Speak Your Piece: ‘Beef Tax’ Abuse

[imgbelt img=Beef_Check.jpg]The “beef tax” check off program funnels publicly controlled money into an organization that lobbies for the meat-packing industry and fights antitrust enforcement, says Siddhartha Mahanta. 


New America Foundation says one of the reasons the Obama administration dropped antitrust action against meatpackers was because of the political power wielded by the National Cattlemen’s Beef Association, a trade group supported by a federally mandated marketing fee that ra nchers must pay on each head of cattle.


Imagine if the federal government mandated that a portion of all federal gas taxes go directly to the oil industry’s trade association, the American Petroleum Institute (API). Imagine further that API used this public money to finance ad campaigns encouraging people to drive more and turn up their thermostats, all while lobbying to discredit oil industry critics—from environmentalists to those calling for better safety regulations or alternative energy sources.

That’s a deal not even Exxon could pull off, yet the nation’s largest meat-packers now enjoy something quite like it. Today, when you buy a Big Mac or a T-bone, a portion of the cost is a tax on beef, the proceeds from which the government hands over to a private trade group called the National Cattlemen’s Beef Association. The NCBA in turn uses this public money to buy ads encouraging you to eat more beef, while also lobbying to derail animal rights and other agricultural reform activists, defeat meat labeling requirements and defend the ongoing consolidation of the industry.

Like most things that go awry in Washington, this one started out with arguably good intentions. The story begins in the 1980s, a time when the plight of family farmers and ranchers inspired the likes of Willie Nelson and Neil Young to put on benefit concerts and launch the Farm Aid movement. Another, more enduring response to the farm crisis of the 1980s was Congress’s decision to create what’s known today as the beef “check-off” program.

The idea was to help struggling ranchers by creating a program to pool their money and use it to promote demand for beef. Under a bill passed in 1985, cattle producers were required to pay $1 per head to one of 45 “qualified state beef councils.” These councils in turn contributed to a national program supervised by the U.S. Department of Agriculture (USDA) dedicated to promoting the beef industry.

Older readers may recall the first major result of this legislation, which was a $42 million, 17-month advertising campaign launched in 1993 featuring Hollywood screen legend Robert Mitchum, who proclaimed in his gravelly voice, “Beef. It’s What for Dinner.” Over the years, similar federal programs have come to exist for other food groups, from avocados to popcorn, and have produced such memorable marketing slogans as “Milk: It Does a Body Good,” and “Pork. The Other White Meat.”

Fork in the Road

Hog farmer and Missouri’s former lieutenant governor Joe Maxwell is vice president of outreach and engagement for the Humane Society of the United States.

In doing so, they have picked up the support of Dudley Butler, a lawyer appointed to the USDA by Obama in 2009 but who left in 2012. “This administration is well aware that the NCBA has misappropriated producer contributions,” Butler wrote in a letter to the president last year. “The administration is also aware that the NCBA’s control over the beef checkoff program has helped it and the meat packers defeat major policy reforms sought by independent producers.” Butler’s solution is simple: stop collecting the beef tax.

Even in this era of political gridlock, that may just be possible. In 2012, before leaving to head up the Heritage Foundation, Tea Party firebrand Senator Jim DeMint attached an amendment to the farm bill that would make all the checkoff programs voluntary. Writing in support of the amendment, the Heritage Foundation blasted the checkoff as a flat-out compulsory tax—not an unusual stance for a movement committed to zeroing out government involvement in private enterprise.

With liberals and conservatives for once in agreement, it’s time to have a barbeque. Big Beef subsidies. It’s what’s for dinner.

Siddhartha Mahanta is a policy analyst at the New America Foundation. This article originally appeared in Washington Monthly and is reprinted with permission.