TRY FREEDOM INSTEAD OF REGULATION
Two senators have gotten some big media play proposing a bi-partisan cure for alleged cattle price manipulation by the big packers. Sen. Chuck Grassley (R-Iowa) and Sen. Jon Testor (D-Montana) have teamed up to write a mandate that the big four beef processors must purchase half their supply from what is known as the spot market.
The spot market is not a captive supply, or a contracted animal. The allegation in the cattle farming and ranching community is that the four processors who control 80 percent of the U.S. market use forward contracts and their down line supply fraternity to bilk producers out of true market value. While the processors' margins go up and retail prices soar, farmers and ranchers see either no price increases.
That seems unfair and so the good senators, who are also part-time cattle producers, want to rectify the situation with yet another regulation. Of course, this regulation will require a new group of bureaucrats to ride herd (pun intended) on these mega-processors to make sure they don't cheat. As well intentioned as this effort may be--and I certainly don't question the good intentions--it's a typical more government answer to a problem created by big government.
Why have these four processors gained such power in the market place? Where have all the competitors gone? Isn't it interesting how these big government folks write scale prejudicial regulations and then wonder where all the small operations went? A complete disconnect exists between the rules and fewer players. If you make it harder and harder to play the game, fewer people will play. When fewer people play, you get collusion, centralization, and cronyism.
One of the most ignorant statements anyone can utter today--and many are--is that we've arrived at this juncture (amalgamation and consolidation whereby four outfits control 80 percent of the U.S. beef packing volume) because of free markets. Nothing could be further from the truth. We haven't had free markets since Teddy Roosevelt acquiesced to the packers in 1906 and gave us the Food Safety Inspection Service (FSIS). Ever since that agency came into existence, it's waged a war against small abattoirs until today very few exist.
Under the guise of food safety, FSIS destroys competition and market access. To the good senators who mean well, I would say we don't need yet another layer of regulations; what we need is a new freedom of access in the marketplace. Congressman Thomas Massie's PRIME ACT is certainly a step in that direction, but I'd love to see it go farther.
I think we need a FOOD EMANCIPATION PROCLAMATION that would guarantee every American citizen the right to acquire the food of their choice from the source of their choice. Right now I can shoot a deer during hunting season and take it to a community processor who will make it into summer sausage that's to die for. No bureaucrat checks the venison for safety; no bureaucrat checks the neighbor's processing facility for sanitation or safety. I pay the neighbor processor
and eat the summer sausage; I can feed it to my children and friends. This is all legal because it's wild game.
But this same community outfit may not have a pound of beef in its establishment. Why? Obviously this has nothing to do with food safety; it's strictly denial of market access. And yes, it offends me that people ask for government interference in my food choices. If two consenting adults want to exercise freedom of choice for their microbiome's fuel, by what authority does a bureaucrat intervene in that most intimate of decisions? Indeed, by what authority?
The answer, good senators, is to restore competitive market access to thousands and thousands of small processors. That would break the chokehold of these mega-outfits in short order without any bureaucrat at all. The answer is freedom, not more bureaucracy. Instead of a "too big to fail" policy, we need a "too small to worry about" mindset.
What will it take for the American people to allow unregulated consensual food commerce between neighbors?