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Anonymous
Trade Tug of War; R-CALF Has Tapped Discontent Among Smaller U.S. Cattle Producers in Its Challenge to the 106-year-old NCBA
Omaha World-Herald, August 08, 2004
by Mark Kawar WORLD-HERALD STAFF WRITER
Bob Sears and his son Korley used to spend family vacations at National Cattlemen's Beef Association conventions around the country, helping chart the group's future.
Bob, a third-generation NCBA member who owns the Ainsworth (Neb.) Feedyards Co., still belongs to the group. But two years ago, he joined the NCBA's rival, the Ranchers-Cattlemen's Action
Legal Fund, United Stockgrowers of America, or R-CALF. He also stopped giving the NCBA $17,000 a year.
Korley, the feedlot's manager, feels even less loyalty to the old group, whose free-trade policies he believes have hurt cattle prices. He's an R-CALF activist and may even cast his first vote for a Democrat, John Kerry, because the candidate wants to ban meat packers from owning livestock.
"The future is in trade, and we know we're going to have to trade with other countries," said Bob Sears, "but that trade has to be fair for cattlemen."
Just six years old, R-CALF has tapped a deep vein of discontent among smaller U.S. cattle ranchers and feeders like the Searses who believe that big agribusiness and the federal government have promoted free trade and ag consolidation at their expense.
The association has attracted enough members, money and influence to make it perhaps the biggest threat ever to the 106-year-old NCBA.
Through lawsuits and other tactics, R-CALF has scored some successes, making itself more than simply a shrill voice of protest.
"I don't think NCBA can ignore R-CALF anymore," said Earl Peterson, a cattle industry consultant and former NCBA vice president. "There are specific issues that they own," especially trade.
In its short history, R-CALF has already managed to shake up cattle politics.
The NCBA once spoke for an undivided cattle industry.
Like most major agriculture lobbying groups in Washington, it supports free trade as a way to win export markets for U.S. agricultural products. But the small cattlemen who form R-CALF's base blame foreign competition for the loss of about 500,000 ranching jobs, or nearly 40 percent of the total, between 1980 and 2000.
As R-CALF has grown, the NCBA has seen its membership and fund- raising advantages shrink.
Earlier this year, R-CALF sued the Department of Agriculture, successfully blocking a government plan to end the yearlong ban on Canadian cattle imports put in place after the discovery of mad cow disease in Alberta in 2003.
Large agribusiness companies, the NCBA and many politicians are still trying to restart trade with Canada.
U.S. cattle prices have risen about 25 percent since the border closed, a fact that R-CALF has taken notice of. Even the discovery of a case of mad cow disease in Washington state in December hasn't completely dampened the markets.
"This completely contradicts what the industry has been telling U.S. cattle producers regarding the importance of exports," said R- CALF Chief Executive Bill Bullard. "Our industry has been conditioned for over 15 years that the most important factor to cattle prices, both present and future, is the expansion of exports."
Rival groups have emerged before to challenge the National Cattlemen on particular issues, but for decades it essentially held a monopoly on representing the cattle industry, said Merlyn Carlson, Nebraska agriculture director and a former NCBA president. None of the earlier rivals attracted a following as large as R-CALF's, he said.
"Have we seen this before? Yes. But we haven't seen anything to this extent."
R-CALF's founders are former NCBA members who struck out on their own after failing to turn that group against cattle imports.
For most of its history, NCBA supported protectionism, but views began to change as exports rose in the 1980s, especially to Japan. After a contentious debate, the group (then known as the National Cattlemen's Association) supported the 1994 North American Free Trade Agreement.
In 1996, further inflaming some members, the National Cattlemen's Association and the National Live Stock and Meat Board, which represented both cattlemen and meat packers, merged to form the NCBA. Bullard and many other cattlemen believe that's when the NCBA went astray.
