Moynihan
Conrad Johnson Reid
Daschle Kennedy Rockefeller
Dodd Kerrey Sarbanes
Dorgan Kerry Wellstone
Abraham Enzi Mikulski
Allard Feinstein Murkowski
Ashcroft Fitzgerald Murray
Bayh Frist Nickles
Bennett Gorton Reed
Biden Graham Robb
Bingaman Gramm Roberts
Bond Grams Roth
Breaux Gregg Santorum
Brownback Hagel Schumer
Bunning Hatch Sessions
Burns Helms Shelby
Campbell Hutchinson Smith (NH)
Chafee, L. Hutchison Smith (OR)
Cleland Inhofe Snowe
Cochran Jeffords Specter
Collins Kyl Stevens
Coverdell Landrieu Thomas
Craig Lieberman Thompson
Crapo Lincoln Thurmond
DeWine Lott Torricelli
Domenici Lugar Warner
Durbin Mack Wyden
Iowa's Chuck Grassley was the lone Republican supporting the amendment and said he voted for the Wellstone
amendment to send a signal to the Justice Department to take a closer look at agribusiness mergers and to let the
agribusiness community know Congress is concerned about the unfair disadvantage created for independent producers with increased concentration.
"With the steady increase in concentration, it's no wonder family farmers believe their independence and access to a
competitive marketplace is becoming a thing of the past," he said.
Wellstone promised that he and his staff will work with those of Senators Patrick Leahy (Dem.-Vermont), Grassley and Tom Harkin (Dem.-Iowa) to strengthen the Justice Department and USDA's enforcement of antitrust laws and the Packers and Stockyards Act.
He says he hopes to see big crowds of farmers in Washington in February to lobby for tougher antitrust laws and changes
in farm policies. "Most of my life has been devoted to organizing and putting pressure on people and I'll be proud to do
that with farmers," he says.
Opposing the amendment, Oregon's Republican Senator Gordon Smith, who has made millions in the frozen food
business, remarked that "this is not the way to help the family farmers. We should trust the marketplace . . . If you want to help farmers you go after the regulations that are strangling them. You open up international markets," Smith added.
Likewise, as expected, agricultural economists claim that worldwide overproduction of grain, not agribusiness
consolidation, is the reason for depressed commodity prices.
"Nonsense!!!" American Corn Growers board member Dan McGuire argues. "The 1996 `Freedom to Farm' law has
created a disastrous situation in the farm economy. Farmers are subsidizing multinational exporters, processors and
traders. Is that why this farm bill was written and passed into law? It surely cant be in the national public interest to have
a public farm policy that works for a few mega corporations and against nearly two million independent businesses we
know as family farms.
"Farmers need a referee in the marketplace," McGuire, who also serves on the Nebraska Farmers Union board, points out. "That referee role can only be provided by the federal government. Congress must pass a stronger farm program that
serves as a price referee to give farmers some bargaining power against the giant corporations that buy the grain and
livestock produced by farmers. A much higher loan rate in the farm program, combined with a farmer-owned and
controlled reserve and acreage set asides will provide the such needed bargaining and marketing tools." (See Issue #23)
Likewise, populist farm groups complain that because of lax antitrust enforcement, producers are losing their independence and bargaining power as the number of food processors, grain traders and farm suppliers shrinks.
Clearly, the Justice Department has not done enough to curb a recent wave of agribusiness mergers and acquisitions, they
point out, including the purchase by giant grain trader Cargill Inc. of Continental Grain's grain merchandising
division. (See Issues #45 & #46) Justice Department officials counter that such mergers can help farmers by cutting costs
for U.S. companies, making them more competitive with foreign competitors. (See Issue #49, "Corporate Agribusiness:
Bemoans `Parastatal Monopolies,'Vows to Eliminate Them In Upcoming Trade Talks.")
Sen. Byron Dorgan, Dem.-North Dakota, however, charges that such companies "are choking the economic life out of the
little guy, the little producer. Why? Because they can."
