Business Tyson Foods

Published on December 17th, 2015 | by Todd Smekens

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Tyson Foods Cartel Hurts Rural America

MUNCIE, Indiana NEWS– Everybody likes some form of chicken – wings, thighs, or breasts. Some folks like it fried, baked, grilled, or barbecued. Kids love nuggets, even though it’s not really chicken. Most Americans could care less how or where the chicken is produced, as long as the grocery store or fast food restaurant has it when we want chicken. However, as with all of our choices, Americans need to know how it is produced because of the unintended consequences. In this case, the production of our chicken may be doing more harm, than good?

A regional farmer sent us a book review by Christopher Leonard about Tyson Foods called, How Tyson Foods Kills Small Rural Towns. The author, Christopher Leonard, tells the story Hoosiers should read very closely, since it identifies a systemic failure that represents much of our industry in the United States, and more specifically, in Indiana.

We’ve discussed how Indiana, under the “leadership” of former governor, Mitch Daniels, has become a CAFO haven for many large Meat Trusts since Daniels stripped away the public health part of Indiana’s Department of Environmental Management (IDEM). He, and the republican legislators voters surrounded him with, literally neutered IDEM and our public health departments, which allowed CAFO’s (Confined Animal Feed Operations) to flourish in Indiana.

The CAFO’s were experiencing increasing environmental and public health pressures from other states for their poor management systems leading to environmental disasters. They were polluting the land, groundwater, rivers and air causing poor health conditions in local residents. Residents started pressuring their legislators, so the CAFO’s started looking for “business-friendly” or “environmentally friendly” states – like Indiana.

As a result, the worst of the polluters came first to set up shop in Indiana. Large industrial farms who were literally being evicted from other states like North and South Carolina, relocated their farms in Indiana thanks to Mitch Daniels, former governor of Indiana. The Hoosier state became a “State that Works” for Big Ag and the Meat Trusts, who give tons of poultry to Hoosiers over the Holidays.

Goodwill, or Political Payback?

Depends on which side of the aisle you’re standing. In Indiana, this is how Hoosier republicans do business. If you can keep a straight face, we’ve heard that improving “state ethics” is high on the list for republican House Speaker Brian Bosma. There are no ethics in Indianapolis. Oh wait, they’ve promised to clean up the election fraud which doesn’t exist. They also promised to end welfare abuse by drug testing single working mothers and forcing them to comply with even more burdensome bureaucracy to prove they are looking for work. It will cost the state millions to save thousands.

Meanwhile, when Hoosiers volunteer their time and personal aircraft to photograph large industrial farms who are dumping manure illegally into our waterways, republican legislators write new laws to “prevent personal aircraft from taking pictures of privately owned farms”.

Quite literally, we have citizens volunteering their time to protect our environment and public health. Instead of supporting these volunteers, our state “politicians and regulators” make it even more difficult. Instead of being congratulated by our public servants, the laws are rewritten to refer to them as “terrorists”. The real term is “Eco-Terrorist”. Our state government officials want to give them a fine, and/or put them in jail, for standing up to these large environmental polluters.

Meanwhile, the real Eco-Terrorists are the massive polluters like Charles and David Koch who privately own Koch Energy and funnel hundreds of millions into a libertarian free market network of paid shills and media properties who spread their propaganda versus holding them accountable for the damage they’ve done to our environment and democracy.

Profits, Profits, Consolidation, Profits

In the communities where Tyson operates large industrial food complexes, the annual per capita wages of residents have stagnated. Sound familiar, Indiana? Remember, the Poultry Lobbying Group donated 65 tons of birds to feed the hungry. The statistic given in the article was “1 in 6 Hoosiers are getting their food from local pantries”.

Hoosiers do have a strong work ethic, but our politicians have sold out workers to their corporate puppet masters so we work for less. In fact, it might get even worse from what we’ve been told by anonymous sources. We’ll delve into this in another article on Muncie Voice.

Right to work laws have financially damaged labor unions. Our strong work ethic is rewarded by stagnant wages and lower starting wages. According to the book review:

The communities where our food is raised have been increasingly severed from the giant corporations that profit from processing our food. The average annual per capita income in Waldron and surrounding Scott County has stagnated in Tyson’s shadow, growing just 1.4 percent over the last decade to about $22,000. During that time, Tyson’s annual income rose a staggering 245 percent. The same pattern is writ large across other areas where Tyson and other industrial agriculture businesses operate.

While Tyson profits soar, rural communities tread water. Or drown.

Again Hoosiers, sound familiar?

It’s all very predictable when our private sector is allowed to form monopolies. Our government, the public sector, was formed to limit monopolies which restrict competition, but the lobbying efforts (including giving free poultry) by the private sector keeps politicians flooded in cash so they play along and look the other way.

The food industry is one of the most powerful lobbying groups in statehouses and Washington – meaning they own more politicians and regulators than any other group.

The industry is more consolidated today than it has been at any point in U.S. history, largely because a number of companies, including Tyson, went on a massive merger spree during the 1980s and ’90s, buying out their competitors and gaining ever more control over the industrial food market. The meat industry is emblematic of other parts of the food system, which is dominated by companies with monopolistic control of markets, whether it is Monsanto in the seed business or Archer Daniels Midland in grain processing.