Ranchers from Montana, Colorado and South Dakota founded R-CALF (which then stood for the Ranchers-Cattlemen's Action Legal Foundation) in 1998 as a vehicle for stopping Canada and Mexico in the alleged practice of selling cattle below cost in the United States.
The International Trade Commission ruled against its complaint, though conceding that R-CALF had a point. Cattlemen assumed the foundation would dissolve.
But the case generated so much support that the group stuck around, Bullard said. The next year, it opened a headquarters in Billings, Mont.
"We won on the merits, but we lost on the permanent remedy," Bullard said. "That was the start of R-CALF."
The group has since ridden the backlash among cattlemen against the expansion of free trade. The United States signed its seventh and eighth free trade agreements in July, including one with Australia, a major cattle producer. The Bush administration is working on agreements with six Central American countries, several of which produce cattle.
In 2001, the South Dakota Stockgrowers Association broke from the National Cattlemen and joined R-CALF. Last year, New Mexico Cattlegrowers did the same.
"Before the South Dakota Stockgrowers joined R-CALF, we couldn't give memberships away," said Ken Knuppe, president of the South Dakota group. "Now they're coming to us."
Four other state NCBA affiliates now also belong to R-CALF, and new state groups aligned with R-CALF have popped up recently in Missouri, Montana, Kansas, Oregon and Washington. Reflecting the broader backlash against free trade in agriculture, corn and soybean growers recently created groups opposed to free trade to rival the dominant players in their industries.
The industry's split can be measured, in part, through the two national cattle groups' membership and fund raising.
The NCBA lost 21 percent of its members in the past four years and now has about 26,000, a decline it attributes to the general shrinking of the cattle industry. In the same period, R-CALF membership has tripled to more than 10,500.
Between 2000 and 2003, contributions to R-CALF have more than doubled, to about $700,000, according to the group's IRS filings. It expects to raise more than $850,000 this year.
R-CALF's finances still are minuscule compared to the NCBA's annual budget -- $58 million in 2002, the latest available.
But while all of R-CALF's money comes from supporters, the NCBA gets 86 percent of its as "checkoff" money from a mandatory assessment on all cattle sales. Checkoff money can be used only to promote beef, not for political purposes. And it may dry up entirely if a pending U.S. Supreme Court case goes against the program.
NCBA income from membership dues and assessments was flat -- about $2.9 million -- from 1998 through 2002, the most recent year for which IRS filings are available. This year, NCBA expects to raise about $2.6 million in dues and assessments, up from a low of $2.3 million in 2003, said John Braly, vice president for industry and membership.
"For over 100 years we have represented cattlemen, and we are a cattlemen's organization," said Terry Stokes, chief executive for the National Cattlemen. "You ask our members, you ask Congress, you ask the administration -- clearly, we represent cattlemen across this country."
R-CALF has grown in part through creative, even folksy, tactics.
For instance, supporters staged a "fund-raising auction" recently during a regular Tuesday cattle auction at the Gordon (Neb.) Livestock Market.
Matt Lowery, the market's auctioneer, "sold" a donated calf repeatedly to more than half the ranchers attending the auction. Cattlemen bid on the animal not to keep it, but to contribute to R- CALF. It raised $6,187.50 and signed up 30 new members.
"These ranches have been in these families for over a hundred years," Lowery said after the auction, pointing to the men in boots, jeans and cowboy hats around the room. "If people want to keep it that way, they have to stay involved."
R-CALF's popularity is throwing a stumbling block at economists, agribusinesses and others who say American agriculture is best served by more trade and less government interference -- a group that includes President Bush and U.S. Secretary of Agriculture Ann Veneman.
Bullard said R-CALF doesn't oppose all trade, and he doesn't like the word "protectionist." But all trade agreements should take the livelihood of U.S. cattle producers into account, he said.
The group supported a recent U.S.-Morocco free-trade agreement because Morocco doesn't have any cattle. But even before mad cow disease was discovered in North America, it called for a two-year ban on all cattle and beef imports.
