Monopoly Round-Up: The Enshittification of the American Hamburger
| Matt Stoller Sep 7 |
The U.S. cattle industry is in trouble, and Trump’s plan to bring in imports may turn the American burger into mystery meat. Plus, a judge once again rules that Google keeps its monopoly.
Lots of news, as usual. Google escaped from an antitrust remedy, as another judge decided not to break up the company after ruling it’s an illegal monopoly. Plus, AI firms are telling ghost stories about the end of the world, the New York Times slimed me and then retracted it, and the National Basketball League penalized a billionaire the way the justice system should.
But before getting to all of that, I want to delve into an important fight during the past few weeks over that most basic of American symbols, the hamburger. Yes, that lovely simple food is under attack.
Here’s how.
A few months ago, the Chinese government began blocking Argentine beef imports because of contamination by chloramphenicol, a dangerous antibiotic prohibited in most countries, including the U.S. It also warned Australian cattle producers that it was about to impose large tariffs to protect its domestic industry. At roughly the same time, the European Union rejected imports of Brazilian beef for food safety reasons.
Three huge meat exporting nations now have large reserves of frozen surplus beef, and not the nice kind of quality chops and steaks, but the processed remainder. And now, that huge quantity of remnant beef is headed to the United States, and it’s about to go into your hamburger.
You might be asking why that would be. Doesn’t America have its own major beef industry? Don’t Americans prefer local U.S.-raised product?
The answer is corruption and monopoly power. Because we’re not really talking nation-states, but global meat corporations, in particular a giant packer named JBS, which dominates the Brazilian and Australian industries. JBS was a small Brazilian firm, until its founders, the Batista brothers, grew it into the world’s largest beef company. How? Well many ways, few of them clean. For instance, roughly ten years ago, the brothers spent time in jail in Brazil, after admitting they bribed politicians.
On August 20th, the co-founder of JBS, Joesley Batista, met with Donald Trump. His company has all this frozen beef on hand, so presumably, he asked Trump to temporarily reduce tariffs on foreign beef. Did he have a good case? That’s beside the point; Batista was the largest donor to Trump’s inauguration, with a $5 million gift from JBS subsidiary Pilgrim’s Pride.
The next day, Trump announced a plan to import three hundred thousand metric tons of lean beef trimmings into the U.S. at below market prices. These lean trimmings will be ground with fattier trimmings to produce ground beef, going into things like hamburgers, tacos and spaghetti sauce. It’s a huge amount to import, equivalent to roughly 1.2 million head of cattle, and slated to come in the next 90 days. The idea is to cut prices to consumers just before the midterm elections.
This plan probably seemed fine on paper. U.S. consumers would get cheaper beef, and Trump gets to reward a contributor. But it fostered a political storm for the GOP. Last week on Organized Money, we had on Mike Callicrate, owner of Ranch Foods Direct, to talk about the impact this decision had among domestic cattle ranchers, who are among the most supportive constituencies of Trump and the GOP.
They are really mad. Here’s why.
The cattle industry has been in crisis for a very long time, with half the ranches disappearing because it’s just not possible to make money anymore. There are four meatpackers that control 85% of the industry, and as Callicrate observed, they don’t really compete over cattle purchases. Instead, they use a variety of tactics to punish cattle ranchers and keep their prices low.
Over the last generation, the industry has undergone a structural shift.
Traditionally, when prices for cattle are high, ranchers will expand their herd, in what’s called the “cattle cycle.” It takes a few years to breed a new cow, so the rancher must believe that the price will remain high for the investment to make sense. Over the last decades however, every time ranchers expand their herds, packers find a way to manipulate prices lower by the time the new cows are ready to be sold. And so the cattle cycle has ended. Ranchers are simply shrinking their herds, and going out of business. You maybe read that the U.S. cattle herd is at 90-year lows, this is why.
Finally, with the shrinkage of domestic cattle, prices have started to go up for the rancher. For the first time in a very long time, ranchers are making money. Indeed, last month, a Cattle on Feed report came in showing a lack of supply, which would have given the ranchers more leverage.
But the tariff announcement, plus the border reopening to Mexican cattle despite the possibility of the screw worm disease, temporarily crashed cattle futures. And that has a psychological effect on ranchers selling their animals, who begin to panic. If they had considered expanding their herds before, they likely won’t do so now. And that means after a few more years, there just won’t be much domestic cattle ranching anymore, the U.S. will mostly import beef.
