By Hannah Packman, NFU Communications Director
To address corporate consolidation in nearly every sector, President Joe Biden last week signed a sweeping executive order aimed at promoting competition and fairness throughout the economy.
The order includes 72 directives that will be carried out by 12 federal agencies, many of which target the agricultural sector:
- It will offer farmers greater legal recourse when they are treated unfairly by corporations.
In order to challenge a corporation when it violates the Packers and Stockyards Act, a farmer currently has to prove that the entire industry has been harmed by the practice, rather than just themself. The executive order directs the U.S. Department of Agriculture (USDA) to change this so that a farmer only has to prove injury to themself in order to take legal action.
- It will prevent corporations from retaliating against farmers who speak out against unfair practices.
In the livestock sector, corporations often have significant control over farmers, determining their contracts, inputs, and wages. As a result, many farmers won’t say anything when they experience discrimination for fear the corporation will sabotage their operation in retribution. The order would put into place anti-retaliation protections so that farmers can assert their rights without the threat of retaliation.
- It will offer fairer wages to contract poultry growers.
Contract poultry growers’ wages are determined by a “tournament system,” in which growers are pitted against one another. The growers who perform the best earn a bonus per pound of chicken, while those who perform the worst suffer a wage deduction – even though most growers have little influence over their yields. The order would restructure this system so that growers are paid more fairly.
- It will give farmers the right to repair their own equipment.
Many farm equipment manufacturers refuse to sell software repair tools to farmers or independent mechanics. This all but forces farmers to take their broken machinery to a licensed dealership, which can be expensive and inconvenient. The executive order encourages the Federal Trade Commission (FTC) to address anticompetitive restrictions on the repair of items.
- It will limit “Product of USA” labels only to meat raised in the U.S.
Under current regulations, the “Product of USA” label can be used on meat products that were born and raised in another country, as long as it was processed in the U.S. This practice misleads consumers and puts American ranchers at a disadvantage. The order encourages FTC to “ensure consumers have accurate, transparent labels that enable them to choose products made in the United States.”
- It will help prevent rural hospital closures.
Due to chronic underfunding and unchecked mergers, 139 rural hospitals have closed in the last decade, leaving rural residents with fewer and more expensive options when it comes to health care. In the order, President Biden urges FTC to review and revise their merger guidelines to ensure patients are not harmed by such mergers.
- It will encourage more choices in banking and credit in rural communities.
Between 2012 and 2017, 14 percent of rural bank branches closed, in part due to mergers and acquisitions. This left 1 in 4 nonmetropolitan counties without a single bank. The order encourages the Department of Justice (DOJ) to provide more robust scrutiny of banking mergers and make it easier for customers to change banks.
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