Why would anyone oppose reforming the beef checkoff?

cows

By Ben Rainbolt

The beef checkoff probably has little meaning to most Americans, yet the popular slogan, “Beef, it’s what’s for dinner,” is well known nationwide. The beef checkoff helps fund marketing plans to promote the consumption of beef. Unfortunately, some ranchers also believe the beef checkoff is being used in ways that go well beyond promoting beef in the marketplace. The current program is in need of a fix.

In fact, a working group of agricultural representatives has been working on ways to reform the checkoff program and allow it to do what it does best: promote beef. Yet after three years of efforts to find a solution, the working group has failed to do its job. The United States Department of Agriculture is taking steps to correct the checkoff program. Not everyone is happy about this. Frankly, I am. A few individuals have something to gain by keeping the program just the way it is. These people are running the National Cattlemen’s Beef Association (NCBA). The NCBA is entrenched when it comes to any reform to the checkoff.

The checkoff works like this: ranchers selling or importing cattle are required by law to pay $1 per head to the Beef Checkoff Program (there is a call to increase this to $2). These dollars are supposed to fund research and marketing efforts that benefit ranchers. The checkoff dollars are administered by the Cattlemen’s Beef Board, with oversight by USDA. The Beef Board can and does award contracts to do much of its work. And, 97 percent of those contracts go to the NCBA, an organization whose lobbying efforts have tried to kill off country-of-origin-labeling of food, opposes the renewable fuel standard, and opposed the 2014 farm bill.

I can tell you I know ranchers who are unhappy with this situation. They see NCBA as working against the interests of the very cattle producers who are providing the funding. Let’s think about this. Who stands to profit from eliminating country-of-origin labeling? Try beef packers. In the U.S., there are three big companies that pack beef. It is in their best interest to buy beef cattle as cheap as possible from ranchers. Equally, packers do not want you to know where your beef was born, raised or processed. They can blend cheaper imported beef and keep consumers in the dark about what they are actually buying.  NCBA is pursuing a political agenda that is at odds with what works for ranchers. Is it any wonder some ranchers think NCBA is more worried about the big business end of beef production?

And why would NCBA oppose renewable fuels, a program that has been good for rural economies and consumers? Well, renewable fuels initially provided a new market for feed corn farmers. Feed corn has been grown by farmers for generations. It is not to be confused with sweet corn, which is grown for human consumption. Ethanol production let to higher prices for corn. That’s good for corn farmers, but meat packers want to buy beef at the cheapest price possible, as it increases their own profits. Cheaper corn equals cheaper beef cattle (although consumers seldom enjoy an equal savings in the meat they pay for in the grocery store checkout line). Financially, there are winners and losers. Beef packers are not concerned about whether ranchers can make a living raising beef or whether corn farmers can make a living when the price per bushel drops (and this year the price has dropped and corn farmers are feeling the financial loss.

Did I mention that the Cattlemen’s Beef Board and NCBA are headquartered under one roof? Is it any wonder why ranchers have concerns that their beef promotion dollars might be benefitting NCBA and its legislative agenda, regardless of what either organization says? Is there a reason NCBA is throwing a fit knowing that its cash cow, the beef checkoff, might face any change at all? Is it obvious that the reason the working group failed to suggest reforms is because NCBA’s interests dominated the group? Consider that the group included the Meat Importers Council of America. It becomes clear why NCBA would oppose country of origin labeling because to the Meat Importers Council of America wants to protect its own interests, not those of farmers. The American National CattleWomen, an organization that ­– surprise! — also is in the same building as the Beef Board and NCBA and also is on the working group. The old saying about not letting the fox guard the henhouse has new meaning.

Make no mistake, I am not against the beef checkoff. It was voted in by ranchers who, in 1988, wanted a mandatory program that would raise money to promote the sales of beef, both in the U.S. and overseas. Funds also were to be used to research ways to help ranchers reduce their production costs while improving the quality of beef. This is good common sense and good business practice. Beef producers need to be in charge of making decisions to assure their scarce dollars are not misdirected to support a lobbying group that seems to have more concern for the meat industry than the families who make their living raising beef.  There is no room for buyers, processors, importers, and marketers to be calling the shots: without question, they will see to their own profits regardless of the cost to others. Nor is this about allowing others to tap into the cash flow the way NCBA does. Did you know NCBA takes 97 cents of every dollar contracted out by the Beef Board. I would like to see other organizations have a real chance to earn some of this contract work, as it might introduce a healthy and fresh point of view.

For ranchers, the real bottom line is making sure the checkoff is benefitting them. With all the questions clouding the process, the only way to clear up the confusion is through reform.  For those who stand against reform, it’s time to admit three years was long enough to find a solution. Last September USDA Secretary Tom Vilsack said he would move forward on fixing the checkoff. He said he would not welcome critical comments from anyone on the working group, as the participants had three years to fix the problem. I applaud Secretary Vilsack’s initiative to enact reform.

It is important to note that Farmers Union was a member of this working group and it recently withdrew, citing frustration over the inability of the group to achieve any meaningful recommendations. It is equally important to know Farmers Union has no interest in the checkoff dollars. Those dollars are to fund research of value to beef producers and increase market sales. As a grassroots organization, Farmers Union’s members share the concern of ranchers who are suspicious of having checkoff dollars being used to offset the operating costs of NCBA and its actions to undermine policies beneficial to ranchers. We want those dollars going to research and development groups and not to organizations whose activities include lobbying on policies that benefit a few.

To leave the checkoff untouched is not an option. Ranchers need to control the flow of dollars for their own good.

(Ben Rainbolt lives near Gilcrest in Weld County. He is the executive director of Rocky Mountain Farmers Union, a general farm organization whose members whose members are involved in all aspects of agricultural production from growing crops to raising beef cattle.)

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