Good News and Bad News from the Fed

monopoly

The Fed is sending mixed messages to small farms these days. Taken separately, HR 2749 and new promises from the new Anti-trust arm of the Justice Department show two very different agricultural agendas, but both are big news, with enormous potential to either weaken or strengthen the position of small farmers nationwide.

The good news first: The Justice Department will be scrutinizing agricultural monopolies as one of its goals under Obama.  According to NPR, the Department plans to part from the usual reactionary protocol to investigate perceived monopolies instead of waiting for accusations. First on the list are seed companies,  whom the justice department believes may be interfering in competition in the corn and soy markets. This doesn’t come as a surprise to JCarrot readers, but it appears, from Phil Weiser’s speech to the Organization for Competative markets ( read the full text of his speech here), that the Justice Department’s intention is to keep companies like Monsanto from interfering with start-ups in the genetically-engineered seed business, not necesarily to keep them from persecuting farmers who don’t want to plant their seeds.

Beef, Hog and Dairy companies are also on the list for investigation, as is general “Transparency in the Marketplace”. Check out this article on Rabbi Steve Greenberg’s talk at last year’s Hazon Food Conference for a look at market transparency in Jewish Law. The NPR segment (text version here) that reports on the Justice Department’s new move in detail can be listened to below:

Comments on the show page are interesting, too. A couple of them reflect the extent to which meat buyers control the choices of the farmers who raise meat for them, and discuss how, because of the lack of competition in the market, many farmers have no choice as to where they sell.

Phil Weiser, deputy assistant attorney general, will lead the charge for the Justice Department. In the speech linked above, he outlines some historical federal interventions in the great agricultural monopolies of the past, most notably the Beef Trust Cases of 1905. He also listed more recent mergers, including Smithfield merger of 2007, which the Justice Department under Bush declined to challenge.   Livestock farming (at least, pigs and cows) is clearly a main area of focus for the Justice department, as it is in  Time Magazine, which makes food politics front page material in an article that celebrates everything Michael Pollan and Eric Schlosser hold dear. It’s possible that a confluence of media coverage, public attention, farmer’s complaints and legitimately illegal and anti-competative activities among these giants of agro-industry will lead to renewed competition in the market. The Justice department is looking for suggestions for how to make changes that promote transparency and competition. Perhaps hearings like those held by the USDA for NAIS (y’know, the ones where Wendell Berry came and raised hell) might be a method for getting those ideas.

Of course, when it comes to politics it seems no silver lining comes along without a cloud, and as much oomph as broken ag monopolies would put into small farmers, HR 2749 might take away that and more. The bill, which has run quickly through committees and has alread passed in the house, seems to be on the fast track to approval. Senators will vote on it after the August recess. The bill is meant to adress a lack of sufficient regulation of processed foods that lead to recent food product recalls. But critics say that its major shift of power into the hands of the FDA and the bill’s one-size-fits-all policies will do little to restrain the giants whose contaminated products caused the recalls, while still managing to  hobble small farmers with added fees and restrictions. See this article at the Farm-to-Consumer-Legal-Defense-Fund for a detailed run-down of the bill and their reasons for opposing it. The Weston Price Foundation is also running an action alert to mobilize foodies and activists to visit their senators in support of small farmers, and urge senators to say no to this bill.  Note that the action alert is from before the bill passed in the house.

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