How Beef Companies Use the Checkoff to Squeeze Ranchers

by David Muraskin | September 30, 2019

The massive Brazil-based meat company JBS has been in the news in recent months for receiving millions in bailout money meant for U.S. farmers, to the reasonable outrage of producers and taxpayers. So, what if there were also a program that takes money from independent farmers and ranchers and puts it into the hands of multinational agricultural corporations under the guise of offering marketing support?

Well, there is such a program, and it’s called the Beef Checkoff.

Because we believe corporate agribusiness has been able to exploit the land, workers, and farmers and ranchers for far too long, Public Justice is representing R-CALF USA, the nation’s largest organization for independent, domestic cattle producers, to fight the checkoff. We’ve already won a preliminary injunction against the program in Montana. On October 2, we’re asking the magistrate to expand that ruling to 14 other states.

What Is the Beef Checkoff?

There are checkoff programs for a wide variety of farmers’ and ranchers’ products. The programs were established under federal law and are nominally administered by the USDA’s Agricultural Marketing Service, which is named as the defendant in our case.

Ranchers pay into the Beef Checkoff, ostensibly to help market their beef. But in actuality this money is controlled by and benefits corporations and even foreign companies, not the ranchers who pay into it. The checkoff is a federal tax that forces ranchers to pay $1 per head every time cattle are sold, half of which is used in Montana and other states to fund the advertisements of the private, corporate run “state beef councils.” This is a form of compelled speech that is not only regressive — it’s unconstitutional.

The Montana council, for example, includes people working with the largest multinational beef packers, and it uses checkoff money to promote the idea that there is no difference between domestic beef produced under U.S. food safety laws and beef produced in foreign countries. It has paid for advertisements for the fast-food chain Wendy’s to promote hamburgers that use North American beef, meaning beef that can come from anywhere on the continent, not necessarily Montana or even the United States.

We’ve identified 14 identical councils to the Montana council — privately created, privately controlled, nongovernmental entities that nonetheless get to use ranchers’ tax money for their speech. Whether they can continue to do so is at the core of the October 2 hearing. Our case asks that the checkoff money stop going to these industry-run councils unless ranchers first give their consent to fund them. Without such consent, all their money would flow to the federal-level beef board instead — which is accountable to government officials and thus their rancher constituents.

The Industry Is Feeling the Heat

Our case, and the work of independent ranchers to force transparency and stop the program’s abuse, has the industry running scared: In a recent statement, the National Cattleman’s Beef Association (NCBA)said advocates working to halt the Beef Checkoff were running a “smear campaign” and trying to “divide the beef industry”. But the multinational companies that NCBA represents have done that all on their own with the routine exploitation of independent ranchers, thanks to the enormous market power they wield. Indeed, the same day we’re arguing our case, ranchers from around the country will be gathering in Omaha to demand #FairCattleMarkets. NCBA, of course, has chosen to be absent.

The Beef Checkoff program is just another giveaway to industrial agriculture under the guise of a program to help farmers and ranchers. And this case is just one example of how we use legal tools to help drive the movement for systemic change and chip away at the consolidated market power of Big Ag. Taking on the industry’s outsized influence is the only way that we’ll get the food system we all want and deserve: one that is just, humane and sustainable and that takes care of its farmers and ranchers, its animals, the environment, rural communities, and all the rest of us, too.

David Muraskin, Senior Food Project Attorney at Public Justice, serves as lead counsel on the case for R-CALF. Learn more about our team and the Public Justice Food Project.