One of the group's first battles was lobbying Congress to support a bill requiring meat labels to include a product's country of origin. R-CALF hopes such labels would help consumers avoid foreign beef. The bill passed in 2002, but a challenge remains tied up in Congress.
The NCBA supports only voluntary labeling. But its Nebraska affiliate, the Nebraska Cattlemen, polled its members and then joined R-CALF in supporting mandatory labeling. Other state affiliates also have bucked the NCBA on the issue.
R-CALF's greatest victory, Bullard said, came in a 2002 law giving the president greater power to negotiate free-trade agreements. The group won a provision retaining some protections for cattle and beef by designating them "perishable and cyclical" products.
"Congressmen were surprised when cattle producers came into their offices and said, 'Our prices have been depressed,'" Bullard said. "The general response was, 'Why are you here? We've been hearing from the beef industry for years that everything's fine in the cattle industry.'"
Interviews with R-CALF and NCBA members across Nebraska show the most R-CALF support in the west, especially in Sand Hills ranching country. Eastern Nebraska cattlemen, who rely on feedlots more than ranches and therefore both pay and receive more when cattle prices are high, seem to give more support to the NCBA.
When asked why they joined a particular group, R-CALF members talked about political issues, especially trade. NCBA members were more likely to mention loyalty, tradition and services the group provides, such as cattle pricing information and television ads that promote beef, including the "Beef, it's what's for dinner" ads.
"The problem that some other groups have is that they just focus on one or two issues, like keeping the Canadian border closed," said Gary Kaup, an NCBA member who works at a feedlot near West Point, Neb. "The NCBA does more for us."
Though R-CALF's members come mostly from conservative western cattle states, the group has created some unusual alliances with political liberals.
In May, R-CALF joined two consumer groups -- the Consumer Federation of America and Public Citizen -- in calling on the government to keep out Canadian cattle until all risks had been assessed. In the past, the two consumer groups had fought the beef industry over such issues as irradiating meat.
Most cattlemen criticized R-CALF over the unusual alliance, said Joe Roybal, editor of Beef magazine. "These are groups that have an anti-beef reputation."
Bullard makes no apologies and said R-CALF will continue to work with any group that shares its positions. Its allies in Congress come from both parties, but U.S. Sen. Tom Daschle of South Dakota, a Democrat, has consistently backed the group.
"One difference between us and R-CALF is that R-CALF wants more government intervention. That lines up with the Democrats," said NCBA President Jan Lyons, who owns a cow-calf operation near Manhattan, Kan. "We support the Republican agenda more."
NCBA gave six times as much money to Republicans as Democrats in the current election cycle, according to the Federal Election Commission. The U.S. Department of Agriculture under Bush has hired four NCBA employees to top positions. R-CALF gives no money to politicians.
R-CALF's populism echoes the NCBA in its early years, when it fought big business on behalf of small ranchers.
In 1898, two Colorado ranchers founded the National Live Stock Association, the NCBA's predecessor. Their goal was to harness the power of ranchers against the powerful economic interests of their day.
At the group's first convention, rancher G.F. Patrick attacked meat packers, banks and stockyards, before making the case for cattlemen to unite:
"The single shipper (cattleman) . . . is fighting an individual battle against a thousand combined in one, against hundreds of thousands of dollars controlled by a single mind, the will of the organization."
The group supported the 1921 Packers and Stockyards Act, a signature piece of the Progressive movement's agenda that broke up some of the large meat packers and curtailed their activities.
Some liken R-CALF to that wave of agricultural populism, which included William Jennings Bryan's progressive Democrats and the Grange movement. But Bullard dismisses the comparison.
"We are unique in the history of agriculture groups. We are not promoting a philosophy," he said.
"These are rural issues, as opposed to liberal or conservative issues."
Rivals over beef
R-Calf
Year founded: 1998
How founded: Ranchers created a foundation to file anti-dumping charges against Canada and Mexic in the International Trade Commission.
