CONTACT: SARA
LILYGREN
JANET
RILEY
(703)
841-2400
AMI
Statement on
Ag Economists’ Debate
Over
Packer Ownership Ban
March 13, 2002
(Attribute
Statement to AMI President and CEO J. Patrick
Boyle)
Today, another paper by
agricultural economists was released – the fourth in the
past two months -- attempting to explain the market
impact of an amendment in the Senate’s farm bill banning
packer ownership, feeding and control of livestock.
Their views differ sharply with other
economists.
The fact that leading ag
economists strongly disagree about this amendment’s
impact suggests that the amendment itself has been
neither well researched, thoroughly studied nor
adequately discussed. Thus, at a very basic level, this
amendment is premature and should not become law. That
is why the American Meat Institute (AMI) and others have
supported the launch of a thorough economic study by the
U.S. Department of Agriculture prior to moving forward
with any new legislative restrictions or mandates upon
livestock farmers or meat packers.
If, as today’s fourth paper
asserts, meat packers exert market power illegally in
particular areas, they should be prosecuted by USDA’s
Grain Inspection/Packers and Stockyards Administration
(GIPSA) under the Packers and Stockyards Act. This Act
is an additional layer of fair business practice
mandates on meat packers, above and beyond the Sherman
Act and the Clayton Act, enforced by the U.S. Department
of Justice, which dictate antitrust and competitive
business practices for the entire U.S. economy. Between
these three laws and the various agencies that enforce
them, there are ample resources available to prosecute
meat companies for anticompetitive behavior.
The entire U.S. economy –
from manufacturers to service providers – has moved
towards both vertical and horizontal integration as a
means of survival and striving for excellence. Barring
one sector of the economy, meatpackers, from utilizing
this model is unfair, punitive and lacking in any
credible evidence.
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