Cattle ranchers are a loyal Republican constituency, and they are angry. But they are unlikely to break from their political allegiance, despite 13 Democratic Senators introducing legislation in March to break up the big meatpackers. They are culturally affiliated with the right, and that connection is deep. It is similar to Barack Obama overseeing the largest loss of black wealth in our lifetimes, and yet maintaining deep and wide black support. Old allegiances die hard.
Still, the frustration is deep. So Trump on Friday invited several ranchers to the White House to make some announcements that were supposed to mollify them. The executive orders covered mandatory country of origin labeling, dealing with wolves that may threaten cattle, investigations into concentrated packers, and enabling ranchers to process their own meat. As I read these EOs, they don’t do much, they are the kind of thing a politician does when he wants to look like he’s acting, but lack the authority to really do anything.
7:17 PM · Sep 4, 2026 · 127K Views 173 Replies · 383 Reposts · 1.23K Likes |
Some ranchers greeted these announcements as evidence that Trump is great, others had a “wait and see” attitude, while a third faction believe it’s vaporware that will accomplish nothing. At the end of the day, Trump granted giant market moving imports of beef to multi-national packer JBS, and some vague executive orders and reports to independent cattle ranchers.
Still, leaving ranchers aside, at least this move will bring in cheap beef and lower consumer prices, right? Well, not necessarily. This move isn’t the first time the Trump administration has sought to lower beef prices with imports. In February, as a favor to his political ally Javier Milei, Trump dropped the 10% tariff on Argentine beef, and quintupled the country’s in-quota allowance to 100,000 metric tons. It didn’t move consumer prices.
The reason is that the supermarket sector, which sets the price of beef, is very concentrated. In July, the Trump administration sent a letter to eight grocers, including Walmart, asking them to brief the Antitrust Division on the price of beef.
As with threats against the packers, I am skeptical it’ll lead to anything. First, these grocers are close allies of the administration. But practically, there’s not much that enforcers can do to affect prices in the short-term. I asked an experienced antitrust lawyer who has led investigations in this sector, and he was not impressed with the letter, pointing out that you usually want to have documents in hand before meeting with company officials. The administration has also bled lots of the talent out of the Antitrust Division, so even if they wanted to bring a case, it would be hard. Finally, even if they did bring a case, it would take a really long time to affect the market.
In terms of price, it’s not looking good. But there’s one last angle – this plan is gross. Combining the meat from lots of different animals is risky, especially when it travels from a very long distance. As Consumer Reports noted, when you cut into meat and begin processing, that’s when “you start introducing contamination or cross-contamination.”
To put it differently, this meat is coming in wet, and wet stuff tends to rot more easily. In addition, it won’t be labeled as foreign beef. In the early 2010s, the World Trade Organization ruled that mandatory country of origin labeling (MCOOL) violated trade rules by discriminating against foreign imports. So this stuff will be combined with domestic beef trimmings from the big packers, it won’t be labeled as such, and, well, enjoy your burger.
Ultimately, high beef prices and a collapsing domestic cattle industry are not problems that Donald Trump created. They are a long time coming, going back to the 1980s and the change in how we organized competition in agriculture. One of the most dangerous aspects of monopolization is that concentrated market power often destroys the industry it controls. That’s what’s happening here, the guts of the infrastructure, from smaller packers and feedlots is disappearing, and now even the plants of the big packers are shutting down.
But Trump has also made the situation worse, by working to replace domestic beef with foreign beef, and undermining the price signals that would have encouraged packers to begin rebuilding their herds. And by reducing safety inspections, he may actually undermine American cultural affinity with the hamburger. Ultimately, Trump is testing the loyalties of this deeply conservative group, and forcing a few basic questions. Will the U.S. cowboy go extinct? Will ranchers figure out how to organize politically in a more effective way? And in a generation, will we still consider the burger an American icon?
And now, the rest of the monopoly round-up. Lots of weird and/or important stories. For example, there’s a freak-out in Silicon Valley over AI going rogue and destroying humanity, brought to you by AI billionaires who believe in ghost stories. Florida is trying to get rid of Flock cameras. Judges have decided that Google is an illegal monopoly but they aren’t going to do anything about it.
And in the not important but funny bucket, the New York Times decided to smear me in the dumbest way, writing an article in which they wrote I criticized McKinsey because I’m a secret influencer working for Mamdani. The paper then had to retract the claim…
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