Alan Guebert on OCM-HSUS Checkoff Lawsuit

02 Sep

ALAN GUEBERT: Lies, distortions and lawsuits

August 24, 2012 11:27 am  •  By Alan Guebert

Somewhere along the line it became acceptable to bend and break the records of public figures and firms without any consequence whatsoever. Shortly thereafter distortion and deception replaced discussion and debate, and yelling and lying replaced compromise and progress.

And that’s just in agriculture; in politics it’s even worse.

The latest farm and food fight centers on the legal battle that pits the U.S. Department of Agriculture’s management of the beef checkoff against long-time checkoff critic Mike Callicrate, a Kansas rancher who owns the Colorado-based Ranch Food Direct.

But it’s more than just the she-said, he-said checkoff standoff.

That unending fight would end if the USDA simply conducted a multiyear audit of NCBA’s checkoff contracts. Past efforts to do just that, however, have been stiff-armed by NCBA’s powerful Capitol Hill allies,  who claim any audit of NCBA’s books is a waste of government time and money.

This political cover, well-irrigated by NCBA and its meatpacker members, allows the tiny cattle group (less than 4 percent of all U.S. cattle producers belong) outsized power as a political organization and as a checkoff contractor. That two-hatted trick also carries financial benefits for NCBA.

According to NCBA’s 2009 IRS Form 990 filings, the latest available, just $3.3 million of its $58.7 million in reported revenue came from membership dues. Most of the remainder came either directly or indirectly from the checkoff.

Threats to this rich river of revenue — and Callicrate’s federal lawsuit is an enormous threat — are met with cowboy hellfire and ranch brimstone.

In the past, NCBA has called on politicians and checkoff-benefiting media to sing its praises and deflect checkoff queries. This time, however, it was handed a loaded gun by two tough critics: Fred Stokes, outgoing president of the Organization for Competitive Markets, and Callicrate, OCM’s incoming president.

Stokes, a 77-year-old retired Army major, announced the federal lawsuit, which names Callicrate as its only plaintiff, Aug. 10 in a kick-off to OCM’s annual meeting.

In explaining the lawsuit, Stokes noted that OCM had asked attorneys at the Humane Society of the United States to examine rafts of checkoff material OCM had received from the USDA through the Freedom of Information Act to assess the merits of any possible suit. HSUS attorneys did so for free.

After that revelation, the sky fell on OCM, Stokes and Callicrate. Everyone with a wide-brimmed hat condemned the group and its leaders for taking any assistance from the Humane Society, a group mainline farm organizations loathe reflexively.

NCBA President J.D. Alexander fired first when, according to a NCBA news release later that day, he “expressed disgust … that (OCM) has formed a partnership with the (HSUS) to destroy more than 25 years of market development and consumer demand building by the Beef Checkoff Program.”

Alexander was wrong; OCM had not formed a “partnership” of any kind with HSUS. As Stokes explained, Humane Society attorneys, at OCM’s request, read checkoff documents to offer their unpaid judgment on whether a suit was advisable.

The checkoff lawsuit, in fact, was written and filed, pro bono, by Daniel Owen and G. Gabriel Zorogastua of Polsenelli Shughart PC, a Kansas City, Mo., law firm known for its antitrust expertise.

Worse, Alexander’s hyperbolic “destroy more than 25 years of market development and consumer demand building” is not just a personal opinion, it’s fact-defying baloney.

Since the 1987 start-up of the beef checkoff, the number of U.S. beef operations has fallen from 1.01 million to 742,000, U.S. retail sales of beef per capita have plummeted from 78.7 pounds to 60.8 pounds, and the U.S. cattle herd has fallen from 102.1 million head to 90.8 million.

There are reasons for this dismal performance, but “market development,” “consumer demand,” and $1.5 billion in checkoff money would not be three of them.

Additionally, as the U.S. cattle sector continues a decades-long trend of losing an estimated 1,000 producers per month, the nation continues to outsource its beef. During the first six months of 2012, beef imports were up 21 percent and cattle imports were 22 percent over 2011.

And here’s another hard fact: HSUS, Callicrate and Stokes did nothing to bring about this atrocious record of checkoff failure.

So why is NCBA, a group that 94 percent of all cattlemen choose not to join, making them the bogeyman for beef’s woe?

Because we sit silently.

Don’t worry; the distortions, lying and the yelling won’t kill democratic institutions.

The silence, however, might.

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Posted by on September 2, 2012 in Uncategorized


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