AMERICAN FARM BUREAU DEFINES OBFUSCATION
FIGHTS TO DEFEAT WELLSTONE MERGER MORATORIUM
In the days leading up to the vote on the proposed 18-month moratorium on mergers within corporate agribusiness
introduced by Senator Paul Wellstone (Dem.-Minnesota), the American Farm Bureau Federation (AFBF) once
again demonstrated why it frequently serves as "the voice of corporate agribusiness" as opposed to its false claim of being
"the voice of American agriculture."
While concentration remains the key issue for thousands of family American farmers the AFBF, which receives a
"special" federal non-profit tax privilege to supposedly represent the interests of family farmers, took the lead recently
among agribusiness-oriented business and commodity groups to help defeated the Wellstone amendment. (See Issue #55
"American Farm Bureau, National Cattlemen's Beef Association Lead the Charge Against Wellstone
As the Defenders of Wildlife's Green Notes recently reported, the Farm Bureau while doing nothing to notify its
members of its stance, meanwhile obfuscated its position by publishing a story on it web site entitled "President will not
Back Bill to Block Farm Mergers." The only hitch was, "the president" the story spoke of was not Farm Bureau
president Dean Kleckner, but rather was President Bill Clinton leaving the casual reader with the impression Clinton was to blame if the moratorium did not pass. Nowhere in that story, or anyplace on the web, did they mention Farm Bureau was lobbying to stop the bill.
As the week progressed, Green Notes reports, pressure obviously began to build up at Farm Bureau headquarters.
Finally they released information stating they were "opposing the moratorium at this time."
"This news came out in the form of a pre-produced radio feed. (Farm Bureau sends these out three times a week to
hundreds of radio stations across rural America.) The story, while addressing the subject and saying Farm Bureau
opposed the bill was less than forthcoming with an explanation why."
The Farm Bureau story began with Bob Ellison, the voice of Farm Bureau radio, explaining that the U.S. Senate
would resume debate next week on Senator Wellstone's proposed legislation. Then, Ellison introduced Farm Bureau
Federation governmental relations specialist Tim Cansler. Cansler began talking about why Farm Bureau was
opposing the legislation intended to protect the family farmer.
"This issue is a much larger issue and it strikes right to the heart of the constitution, and the capitalistic system that we have in America," Cansler stressed. He then proceeded to explain how the Department of Justice (DOJ) says the legislation is unnecessary. "DOJ is telling us that the current laws that are in place with regard to antitrust are sufficient enough for them to do their job."
After reassuring the listener that the Farm Bureau wanted to "make sure there are competitive markets for producers to
sell to," Cansler goes on to offer the final, long awaited explanation loyal farmers hoped would be coming.
"We're opposing this amendment at this time because we don't feel that it is a comprehensive solution to this huge
omnibus issue which crosses over many parameters."
Defenders of the Wildlife's Scotty Johnson observes, "I am sure that this `straightforward' explanation cleared up the
concerns of thousands of farmers all across America. Shoot, it's just a huge omnibus issue crossing over many
parameters and the moratorium is `not comprehensive enough.'
"Apart from the obvious double-talk, did I miss something? Is a moratorium supposed to be comprehensive? A
moratorium is simply a halt while something can be analyzed and studied. It recognizes damage is being done and stops
the suspected action to figure out if it is indeed the cause. It's like saying we believe hog waste from that factory farm is
muddying the water. To figure out if that is the cause, we are going to stop pumping the waste in to see if it clears up."
Nowhere, Green Notes points out, did the Farm Bureau mention how they would make Wellstone's amendment more
comprehensive. "Nowhere did they offer anything substantial. Instead, they churned out a fluff piece with vaguely
patriotic rhetoric combined with an weak explanation that is patronizingly vague. Meanwhile, each day the mergers go
unchecked huge sums of money are made, and the rich get richer."
The Farm Bureau's negative stance in this latest effort to advance the cause of family farm agriculture clearly
demonstrates its ability to mislead Congress, the general public and the press into believing that it actually is "the voice of
American agriculture" when in fact its financial resources come not from family farmers, but from the Farm Bureau's
millions of AFB insurance policy holders.
