GUEST opinion

Sep 9, 2011
by WLJ

Farm Bill debate underway: NCBA says livestock title needs to go

2012 Farm Bill discussions are well underway. In fact, I suspect words will begin to appear in writing a lot sooner than most of us originally expected. We are hearing that congressional leaders may begin drafting a farm bill this fall. As policy makers work on crafting a farm bill that represents a whole host of interests, while also cutting spending, National Cattlemen’s Beef Association (NCBA) is working to ensure cattlemen get a fair shake. A fair shake doesn’t mean taxpayer dollars. What I am talking about is common sense principles that don’t end up hurting cattlemen when all is said and done. As well intended as it may have been, the livestock title, which was added during the last farm bill, has certainly done more harm than good. In fact, it has basically opened the door for big government to set up shop on family farms and ranches. For good reasons, NCBA members have instructed us to do everything we can do to strike or reduce the livestock title in the 2012 Farm Bill. We are preparing to do just that.

We can thank the livestock title for USDA’s Grain Inspection, Packers and Stockyards Administration’s (GIPSA) proposed rule on livestock and poultry marketing, which is the most pervasive invasion of government into the private marketplace that our industry has ever witnessed. If this rule goes into effect, cattlemen—especially small producers—who voluntarily take on more risk by investing in superior genetics and management practices in order to capture premiums offered through producer-driven branded beef programs—will suffer financially and will be forced to make very critical decisions about the future of their livelihoods.

Marketing agreements work. Invest more dollars to produce superior beef and you are rewarded. It is basic capitalism—the very principle on which this country was founded.

Don’t take my word for it; listen to the very agency that is proposing this devastating rule. A study conducted by GIPSA overwhelmingly concluded that alternative marketing arrangements help all sectors of the industry, not just those who participate. The report also found that alternative marketing arrangements gave producers the ability to buy or sell higher quality cattle, improve supply chain management, and obtain better prices. Conversely, reductions or restrictions on alternative marketing arrangements would cause a decrease in the supply of cattle, a decrease in the supply and quality of beef, and an increase in retail beef prices. Considering these facts, why propose a rule that could very well eliminate these marketing agreements?

This rule also removes the competitive injury requirement and replaces it with fairness. This means a producer who invests in higher quality cattle and who rightfully gets paid more than another producer who hasn’t made that investment can be sued on a matter of fairness. My definition and your definition of fairness are likely different. This vagueness will allow for a trial lawyers’ bonanza in rural America.

This proposed rule, which has been blasted by more than 150 members of Congress, leading trade organizations, animal welfare experts and leading economists, actually came about during the 2008 Farm Bill. We were successful in defeating many provisions in the GIPSA rule, but GIPSA Administrator and former trial lawyer J. Dudley Butler managed to bring the same language, which was outright rejected by Congress, back to life through his proposed regulation. This job-killing rule contains provisions that eight U.S.

Circuit Courts of Appeals struck down. As a result of the last farm bill debate, Congress instructed GIPSA to come up with a way to increase competition in the livestock industry, primarily focused on the poultry industry. Unfortunately, this rule, as noted by more than 150 members of Congress, including Chairman of the House Agriculture Committee Frank Lucas, R-OK, and Ranking Member of the Senate Agriculture Committee Pat Roberts, R-KS, goes above and beyond the intent of Congress. Did this stop Butler? Nope. The administration has ignored countless requests made by members of Congress to strike this rule.

Had the livestock title not been added to the last farm bill, chances are good that we would not have seen a rule that poses to kill as many as 104,000 jobs, stymie producer profitability, reduce the gross domestic product by $14 billion, and drastically limit consumer choice at the meat case. That’s right; if this rule goes through, packers have already said they will be apprehensive about offering premiums for superior-quality beef in fear of frivolous, costly lawsuits. No premiums for high-quality beef will likely result in producers backing away from investments they have made to provide the branded beef—Certified Angus Beef, Laura’s Lean and others—consumers want. This will ultimately lead to fewer choices for consumers.

Cattlemen have long supported efforts to minimize direct federal involvement in the cattle industry. That is why our top priority during the 2012 Farm Bill debate is to eliminate or reduce the livestock title. We will work vigorously to do just that.%u2015Colin Woodall, NCBA