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HUNTIN' DAYLIGHT - SHOW AND TELL

by: Wes Ishmael

The only problem with democracy is that even folks who are obviously wrong still get to have their day in court, costing a lot of innocent people lots of needless time and money along the way.

Case in point: Never mind the fact that this nation's beef checkoff—a catalyst for everything from new convenience products to systems that milk more value from the traditionally lower priced chuck and round, to genetic selection tools for carcass merit, all of which have helped reverse the tide of declining consumer demand for beef—has already withstood two constitutional challenges.

Never mind the fact that a majority of beef producers have always supported the checkoff since its inception in 1987—that support revealed through independent surveys; 72 percent expressed their approval in the latest research.

No, never mind all of that. The Livestock Marketing Association (LMA) pulled out all of the stops in August, switched from being a wasteful thorn in the industry's side to becoming a genuine threat by asking the courts to rule on the constitutionality of the beef checkoff rather than leave the power of decision in the hands of producers.

Here's a brief overview of how this came to be: Back in 1998, some say because of a squabble with the National Cattlemen's Beef Association (NCBA), the largest contractor for checkoff dollars, LMA began clamoring for a new referendum to give beef producers the chance to decide whether or not they wanted to continue the checkoff. Keep in mind there are already provisions in the Beef Promotion and Research Act that makes the checkoff a law, which outlines how producers can call for a new referendum.

At the time, LMA claimed that the checkoff had lost producer support and producers were chomping at the bit for a referendum. The Cattlemen's Beef Board (CBB), which administers the checkoff, looked at all the research that said just the opposite, that a vast majority of producers still supported it.

Presumably never one to let facts stand in the way of a good argument, LMA began a petition drive. Get 10 percent of the nation's beef producers to sign on the dotted line for a referendum—about 107,000 folks—and USDA, by law, sets the wheels in motion for a referendum. LMA had 12 months to collect signatures. During this process there were plenty of folks questioning tactics used to get the signatures, i.e. folks were signing up for stuff without realizing they were putting their name on the petition. During this process LMA told the world that the process was going smoother than frog guts on a doorknob.

In fact, at the end of the 12 months granted by USDA to gather petition signatures, so many producers were falling over themselves in support of the petition, that LMA asked USDA to give them another six months to collect the needed signatures, then choose the 12-month period of the total 18 they wanted to use for counting. It's a little like saying, “Here's the game I want to play with you, we've agreed on the rules, now that I can see I'm losing, please let me change the rules.” Who knows why, but USDA gave LMA the extra six months.

Fast forward, even with the extra time to gather signatures, LMA failed miserably. Of the 127,927 signatures submitted by LMA, only 83,464 were deemed valid.

Given the common sense exuded by LMA to this point, it surprised no one that rather than accept the verdict, LMA went to court, challenging the independent signature verification process, still, yammering on about the fact all they wanted was producers to have a right to vote on another referendum. During the petition drive, statements like this one from LMA's Director of Information were common: “We have not called for absolution of the checkoff. We have called for the chance to listen to every producer in this country…We support the checkoff.”

Again, thinking people wondered why ask for an expensive and pointless referendum process to prove what other research already verified again and again—that the majority of producers support the checkoff. A point underscored by LMA's anemic petition drive.

How's this for logic? You supposedly support the check-off. You tell folks all you're concerned about is that producers have the chance to have a new referendum if they want one. Then, in the blink of an eye, you do just the opposite, asking the courts to rule whether or not the checkoff is even constitutional, thereby effectively ripping a producer program from the hands of producers and placing it in the lap of the judicial system to decide the fate.

For the record, this latest move was on the heels of the Supreme Court deciding that a checkoff program in the mushroom industry was unconstitutional. Given that, the judge presiding over LMA's legal challenge to the USDA petition verification process asked USDA to state its position on the constitutionality of the beef checkoff. USDA declared its support of the Beef Promotion and Research Act, which makes the checkoff possible and said that it would vigorously defend the program's constitutionality.

From there, according to NCBA, “The chain of events shows that LMA unilaterally made the decision to amend its legal complaint.” In other words, LMA decided to make it a constitutional issue, leaving the CBB and NCBA no choice but to agree to going down the constitutional road first, so that the judge could determine whether the original issue being dealt with—that of the petition count—dealt with a constitutional program.

Furthermore, according to NCBA in an August 6th letter, NCBA president Lynn Cornwell, on behalf of the NCBA executive committee asked LMA president Pat Goggins to drop the litigation challenging the constitutionality of the checkoff.

Goggins responded on August 8, saying in part, “LMA, USDA and CBB agreed that the constitutional issue raised by the Supreme Court's mushroom decision had to be resolved before proceeding with LMA's request for a referendum.” As mentioned previously, though, it was up to LMA whether or not they would amend their litigation to include the constitutional issue. They did.

All of this he-said, she-said rhetoric misses the point, though. Since LMA began its petition process, CBB and NCBA have repeatedly invited LMA to meetings to sit down and identify its specific concerns about the checkoff so that a potential resolution could be found. So far, LMA has been content to wage its battle in the media and the courtrooms, rather than address the issue face to face.

Consequently, according to an NCBA statement, “Since 1988 we have vigorously defended the constitutionality of the checkoff when it was attacked and will do so again in this instance. By joining with those who wish to do away with the checkoff, the LMA has very clearly chosen its position on the $1-per-head beef checkoff and its efforts to increase beef demand.” And, that position, unfortunately, doesn't include the very producers the organization is supposedly serving.

Don't Confuse Auction Markets With LMA

That's what's so vexing about this whole convoluted affair. What LMA says and does is completely different than a lot of its auction market members. Pick a state. You can find plenty of auction markets that continue to provide producers in the area with valuable marketing services and the industry with a reliable price discovery system. Heavens, plenty of these markets have even adopted new technology and value-added marketing models to better serve producers. For instance, later this fall, the folks at Blue Grass Stockyards in Lexington, Ky. will combine the state's longstanding Certified Preconditioned for Health program with electronic identification, sophisticated sorting and Internet bidding to offer its consignors and buyers a whole new world of opportunity. And, that's just one example.

So, it doesn't add up, what auction markets are doing on their own to serve the industry and what their organization—LMA—is doing to tear it down.

Isn't it time for a little old fashioned show and tell?

Ask your local auction market to tell you where they stand on the checkoff. Are they for it or against it? Why do they take that position? If they're against the checkoff, ask them to show you LMA's alternative for giving producers a chance to collectively research their product, promote their product and impact demand through those efforts at $1 a head.

Think of that, one lousy dollar per head—less than a half of 1 percent of the gross on a 5-weight calf, even less on a fed steer—to proactively build demand and returns for your product. Tell someone else in any other industry that you're spending less than half a percent on research and promotion and they'd laugh themselves silly after calling you a bald-faced liar. Every industry would like to spend so little.

As a beef producer, you have chosen to be in the business of cattle and producing food for a hungry world. The majority of your peers support the checkoff as a cost-effective self-help program that has helped them. If and when that view changes, obviously the majority will no longer support it.

Your local auction market has chosen to be in the cattle marketing business. If you have access to a reliable one, and there are many, those folks have chosen to make a living by helping you market your product.

The organization representing many of the nation's auction markets, the Livestock Marketing Association, has chosen to take away rather than support your right as a producer to have a beef checkoff.

It still doesn't add up, but those are the facts.

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