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Wall Street Journal Editorial: When You Can't Beat 'Em Scream Monopoly

Monday, March 29, 2010

(American Meat Institute)

“When you can’t beat ’em, scream monopoly. That’s the vintage gambit now playing out in the farm business, with the encouragement of the Department of Justice,” states a recent Wall Street Journal editorial.

The subject of the editorial, which was published today, is a series of workshops being held this year to discuss competition in the agriculture industry. But the first meeting looked more like “the Obama Administration’s latest dunk tank for business,” the WSJ states.

The editorial points out that the first meeting occurred in Ankeny, Iowa, home of DuPont's seed company, Pioneer Hi-Bred. DuPont has filed an antitrust suit against agriculture company Monsanto over its dominance of a sliver of the soybean market.

However, the editorial notes, DuPont holds a slight edge in soybean seed sales, and each company represents about one-quarter of the soybean seed market. Competition is strong in the seed industry.

“But Ms. (Christine) Varney, the Justice antitrust chief, has her eye on bigger things,” the editorial warns, noting that Varney once worked to organize farm workers and has said that the Iowa workshops were inspired by her concern that the Bush Administration had allowed too many mergers across the farm industry, creating a culture of Big Agriculture that is bad for America.

Besides this litigation, the Justice Department recently filed suit in Wisconsin to prevent further ‘consolidation’ in dairy processing. The livestock industry, which was another hot topic at the Iowa workshops, could be next, the editorial predicts.

“Monsanto and farm conglomerates represent evil to the same demographic that believes we should go back to growing our own food. While the increase in organic produce and ‘buying local’ is gospel to urban foodies and those rich enough to afford high prices, large-scale farming has succeeded in the marketplace because its economies of scale make food more affordable and have helped feed the hungry around the world,” the editorial states.

“An antitrust assault against Monsanto and the broader farm industry will do nothing to advance the competition that Mr. (Eric) Holder claims to protect. Federal interventions against market leaders typically target companies most likely to innovate and create products that drive progress. Those who invest in research and development have a right to reap what they sow,” the editorial concludes.

To view a copy of this editorial, “Seeds of Antitrust Destruction,” in its entirety, click here: http://www.meatinstitute.org/ht/a/GetDocumentAction/i/58273

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