It’s the only way to prevent smear campaigns.
July 14, 2016 — 4:00 AM MDT
There are few points of agreement between Democrats and Republicans these days, but it turns out maintaining a fair marketplace for vegan mayo is one of them.
In a rare display of bipartisanship, Senator Cory Booker, a Democrat from New Jersey, and Senator Mike Lee, a Republican from Utah, introduced a bill this week to make sure that federal programs intended to promote the sale of agricultural commodities like eggs, beef and pork don’t break the law by becoming mere extensions of the industries themselves, whether by attacking competitors or attempting to influence public policy.
Last year, a Freedom of Information Act request revealed the nefarious lengths to which the American Egg Board went to protect the egg industry from Hampton Creek, a small, Silicon Valley-based maker of eggless products. Calling the company a “major threat to the future of the egg product business,” Egg Board President Joanne Ivy raced to confront the possibility of consumers choosing eggless mayonnaise.
Ivy approved a plan to get the U.S. Food and Drug Administration to take action against the company, wanted to pay a contractor to get its products out of Whole Foods, and aided Unilever with a lawsuit against the startup (which it would eventually drop). She was even part of an e-mail thread in which an egg executive asked, “Can we pool our money and put a hit on him?” in reference to Hampton Creek CEO Josh Tetrick.
But the Egg Board is a commodity checkoff program, operating under the supervision of the U.S. Department of Agriculture. By law, these programs are supposed to promote their own commodities—whether eggs, beef, pork, mushrooms or soy—not attack competitors. The programs are funded through mandatory payments by producers, but the USDA supervises their activities and approves their major expenditures. Due to this oversight, a 2005 Supreme Court ruling allowed the beef checkoff board to compel protesting producers to pay fees into the program, saying the promotions counted as "government speech."
“Hampton Creek was being attacked by its own government,” said Matthew Penzer, who serves as special counsel to the Humane Society of the United States, the animal-protection organization, and has an expertise in checkoff laws.
Checkoff programs aren’t supposed to get involved in policy issues either, but Penzer says that cozy relationships between the industries and the checkoff boards that promote them make it inevitable. He pointed to the relationship between the National Pork Board and the National Pork Producers Council, a pork lobbying group, as an example. The Humane Society sued the USDA in 2012 over the relationship, citing $60 million in payouts from the Board to the Council, including a $3 million-a-year fee for a slogan—“the other white meat”—that had already been retired and replaced with "Pork: Be Inspired."
Following the release of the Egg Board e-mails, the USDA launched an administrative review of the misconduct. Ivy, who had served as its president since 2007, stepped down.
The new bill, named the Commodity Checkoff Program Improvement Act of 2016, would provide additional oversight to avoid these types of problems. If passed, it will not only clarify what commodity boards can and can’t do, but also it will add transparency requirements to dissuade behavior like the Egg Board’s improper practices. While the U.S. Secretary of Agriculture currently has to approve board budgets, the bill would require those budgets be made public, and that the checkoffs disclose how much money is spent on outside contractors and for what purpose. Checkoffs would also be subject to routine audits by the USDA’s Office of Inspector General.
Penzer called for exactly this kind of legislation. “There needs to be a great deal more transparency than there currently is, including publication of budgets,” he said.
Senator Booker feels the bill is necessary to ensure fair business practices. “When checkoff programs engage in anticompetitive activity, it is a threat to a dynamic and informed free marketplace," he said in a statement. "This bipartisan legislation will help increase transparency and restore trust in checkoff program practices.”
Tetrick, who spoke extensively with the senators about the bill, says he hopes it’s just the beginning of more bipartisan efforts to repair the U.S. food system. “Food that is healthier and more sustainable should be more affordable and delicious,” he says. “Everyone agrees with that central truth.”