Why Does Government Act As Tax Collector For Agribusiness? | KERA News

Why Does Government Act As Tax Collector For Agribusiness?

Sep 23, 2015
Originally published on September 26, 2015 12:35 pm

Every time a cow or steer in this country is sold for beef, the seller pays a dollar into a special fund.

"We collect about $80 million" each year, says Polly Ruhland, CEO of the Cattlemen's Beef Promotion and Research Board. "Half of that stays at our state chapters."

All of it, though, pays for research, promotion and marketing of American beef. It funds scientific studies on beef's nutritional quality, promotes beef exports and pays for advertising, like the familiar slogan "Beef, it's what's for dinner."

More than a dozen promotional funds like this have been set up for different parts of American agriculture. Among the biggest are programs for dairy products, eggs, pork and cotton. All together, they collect and spend more than a half-billion dollars each year.

In a way, this is perfectly natural. Everybody has a marketing budget these days.

What's unusual, though, is that the federal government collects this money, like a tax on every farmer producing these commodities (and sometimes importers), and then passes it on to groups like the Cattlemen's Beef Board, or the American Egg Board or the National Pork Board.

Farmers voted to set up each of these programs, and then Congress made them mandatory. Every farmer is required, by law, to contribute.

The dollars the the government collects are subject to certain rules. They can't be used for lobbying, or to say nasty things about other foods, or say things that aren't true. "Everything we say must be backed up by research. We can't make claims that we can't back up," says Ruhland.

But beyond that, each group gets to spend those dollars solely to benefit its own industry.

This bothers Parke Wilde, an expert on U.S. food policy at Tufts University in Boston. He says the government is supposed to work on behalf of the general public and do things that we cannot easily do as private individuals, like build roads. But really, he says, do we need the government to collect money for beef advertising? "If we had [fewer] roads, we would be worse off. But if we had less advertising, it's not clear at all that we would be worse off," he says.

What's even more troublesome, Wilde says, is the fact that these groups sometimes step over the line and use government-collected funds to attack their opponents.

A few weeks ago, for example, the American Egg Board was forced to release emails showing that it tried to organize a public relations campaign against a competing product — a vegan alternative to mayonnaise.

The National Pork Board, meanwhile, is facing a lawsuit claiming that it used millions of those government-collected dollars to fund an industry lobbying organization called the National Pork Producer's Council.

Wilde says there are several ways to stop this sort of thing.

He says the government could just stop acting as tax collector for farm industries. Alternatively, it could keep these programs alive, but put different people in charge of spending the money. It could require that the boards that control these funds include not just farmers and marketers, but also nutritionists, public health experts and environmental advocates.

"One way or another, though, it has to be fixed," Wilde says.

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KELLY MCEVERS, HOST:

The government has a long history of helping farmers. It even helps farm groups collect money for their advertising. Remember the other white meat? Critics say the government has no business promoting such narrow commercial interests. NPR's Dan Charles reports.

DAN CHARLES, BYLINE: Every time a cow or a steer in this country is sold for its beef, the seller pays a dollar into a special fund. And Polly Ruhland, CEO of the Cattlemen's Beef Promotion and Research Board, helps decide how to spend it.

POLLY RUHLAND: We collect about 80 million dollars. Half of that stays at our state chapters.

CHARLES: Together, they use the money to pay for research on the nutritional quality of beef, to promote American beef and export markets and for advertising.

(SOUNDBITE OF ARCHIVED RECORDING)

UNIDENTIFIED MAN: You can have a great beef dinner in no time at all. Beef - it's what's for dinner.

CHARLES: There are more than a dozen programs like this promoting different parts of American agriculture - milk, eggs, pork, cotton. All together, they collect and spend more than half a billion dollars every year, which seems perfectly natural. Everybody has a marketing budget these days. What's unusual, though, is that the federal government, by law, collects the money like a tax on everybody in the industry and then turns it over to groups like the Cattlemen's Beef Board or the American Egg Board or the National Pork Board. These dollars are subject to certain rules. They can't be used for lobbying or to say nasty things about other foods or say things that aren't true.

RUHLAND: Everything we say must be backed up by research. We can't make claims that we can't back up.

CHARLES: But apart from that, each group gets to spend these dollars just to benefit its own industry. And that bothers people like Parke Wilde, an expert on U.S. food policy at Tufts University in Boston. He says the government is supposed to do things that are good for all of us - build roads, for instance. But really, do we need the government to collect money for beef ads?

PARKE WILDE: If we had less roads, we would be worse off. But if we had less advertising, it's not clear at all that we would be worse off.

CHARLES: What's even more troublesome, Wilde says, is that some recent examples show these groups sometimes step over the line and use the money to attack their opponents. A couple of weeks ago, for example, the Egg Board was forced to release emails showing that it tried to organize a public relations campaign against a competing product, a vegan alternative to mayonnaise.

And the pork board is facing a lawsuit claiming that it used millions of those government collected dollars to fund an industry lobbying organization called the National Pork Producers Council. Parke Wilde says there are several ways to stop this sort of thing.

WILDE: One way or another, though, it has to be fixed.

CHARLES: He says the government could just stop acting as tax collector for these farm industries, or, if it keeps the programs alive, it could change who decides how the money's spent. It could demand that the Beef Board or the Egg Board include also nutritionists, environmental advocates, not just the farmers. Dan Charles, NPR News. Transcript provided by NPR, Copyright NPR.