Antitrust Official Gets Stampeded By Big Beef : The Salt President Obama's appointee for antitrust issues in the meat industry wanted to give cattlemen more clout against big meatpackers. But he's quitting his job on Thursday. His reform efforts ran into fierce opposition from the country's packers and big cattle producers.

Antitrust Official Gets Stampeded By Big Beef

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Dudley Butler is quitting his job tomorrow. Never heard of him? He was picked by President Obama to run a division of the USDA. Butler was part of a group charged with exposing and fighting agribusiness monopolies. But he's the last of the group.

Frank Morris of Harvest Public Media explains his mission and what happened to him.

FRANK MORRIS, BYLINE: Dudley Butler set out to change the cattle industry, a business cattleman Shawn Meyer will tell you gets harder all the time.

SHAWN MEYER: It seems like the smaller go away and the bigger just get a little bigger.

MORRIS: More than half a million families have stopped raising cattle in the last three decades. Some say efficiency and economies of scale fully account for the decline. Others blame a revolution in the way livestock is sold.


MORRIS: At sale barns like this one in Kingsville, Missouri, cattlemen still bid openly for breeding stock. Meatpackers once bought on the open market, too.

STEVE KAY: But, yeah, those days are over.

MORRIS: Steve Kay, the publisher of Cattle Buyers Weekly, says the four big packing companies now buy mostly on contract, a more sophisticated and efficient arrangement.

KAY: It rewards producers who produce the most consistent, highest quality cattle so that we can then produce more consistent high quality beef for consumers.

MORRIS: Packers get a guaranteed supply. Cattle producers get a guaranteed market. That's good for everybody, according to Mark Dopp with the American Meat Institute.

MARK DOPP: That working relationship gives everybody some certainty and removes risk.

MORRIS: But it also removes a measure of independence and that rankles some cattlemen. The system took hold in the poultry industry years ago. Now, fewer producers raise a whole lot more birds and they work almost exclusively under restrictive contracts for packers.

Fred Stokes, a Mississippi cattleman who runs the Organization for Competitive Markets, says beef is next.

FRED STOKES: We call chickenization. Go the way the poultry guy is, where the farmer owns the land, totes the mortgage, does the work, but is under contract to someone who determines how much he's going to get paid.

MORRIS: And if that pay seems unfairly low, well, Stokes says there's much a producer can do about it under the current interpretation of the Packers and Stockyards Act. This is where Dudley Butler comes in. A lawyer with experience suing poultry processors, Butler took over the Grain Inspection, Packers and Stockyards Administration determined to make litigation against packers easier. Stokes, a friend of Butler's, saw hope for the family farm.

STOKES: Oh, I thought, my God, finally. Finally. It was unprecedented.

MORRIS: The USDA linked up with the Justice Department to launch a massive study of antitrust issues in agriculture, five big public hearings. Christine Varney was leading a freshly invigorated antitrust division, launching investigations and working closely with Butler. Now, Varney says she's sad to see Butler step down.

CHRISTINE VARNEY: I think he's terrific. I think he's done a great job for farmers in America and I think it's a great loss to the Department of Agriculture, but these are tough jobs and everybody serves their time.

MORRIS: In fact, Varney resigned last summer.

BILL BULLARD: This was the reformist team that was supposed to restore competition to the markets.

MORRIS: Bill Bullard runs R-Calf USA, a cattleman's advocacy organization.

BULLARD: Now, they are all gone and we have seen no improvement whatsoever in the ongoing erosion of competition.

MORRIS: Now, that's not the way major meatpacking and livestock groups see it. They say what Bullard would call increased and transparent competition for cattle would have thrown a wrench into the beef industry big enough to cost thousands of jobs, millions of dollars and significantly raise the price of beef. In the end, the House refused to fund implementation of the proposed rule change. So, after a long fight, the big meatpacking companies will keep their efficient production system while smaller producers will continue to scramble for their place in the modern meat industry.

For NPR News, I'm Frank Morris in Kansas City.



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