An example of such deception was found in a November 20 Reuters news story emanating from Paris, France concerning
the World Trade Organization being urged to adopt clear rules on genetically engineered food. The story notes:
"U.S. farmers said the European Union's reluctance to approve their crop strains amounted to a trade barrier, albeit one that did not use the traditional means of slapping tariffs on imports. `It's absolutely a non-tariff barrier,' said Alex Jackson of the American Farm Bureau Federation, which represents more than 4.6 million farms.
Latest Bureau of Census figures (1997) show the U.S. has 1,911,850 million farms!!!
HOUSE AND SENATE OPEN ASSAULT
AGAINST LIVESTOCK AND HOG CONCENTRATION,
SEEK DOJ ENFORCEMENT OF ANTITRUST LAWS
Rep. David Minge, Dem.-Minnesota and a bipartisan group of lawmakers have introduced in the U.S. House of
Representatives a bill that would ban packer ownership of hogs more than 14 days prior to slaughter. The legislation is
similar to an earlier measure offered in the Senate by Sen. Tim Johnson, Dem.-South Dakota, although the Senate bill
would also apply to cattle. Both bills would exempt producer-owned cooperatives.
Increasing packer ownership of livestock and the "urge to merge" in the pork industry have raised concerns about price
manipulation in the market for independent producers selling their hogs and livestock.
"We are pleased to see Congressman Minge provide leadership on this issue in the House," said National Farmers Union
President Leland Swenson. "Hog producers last year suffered a devastating blow in price and have seen their markets dry
up due to increasing vertical integration. This legislation is key to returning competition to the livestock sector. We look
forward to working with these lawmakers to get this bill passed."
House co-sponsors of Minge's bill include Reps. Leonard Boswell, Dem.-Iowa, Marcy Kaptur, Dem.-Ohio, Tim Roemer, Dem.-Indiana., Bennie Thompson, Dem.-Mississippi., Ed Pastor, Dem.-Arizona, Earl Hilliard, Dem.-Alabama, James Leach, Rep.-Iowa, Sam Farr, Dem.-California., and David Phelps, Dem.-Illinois
Funds have also recently been found to pay for implementation of a new mandatory price reporting law for livestock sales. While the price reporting language was passed in October as part of the fiscal year 2000 agriculture appropriations bill it wasn't until last week when the omnibus spending bill was approved, that lawmakers were able to authorize USDA to transfer $4.7 million in unused funds to pay for implementation of the measure.
Largely due to the efforts of Sen. Thomas Daschle, Dem.-South Dakota and Sen. Tom Harkin Dem.-Iowa, funds were
located to carry out the new law which will mean its implementation, designed to provide farmers with more price and
market information on livestock sales, will begin very soon.
The new law will require large cattle and hog packers to report twice daily to USDA the prices and quantities of livestock
they purchase. Small packers would be exempt from the legislation. The bill also authorizes USDA to establish mandatory price reporting for lamb. The bill preempts state laws narrowly for price reporting only.
Also, the U.S. Senate legislation was introduced on November 19 by Senator Harkin and Senator Dick Lugar
Rep.-Indiana, chairman of the Senate Agriculture, Nutrition, and Forestry committee, designed to create a high-level
position in the Antitrust Division of the Justice Department to help ensure and enforce antitrust laws for food and
"Family farmers will not survive if the deck is stacked against them when they buy and when they sell," Harkin said. "This fight is all about fair access to fair markets. It is not about efficiency and productivity, because nobody can beat the family farm in that area."
"This bipartisan legislation will help guarantee the effective enforcement of our nation's antitrust laws with regards to this
unique sector of our economy," Lugar said. Lugar held two hearings this past year to discuss the impact of agribusiness
concentration on farmers and consumers. Harkin has also held meetings with farmers in Iowa and Minnesota.
THANKSGIVING DAY MEAL COSTS
HOW MUCH IS THAT TURKEY IN THE WINDOW?
