What has her riled up is the decision by the Missouri Beef Industry Council (MBIC) to increase the state check off, doubling it from a long standing dollar a head. Maybe not so much that they did it, but that it was done by over ruling their own task force which thought a fifty cent increase was plenty.
Perry is a member of the Missouri Rural Crisis Center and, calling this MBIC request a full-blown industry crisis, the Center decided to take the issue to court.
Even though approval of the increase is subject to state-wide ballot in just a few months.
She suggested the MBIC loaded the dice, that the independent ranchers of the Show Me state were being played with a stacked deck. No one was showing them the real deal. In other words, legal action was needed to stop a foregone conclusion. The idea that ‘game, set, match’ might have been called behind closed doors before the first ball was tossed made her angry.
It’s a financial game that could have large repercussions nationwide if the MRCC court case is successful. I contacted her and asked a few questions.
Q. Let’s start with a description of your organization, the Missouri Rural Crisis Center (MRCC). Give me the basic ‘who, what, why’ of the group.
A. The Missouri Rural Crisis Center (MRCC) is a statewide farm and rural membership organization that started in 1985. We currently have 5,600 member families throughout Missouri. MRCC supports policies that benefit independent family farmers, rural communities and local economies.
Q. For this discussion, let’s separate the national check off from the state check off. When the national check off was first established in 1985, it was set at $1.00/head where it still is. That 30-year-old dollar in today’s money is worth just 50 cents. Do we need to revisit the program on a national level, instead of state-by-state?
A. Here are some facts about the current federal checkoff. Since the 1980’s, Missouri cattle producers alone have been paying over $2 million each year into the federal checkoff and U.S. beef producers have paid check off fees totaling over $2 billion.
The results: since 1985, when the beef checkoff was passed by Congress, beef consumption dropped 32% nationally and Missouri has lost 40% of our cattle producers. This has not been what we would consider a successful program for Missouri cattle producers. And now the Missouri Beef Industry Council (MBIC), who has been the recipient of $.50 of every $1.00 of this checkoff, is asking for a 200% raise from Missouri cattle farmers.
Also, looking at the pork industry, which has had a checkoff for three decades, we see similarly alarming results, Missouri has lost 90% of our hog farmers (from 23,000 to 2,100) and farmers' share of the retail dollar has decreased by 53%.
These numbers are on top of the loss of thousands of rural jobs and small businesses that have historically been supported by independent livestock production. Unfortunately, instead of increasing American beef consumption and the farmer's share of the consumer meat dollar, we have built an entire industry and subsequent bureaucracy around the existence and promotion of mandatory checkoffs.
Have mandatory checkoff programs been good for Missouri's livestock producers? I think producers have good reason to think not.
These 30 year-old programs are obsolete and outdated. The beef industry looks very different today than it did 30 years ago when the checkoff programs were put into place. Then, 1.5 million U.S. cattle producers were selling into markets in many locations that were price determining. Now we have a third fewer producers and the industry has consolidated to the point that over 80% of U.S. beef slaughter is controlled by just 4 corporations and the largest U.S. beef packer, JBS, is Brazilian owned.
We cannot expect a mandatory program to represent both the interests of independent cattle producers and the interests of multi-national packers. We have also drastically increased imports of beef, which means our checkoff dollars are more and more being used to promote foreign beef. To most producers this is not acceptable.
Before we start adding more checkoffs, we need to fix the ones we have and make them accountable to the economic interests of independent producers, if that is even possible with the current checkoff setup.
There is a recent history of livestock producers opposing these mandatory checkoffs. In 2000, pork producers voted to do away with the federal pork checkoff program, but the government fought to keep it in place by going to the Supreme Court which ruled that these mandatory checkoffs were government speech, and not producer speech.
Supporters of this new beef tax view beef producers who don’t agree with them as the enemy. They seem to have forgotten that it’s Missouri’s independent beef producers who are the backbone of our industry, not P.R. firms and bureaucrats.
Q. Let’s look at your state level initiative. The Missouri Beef Industry Council is asking for an additional dollar per head in check off funds and the MRCC has chosen to fight it in court. It’s subject to a state-wide ballot, though, so why do you want to stop it through legal means rather than fighting it at the ballot box?
The press release announcing your law suit contained language that was definitely swinging for the fences. It said the referendum process “disenfranchises voters, discourages producers from registering and voting, dilutes the vote of many producers and undermines the integrity of the election.” Would you expand on those points?
