Ag trade groups bilk farmers out of tens of millions through diversion of check-off dollars

By on March 29, 2017 with 0 Comments By Wayne Pacelle

Two pair of ideological opposites introduced bills in the U.S. House and Senate yesterday – Mike Lee, R-Utah, and Cory Booker, D-N.J., in the Senate, and Dave Brat, R-Va., and Dina Titus, D-Nev., in the House — to reform a series of federal government programs that have too often taken on the character of a slush fund for the beef and pork industries. Their legislation, the Opportunities for Fairness in Farming (OFF) Act, would prevent the U.S. Department of Agriculture and agribusiness trade groups – including the National Cattlemen’s Beef Association (NCBA) and the National Pork Producers Council (NPPC) – from diverting tens of millions of dollars a year to salaries, lobbying, and other inappropriate and impermissible activities through the national check-off programs.

You’ve heard the slogans and seen the advertising that’s come from these check-off programs, such as “Beef: It’s What’s for Dinner.” Congress intended to tax farmers and force them to pay into what are supposed to be non-political, federal programs to promote their commodities. The reality is, vast sums go to allow NCBA and others to engage in advocacy or anti-competitive activities that hurt small farmers and farm animals, too. This legislation fits in with President Trump’s promise to stop waste, fraud, and abuse in the federal government, and he can look to none other than the Heritage Foundation, the preeminent conservative think tank, as an endorser of this legislation.

Take the beef checkoff program. The NCBA, the industry’s biggest trade association, is the primary contractor for beef checkoff advertising efforts, despite the fact that the group claims membership of only 3.1 percent of America’s cattlemen. NCBA receives the majority of national checkoff fees, making up most of its total budget. That’s almost every beef checkoff dollar, paid by many of the smallest farmers, going to a lobbying group that typically works for the interests of the biggest producers and against interests of independent cow-calf operators. An astonishing 82 percent of the budget of NCBA is covered by check-off funds.

The pork checkoff is arguably just as bad. Years ago, the Pork Board developed the memorable “Pork: The Other White Meat” campaign. Yet, despite the exclusive use of checkoff funds to develop and promote the slogan, the NPPC claimed title to the trademark free of charge. Then, after the trademark had nearly exhausted its market value, the Pork Board bought back (with checkoff dollars) its own unlawful “gift” from the NPPC – for $60 million! These federal funds are now being paid out every year in $3 million installments, and they make up a third of the NPPC’s annual budget. The HSUS, along with Iowa Citizens for Community Improvement and an individual pig farmer, have sued over this gross abuse of the checkoff program and the pending lawsuit threatens to eliminate NPPC’s use of the checkoff as an illegal slush fund. Remember, the NPPC is the trade association that defends keeping pigs in lifelong inhumane confinement in small cages, the overuse of antibiotics, and so many other retrograde policies.

In some instances, checkoff boards have engaged in outright market manipulation, attempting to keep products that might be viewed as competitive off the shelves. In 2013, the Egg Board tried to get government regulators and retailers to take action to halt sales of Hampton Creek’s egg-free “Just Mayo” brand products, clearly worried that the widespread availability of humane alternatives would reduce their market share. Sen. Lee highlighted this case example when he introduced the bill yesterday.

“For too long, America’s family famers have been forced to fund programs that undermine their efforts to preserve rural communities and to use traditional methods of farming,” said Joe Maxwell, a Missouri hog farmer and political director of the Humane Society Legislative Fund. “Farmers should have guarantees these programs are working for them, and shouldn’t have their hard-earned money going toward a slush fund for big ag.”

“This legislation is a show of good faith to America’s farmers, who believe in accountability and government transparency,” said Pete Eshelman of Joseph DeCuis Farm and the HSUS National Agriculture Advisory Council. “We deserve to know where our dollars are going. Thanks to Senators Booker and Lee and Representatives Brat and Titus for standing up for open government, free markets and fairness for all farmers.”

The Lee-Booker and Brat-Titus bills threaten to upend this set of sweetheart deals for the trade groups that tend to treat checkoff dollars as manna from heaven. The bills are backed by dozens of farm groups, including the Organization for Competitive Markets, and a number of national and local animal welfare groups.

In my recent book, The Humane Economy, I talk about the wave of animal-friendly reforms happening throughout so many sectors, including food and agriculture, driven by conscious consumers and forward-thinking entrepreneurs. But I note that we have a lot more work to do, and uprooting government subsidies to agribusiness interests is at the top of the list. That effort starts right here with these bills.

Farm Animals, Public Policy (Legal/Legislative)

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