By David Dayen
Identifying the corporate power that holds back farm communities could revive Democratic fortunes.
There’s a misconception that Democrats have to abandon their principles to win in rural America, Joe Maxwell believes. He’s a fourth-generation hog farmer and the former lieutenant governor of Missouri, and he thinks the key to success in farm communities lies in speaking to their specific circumstances. “People know they’re getting screwed, that the system is rigged, that wealth is being extracted from rural communities,” Maxwell said in an interview. “We can bring about economic justice for all.”
Maxwell is one of the driving forces behind Family Farm Action, a new organization dedicated to taking on Big Agriculture, which it says has threatened the viability of the family farmer and the sustainability of rural America. They plan to advocate for increased antitrust enforcement and new farmer protections not yet implemented by the Trump administration, and for candidates in rural districts who agree. “There is no progressive organization on the political offensive fighting for rural America,” Family Farm Action writes in its mission statement. “We’re going to change that.”
The rise of monopoly power in the agriculture sector has implications for anyone who eats food or breathes air. But it keenly affects those in rural areas, from the Latino farmhand or slaughterhouse worker to the black farmer struggling to finance a year’s crops to white owners of the country store or local diner who thrive in a vibrant community.
Maxwell and his colleagues have already shown they can reach rural voters. Last year, while Donald Trump was romping in Oklahoma, Maxwell ran a statewide campaign to beat a corporate-backed “right to farm” initiative that would have gutted regulations on agribusiness. He brought together animal welfare groups, environmentalists, and farmers, and crushed the initiative by over 20 points. Even this year, Democrats have picked up two state legislative seats in rural Oklahoma, an small reversal of the carnage of the past eight years.
“This country is not founded upon common faith, color of skin, or where your ancestors come from,” Maxwell said. “We share one thing in America, that’s the hope of opportunity. Because we lack the economic justice that fair and open markets provide, we destroy that hope. We believe that issue resonates with everybody.”
Maxwell defines the problem very specifically. Multinational corporations have monopolized the entire agricultural sector, from seeds to livestock, produce to dairy, and everything in between. Even a farmer’s financial institutions have consolidated.
The effects go beyond the ability to raise prices when you’re the only game in town. For example, a proposed deal between Bayer and Monsanto, in the wake of completed mergers between Dow/DuPont and ChemChina/Syngenta, would lead to three firms controlling 80 percent of the U.S. seed supply and 70 percent of pesticides, according to an issue brief from the Organization for Competitive Markets. “They’re controlling the seed, the genetics, and they sell chemicals,” Maxwell said. “Do you think they’ll create seeds that need less chemicals?” This inhibits the ability for the independent farmer to differentiate and plant what they want, a major driver of success.
On the livestock side, a handful of companies process meat and poultry, including Chinese-owned Smithfield (the largest U.S. pork producer) and Brazilian-owned JBS (tops in all meat). And similar to the telecom monopolies splitting up access to internet and cable TV service, livestock producers break up the country by region, with slaughterhouses placed far from one another. “You have to look at the regional market, because the farmer can only ship livestock so far,” Maxwell said. “So the farmer ends up with only one buyer.” Suppliers to large livestock producers have seen prices for their animals plummet, even as consumer prices for processed meat rise. And that’s in cases where the family farmer hasn’t been squeezed out of business by concentrated animal feeding operations (CAFOs).
In the chicken market, the situation is dire. Farmer suppliers, under contract with agribusinesses, have not seen an increase in pay for 20 years. A 2013 report from the Pew Charitable Trusts shows that 71 percent of poultry farmers live below the poverty line. Companies pit farmers against one another in what is called the “tournament system,” where Big Ag ranks suppliers on performance and only pays those that rate highest. “You’ve spent a million dollars to raise chickens, have hopes and dreams, and you’re stuck,” said Maxwell. “It breaks the fabric of communities. It should be criminal, but in America it’s called good business.”
When farmers are paid less and consumers pay more, middlemen producers enjoy massive profits. But industrial agriculture also destroys soils and pollutes streams. Giant feedlots are environmental nightmares that drive down local property values and destroy the tax base. Routine animal cruelty flowers from concentrated ownership. When wealth leaks out to corporations instead of staying locally, communities suffer and despair leads to drug and alcohol abuse. And consumers lack the diversity of different foods.
Family Farm Action wants safeguards returned to farm communities, laid out in a farmer’s bill of rights on their website. These include subjecting agribusinesses to the same environmental standards as family farms, transparent labeling laws, increased access to financing for a capital-intensive business, and caps on foreign ownership.
But the biggest demand from Family Farm Action is for the government to reinvigorate the antitrust laws that ensure open competition and prevent collusion. A major case involving the rigging of a key benchmark price grocery stores use to buy poultry cost consumers hundreds of millions of dollars. “If the legal definition of collusion doesn’t give the Department of Justice the ability to prosecute, then we need to change the laws,” Maxwell said. The organization also supports using the Sherman and Clayton Acts to break up concentrated agricultural markets.
Next, they want the Trump administration or Congress to finalize three rules proposed near the end of the Obama Administration, authorized under the Packers and Stockyards Act. The rules would ban the tournament system for chicken farmers, codify certain predatory and retaliatory practices, and allow farmers to sue for mistreatment even if the entire market for his produce or livestock wasn’t harmed.
The rules came out of a promise then-candidate Obama made to protect farm communities, and five field hearings done early in his tenure. Sadly Obama’s USDA never followed through, and after 2011 were prevented by Republicans in Congress from moving forward until the final days. “I thought (the Obama rules) were watered down, but this administration has done nothing on them,” Maxwell said. The rules have been delayed until at least October, much to the industry’s delight, Maxwell added. “You can’t even find them on the USDA web page.”
Rural communities have been perturbed about Trump’s broken promises and a proposed 21 percent cut to the Agriculture Department budget. But too often, political observers take the announcements of Big Ag and its corporate trade associations as a substitute for what local farmers want.
For example, media reports have lamented the pullout of the Trans-Pacific Partnership as a loss for rural communities, when the impact on agriculture is actually tiny, as economist Dean Baker demonstrates. But the real beneficiaries of TPP and NAFTA are Big Ag giants like Cargill, who have agricultural operations overseas.
Identifying the corporate power that holds back farm communities could revive Democratic fortunes. Obviously, there are huge cultural barriers dividing Democrats from these areas, dominated by a media that paints them in the worst possible light. But the answer to that isn’t to walk away from the region, or present Republican-lite “moderates” who line up with corporate interests; it lies in showing farmers you stand with them, not the monopolists.
“The current system is just not sustainable,” Maxwell said. “Hope for your piece of the prosperity pie is the fabric of our society.”