By Peter Galuszka
One book on my to-read list is Christopher Leonard’s “The Meat Racket” which looks at how food production in this country is being absorbed by large, vertically integrated companies that combine indirect federal government support with anti-free market policies to control much of the chicken, pork and beef we eat.
The book, published by Simon & Schuster, has gotten favorable reviews in The New York Times and the Wall Street Journal. Leonard, who covered the food industry for a decade as an Associated Press reporter, writes that the 95 percent of Americans who eat chicken are supporting a top-down corporate structure and culture that keep “farmers in a state of indebted servitude, living like modern-day sharecroppers on the ragged edge of bankruptcy.”
This might have been an over-the-top statement from the conservative and pro-business Journal, but the reviewer actually says that Leonard has carefully built his case.
His evidence is Tyson Foods, a firm that grew out of the poultry belt of Arkansas into a global agribusiness giant. Early on, Tyson’s executives decided that it was too risky for them to grow their own chickens, so they farmed it all out (“out sourced” in that term we all love).
The problem is that Tyson’s rules its contract system like a ruthless plantation owner exploiting old-time sharecroppers. Pay is based on fatter chickens. If a grower goes bust, the federal government, not the banks, picks up the tab. Tyson is not at risk, the taxpayer is. It neatly dodges problems to boost its bottom line.
Growers are dependent upon Tyson for just about everything from tiny chicks to money. The author tells the stories of farmers who ran into disease issues and ended up bust. Calls for help to Tyson went unanswered until the bankruptcy papers went through. Then company men in blue anti-contamination suits would show up to gather the carcasses and birds that they still owned.
The company, of course, owns the process, from the hatchery, feed mill and the slaughter house that it often bought from locals. Leonard says the rest of Big Farming is being “chickenized.” It happened a while back with pork producers controlled by Smithfield Foods and now by its new owners, Shuanghui International which bought the venerable Virginia firm last year for $ 7 billion. Beef is next.
Virginia is a big poultry producer ranking No. 10 nationally. More than 13,000 people are employed directly in the industry dominated by a half a dozen or so huge players like Tyson’s or Perdue or Pilgrim’s Pride. Drive in the Shenandoah Valley or in Southside and you will see lots of lengthy chicken coops with Tyson or other corporate logo written on them.
Ditto hog farms, which are operated on a massive scale. Smithfield got in trouble some years back for waste pollution and in the mid-1990s, the Raleigh News & Observer won a Pulitzer for exposing pork megafarms that produced more waste than entire cities yet were handling it in a rudimentary fashion.
Things are not likely to get much better with the new Chinese owners. Apparently Shuanghui has had issues with cutting corners, putting banned chemicals in feed and have a loose oversight structure.
This isn’t exactly the glory of the free market we hear so much about. I gather re-creating that will be up to green or organic farmers. For instance, the Virginia Association for Biological Farming promotes small farms of 10 acres or less that can network sales to local groceries.
I was in New York last weekend and was surprised at the number of green farmers selling their wares at Union Square. Prices seemed pretty steep but it looked good. The food came from a growing grid of organic farms in New England, New York, New Jersey and Pennsylvania.
The issues raised by Leonard’s book are worthy of exploration especially since they show the very factors you see raised so much on this blog – the evils of government subsidies and the lack of free markets.
N.B. I’d link to the Journal story but I can’t get past their pay firewall. More capitalism. Sorry.
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