tyson_chickBy Peter Galuszka

One book on my to-read list is Christopher Leonard’s “The Meat Racket” which looks at how food production in this country is being absorbed by large, vertically integrated companies that combine indirect federal government support with anti-free market policies to control much of the chicken, pork and beef we eat.

The book, published by Simon & Schuster, has gotten favorable reviews in The New York Times and the Wall Street Journal. Leonard, who covered the food industry for a decade as an Associated Press reporter, writes that the 95 percent of Americans who eat chicken are supporting a top-down corporate structure and culture that keep “farmers in a state of indebted servitude, living like modern-day sharecroppers on the ragged edge of bankruptcy.”

This might have been an over-the-top statement from the conservative and pro-business Journal, but the reviewer actually says that Leonard has carefully built his case.

His evidence is Tyson Foods, a firm that grew out of the poultry belt of Arkansas into a global agribusiness giant. Early on, Tyson’s executives decided that it was too risky for them to grow their own chickens, so they farmed it all out (“out sourced” in that term we all love).

The problem is that Tyson’s rules its contract system like a ruthless plantation owner exploiting old-time sharecroppers. Pay is based on fatter chickens. If a grower goes bust, the federal government, not the banks, picks up the tab. Tyson is not at risk, the taxpayer is. It neatly dodges problems to boost its bottom line.

Growers are dependent upon Tyson for just about everything from tiny chicks to money. The author tells the stories of farmers who ran into disease issues and ended up bust. Calls for help to Tyson went unanswered until the bankruptcy papers went through. Then company men in blue anti-contamination suits would show up to gather the carcasses and birds that they still owned.

The company, of course, owns the process, from the hatchery, feed mill and the slaughter house that it often bought from locals. Leonard says the rest of Big Farming is being “chickenized.” It happened a while back with pork producers controlled by Smithfield Foods and now by its new owners, Shuanghui International which bought the venerable Virginia firm last year for $ 7 billion. Beef is next.

Virginia is a big poultry producer ranking No. 10  nationally.  More than 13,000 people are employed directly in the industry dominated by a half a dozen or so huge players like Tyson’s or Perdue or Pilgrim’s Pride. Drive in the Shenandoah Valley or in Southside and you will see lots of lengthy chicken coops with Tyson or other corporate logo written on them.

Ditto hog farms, which are operated on a massive scale. Smithfield got in trouble some years back for waste pollution and in the mid-1990s, the Raleigh News & Observer won a Pulitzer for exposing pork megafarms that produced more waste than entire cities yet were handling it in a rudimentary fashion.

Things are not likely to get much better with the new Chinese owners. Apparently Shuanghui has had issues with cutting corners, putting banned chemicals in feed and have a loose oversight structure.

This isn’t exactly the glory of the free market we hear so much about. I gather re-creating that will be up to green or organic farmers. For instance, the Virginia Association for Biological Farming promotes small farms of 10 acres or less that can network sales to local groceries.

I was in New York last weekend and was surprised at the number of green farmers selling their wares at Union Square. Prices seemed pretty steep but it looked good. The food came from a growing grid of organic farms in New England, New York, New Jersey and Pennsylvania.

The issues raised by Leonard’s book are worthy of exploration especially since they show the very factors you see raised so much on this blog – the evils of government subsidies and the lack of free markets.

N.B. I’d link to the Journal story but I can’t get past their pay firewall. More capitalism. Sorry.

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18 responses to “Modern Day Sharecroppers”

  1. LifeOnTheFallLine Avatar

    No surprise that a region so enamored with exploiting labor that it was willing to split the union to keep its slaves and later was the propulsive force behind right-to-freeload laws would be the launch point for contemporary sharecropping.

  2. Like with coal, I end up a bit conflicted.

    I hate the idea of factory animal operations .. and I’m convinced that those operations of not handling their antibiotic/hormone-laden poop… property and it is getting into the rivers. And chicken in the stores is widely contaminated with feces.

    and there many other problems from inhumane treatment of the animals as well as terrible working conditions for the folks who slaughter and process.

    but I’m a skeptic on the smaller “organic” operations also. Some are legit and some are scams and the irony here is that there is a lot more focus and visibility into the major companies than the small producers.

    Then we have the problem of just how many people would be willing to pay $10 for a chicken or a pound of burger – the added cost of a 3rd party certification process because I don’t believe just because someone says they’ve done something “organically” that they have.. and the thing I’ve heard is that the govt “certifies” organic… so.. my question is – is this the same government that certifies the factory farms?

    who do you trust? The government or the guy who grows his own chickens and other stuff ? Do we just take the word of the small producer that his stuff is “good”?

  3. In his zeal to portray Tysons as an example of the “free market” in operation, Peter left out a minor detail. I quote from the book review:

    “Less efficient farmers are driven out of business. Their loans are guaranteed by a federal organization called the Farm Service Agency, so the banks don’t lose money if the farmers default. In other words, the taxpayer foots the bill if something goes wrong.”

    Without the federal loan guarantees, banks would be far more careful about lending money to chicken farmers, and the Tysons business model would fall apart!

    1. re: ” Without the federal loan guarantees, banks would be far more careful about lending money to chicken farmers, and the Tysons business model would fall apart!”

      isn’t this the same for the entire industry – beyond Tysons – including Perdue?

      you seem to be taking the side that Peter normally takes.. i.e. that a lack of regulation and govt subsidies are the reality for some businesses said to be “free market”.