Headquarters: Billings, Mont.
Leadership: President Leo McDonnell, CEO Bill Bullard
Membership: 10,500
Affiliates: 63, representing 43,000 members
Annual budget: $700,000 in 2003
Source of funding: Membership dues, contributions
Major issues: International trade, industry consolidation, country of origin labeling
NCBA
Year founded: 1898
How founded: Ranchers banded together to counter the economic power of the big businesses they dealt with.
Headquarters: Centennial, Colo.
Leadership: President Jan Lyons, CEO Terry Stokes
Membership: 26,000
Affiliates: 85, representing 230,000 members
Annual budget: $58 million in 2002
Source of funding: Government funding to promote beef, membership dues, contributions
Major issues: Public image of the beef industry, industry regulation, environmental issues, international trade
Omaha World-Herald, August 08, 2004
by Mark Kawar WORLD-HERALD STAFF WRITER
Bob Sears and his son Korley used to spend family vacations at National Cattlemen's Beef Association conventions around the country, helping chart the group's future.
Bob, a third-generation NCBA member who owns the Ainsworth (Neb.) Feedyards Co., still belongs to the group. But two years ago, he joined the NCBA's rival, the Ranchers-Cattlemen's Action
Legal Fund, United Stockgrowers of America, or R-CALF. He also stopped giving the NCBA $17,000 a year.
Korley, the feedlot's manager, feels even less loyalty to the old group, whose free-trade policies he believes have hurt cattle prices. He's an R-CALF activist and may even cast his first vote for a Democrat, John Kerry, because the candidate wants to ban meat packers from owning livestock.
"The future is in trade, and we know we're going to have to trade with other countries," said Bob Sears, "but that trade has to be fair for cattlemen."
Just six years old, R-CALF has tapped a deep vein of discontent among smaller U.S. cattle ranchers and feeders like the Searses who believe that big agribusiness and the federal government have promoted free trade and ag consolidation at their expense.
The association has attracted enough members, money and influence to make it perhaps the biggest threat ever to the 106-year-old NCBA.
Through lawsuits and other tactics, R-CALF has scored some successes, making itself more than simply a shrill voice of protest.
"I don't think NCBA can ignore R-CALF anymore," said Earl Peterson, a cattle industry consultant and former NCBA vice president. "There are specific issues that they own," especially trade.
In its short history, R-CALF has already managed to shake up cattle politics.
The NCBA once spoke for an undivided cattle industry.
Like most major agriculture lobbying groups in Washington, it supports free trade as a way to win export markets for U.S. agricultural products. But the small cattlemen who form R-CALF's base blame foreign competition for the loss of about 500,000 ranching jobs, or nearly 40 percent of the total, between 1980 and 2000.
As R-CALF has grown, the NCBA has seen its membership and fund- raising advantages shrink.
Earlier this year, R-CALF sued the Department of Agriculture, successfully blocking a government plan to end the yearlong ban on Canadian cattle imports put in place after the discovery of mad cow disease in Alberta in 2003.
Large agribusiness companies, the NCBA and many politicians are still trying to restart trade with Canada.
U.S. cattle prices have risen about 25 percent since the border closed, a fact that R-CALF has taken notice of. Even the discovery of a case of mad cow disease in Washington state in December hasn't completely dampened the markets.
"This completely contradicts what the industry has been telling U.S. cattle producers regarding the importance of exports," said R- CALF Chief Executive Bill Bullard. "Our industry has been conditioned for over 15 years that the most important factor to cattle prices, both present and future, is the expansion of exports."
Rival groups have emerged before to challenge the National Cattlemen on particular issues, but for decades it essentially held a monopoly on representing the cattle industry, said Merlyn Carlson, Nebraska agriculture director and a former NCBA president. None of the earlier rivals attracted a following as large as R-CALF's, he said.
"Have we seen this before? Yes. But we haven't seen anything to this extent."