A traditional Thanksgiving meal --- turkey, stuffing, sweet potatoes, rolls with butter, peas, cranberries, a relish tray of
carrots and celery, pumpkin pie, coffee and milk --- for ten people will cost $33.83 in 1999, an increase of 74 cents from
In a survey of 28 states using 113 shoppers, an American Farm Bureau survey showed that since 1986 the cost of
Thanksgiving dinner has risen $5.09.
Leading the cost of the holiday meal is the price of a 16-pound turkey which is up 52 cents this year to $14.23. While
nationwide turkey production already was down about four percent before Hurricane Floyd, the storm devastated North
Carolina's turkey production killing an estimated 800,000 turkeys alone in eastern North Carolina. The states produces
about 50 million turkeys a year.
Also, turkey prices often vary widely from supermarket to supermarket as stores often sell the birds for less than the
wholesale cost as a marketing loss leader. Stores "use meats of all types to draw people into the stores. What's paid in the
stores isn't all that closely related to what the farmer is being paid," Gerald Havenstein, a poultry specialist at North
Carolina State University, told the Associated Press.
Individual poultry farmers have watched their average net farm income decline by 37% since 1991.
Cranberry sauce will cost less this year, as will the stuffing and the rolls, according to the survey. A 12-ounce package of
cranberries costs $1.70, down 30 cents. The price of a 14-ounce package of stuffing mix is down 6 cents to $2.30. The
price of milk is up, however, as is the cost of the vegetables and dessert.
A gallon of milk is averaging $2.95 a gallon, up 32 cents from last year, according to the survey. A package of peas costs
eight cents more and a pound of sweet potatoes is priced seven cents higher. A pound of celery and carrots for the relish
plate will cost six cents more and the pumpkin pie, the prices of the whipping cream, pie shell and filling are up a combined 13 cents.
Meanwhile, the depressed prices that farmers are getting for wheat and other grains have had little effect on what
consumers are paying. Likewise, the average price that growers are getting for vegetables and melons also is down this
year about eight percent but that is not necessarily reflected in the grocery store.
In January, 1999 testimony before the U.S. Senate Agriculture Committee hearings on concentration in agribusiness, C.
Robert Taylor, Alfa Eminent Scholar and Professor of Agriculture and Public Policy at Auburn University testified about
the implications for the agriculture economy of general trends in vertical integration and market concentration in
Among his findings were the fact that since 1984 the real price of a USDA market basket of food has increased but 2.8%
while the farm value of that food has fallen by 35.7% and that a "widening gap" between retail price and farm value also
exists for the components of that market basket, specifically meat products, poultry, eggs, dairy products, cereal and
bakery products, fresh fruit and vegetables, and processed fruit and vegetables.
By way of illustration, between 1980 and 1996 in choice beef that gap widened by 42.4%, in pork it widened to 74.6%. In a one-pound loaf of wheat bread the gap from 1970 to 1996 was 238% and the gap in one pound of oranges from
1982-1996 was 59.8% to name a few commonly purchased items.
Farmers currently receive an estimated 21 cents of each dollar Americans spend on food, down from 32 cents a year ago.
Philip Morris, the nation's largest food manufacturer, alone receives an estimated ten cents of every American food
FOOD ASSISTANCE AT RECORD LEVELS IN U.S. CITIES
AS HOLIDAY MEAL SEASON APPROACHES
As most American prepare for their Thanksgiving holiday meal amidst a thriving economy millions of their fellow citizens
who are not sharing in the nation's booming economy will be waiting in their city's soup kitchens and food banks for a
small share of the food cornucopia that has become of the hallmark of our agriculturally rich land.
"Our requests for help are at an unprecedented level," Nancy Carrington, executive director of the Connecticut Food Bank
told the Associated Press as reports nationwide continue to tell that the demand for food is far out pacing donations.
"It really is ironic," said Dave Krepcho, executive director of the Daily Bread Food Bank, which serves southeast Florida.
"You're surrounded with appreciated stock and people buying luxury automobiles and SUVs ... and they can't possibly
imagine somebody living on the other side of the tracks."
