Book Review: ‘The Meat Racket’ by Christopher Leonard

Using a tournament system, Tyson compares how well each farmer fattens his chickens. Inefficient farmers are driven out of business.

Please do not misunderstand or misinterpret. There is nobody alive that is more pro-competition as brought about by truly free markets and firmly protected private property rights. It is what built America.

The problem is that socialism is tearing it apart. This socialism comes in two flavors. One is of the communist variety which the government of the uSSA applies to its social programs. The other is of the national socialist (fascist) variety which is how they deal with business.

Benito Mussolini (Mr. Fascism himself) once said that fascism should be called corporatism because it is a marriage between big government and big business. This cozy relationship between Big Ag and Big Government is killing ranching as we have always known it. — jtl

By  Moira Hodgson via The Wall Street Journal

After the stock-market crash of 1929, 25-year-old John Tyson left his nearly bankrupt family’s farm in Missouri. He headed with his wife, his son and his truck to Arkansas, where he began to invest in chickens, hauling birds from the South, where they were cheap, to Chicago, Detroit and St. Louis. He used his profits to buy chicken houses and eventually bought his own hatchery and feed mill, vertically integrating his company by buying up the firms that supplied it.

In the 1960s, Tyson Foods decided that running chicken farms was too risky and decided instead to leave that part of the business to contract farmers, who would take out loans to finance their operations. Using a tournament system, Tyson now compares how well each farmer is able to fatten his chickens and pays him accordingly. 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.

Tyson Foods is now the largest meat-producing company in the world, the leading member of an “oligarchy” of companies whose hold on the American meat industry Christopher Leonard examines in his gripping “The Meat Racket.” Mr. Leonard’s focus isn’t the treatment of animals in factory farms, a subject already well documented; nor is it taste or quality, although some unpleasant facts emerge. He is primarily concerned with how these corporations gained control of the business from farm to table.

We are used to an abundance of choice at the supermarket. But, Mr. Leonard points out, the rotisserie chicken slowly turning in its oven, the Lady Aster-brand chicken cordon bleu and the chicken pot pie all come from the same company. Tyson also makes such delicacies as frozen omelets, stuffed with cheese and ready for your microwaved breakfast, and packages of “Grilled & Ready™ Fully Cooked Honey BBQ Seasoned Chicken Strips” for your lunch on the go, along with meat products such as Bonici pepperoni and Wright bacon. The 95% of Americans who eat chicken, he contends, are guilty of supporting a system that “keeps farmers in a state of indebted servitude, living like modern-day sharecroppers on the ragged edge of bankruptcy.” It’s a drastic statement, but Mr. Leonard builds his case carefully with reports from both people inside the company and farmers.

Among those bankrupted are Jerry and Kanita Yandell, who had been chicken farmers in Waldron, Ark., for two decades when Jerry was persuaded to sign a contract with Tyson. Every eight weeks the company delivered tens of thousands of chicks to the Yandell farm; its vans returned later to collect grown chickens for slaughter. In 2003, something went wrong. The Yandells’ birds began dying overnight. Kanita entered the chicken houses to find the birds literally rotting, “their bodies like soft, purple balloons . . . legs sloughing off the body when she tried to pick them up.”

She called the Tyson plant for months asking for help with this strange disease but never received it, according to Mr. Leonard. The birds kept dying, one delivery after another, and in the end the Yandells lost their paychecks, their farm and their assets. The crew from Tyson that arrived to gather the last flocks was dressed in blue plastic suits, as if fending off a plague.

Soon enough, another crop of farmers willing to sign new contracts appeared in Waldron: Laotian refugees. Boonau Phouthavong bought a failed chicken farm and lived in impoverished conditions, working seven days a week until he in turn was bankrupted. He couldn’t compete with other farmers who were able to afford more advanced equipment and produce fatter birds. “Rural Americans have a word for what has happened to the economy of towns like Waldron. . . . They have been chickenized.”

In Tyson’s case, writes Mr. Leonard, as the company expanded, it would take over all the businesses that used to make up a small-town economy. “It owns the feed mill, the slaughterhouse, and the hatchery. It owns the trucking line and the food-processing plant where raw meat is packaged and cooked into ready-to-eat meals.” This system has “provided tremendous benefit to American consumers,” Mr. Leonard acknowledges. Chickens grow bigger faster, even while eating less feed, and meat has gotten much cheaper. Between 1955 and 1982, he notes, the time it took to raise a chicken dropped to 52 days from 73. But the rate of improvement slowed in the 1990s, Mr. Leonard writes, while Tyson has remained dominant, its vertical integration ensuring, for example, that there is no free market to determine the price of baby chicks or grown chickens sold back to the slaughterhouse.

After pioneering their model in the poultry business—and, to their triumph, getting chicken on the menu at McDonald’s, in the form of the McNugget—Mr. Leonard says, Tyson set out to “chickenize” first the hog and now the cattle business. It has faced fierce resistance in the latter, but its practices still help set the standard for the entire industry. Tyson was one of the first companies to use a growth hormone called Zilmax, which causes cattle to put on weight with astounding results. “The animals blow up like muscled balloons,” Mr. Leonard writes, adding that the hormone also makes the meat leaner and cheaper to produce—in other words, “more like chicken.” Tyson stopped using Zilmax last year after critics raised concerns that cows were becoming paralyzed.

“The Meat Racket” is a riveting book, and the picture Mr. Leonard paints is a disturbing one. He sees rural small-town life as the keystone of a democratic society and believes in the Jeffersonian idea of ownership of land and economic independence. But there is obviously no going back to the 19th (or even the 20th) century, and any real solution to the issues Mr. Leonard raises must achieve the right balance between competing interests. If change is to come, he says, it will have to originate with not only the people who raise meat but with those who buy it too.

Ms. Hodgson is the author of “It Seemed Like a Good Idea at the Time: My Adventures in Life and Food.”

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About Land & Livestock Interntional, Inc.

Land and Livestock International, Inc. is a leading agribusiness management firm providing a complete line of services to the range livestock industry. We believe that private property is the foundation of America. Private property and free markets go hand in hand—without property there is no freedom. We also believe that free markets, not government intervention, hold the key to natural resource conservation and environmental preservation. No government bureaucrat can (or will) understand and treat the land with as much respect as its owner. The bureaucrat simply does not have the same motives as does the owner of a capital interest in the property. Our specialty is the working livestock ranch simply because there are so many very good reasons for owning such a property. We provide educational, management and consulting services with a focus on ecologically and financially sustainable land management that will enhance natural processes (water and mineral cycles, energy flow and community dynamics) while enhancing profits and steadily building wealth.
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