Pro business? Drop the GIPSA rule, says AMI

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Responding to President Obama’s speech to the U.S. Chamber of Commerce calling on businesses to hire and invest, the American Meat Institute suggests a good place to start would be to drop the proposed GIPSA rule for livestock marketing.

AMI notes that the comment period on the rule closed in November and more than 60,000 comments were filed. USDA presumably is in the process of reviewing the comments.

In December 2010, Agriculture Secretary Tom Vilsack said the USDA would conduct a more extensive economic analysis of the rule in response to requests from industry and Congress. Several economic studies sponsored by industry groups indicate the rule would have negative consequences for livestock producers and the industry overall, but proponents of the rule question those results.

It remains unclear when, or if, USDA will release results of its economic analysis.

“The future direction of the proposed rule is uncertain, and if there’s one thing that American businesses cannot tolerate easily now it’s more economic uncertainty,” says AMI President J. Patrick Boyle. “Uncertainty kills investment and, in turn, economic growth.” 

Realistically, it seems doubtful the administration would simply drop the proposed marketing rules at this stage. USDA spent the summer conducting a series of “competitiveness workshops,” including one in August that attracted more than 1,200 participants to the Colorado State University campus in Fort Collins to debate the GIPSA rule.

Read “A hot day in Fort Collins” for a summary of the workshop’s proceedings.

During that meeting and in other comments, it became clear that Secretary Vilsack, U.S. Attorney General Eric Holder and other administration officials believe the current livestock marketing system is broken and that new regulations are necessary to “level the playing field” for small producers. And, of course, the rule has strong support from numbers of opinionated and vocal producers around the country.

It seems likely that once USDA completes its review of those 60,000 comments and analyses its own economic study, the agency will make some minor changes to the proposed rule to demonstrate responsiveness to all stakeholders, but a final rule similar to the current proposal is likely. Once implemented, at least some aspects of the final rule likely will face legal challenges that could linger in federal courts for years. So stay tuned.

Read more about the proposed rule from AMI.

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M. Jones    
SD  |  February, 08, 2011 at 06:56 PM

The proposed changes appear, at best, to be determined to use problems with some commodities, poultry and possibly pork, to dramatically alter the marketing tools chosen by some cattle producers to secure better prices for superior quality cattle available in load lots, in order to force all cattle onto the same payment basis regardless of quality or quantity from the individual producer. This benefits mostly the plaintiffs' attorneys, one of whom appears to have crafted this debacle, along with the unions prevalent at the Ft. Collins meeting, and the anti'animal agriculture activists, as in Food and Water Watch, also in attendance, with both groups obviously given preference in seating over the cattle producers who were NOT favorable to the rule.

Edgar Raymond    
Louisiana  |  February, 09, 2011 at 11:41 AM

We are dealing with an antiquaited Rule that should be scrapped and replace it with a modern updated version.

TN  |  March, 12, 2011 at 12:00 PM

AMI is pro business---their business-- at the expense of family farmer's business. These new GIPSA laws were proposed because of all the documented cases where the AMI's members broke the plain reading of the Packer and Stockyards Act to take value from their producers without adhering to the market laws contained in the PSA. The AMI is supporting market fraud for big business that hurts many little businesses. It is time we exposed the AMI for what it is--- a meat packer propaganda and lobbying group who tries to influence Congress into allowing them to steal value from the producers in the market and then use that value to compete with. This allows all of the existing and biggest meat packers to obtain a barrier of entry against new entrants in their side of the business. They are a bunch of meat processors and their friends colluding against the family farmer. It is illegal, but nothing is being done about it just as nothing is being done about those who wrecked our financial system. Our nation can't take much more of this kind of "business". It is ruining our economy. Tom

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