Many providers say the increased need largely has been driven by Bill Clinton's so-called "welfare reform," which over the last three years has removed 1.7 million families from the rolls, but also left many unable to afford enough food for their families.
"People are feeling that the economy is good and unemployment is at an all-time low, but the stark reality is that the people
who were getting General Assistance are off it, and those people are still needing food," Carrington said.
"We don't have any real hard evidence that the changes in welfare have resulted in a greater hunger or greater need for food banks," said Michael Kharfen, a spokesman for the U.S. Department of Health and Human Services.
In Dallas, food donations have increased about five percent throughout this year, but the number of people asking for food is up about 15%, according to the North Texas Food Bank. In Atlanta, donations this year are down 15 percent, but the demand has increased 30% over the last 18 months.And in Wichita, the Kansas Food Bank Warehouse has distributed
37% more food this year than it did in 1998.
In Connecticut, among the richest states in the country, thousands of people rely on food pantries and soup kitchens. Last
year, the Connecticut Food Bank distributed 15,000 turkeys for Thanksgiving. This year, it has had requests for 17,000,
with hundreds more on a waiting list.
Scott McCredie of the Seattle Times reports that a national study released this year by the U.S. Department of Agriculture
showed that Washington State residents experienced more hunger than all but four other states and the District of Columbia between 1996 and 1998.
"To still be in the top ten for hunger, especially when we're not among the top 10 states in poverty, is pretty perplexing,"
said Linda Stone, food policy director for the Children's Alliance, a statewide children's advocacy organization.
America's Second Harvest, the nation's largest domestic hunger relief organization, says many of its 189 member food
banks are reporting sharp increases in demand for food this year. "When I go to meetings, I ask them to raise their hands iftheir need for food is up, and almost every hand goes up," said Deborah Leff, Second Harvest's president and chief
Providers who blame welfare reform say many people who have been taken off government assistance get minimum-wage jobs that don't pay them enough to afford necessities, including food.
When the federal welfare reform law went into effect in August 1996, there were approximately 4.4 million families
receiving welfare benefits. In March 1999, that number had been cut to 2.7 million, according to the Health and Human
Ironically, also in rural America an increasing number of its residents, including many family farmers, are requiring food
stamps to simply purchase much of the food, containing the raw materials, which they grow and produce on their own
A HOLIDAY TRADITION:
THE CORPORATE AGRIBUSINESS RESEARCH PROJECT
THANKSGIVING DAY MEAL
In a few short days many of us will once again be sitting down with our families to celebrate Thanksgiving. We will all be
looking forward with mouth-watering anticipation to the bounty that will be spread before us.
But for most Americans the turkey is not likely to be from Uncle Ray's farm, nor the potatoes from Aunt Jean's recipe, nor the dressing from Grandma's stove, nor the biscuits from Mom's oven, nor the dessert from Aunt Belle's kitchen.
No, more than likely for most Americans the turkey might well be from Butterball or maybe a ham from Cook Family
Foods; someone might suggest that a few Singleton Butterfly Shrimp be put on the "BarB" before dinner, the grill already hot from the Just Light Charcoal Briquets underneath; we might also want some Jack Rabbit Long Grain Rice; maybe potatoes from Golden Valley Foods, and someone might note that the flour in the bread is from Peavey Grain.
We also might want to enjoy some of our favorite private label pasta from the local supermarket; tomatoes from Hunt's;
perhaps a touch of Oriental from La Choy; the pudding from Swiss Miss, or the frozen dairy dessert from Healthy Choice,topped perhaps with some Reddi Whip; the salad oil from Wesson; the cheese from Miss Wisconsin; the canned beans from Van Camps; some spices from Armour Dairy, and the tomato or apple juice cocktail from Mott's.
While watching the traditional Thanksgiving Day football game on television we might want to dip into the popcorn bowl
for some Orville Redenbacher's, putting another handful on one of our Budget Buy paper plates for future munching, or
we might also want to "partake" of the barley malt in a bottle of Carlsberg Beer as we watch the game.
