# Livestock Industry



Weekend open thread: Food and farm policy edition

Share anything that’s on your mind this weekend in the comments below.

Yesterday the U.S. Department of Agriculture and the U.S. Department of Justice jointly hosted a workshop in Ankeny devoted to concentration in agriculture, antitrust issues and market practices. After some controversy over the speakers scheduled initially, more farmers and producers were able to speak during the workshop. Lynda Waddington covered a panel including U.S. Secretary of Agriculture Tom Vilsack. The Des Moines Register covered a session concerning Monsanto’s dominance in the biotech seed industry:

Monsanto has generated controversy because of its leading role in the biotech revolution in corn, soybean and cotton seeds since the mid-1990s. About 90 percent of the corn and soybean fields in the Midwest now are planted with seeds genetically altered to resist herbicides and pests.

“Biotech seeds have given farmers better yields and improved their lives,” said farmer Pam Johnson of Floyd County.

Monsanto, Pioneer and other seed companies license their traits under the auspices of a 1980 U.S. Supreme Court decision allowing life forms to be patented.

Iowa State University professor emeritus Neil Harl said that Supreme Court decision radically changed the seed business from a collaborative, collegial enterprise among land grant colleges, farmers and companies.

“Before 1980, seed germplasm was considered something in the public domain,” said Harl. “Seed was developed in the field and everybody shared. Now seeds are developed in the laboratory and are patented and licensed.”

Holder said the high court decision 30 years ago wouldn’t block antitrust action, if it was deemed necessary.

“The antitrust authority is there,” Holder said. “The question is what the patent holders are doing with their patents. If they are using it to preserve monopolies, that is unfair behavior.”

Iowa Secretary of Agriculture Bill Northey noted that farmers are spending twice as much on seed as they did a decade ago, but also are getting better yields.

“There is tension about the cost of inputs,” Northey said. “But we don’t want to lose the innovation.”

The food blog Cooking Up a Story published this short backgrounder on “Hybrids and the Emergence of Seed Monopolies.”

The night before the DOJ/USDA workshop, Iowa CCI, Food and Water Watch, the National Family Farms Coalition and Food Democracy Now organized a town-hall meeting to raise awareness of excessive levels of concentration in agriculture. Lynda Waddington was there for Iowa Independent.

Democratic candidate for Iowa secretary of agriculture Francis Thicke has long been concerned about the loss of competition in agricultural markets. He attended the workshop in Ankeny and praised the DOJ and USDA for investigating antitrust issues related to agriculture:

“Antitrust enforcement by the federal government has been ignored for so long that it will take Teddy Roosevelt-style trust busting to bring competitive markets back to agriculture,” said Thicke, who plans to participate in the first of a series of five workshops planned by the two federal departments this Friday in Ankeny. […]

“The effects of excessive market power by a few firms has been studied for years,” said Thicke. “It has been shown that if four or fewer firms control 40% or more of a market, then it no longer functions as a competitive market.” He pointed out that, as of 2007, four firms controlled 85% of the beef packing market, four firms controlled 66% of the pork packing market, four firms controlled 59% of the broiler market, and four firms controlled 55% of the turkey market.

“Clearly we are beyond the point of open competition in our agricultural markets,” Thicke asserted. “When there are so few large firms in a market, controlling firms begin to act in concert whether or not they are directly communicating pricing with each other.”

Speaking of food policy, I heard some good news this week. The Iowa Center on Health Disparities at the University of Northern Iowa has received major grants for two important projects:

The focus of the W. K. Kellogg Foundation grant is to launch an Iowa Food Policy Council, a diverse statewide cooperative to develop and make research, program and policy recommendations for a food system to support healthier Iowans, communities, economies and environments. Over the next year, the Iowa Food Policy Council will conduct a comprehensive statewide assessment of food systems, food access and health indicators.

The focus of the Leopold Center grant is to convene key food security and public health stakeholders from across Iowa who will examine the disparities in food access and health among Iowans. The Food Access and Health Working Group will address programs and policies that increase access to fresh, nutritious and affordable local food for all Iowans, including vulnerable children and their families.

More details on the grants are after the jump. I was hoping Governor Culver would revive the Food Policy Council, but I’m glad another way was found to get this project going.

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Harkin committed to reforming student loans

In his latest e-mail blast to constituents, Senator Tom Harkin touches on his priorities as the new chairman of the Senate Committee on Health, Education, Labor and Pensions. One point he mentioned hasn’t been on my radar screen this year:

The full agenda of the Committee will focus on reforming federal student loan programs so that we can stop subsidizing private banks and instead focus on loans that the federal government can make more cheaply.  We can save $87 billion over 10 years in that effort, and use that money to increase Pell grants for low- and middle- income college bound students, and to fund other important education initiatives.  

I had forgotten about President Barack Obama’s effort to reform the student loan system:

His plan is to do away with a system in which the Federal Government subsidizes banks and other private finance companies like Sallie Mae to lend money to students. The Administration essentially wants to cut such companies out of the game and run the system itself. Democrats claim the move will save $87 billion over 10 years, which can be used for a laundry list of education priorities, including increasing the maximum amount of Pell Grants, expanding Perkins Loans and investing in community colleges and other programs. […]

Educational institutions currently have two ways to offer federal loans to students. In the Federal Family Education Loan (FFEL, pronounced “fell”) program, the government pays subsidies to banks and lenders to dole out money to borrowers and reimburses companies up to 97% of the cost of any loan that is not paid back. The second way is the direct-loan program, created in 1993 as an alternate option, in which the government cuts out the middle man, lends money directly and gets all the profits. If the Student Aid and Fiscal Responsibility Act (SAFRA) passes both houses of Congress, the approximately 4,500 colleges and universities that are currently signed up for FFEL will have to abandon the program and start using the direct-loan option by July 1, 2010.

Directing federal money toward programs that help needy students, such as Pell Grants, makes a lot more sense than subsidizing private banks to make student loans.

Finding 60 votes in the Senate for this proposal will be challenging, however. This is one banking bailout Republicans will fight hard to protect, and according to Time magazine, at least one Democrat (Ben Nelson of Nebraska) opposes the plan too. If this bill passes, it will probably be through the budget reconciliation process, which requires only 51 votes in the Senate.

Health care reform is sure to take up a lot of Harkin’s time this fall, but I’m glad the HELP chairman will also focus on other bills that could change many lives for the better. Even if the health care project falls apart in the Senate, Harkin could accomplish a lot this year if he gets the student loan bill through and brokers a good compromise on the Employee Free Choice Act.

I see only one downside to Harkin becoming the HELP chairman, and that’s Senator Blanche Lincoln of Arkansas taking over the Agriculture Committee. Jill Richardson has been on this case at La Vida Locavore. I recommend reading her posts on industry lobbyists who used to work for Lincoln, Lincoln’s strong support for corporate ag interests such as Arkansas-based Tyson Foods, and Lincoln’s positions on trade, the climate change bill, and the Clean Water Act.

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