A. Unfortunately, even the petition by the Missouri Beef Industry Council (MBIC) requesting a referendum demonstrates their complete lack of accountability to Missouri’s cattle producers. When MBIC created their own “Missouri Beef Checkoff Taskforce” to determine whether they should ask for $.50 a head or $1.00 a head, the majority of their own taskforce voted to request $.50. But, of course, MBIC totally ignored that recommendation and requested $1.00 anyway. So, why should producers believe they are going to be any more accountable once we are forced to pay them another mandatory checkoff.
And maybe even more troubling, is the fact that the government (the Missouri Department of Agriculture (MDA) will be collecting the checkoff and enforcing payment and then turning that money over to MBIC, which is a totally private entity that says it has “no obligation to disclose” information about how the checkoff dollars will be spent. According to MDA and MBIC, there will be no government oversight of this program. This is basically government taking from cattle producers and giving it to private interests which is, in our opinion, un-American and not democratic.
We along with thousands of Missouri cattle producers are fighting this at the ballot box. But, if someone is going to force cattle farmers to pay what amounts to an additional $2 million dollar tax every year, the least we should have is a fair vote. And a fair vote is not what is happening here. Which is why we had to resort to legal options in order to try to get basic fairness and transparency from the government in this process.
Here are a few examples of what is wrong:
· Just to be eligible to register to vote in the referendum, producers have had to provide 3 years of their cattle sales numbers to the MDA, with no guarantee that this information will not be made public.
· MDA refused to do any public rulemaking process at all. Instead, they insisted on making up the rules as they went. In fact, they changed the definition of “beef producer” to include corporate shareholders and gave each shareholder the same right to vote as Missouri’s cattle farmers. These shareholders may have never even set foot on a Missouri cattle farm.
· MDA is refusing to allow cattle producers to vote with a secret ballot. They will be forced to sign their name on the ballot right next to their vote.
· MDA says there is no need to have a public vote count; instead, they will just enter your vote in a government database right next to your name and the other confidential business information you had to give them in order to be able to participate in the “democratic process”.
If checkoff supporters believe it’s in their best interest to increase the amount they pay into a check-off program, they could implement a point-of-sale VOLUNTARY check-off at any time without a referendum or government involvement at all. This would be a market-based solution, instead of a government mandate and producer tax.
Q. In a January 19 editorial published by the Columbia Tribune, Roger Allison, a cattle farmer and executive director of the Missouri Rural Crisis Center, wrote, “I have heard from hundreds of beef producers across the state who oppose this checkoff — especially at a time when net farm income is expected to drop by 38.2 percent this year, the largest single-year decline since 1983.”
Those are some frightening numbers that would suggest now is not the time to ask for an extra buck. Where did they come from? And what about the oft-repeated claim that every dollar invested in the check off returns $11? With that kind of R.O.I., isn’t it time to fatten the kitty and go ‘all in’?
A. In November of 2015, USDA released a statement that net farm income was forecast to drop by 38.2% since 2014 and would be the largest single-year decline since 1983. For 2016, the numbers don’t look any better. The University of Missouri projects these lower farm incomes to continue for the next 10 years. And we all know, cattle prices have declined sharply with no substantial increase being projected into the near future. This is definitely not the time to add a new beef checkoff. This is definitely not the time to mandate Missouri cattle farmers to pay $2 million every year that we could be keeping in our local economies or spending on our farming operations.
The claim by the NCBA that every checkoff dollar returns $11.20 to beef producers is based on a Cornell University study that was commissioned and funded by the Cattlemen’s Beef Board. The fact that these types of studies are not independent, but are funded by checkoff dollars puts the ROI results in doubt. But the reality is that the results that really matter to cattle producers such as beef consumption and cattle prices have not been good for independent cattle producers.
Q. Let’s assume for the moment, that your law suit fails to stop the referendum. What are you prepared to do as a next step?
A. Our lawsuit is for the purpose of holding a government agency, the Missouri Department of Agriculture, accountable to the producers who will be mandated to pay into this checkoff program. This is important, not only for this referendum, but for future checkoff proposals in Missouri. It is just common sense accountability. We will continue to fight for independent cattle farmers and democracy throughout the referendum process and into the future.
Stopping the new beef checkoff tax is a big fight, but I’m afraid an even bigger fight ahead of us is the fight for independence—it’s about who will control livestock production in Missouri and around our country, hundreds of thousands of independent cattle producers or a few multi-national corporations with no allegiance to our industry or our local economies.