All in all it will be quite a day and quite a meal, a testimonial to the cornucopia of food that most of us now living in
America have come to take for granted in the land of Freedom of Choice and the Home of the Private Entrepreneur.
But wait one minute here, let's take a little closer look at that meal. True, we saw a wide range of different products that
composed this Thanksgiving Day feast we so heartily consumed.
Yet, the reality of the matter is that all that food, all those products and all those brands came in fact from just ONE
company --- ConAgra Inc. --- the nation's second largest food processor and manufacturer, where six cents out of every American food dollar is today spent.
Here is a company that operates "across the food chain" --- from seedling to supermarket --- in many different products
where it totally dominates the market shares and where it reaps enormous profits at the expense of family farmers, workers and consumers.
"The fierce entrepreneurial spirit that's long been ConAgra's trademark is alive and well, and ConAgrans are working
together to feed people better and increase shareholder value. We are a winning team, and we have a solid game plan for the next phase of our success," ConAgra Inc. Chief Executive Bruce Rohde recently declared.
"Our past success is remarkable. ConAgra has the best long-term earnings growth record among all major food companies in the world. Our 19 consecutive years of earnings-per-share growth at an average annual rate of 14.6%, excluding required accounting changes and non-recurring charges, is unequaled by any major food company." It is estimated that in the past decade U.S. family farmers have been receiviong a mere 2.39% return on their yearly investment
In its 1999 Annual Report the company explains that each of the company's 25 branded foods has annual retail sales
exceeding $100 million and its Food Service branch is the nation's largest provider of products for restaurants, fast-food
outlets and other food service customers.
So, let's not forget that when we sit down to our modern day Thanksgiving Day dinners we are making an increasingly
small handful of American and international corporate agribusinessmen exceedingly wealthy.
We can be forgiven, therefore, if we begin our holiday meal with the prayer: "Bless us O Corporate America that these thy
`Healthy Choice' foods which we are about to receive, through the bounty of corporate agribusiness and ConAgra Inc.
bon appetit !!!
CORPORATE AGRIBUSINESS RESEARCH PROJECT
WEB SITE POSTED ON WORLD WIDE WEB
As promised the "remodeled" 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 an on-line news feature of the
Project. Its initial essay concerns one Hillary Rodham Clinton, the almost declared candidate for a U.S. Senate seat in NewYork State.
In his recent book, Shadow, Bob Woodward recounts that Hillary Clinton reportedly told close friends after it was revealed that her husband had sex with a young White House intern: "I have to take this punishment. I don't know why God has chosen this for me. But He has, and it will be revealed to me. God is doing this, and He knows the reason. There is some reason." This bit of Hilliarism occasioned the Progressive Review's Sam Smith to report that "reached at his celestial headquarters, God told this reporter, `That'll teach her not to rig cattle futures'."
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 TILLER.
By popular reader demand THE AGRIBUSINESS EXAMINER section includes not only an issue-by-issue and verbose
index of this weekly e-mail newsletter, but an archive of all the past issues. Thanks to Todd Gantzler who not only
volunteered but did the outstanding job of creating (and will be maintaining) THE AGRIBUSINESS EXAMINER indexes and archive file. Be sure and visit his excellent website at: http://www.freedomportal.com
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 1992 book The Corporate Reapers: The Book of Agribusiness.
On a personal note this web site would have been impossible without the fine design and production skills of the staff of
ElectricArrow of Seattle, Washington.
Pride necessitates that I should also note that ElectricArrow's President David Arevalo and Client Relations Director Leigh
Arevalo are my son and daughter-in-law. Also to be acknowledged are Jennifer Donohue of Seattle, Washington for her
beautiful graphic site designs.
Now, simply by clicking on either of the addresses below all the aforementioned features and information are yours to
enjoy, study, absorb and sow.
FROM THE PUBLISHERS DESK:
AN UNUSUAL APPEAL
For the past several weeks I have been harassed by one of the readers of THE AGRIBUSINESS EXAMINER who no
longer wishes to receive a weekly copy of this e-mail newsletter. I sincerely want to honor such a request, however, neither the person's name nor e-mail address appears on the list of those many hundreds of recipients who now directly receive THE AGRIBUSINESS EXAMINER from me each week.
