The Power of Corporate Agriculture: Part II
In the first post of this three-part series, I discussed how Big Ag amasses and maintains power through its influence on government. Now I’ll explore the harms this relationship causes to the economy, small businesses, workers, the food supply chain, and the average consumer.
Perhaps one of the most astonishing ways in which the federal government collaborates in this special relationship with agriculture — and especially the meat industry — is through its financial support. For a very long time, the government has subsidized the industry to drive down market prices — investing tens of billions of dollars per year through direct payments, insurance, loans, grants, and corporate bailouts.[i] A large portion of this funding goes to livestock and dairy programs, and particularly to crop insurance for common livestock feeds like corn and soybeans.[ii]
The majority of ag subsidies are going to help corporations, not small businesses; from 1995 to 2023, the top 10% of recipients received 79% of total commodity payments.[iii]
The federal government also enters multimillion-dollar contracts with many large meat conglomerates, such as JBS, the world’s largest meat packer, which the U.S. Department of Agriculture refused to end business with even after the company pled guilty to both foreign bribery and price-fixing charges.
USDA has also helped boost an already wealthy industry through marketing cooperatives called “checkoff programs,” which fund major advertising campaigns like “Got Milk?” In theory these programs were established to help promote entire industries whose products are often sold generically. But while small farmers are also required to pay into the checkoff fund, they rarely reap any of the benefits. Instead, they’re often harmed by marketing from competitors, as it’s the big corporations that decide where the money goes.
By pulling the strings of government policy, Big Ag skews the game in its own financial favor. Agricultural corporations have been accused of obtaining federally guaranteed loans and then purposely producing a crop surplus to drive down prices and make it impossible for smaller producers to compete, knowing that the federal government will buy up the surplus no matter what to maintain economic stability.
Because they control the market, giant agribusinesses can recruit and employ low-wage workers and even unpaid prison labor, maintain hazardous and unclean working conditions, and silence whistleblowers while continuing to increase their profit margins even when the economy is in a downturn.
Four of the largest meat-processing companies saw their net income rise by 500% during the COVID-19 pandemic, as supply chains were disrupted, and consumers struggled to afford groceries.[iv] According to the Biden administration, meat price increases were the single largest contributor to the rising cost of food during this time.
This profit occurred even as meat companies contended with massive COVID outbreaks among employees, the majority of whom weren’t provided with any personal protection equipment or other safety measures and didn’t have access to healthcare or sick days.
Instead of taking responsibility for their lack of preparedness and protection, corporations shut down their operations and mass-killed millions of healthy animals. The government then compensated them for these wasteful killings by spending millions in taxpayer dollars to bail them out at 80% of the fair market value of each animal and covering costs of euthanasia and disposal.[v]
But the greatest expense is to the American public. Big Ag’s lobbying has created a food system in which we can rarely understand exactly where our food comes from or how it is produced. For example, research shows that the majority of grocery shoppers would choose to purchase meat, egg, and dairy products that were produced with higher welfare standards, but information failures often get in the way.
This confusion results because many companies use food labels that are optional, unregulated, and misleading at best. Labels may use vague terms like “humane,” “natural,” and “sustainable” that have no legal definition. Ag industry groups have also pushed for private self-regulation that prevents government or third parties from ensuring the accuracy of these labels’ claims. This is also another form of anti-competitiveness, because many small and independent farms embrace higher welfare standards and would benefit from stronger regulation of such labels.
Big Animal Ag has even invested large amounts of money into “research” to try to prove that its negative impact on both human health and climate change is minimal. Lobbyists have been accused of censoring United Nations research and successfully persuaded the Intergovernmental Panel on Climate Change to remove a line from its report that recommended plant-based eating as a more environmentally friendly diet.
Big Ag has succeeded in gaining near-total control over our food system. Its mutually beneficial relationship with government allows it to get away with minimal regulation, oppressive labor practices, anti-competitive tactics, widespread disinformation, and a stunning lack of transparency. And that doesn’t even address the devastating impacts that intensive, industrial animal agriculture has on the environment, public health, food security, communities, animals and biodiversity.
This may feel overwhelming, but hope is not lost. There are many ways you and I can work to dismantle corporate control and support existing food sovereignty and food justice movements led by farmers and food industry workers — particularly Black people, Indigenous people, women, and other marginalized groups — to reclaim the public right to a just, equitable and accessible food system. My next post will discuss the policies and strategies at play.
Rooted in Policy is a blog making the connections between policy, agrifood systems, and biodiversity more digestible for everyone. It’s written by Leah Kelly, food and agriculture policy specialist at the Center for Biological Diversity.
[i] Simon, D.R. (2013, August 22). The meatonomics index. Meatonomics. https://meatonomics.com/2013/08/22/meatonomics-index/
[ii] Environmental Working Group. (2023). The United States farm subsidy breakdown, 2023. https://farm.ewg.org/region.php?fips=00000&progcode=total&yr=2023
[iii] Environmental Working Group. (2023). Commodity subsidies in the United States totaled $278.8 billion from 1995–2023. https://farm.ewg.org/progdetail.php?fips=00000&progcode=totalfarm&page=conc®ionname=theUnitedStates
[iv] Deese, B., Fazili, S., & Ramamurti, B. (2021, December 10). Recent data show dominant meat processing companies are taking advantage of market power to raise prices and grow profit margins. The White House. https://www.whitehouse.gov/briefing-room/blog/2021/12/10/recent-data-show-dominant-meat-processing-companies-are-taking-advantage-of-market-power-to-raise-prices-and-grow-profit-margins/
[v] McRimmon, R. (2021, July 28). USDA to pay farmers who euthanized animals amid meat plant shutdowns. Politico. https://www.politico.com/news/2021/07/28/usda-to-pay-farmers-who-euthanized-animals-amid-meat-plant-shutdowns-501271
