The Daily Yonder | Senate Democrats take aim at antitrust and lack of competition in ag markets

Reposted from:

Family farm groups are applauding a new proposal by Senate Democrats to strengthen antitrust enforcement and make markets fairer and more competitive. 

The Competition and Antitrust Law Enforcement Reform Act, sponsored by Senator Amy Klobuchar (D-Minnesota), is designed to “reinvigorate America’s antitrust laws and restore competition to American markets,” according to a press release.   

Klobuchar, who recently became chair of the Senate Judiciary Subcommittee on Antitrust, Competition Policy and Consumer Rights, said the U.S. has a “massive competition problem.”  

“We can no longer sweep this issue under the rug and hope our existing laws are adequate,” she said. “The Competition and Antitrust Law Enforcement Reform Act is the first step to overhauling and modernizing our laws so we can effectively promote competition and protect American consumers.” 

Many family farm groups, which have long called for federal antitrust policies that aggressively address corporate consolidation and concentration in agriculture, support the Klobuchar antitrust bill. 

“A decades-long trend of unbridled consolidation has led to far-reaching corruption, the decimation of competitive markets, and the extraction of wealth and opportunity from our rural communities,” said Joe Maxwell, a Missouri farmer and president of Family Farm Action Alliance. “This act is a historic step toward curbing monopolies and building an inclusive economy for all small businesses, workers, and farmers.”

David Schwalbe, a rancher from Bismarck, North Dakota, and member of Dakota Resource Council (DRC) and the Western Organization of Resource Councils (WORC), also supports expanded federal antitrust action. 

“With Covid-19 exposing the weakness of our food system, Senator Klobuchar’s bill is more important than ever to break up the giant corporations that have made us vulnerable to unforeseen calamities,” Schwalbe said in an email to the Daily Yonder. 

He said large corporate conglomerates have driven down what farmers can earn for producing food while raising the price for consumers. That results in huge profits for corporations, he said. 

“It’s past time to put an end to the theft we experience from our monopolized agriculture and food system,” Schwalbe said. “Congress needs to act to stop price-fixing and restore competition and Senator Klobuchar’s bill is a step in the right direction. Antitrust enforcement and strengthening independent family farms and ranches is a unifying call to action.” 

Federal antitrust action is a ‘foundation” for deep structural reforms needed in the agriculture and food system, according to Tyler Whitley, program manager for the Challenging Corporate Power Program of RAFI-USA, which also supports the Klobuchar bill. 

“People in rural America know that unbridled corporate power is the real driver for rural economic extraction, loss of small businesses, and a decline in family farmers,” Whitley said in an interview with the Daily Yonder. “That said, antitrust action on its own isn’t an end-all be-all solution. When livestock and poultry markets are this concentrated, one more poultry integrator or one more hog processor isn’t going make the difference.” 

Whitley said that in addition to making existing markets fair and competitive, structural change is needed in agriculture to address large, complex problems like climate change. “If we’re going to take on a problem as large as climate change, we need every tool in the toolbox,” Whitley said. “Antitrust action is pretty darned big wrench, and a necessary one if we’re gonna have solutions that come from outside the existing corporate-controlled box.” 

RAFI-USA’s support for the bill is based on some key reforms to antitrust law that the group has been supporting for decades. The bill expands the legal definition of antitrust law, expands wage and compensation protections and provides safeguards for whistleblowers speaking out against abuses of corporate power. 

These whistleblower protections are critical, Whitley said, especially for the nation’s remaining 25,000 poultry growers. “The vast majority of poultry farmers who spoke out about contract abuses they faced from integrators during those livestock competition hearings in 2010 during the Obama administration are no longer farming,” Whitley said. “Once they spoke out against abuses of power from corporations, things started to change [for the worse] for them.” 

Family Farm Action also believes that the Klobuchar bill is a good start for addressing concerns about mergers and acquisitions within agricultural markets, but also stated that more agriculture-specific actions will be required to address fair and competitive markets for farmers. 

“This bill primarily targets a court’s review of corporate acquisitions and mergers, governed by the Department of Justice and the Federal Trade Commission,” the group stated. “It does not address monopoly meatpacker’s abusive practices governed by the Packers and Stockyards Act.” 

Family Farm Action Alliance’s Toolkit for the 117th Congress provides a more in-depth list of what they say is needed Congressional action to curb globalized concentration, confront abuses of power, and establish fair markets. 

The Competition and Antitrust Law Enforcement Act is co-sponsored by Senators Richard Blumenthal (D-Connecticut), Cory Booker (D-New Jersey), Ed Mareky (D-Massachusetts), and Brian Schatz (D- Hawaii). The bill would need to be passed through the Senate Judiciary Committee before heading to a full Senate floor vote. House action would also be required.