Today, President Biden will sign an executive order to “to promote competition in the American economy, which will lower prices for families, increase wages for workers, and promote innovation and even faster economic growth.” The White House press release explains, “For decades, corporate consolidation has been accelerating. In over 75% of U.S. industries, a smaller number of large companies now control more of the business than they did twenty years ago. This is true across healthcare, financial services, agriculture and more.”
The Executive Order pays particular attention to agriculture and reflects the lived experience of the farmers and ranchers we work with and hear from on our hotline. The portion of the order that deals with agriculture ushers in a new era of oversight, transparency and fairness, which will help level the playing field so that independent farmers and ranchers have a fair shot at earning a living in agriculture. The order will protect and serve eaters as well.
In the Order, the President:
- Directs USDA to consider issuing new rules under the Packers and Stockyards Act making it easier for farmers to bring and win claims against meatpackers who wield enormous power in their dealings with farmers and ranchers, stopping chicken processors from exploiting and underpaying chicken farmers, and adopting anti-retaliation protections for farmers who speak out about bad practices.
- Directs USDA to consider issuing new rules defining when meat can bear “Product of USA” labels, so that consumers have accurate, transparent labels that enable them to choose products made here.
- Directs USDA to develop a plan to increase opportunities for farmers to access markets and receive a fair return, including supporting alternative food distribution systems like farmers markets and developing standards and labels so that consumers can choose to buy products that treat farmers fairly.
- Encourages the FTC to limit powerful equipment manufacturers from restricting people’s ability to use independent repair shops or do DIY repairs—such as when tractor companies block farmers from repairing their own tractors.
Farm Aid applauds this bold action and stands ready to help USDA implement these urgent and critical reforms to rein in the power of corporations in our food system and empower farmers and ranchers to earn a fair living in competitive markets that strengthen family farm agriculture, our communities and all of us who eat.
- Farm Aid supports the order’s directive to issue new rules defining when meat can bear “Product of USA” labels because for decades we have heard from hard working, independent livestock producers about their frustration and financial losses at having their quality, US produced meat undercut by meat coming across the border sporting the US label, a label that they created.
- Farm Aid supports the order’s directive for USDA to develop a plan to increase opportunities for farmers to access markets and receive a fair return, including supporting alternative food distribution systems like farmers markets and developing standards and labels so that consumers can choose to buy products that treat farmers fairly because we have seen first hand the frustration by farmers who see their products undervalued, and the huge benefits to farmers, rural communities and taxpayers when farmers are supported in their entrepreneurship and marketing.
- Farm Aid supports the encouragement of the FTC to limit powerful equipment manufacturers from restricting the “Right to Repair”— people’s ability to use independent repair shops or do DIY repairs, such as when tractor companies block farmers from repairing their own tractors because we see the frustration of farmers when they somehow no longer own the equipment that they paid their hard-earned money for, and they are denied the use of their own skills and ingenuity in repairing and modifying the equipment that they bought and paid for.
To summarize the need for this impactful action, the White House press release says,
Over the past few decades, key agricultural markets have become more concentrated and less competitive. The markets for seeds, equipment, feed, and fertilizer are now dominated by just a few large companies, meaning family farmers and ranchers now have to pay more for these inputs. For example, just four companies control most of the world’s seeds, and corn seed prices have gone up as much as 30% annually.
Consolidation also limits farmers’ and ranchers’ options for selling their products. That means they get less when they sell their produce and meat—even as prices rise at the grocery store. For example, four large meat-packing companies dominate over 80% of the beef market and, over the last five years, farmers’ share of the price of beef has dropped by more than a quarter—from 51.5% to 37.3%—while the price of beef has risen.
Overall, farmers’ and ranchers’ share of each dollar spent on food has been declining for decades. In short, family farmers and ranchers are getting less, consumers are paying more, and the big conglomerates in the middle are taking the difference.
Meanwhile, the law designed to combat these abuses—the Packers and Stockyards Act—was systematically weakened by the Trump Administration Department of Agriculture (USDA).
American farmers and ranchers are also getting squeezed by foreign corporations importing meat from overseas with labels that mislead customers about its origin. Under current labeling rules, meat can be labeled “Product of USA” if it is only processed here—including when meat is raised overseas and then merely processed into cuts of meat here. For example, most grass-fed beef labeled “Product of USA” is actually imported. That makes it hard or impossible for consumers to know where their food comes from and to choose to support American farmers and ranchers.
Corporate consolidation even affects farmers’ ability to repair their own equipment or to use independent repair shops. Powerful equipment manufacturers—such as tractor manufacturers—use proprietary repair tools, software, and diagnostics to prevent third-parties from performing repairs. For example, when certain tractors detect a failure, they cease to operate until a dealer unlocks them. That forces farmers to pay dealer rates for repairs that they could have made themselves, or that an independent repair shop could have done more cheaply.