Foodopoly and Farmers

At the 33rd Annual Eco-Farm Conference, Jan. 23-26, 2013, Wenonah Hauter gave a plenary presentation based on her book Foodopoly: The Battle Over the Future of Food and Farming in America.

Wenonah Hauter is Executive Director, Food and Water Watch, Washington DC

Hauter’s main theme, and one of the main themes of the entire conference, was that “it is critical for the food movement to become more political and help build the power to hold elected officials accountable” (Eco-Farm conference booklet p 27). We have been “voting with our forks” for some time now, and it has made a substantial difference, but if we want to make the big changes that will make our food systems sustainable and make clean, healthy food available to all, we will need to become more politically organized.

Michael Pollan expressed the same idea in a recent New York Times Magazine article entitled “Vote for the Dinner Party,”, and a recent book from Food First, entitled Food Movements Unite! extends the argument to the entire globe, where roughly the same conflicts are going on between large corporate or, in some cases, sovereign investors on the one hand, and local, small or medium sized, usually more sustainable farmers who are being undermined and put out of business by the conglomerates.

We need to build political power to change the structure of our food system, said Hauter. The USDA claims there are two million US farms, but Hauter says that is a BIG exaggeration. There are many fewer. One third of those two million have annual sales less than $1,000, and two thirds are under $10,000. They count hobbyists and part time farmers, people who should not be counted. There are actually under one million full-time farmers using their own labor. Eighty percent of these get government subsidies that keep them afloat, often just barely. Even small and middle size farmers don’t make it without the government. Farm income averages $19,000, and the subsidies are half of that! Most farm households need off-farm income to survive. This is NOT a fair market. Farmers pay more for their inputs than they get out of their crop.

PepsiCo is the Number One food company, Hauter said, worth $64 billion, and it made $6.4 billion in profit last year. Then she asked everyone to stand up—there were several hundred people in the hall–and then said “Sit if you have eaten any of the following,” and proceeded to read off a list of at least a couple dozen PepsiCo products. After two or three, most everyone had sat down (despite the fact that we were all organic and clean food advocates), but she went on reading. Only one man stood at the end, and most of us thought he was kidding. Point made. [Besides Pepsi, PepsiCo owns the brands FritoLay, Tropicana (including Dole), Quaker, and Gatorade, and all the products under those brands. A more complete list is available at ]

These big corporations benefit from government subsidies, said Hauter, and it is easy to say just end the subsidies, but we need to look deeper. You can’t just end the subsidies because lots of people depend on them after 17 years of an evolving program. The subsidies are a band-aid on an ailing system. The deeper problem is that the food corporations who buy up the food cheap simply don’t pay a reasonable price for the food they use.

Iowa farmer George Naylor gets more specific about the question of subsidies in a 2006 Mother Jones interview.

“Well, the number one thing is farm policy that fails to put a floor under farm prices. A farm bill should act much like a minimum wage. The bottom rung of the whole structure is the production of protein, carbohydrates and oil. If farmers aren’t going to get some sort of minimum price for them, they’re going to be out doing whatever they can to produce more of them, which will only make prices lower. But at the same time, when the prices go very low, purchasers of these products—like Cargill, Tyson, ADM and Smithfield—get to buy them very cheap. And then they can feed industrial livestock very cheaply and basically take over most of the livestock production.”

Seed prices have also been rising precipitously, and not just GMO seeds, said Hauter. Farmers must sell into a concentrated market, with a few big corporate buyers, where there is not much room for a farmer to negotiate a price, so prices are driven down. So you can’t just de-subsidize, because you would drive a lot of farmers out of business, and then corporate agribusinesses would come along and gobble them up and just get bigger. We’ve gotta make more change than that.

During the New Deal years [1933-36], the US government created measures to deal with the periodic overproduction of commodity crops such as corn, wheat, and cotton, and the resulting precipitous drop in prices to the farmer, which was putting farmers out of business by the thousands. They set a floor under grain prices, created reserves to buy the extra production in bumper years and release it in leaner years, and introduced conservation measures to induce farmers to take their most sensitive lands out of production. This assured that the farmer would get a decent price for his or her work, that food would be affordable even during years of poor harvest, and that we would avoid further disasters like the American “dust bowl” of the 1930s, so graphically depicted in the Ken Burns documentary, that spawned some of these measures.

These programs were all attacked as “socialist.”  Large capitalist investors wanted people to leave the farms and move into the cheap manufacturing labor force, while making the farms bigger and more “efficient.” Over the years, Congress has managed to chip away at the New Deal programs, and had virtually eliminated these measures by the Clinton administration. The 1996 “Freedom to Farm” bill is often called “Freedom to Fail” by farmers. This took the government completely out of the process and deregulated the commodities markets. Prices dropped precipitously. So the Government, in order to keep some of these farmers in business, invented subsidies, using taxpayer money to grow commodities [which now include soybeans and canola]. This situation is now virtually permanent. Only the grain traders, in the end, benefit from the system. They get to buy cheap, while taxpayers reimburse the farmers, but not enough to help them prosper. The availability of cheap grains and beans creates confined animal feeding operations [CAFOs], which in turn allows much more grain and beans to be grown to feed the animals.

The farmer receives 2-3 cents of every dollar spent on a bag of chips, Hauter reported, while 98 cents goes to the food companies. Ninety percent of the food budget of Americans goes for processed food. Tastes become habituated, enhanced by advertising. While there are thousands of products, in terms of the actual food substances involved, there is very little diversity in the American diet; a few companies make most of the products, using a few ubiquitous ingredients. American kids see 5000 food ads a year on TV, most of them for junk. Four conglomerates control the bulk of the American food market. One dollar of every three spent for food in America goes to WalMart, a $400 billion+ company that made 40 billion in profit last year, and the Walton family holds as much wealth as the bottom 40% of Americans!

Even the organic food market is largely controlled by large companies. Most of the smaller original organic companies have been bought out by larger non-organic companies, to fill their “niche” markets. And in the organic retail sector, Whole Foods dominates; they bought out most of their competitors. UNFI has no competitors in the natural and organic food distribution world; they drive local coops out of business. UNFI made 18% profit last year. They should be subject to anti-trust laws, said Hauter, but Reagan’s people eviscerated the anti-trust laws.

We need a longer-term vision, said Hauter. We need to break up the foodopoly. We can’t let a few companies control our food. We need to fight for the food system we want. We need anti-trust enforcement. We can “vote with our fork,” but we must also vote with our vote and hold these companies responsible. We need to demand anti-trust enforcement on food companies, and control the biotech industry. Fifteen states now have GMO labeling campaigns, she said. We need to stay politically active.

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