It’s a Democratic Smoke Screen
High food prices and demand for beef in a midterm election year may spell more trouble. Election years always come with a number of promises which last until Election Day but then are quickly forgotten.
Such may happen with a bill that came out after the first of March when U.S. Senate Democratic Leader Chuck Schumer (D-NY) and a number of Senate Democratic sponsors released a bill they say will lower food prices.
Schumer and other bill sponsors of the Family Grocery and Farmer Relief Act said in a March 5 press release, “The act is a competition-driven, pro-farmer, pro-rancher, pro-worker, pro-consumer, cost of living bill which breaks up dominant meatpackers, reins in foreign controlled corporate giants and uses all available tools to stop unfair pricing which drives up grocery bills for American families. It is designed to turn big structural reform into concrete benefits including more competition and greater fairness for farmers and ranchers, more resilient supply chains, lower prices and better choices at the meat counter.”
The bill’s sponsors, which include Sen. Cory Booker (D-NJ), Elizabeth Warren (D-MA), Bernie Sanders (D-VT) and Dick Durbin (D-IL), continue saying, “The act will make it unlawful for major meatpacking conglomerates to control more than one type of meat, forcing the biggest players to choose a line of business. It poses hard caps on the concentration of beef markets at both the regional and national levels. If these thresholds are exceeded, the Federal Trade Commission (FTC) must order targeted divestitures such as selling off plants, facilities or business units or spinning off new independent firms until markets are competitive again.”
The press release also notes the act will “direct the FTC to design and enforce divestiture plans, so the law delivers real structural change, not just fines companies treat as a cost of doing business, while maintaining or improving employment, honoring collective bargaining agreements and promoting safer and more stable workplaces for workers across the supply chain. It will prohibit foreign leverage over the domestic market, empowering FTC to protect competition and national security.”
The Senate Democrats say, “The act links structural reforms to kitchen table prices by focusing on unfair and unjust discriminatory pricing practices in retail and wholesale meat markets which hit independent and neighborhood grocers hardest.”
They continue, “It will authorize the Small Business Administration to provide assistance, loan guarantees, technical assistance and other support to farmer cooperatives and small business concerns which seek to acquire, operate or expand meatpacking plants of facilities divested under the act. The law will make failure to divest enforceable under the FTC, backed by significant civil penalties.”
There are some ag experts such as Derrell Peel, professor of agriculture at Oklahoma State University, who says, “Consolidation has occurred because it’s cost effective. If the meatpackers were broken up, we will lose this cost efficiency, which will raise costs in the middle of the industry, above producers and below consumers.”
Julie Anna Potts, president and chief executive officer of the Meat Institute said, “The bill amounts to reckless election-year pandering which puts the industry at risk.”
I agree with the last sentence.
