Opinion: All producers will lose under new GIPSA rules
By Will Bentley, Georgia cow/calf producer and
Executive Vice President of Georgia Cattlemen’s Association
While the U.S. Department of Agriculture's Grain Inspection, Packers and
Stockyards Administration’s (GIPSA) proposed livestock marketing rule comes
with a name like The Farmer Fair Practices Rule, those of us in the cattle
industry know better than to trust a government program wrapped in a nice
title.
We've witnessed the Federal Government use titles like this before.
A prime example would be the Waters of the U.S. Clean Water Act (WOTUS) and
the Clean Air Act. Both have names that, on the surface, we can all agree on.
But in reality they don’t do much to improve the environment and do more to
impose burdensome regulations on hard working farmers and ranchers while adding
cost to the consumer.
The proposed GIPSA rule claims to protect farmers from unfair pricing
practices, but what it actually does is harm all cattle farmers that have built
their livelihoods on producing high-quality cattle and being paid for their
efforts. Cattle producers who have carefully selected for improved genetics
that allow them to utilize alternative marketing arrangements will suffer from
those programs being jeopardized under the new GIPSA rule.
Programs that pay producers a premium for their cattle, such as breed
programs, grid values, forward contracts and other marketing agreements will be
at risk.
With the new rule, those buyers that have been paying the premiums will now
be open to frivolous lawsuits by anyone that feels that they received a
"competitive injury" or "likelihood of competitive injury"
for inferior cattle. The GIPSA rule will create a trial lawyer's dream world as
it is written so broadly that anything is open for litigation.
Under the proposed rule, USDA or a producer no longer needs to prove true
economic harm but instead only needs to say that he or she was treated
"unfairly" to sue a buyer or processor. The only problem is - there
is no definition of what "fair" actually means.
Value-added marketing programs reward producers for investing in genetic
improvements, herd management and cattle health practices to produce
high-quality cattle that they can sell for a premium. The USDA, under the
leadership of Secretary Vilsack, seems to prefer that there be no premiums
available and all beef be treated as a commodity.
Ultimately, cattle producers are in the business of producing beef for
families to enjoy. Consumers currently benefit from natural market competition
that provides an abundant supply of safe, wholesome and quality beef at an
affordable price. When the incentive to produce prime and choice cattle is
removed, consumers will be left with a lower-quality product that is costing them
more of their hard earned dollars.
No longer will cattlemen be able to, or have the incentive to, tailor their
operations to meet consumers’ preferences as those desires usually incur higher
production costs.
As a cattleman myself, it bothers me to think that the work done by our
industry over the last 30 years to improve the quality of beef and the lives of
our cattle will be erased overnight by an out-of-control regulatory environment
in Washington, D.C. - one that seems to reward mediocrity and punishes any
group that wants to outperform the status quo under the guise of “fairness.”
If stopping cattle producers from being paid based on quality and value
sounds like a socialistic market, that’s because it is. It goes against
everything that capitalism and a fair market stand for. When everyone gets the
same price, no matter what the differences in quality and production practices
exist, consumers will no longer turn to beef as their choice of high-quality
protein, and then we all lose.
About
the Author: Will Bentley is a cattle producer from Thomaston, Georgia. He and
his family own and operate a small cow-calf operation. Will also serves as the
Executive Vice President of the Georgia Cattlemen’s Association. Bentley originally wrote a version of this opinion piece for Growing Georgia www.growinggeorgia.com
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