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Breaking America’s meat monopoly

 (AP Photo/Sauk Valley MediAlex T. Paschal)

(AP Photo/Sauk Valley Media, Alex T. Paschal)

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Updated: March 20, 2014 6:54PM



In the past 60 years, the United States has fallen deeply in love with meat. What was once a treat is now expected at every meal to the point where we can get it in a tube. The demand for meat has increased dramatically, and the largest meat companies have found ways to fulfill that demand cheaply. It’s not a surprise that the path to the six cent Chicken McNugget was built at the expense of not only the chickens themselves, but farmers and smaller meat plants. The quest for cheap meat has resulted in a ruthless market that has left 85 percent of supply in the hands of five companies.

This oligopoly has driven the meat industry to do some very impressive and terrifying things. We raise nine billion animals for the slaughter a year. To do that responsibly in a way that respects the animal, the consumer, and the farmer just isn’t possible. The old clip from Sesame Street is still the image many Americans think of when they imagine a farm. It has an understated beauty, a pastoral ideal that romanticizes the American farmer. But the meat industry lost respect for the farmer a long time ago.

If you’re not in the know, you might expect farming to be pretty simple, in terms of economics. You raise your animals, sell them, and get paid for them. Trading goods for money has been a commonly accepted way of doing business for several millennia, but that system has broken down for the American farmer. Instead of getting paid for goods, American farmers are placed in a tournament where the top producers earn a bonus, which comes from a penalty levied on the least productive farmers. What the meat industry is doing, says Christopher Leonard, New America fellow and author of The Meat Racket, is shifting volatility onto farmers. Tournament results are very often the difference between staying in business and bankruptcy, as farms are forced to become ever larger to meet absurd demand, taking out enormous loans to grow their business.

Trading goods for money has been a commonly accepted way of doing business for several millennia, but that system has broken down for the American farmer.

It goes without saying that however farmers are disrespected, it’s worse for the animals. Dudley Butler, a former USDA official, said at a New America event, “We’ve drifted into a situation where if a product’s cheaper, that’s OK, no matter what happens in the production chain.” Chickens are now born (from a single genetic strain), fattened, and slaughtered within six weeks of life. This is an inevitable byproduct of the way the industry is run, and it’s a tough road back to normalcy. Wayne Pacelle, president of the Humane Society of the United States, laid out four principles: “less cruelty, more husbandry, fewer animals, more farmers.” In other words, traveling back to a time where we had “pig farmers” rather than “pork producers.” It sounds unlikely, but we’ve done it before. The United States had a similar oligopoly broken up by the Packer Consent Decree in 1920. That may only happen when consumers are affected more keenly — that is starting to happen.

It’s the same story that happens in any monopoly. In the absence of competition, the incentive for innovation disappears, prices become distorted, consumer choice becomes an illusion, and new competitors fight a losing battle. The biggest innovation to hit grocery stores in recent years is organic food. But the fight for shelf space is not easily won when your competition is so enormous. It’s more than likely that your favorite organic brand is controlled by one of very few companies. Your label might say, “natural,” but as Andrew Gunther of Animal Welfare Approved said, “natural” just means “minimally processed.” Prices, too, are outside of consumer control. While costs for large industrial meat companies become lower and lower, that is not passed down to consumers.

Barry Lynn, director of New America’s Market, Enterprise, and Resiliency project, said “Maybe it’s time for a citizen’s revolt.” Maybe he’s right. If the market normalizes, we can afford a lot more respect to animals, farmers, and ourselves.

Cyrus Nemati is a web producer for The Weekly Wonk, a new digital magazine where this piece first appeared.



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