Despite my efforts to explain to the reader this fact I am accused of being obviously new to the e-mail list game and your
ignorance is annoying. People should be protected from lists like yours not forced to participate.
It has been proposed by the reader that I send the reader a complete list of those individuals and organizations that receive
this e-mail newsletter. This, in the name of the privacy of my readers, I have refused to do and because I would not honor
such a request the reader charges "I offered to try to help solve the problem but you don't want my help. Therefore, I am
getting unsolicited e-mail from you and I view that as harassing and a waste of my resources."
The reader has now threatened to complain to my server and because I do not want to have to suspend publication of THE
AGRIBUSINESS EXAMINER while this matter gets resolved I am appealing to all readers: If you are or your
organization is sending and\or forwarding THE AGRIBUSINESS EXAMINER to Aki Namioka
<firstname.lastname@example.org> I would very much appreciate your removing that name and address IMMEDIATELY from such
--------------8696BA8D978641A2D4664E33-- od companies are being acquired by tobacco and liquor companies. The first line of quality control for our manufactured food has been the professional conscience of chief executives of independent food companies. Tobacco companies are by their nature indifferent to health considerations. To have our food supply in their hands is something to which the United States people and Congress should give attention."
In 1957 testimony before the U.S. Senate Anti-Trust and Monopoly Subcommittee, University of Oregon Professor Corwin D. Edwards described the "mutual forbearance" often found when confronted with conglomerate concentration.
"When one large conglomerate enterprise competes with another, the two are likely to encounter each other in a considerable number of markets. The multiplicity of their contacts may blunt the edge of their competition. A prospect of advantage from vigorous competition in one market may be weighted against the danger of retaliatory forays by the competitor in other markets. Each conglomerate competitor may adopt a live-and-let-live policy designed to stabilize the whole structure of the competitive relationship. Each may informally recognize the others primacy of interest in markets important to the other, in the expectation that is own important interests will be similarly respected.
"Like national states," he added, "the great conglomerates may come to have recognized spheres of influence and may hesitate to fight local wars vigorously because the prospect of local gain is not worth the risk of general warfare."
"COMMUNITIES OF ECONOMIC INTEREST"
Aggregate concentration, as John Blair shows, has a distinct effect on market behavior since it is based on what can be referred to as "communities of economic interest."
"Through such communities revolving around powerful family and financial groups, clusters of great corporations are said to be related by interlocking directorates, inter- corporate stock holdings, historical relationships, and other means," he points out.
Such aggregate concentration in agribusiness, because it relies so heavily on natural resources such as land, water, energy, etc. and increasing amounts of capital, is widespread, if not endemic.
In 1978 THE AGBIZ TILLER published an examination of 21 major U.S. corporations involved in corporate agribusiness ("The Club 21") and discovered an incredible concentration of decision-making power and a significant pattern of mutual corporate ownership. The figures were derived from a study by the Corporate Date Exchange Center of New York for the U.S. Senate Committee on Government Affairs' Subcommittee on Reports, Accounting and Management.
To comprehend the relationship between these corporations, whose combined 1977 assets totaled more than $25 billion, it is necessary to understand the terms "direct interlock" and "indirect interlock through an intermediate corporation."
A "direct interlock," for example, is John Buck who sits on the board of directors of Bank A at the same time he serves as a board member for Corporation B and C. An "indirect interlock through an intermediate corporation" is John Buck sitting on the board of Corporation D along with Mary Doe of Bank B. Thus, there is an "indirect interlock" between Bank A and Bank B through the "intermediate corporation" Corporation D.
Examining all the agribusiness corporations in the "Club 21," THE TILLER found an astonishing total of 53 "direct interlocks" and 1,038 "indirect interlocks" through 801 intermediate corporations.