      So.. do you support regulation and the government telling Tyson/Purdue/others how to do “chicken”…. “right”?


  4. Breckinridge Avatar

    I’m sure that the presence of heavy federal subsidies has shaped this business model, and woe unto him who tries to pull that bone away from that Doberman. But it is also true that Tyson’s and the other mega producers are driving down costs and consumers are ultimately making the choice. They could go to boutique butchers or shop at the farmer’s markets, but the price is way higher. I don’t spend a lot of time in WalMart but then I have a bit more economic flexibility and those who need the Always Low Prices shouldn’t be told they can’t shop WalMart.

    But regulate the crap out of these operations, pardon the pun. I’m not losing any sleep over the inhumane treatment of food but I care very deeply that the conditions do not generate disease and that the waste products are properly recycled or safely disposed of. And big companies don’t do that well if nobody is looking over their shoulders.

  5. Fairfax County storm water officials told the Fairfax Federation of Citizens Associations last month that the EPA is as aggressive with farm runoff as they are runoff from suburban and urban areas. The frame of reference was any jurisdiction that drains into the Chesapeake Bay.

    Here’s a link to the presentation from the County. http://www.fairfaxfederation.org/committees/Environment/20140220_FCFCA_FCStormwaterBudget2015Presentation.pdf

    1. the problem with CAFOs is the same problem that we have with Blue Plains – which is what do you do with the sludge?

      At Blue Plains they load it onto trucks and take it out to the country and spread it on fields.

      what do they do with chicken and hog poop? do you think they handle it like human sewage? do you think they treat it, remove the antibiotics and hormones, then haul the it off to fields to spread it on or do you think they “store” the stuff without treatment on site ?

      1. Don’t shoot the messenger. I’m only passing on what I heard sitting in audience and from the PowerPoint.

        1. geeze TMT – you seem easily persuaded by powerpoints!

          SURELY you would want to find out for yourself .. get the truth.. right?

          It is available..if you seek it… you know..

          do you support removal of antibiotics and hormones from animals grown for human food?

          I have a view and would share it in exchange for yours.

          1. I do support a law that would prohibit the use of antibiotics and hormones injected into animals grown for human consumption.

            I got to ask probing questions of the Fairfax County engineer. I got to go beyond the PowerPoint. Between my and the other attendees’ questions (there were at least 8 other engineers in the audience), I felt the basic story from Fairfax County was reasonable.

          2. I’m a trust but verify guy myself and the more slick the PowerPoint the more likely I am to seek verification.

            I’m not a conspiracy guy but I am cynical about govt folks dealing with the public.. there is a certain amount of “managing public involvement” sometimes.. for my taste.

  6. so a question for folks – would you support banning mass use of antibiotics and hormones for chickens and hogs and beef?

    In other words, would you require that all chicken, beef and hogs be raised in natural conditions?

    bonus question – do you think that when you and I eat non-organic chicken, beef and pork that you are consuming residue antibiotics and hormones?

    special bonus question: – does anyone think that hormones and antibiotics are flowing into the rivers and the Cbay and getting into critters, fish, oysters, etc?

    super dooper bonus – would you support the government setting standards for how much hormone and anti-biotic can be in human food?

  7. in doing a little research after I posted – the law bans hormones for poultry or hogs.

    but where I got the idea was from the increasing high and widespread correlation of intersex fish with poultry farming.

    Perhaps Peter knows more.

  8. mbaldwin Avatar

    Industrial agriculture as developed since WWII has lowered food prices for sure. And it’s been a disaster for small farmers, with unknown but surely high costs from the broad use of anti-biotics and so forth, and — something we should lose sleep over — the cruel treatment of poultry and livestock (hogs, cattle especially). I take a half dozen lamb-rams to market each year for humane slaughter (probably a more painless death than any of us can expect when the day is done) after their having led as pleasant a free-range life as any sheep could wish. And they’re delicious.

    Now, how to replicate this on a bigger scale? Humane treatment, and slaughter, is possible, and desirable. But we need to put a price on cruelty, as with other economic dislocations that Peter raised.

    1. totally agree.. but that would require (as they say) … job-killing Obama regulation!

  9. mbaldwin Avatar

    Ha! But humanely executed, surely.

    To add complexity: I read yesterday that sheep provide more methane (a vexing GHG) than cattle, albeit marginally, and that industrial agriculture, by increasing production units (via hormones, etc.) allows less such gas per unit of production (e.g. animals slaughtered) than organic farms do, albeit with fields but with less intense production (breeding, etc.) results. So combating climate change can be cruel! One cannot win.

  10. is it the job of government to regulate cruelty to animals ?

    or is it a free-market issue left to the private sector with no government interference?

    some will say this is an example of too much government and regulation
    and others will say it’s not, it’s an example of the purpose of government.

    here we find – an issue that does not involve harm to humans that many humans find appalling.

    and it’s not really a religious issue per se as I note in a PEW poll about Human torture that actually showed more evangelicals approved of torture of humans, than less religious folk:


    mistreatment of animals – and for that matter the even the idea of turning indigent humans away from medical care is repugnant – though not without some differences between political philosophies.

  11. Without large agribusiness firms the country could not be fed. By having a farm and raising some of his own food, mbaldwin is in a position where he would be ok if there waw no large factory farms. But what about people without this advantage? I do not like it that large profitiable companies get subsidies, but it does keep prices down for those that “have to go to Wal-mart.

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