The Washington Post has a front page story this morning headlined: “Obama antitrust enforcement looking like more of the same.” In other words, not much is going on, according to the article.
Meanwhile, the New York Times has this editorial, headlined, “Reforming Meat.” Here is the full text:
“Early in the last century, the federal government tried to create competition in the meatpacking industry by breaking up the five corporations that controlled it. The result is that four big corporations control it now: JBS, Tyson Foods, Cargill and National Beef Packing. Agriculture Secretary Tom Vilsack wants to try again, and we fully support him. In fact, we’d like to see him go much further.
“New rules proposed by Mr. Vilsack aim to restore the balance between independent livestock producers and the industrial behemoths. The behemoths have screamed, a sign of how entrenched they really are.
“The rules seek more transparency in pricing and less collusion. Right now, it’s all too easy for packers to offer premium prices to favored producers and discounted prices to everyone else. The rules would make this harder, partly by allowing lawsuits by producers who feel they’re the victim of anticompetitive practices.
“An even bigger problem is increasing concentration and vertical control. The number of hog farms in the country has declined by 89 percent in the past 30 years, the number of cattle ranches by 40 percent. Just as alarming is the decline in open, cash markets for livestock. Only 4 percent of the hogs in this country were sold in an open market in 2009, down from 62 percent in 1994. The rest were sold under advance contracts to the major meatpackers, making the meatpackers the owners. The cattle market is headed in the same direction.
“As a result, livestock is increasingly traded from packer to packer, not farm to packer, giving packers more control of the total market — in the pasture, in the barns, in the feedlots and on the killing floor. This, in turn, makes price collusion and manipulation much too easy. Mr. Vilsack’s rules aim to address this, making it illegal for packers to sell livestock to other packers.
“By themselves, these changes will only modestly reduce the concentration in the industry today. Packers argue that a tightly integrated system results in high quality meat. In fact, the current system guarantees only a steady flow of animals, at the lowest possible prices, through the nation’s slaughterhouses, while doing little to address the issues of industrial production: overuse of antibiotics, groundwater pollution, toxic manure waste.
“We hope Mr. Vilsack will be able to make his modest rule changes stick. But we also think it’s time for a larger initiative in preparation for the next farm bill — which could reach Congress in 2012 — to prevent packers from owning animals before they’re ready for slaughter, restore open markets and let small farmers back into the game.