Perhaps no statement better explains and captures the frame of mind that enables aggregate concentration to exist not only in terms of corporate power, but also in influencing political power, than a commentary made by Robert M. Strauss, former U.S. Ambassador to the Soviet Union. The remark came in a 1992 PBS "Frontline" TV documentary titled "The Best Election Money Can Buy." The program's narrator Robert Krulich was seen standing in front of a large condominium in Bal Harbor, Florida and was asking himself "why am I standing here?"
He went on to explain that in the condo behind him lived Dwayne O. Andreas, Strauss, Senator Robert Dole, and TV commentator David Brinkley among other political and business notables. After explaining their relationship, Andreas being the then chairman and CEO of ADM, Strauss being a former ADM board member and stockholder, Dole, a long-time political and personal friend of Andreas and soon to be U.S. Senate Majority leader, and Brinkley, hosting each Sunday morning a TV news and commentary show on ABC-TV, sponsored in part by ADM, the camera then focuses on Strauss who observes:
"It has nothing to do with being Democrats or Republicans. These are people that have common values. You know I have a theory about that, that you have to keep in mind. The good guys all manage to get together and have a communication. And the bad guys that don't fit in at all fit outside of that. And the good guys get together. It doesn't have anything to do with race or creed or color or political philosophy or sex or anything else. They're just decent, nice people and have good sets of values that are comparable to your own and you're friends. Those are `after dark friends.' In Washington, maybe, you might be on the opposite sides during the day, but were all good social friends and personal friends."
A more cynical appraisal of Strauss's characterization might be in the words of Adam Smith in his Wealth of Nations: "People of the same trade seldom meet together even for merriment and diversion but the conversation ends in a conspiracy against the public or in some contrivance to raise prices."
It should be added that in accepting Smith's "conspiracy" theory we must also keep in mind Blair's observation that "to ignore the pivotal role played by particular individuals who are in positions of power is to do violence to historical accuracy. A recognition that the course of economic events can be influenced by individuals who have the imagination and the power to take advantage of prevailing conditions does not constitute acceptance of a `conspiracy' theory of history."
For, as Blair further notes, "the effect of such communities of economic interest, it is contended, is to bring about greater cohesiveness and unity of action than would otherwise be the case. Control is sufficient to prevent any member of a community from undertaking a course of action which, though beneficial to itself, would be harmful to other members of the community. The inevitable result is a lessening of the potential for independent, competitive behavior."
CORPORATE AGRIBUSINESS RESEARCH PROJECT
WEB SITE POSTED ON WORLD WIDE WEB
As promised the "remodeled" Corporate Agribusiness Research Project (CARP) web site has now been 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 an on-line news feature of the Project. Its initial essay concerns one Hillary Rodham Clinton, the almost declared candidate for a U.S. Senate seat in New York State.
In his recent book, Shadow, Bob Woodward recounts that Hillary Clinton reportedly told close friends after it was revealed that her husband had sex with a young White House intern: "I have to take this punishment. I don't know why God has chosen this for me. But He has, and it will be revealed to me. God is doing this, and He knows the reason. There is some reason." This bit of Hilliarism occasioned the Progressive Review's Sam Smith to report that "reached at his celestial headquarters, God told this reporter,`That'll teach her not to rig cattle futures'."
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 TILLER.
By popular reader demand THE AGRIBUSINESS EXAMINER section includes not only an issue-by-issue and verbose index of this weekly e-mail newsletter, but an archive of all the past issues. Thanks to Todd Gantzler who not only volunteered but did the outstanding job of creating (and will be maintaining) THE AGRIBUSINESS EXAMINER indexes and archive file. Be sure and visit his excellent website at: http://www.freedomportal.com
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.
On a personal note, this web site would have been impossible without the fine design and production skills of the staff of ElectricArrow of Seattle, Washington. http://www.electricarrow.com
Pride necessitates that I should also note that ElectricArrow's President David Arevalo and Client Relations Director Leigh Arevalo are my son and daughter-in-law. Also to be acknowledged are Jennifer Donohue of Seattle, Washington for her beautiful graphic site designs.
Now, simply by clicking on either of the addresses below all the aforementioned features and information will be yours to enjoy, study, absorb and sow. Bon appetit !!!