Date:  January 19, 2006
FOR IMMEDIATE RELEASE
Contact: Chase Carter, Executive Director 402.817.4443

Last year, Senator Tom Harkin (D-IA) requested the investigative action at the urging of OCM.

The report shows USDA has blocked employees from pursuing complaints of anti-competitive behavior in the livestock industry and inflated the number of investigations it has conducted to create the illusion the agency is upholding the law. This is precisely what independent farmers and ranchers have been saying for years.

GIPSA is charged with investigating complaints of anticompetitive practices like price manipulation or restriction of competition. The agency also ensures that sellers of livestock are paid promptly.

"We know that GIPSA has hired some extremely competent economists," said Dr. Bob Taylor, OCM Economics Fellow. "However, the report clearly shows the administration is not allowing them to do their job."

"This report confirms what we at OCM have suspected for a long time. GIPSA has failed to perform its function. In fact, it has blocked meaningful investigations while American agriculture has become increasingly concentrated and anti-competitive," noted Taylor.

Senator Harkin said the report shows that USDA officials "were blocking employees from pursuing investigations and then cooking the books to cover up the agency’s lack of enforcement action."

The report indicates that as of last August, at least 50 investigations were being held up by deputy administrator JoAnn Waterfield, who had final control over sending cases to agency attorneys. Waterfield abruptly resigned her position last month when the final report was issued to USDA administrators.

"The IG report validates concerns about the growing cronyism at USDA," stated Chase Carter, OCM Executive Director. "OCM thanks Senator Harkin for pursuing this investigation. Now it’s time to reform the agency and ensure that anticompetitive practices are fully investigated and appropriate justice is sought for violations of the law."

Taylor, who is a Distinguished University Professor of Economics at Auburn University, said the Eleventh Circuit Court of Appeals recent action in the Pickett v. Tyson Fresh Meats case makes antitrust enforcement even more difficult, despite the impending changes at GIPSA. "The Eleventh Circuit, by upholding the lower court’s decision to throw out the jury verdict in the Pickett case, has effectively repealed the Packers and Stockyards Act and significantly weakened antitrust laws. One can almost ask the question, why do we need GIPSA at all? This is symptomatic of greater problems at higher levels."

"Only days before the Pickett ruling the court ignored the plain language of the Packers and Stockyard Act and ruled in London v. Fieldale that a poultry grower would have to show harm to competition, rather than harm to an individual. If this ruling stands, poultry growers are left without protection from unfair, deceptive and discriminatory practices by integrators," said Taylor. "This investigation of a federal agency and recent court actions are symptomatic of even greater issues facing America’s agricultural growers."