Americans bury their heads in the sand and ignore the problems created by mass consolidation of power within an industry, but Einstein warned us 50 years ago. If allowed, the Oligarchs will “amass large financial resources from capitalism, and will use that money to influence our government.”

Democracy slips away – we’ve seen this a lot over the past 4 decades. In last months elections, the Koch’s bought 144,000 negative attack ads across the country against democratic opponents who support environmental regulations. More money means control – the power to buy or dump politicians depending on whether they choose to play along. The Koch’s and their Oligarchic few have literally bought congressional seats and now control the House and Senate.

With Profits Comes Control

So when corporations are given free will to dominate, what does it look like to consumers? Well, for one, you have to understand that we are both the working class and consumers. Therefore, we now rely on these large companies for our jobs, and their product. What does it look like for these Meat Trusts?

According to the article:

In Tyson’s case, the company has swallowed all the businesses that used to make up a small-town economy. It owns the hatchery, the feed mill and the slaughterhouse. It owns the food processing plant where raw meat is packaged or cooked and boxed into ready-to-eat meals, and it owns the trucks that deliver its products to stores and restaurants. While Tyson doesn’t directly own most of the farms that supply it with animals, it controls them through the use of restrictive contracts. The best way to picture Tyson’s vertical integration is to imagine the broad network of small businesses that were once the backbone of rural communities sucked into a single, towering silo. That silo is Tyson Foods. The company controls and owns everything that happens within the fortress-thick walls of Tyson’s corporate structure.

Our government was designed to protect us from concentration of power within our private sector, but Tyson Foods uses the money amassed from profits to lobby politicians and fund political campaigns directly. Our politicians worked diligently to deregulate the industry which allowed Tyson to become a towering SILO who extracts millions from local economies allowing them to control wages and prices all along the distribution channel because they own everything – there is no competition.

Is it measurable, or is this another leftist ideology?

The author used Federal data showing per capita income levels in these counties, going back to 1969, and then gathered Tyson Foods profits from their prospectus since they are a publicly traded company. The results:

In 68 percent of the counties where Tyson operates, per capita income has not kept pace with the state average over the last 40 years. The majority of Tyson counties, in other words, were worse off than their neighbors in income growth, even as Tyson’s profits increased.

Again, the free market demands open and competitive markets. Tyson Foods, et al, are food cartels because they are monopolies. These are our words – not the words of the author or from the book. If you don’t believe me, look it up on Wikipedia.

How Do We Solve this Problem

Our great democracy requires active participation. Apathy is the death of all great societies. Every great mind has warned us that apathy destroys democracies from the inside. If we aren’t paying attention, inferior people with low morals will end up in high places within our government. Corruption with the private sector ensues.

Our current problems were created over a long period, so we’ll need some time to right the ship. Currently, we are being led in the wrong direction because those who benefit the most from the status-quo are using their financial resources to make sure they get to keep what they have and guarantee the gravy train keeps rolling.

Others, are blaming just the government, and believe life would be better if no government existed. The libertarian free market crowd get their philosophy from Ayn Rand, who had a serious resentment against the Russian government who stole her father’s private business. See the Koch empire researched in-depth at http://www.prwatch.org/topics/koch-exposed.

And seriously, why should food cartels like Tyson Foods volunteer to dismantle the cartel they’ve run for years? Why would the politicians who’ve become incredibly wealthy accepting gifts from Tyson Foods want to give up their wealth? All they have to do is look the other way and make sure legislation that benefits Tyson Foods gets passed, while legislation opposing monopolies is obstructed.

Christopher presents the evidence:

In 2010, the Obama administration attempted to pass antitrust reforms that would have brought more transparency to the food markets and potentially given farmers more bargaining power. But lobbying groups, such as the American Meat Institute and the National Chicken Council, spent millions to oppose the changes on Capitol Hill. Secretary of Agriculture Tom Vilsack backtracked rather than confront the big meat companies and their congressional allies.

The necessary changes must come from “We the people”. A more informed people. A more organized people. People willing to pay a little extra for their meat raised locally. As a result of more enlightened consumers, things are changing for the better, but we’ll need more momentum.

As Christopher writes,

A vibrant economy of independent meat producers has sprung up around the country, usually selling their products directly to shoppers at local farmers markets or even online. These entrepreneurs raise breeds of chickens, hogs and cattle that are often different from those found on commercial factory farms or feedlots, and they tend to cater to conscientious consumers’ desire for animals that have been raised in healthier and more humane living conditions.

Buying locally also means money stays local benefiting the entire community. Buying local builds community from the inside out, versus watching the money be extracted from the community to some far away land/bank. As opposed to extracting dollars from local communities, buying from your local farmer applies the money multiplier effect.

So, before you think you’re helpless in this grand spectacle being played out on the world’s stage – guess again. In fact, our individual choices have created business models (cartels) like Tyson Foods, but our more informed decisions can actually topple their entire food empire, thus reducing the damage on rural America.

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About the Author

Journalist, entrepreneur, publisher and ethical leader with a passion for truth seeking. Enjoy cycling, yoga, meditation, and spending quality time with my daughter. Wellness advocate who practices servant style leadership. Google


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