R-CALF's founders are former NCBA members who struck out on their own after failing to turn that group against cattle imports.
For most of its history, NCBA supported protectionism, but views began to change as exports rose in the 1980s, especially to Japan. After a contentious debate, the group (then known as the National Cattlemen's Association) supported the 1994 North American Free Trade Agreement.
In 1996, further inflaming some members, the National Cattlemen's Association and the National Live Stock and Meat Board, which represented both cattlemen and meat packers, merged to form the NCBA. Bullard and many other cattlemen believe that's when the NCBA went astray.
Ranchers from Montana, Colorado and South Dakota founded R-CALF (which then stood for the Ranchers-Cattlemen's Action Legal Foundation) in 1998 as a vehicle for stopping Canada and Mexico in the alleged practice of selling cattle below cost in the United States.
The International Trade Commission ruled against its complaint, though conceding that R-CALF had a point. Cattlemen assumed the foundation would dissolve.
But the case generated so much support that the group stuck around, Bullard said. The next year, it opened a headquarters in Billings, Mont.
"We won on the merits, but we lost on the permanent remedy," Bullard said. "That was the start of R-CALF."
The group has since ridden the backlash among cattlemen against the expansion of free trade. The United States signed its seventh and eighth free trade agreements in July, including one with Australia, a major cattle producer. The Bush administration is working on agreements with six Central American countries, several of which produce cattle.
In 2001, the South Dakota Stockgrowers Association broke from the National Cattlemen and joined R-CALF. Last year, New Mexico Cattlegrowers did the same.
"Before the South Dakota Stockgrowers joined R-CALF, we couldn't give memberships away," said Ken Knuppe, president of the South Dakota group. "Now they're coming to us."
Four other state NCBA affiliates now also belong to R-CALF, and new state groups aligned with R-CALF have popped up recently in Missouri, Montana, Kansas, Oregon and Washington. Reflecting the broader backlash against free trade in agriculture, corn and soybean growers recently created groups opposed to free trade to rival the dominant players in their industries.
The industry's split can be measured, in part, through the two national cattle groups' membership and fund raising.
The NCBA lost 21 percent of its members in the past four years and now has about 26,000, a decline it attributes to the general shrinking of the cattle industry. In the same period, R-CALF membership has tripled to more than 10,500.
Between 2000 and 2003, contributions to R-CALF have more than doubled, to about $700,000, according to the group's IRS filings. It expects to raise more than $850,000 this year.
R-CALF's finances still are minuscule compared to the NCBA's annual budget -- $58 million in 2002, the latest available.
But while all of R-CALF's money comes from supporters, the NCBA gets 86 percent of its as "checkoff" money from a mandatory assessment on all cattle sales. Checkoff money can be used only to promote beef, not for political purposes. And it may dry up entirely if a pending U.S. Supreme Court case goes against the program.
NCBA income from membership dues and assessments was flat -- about $2.9 million -- from 1998 through 2002, the most recent year for which IRS filings are available. This year, NCBA expects to raise about $2.6 million in dues and assessments, up from a low of $2.3 million in 2003, said John Braly, vice president for industry and membership.
"For over 100 years we have represented cattlemen, and we are a cattlemen's organization," said Terry Stokes, chief executive for the National Cattlemen. "You ask our members, you ask Congress, you ask the administration -- clearly, we represent cattlemen across this country."
R-CALF has grown in part through creative, even folksy, tactics.
For instance, supporters staged a "fund-raising auction" recently during a regular Tuesday cattle auction at the Gordon (Neb.) Livestock Market.
Matt Lowery, the market's auctioneer, "sold" a donated calf repeatedly to more than half the ranchers attending the auction. Cattlemen bid on the animal not to keep it, but to contribute to R- CALF. It raised $6,187.50 and signed up 30 new members.
"These ranches have been in these families for over a hundred years," Lowery said after the auction, pointing to the men in boots, jeans and cowboy hats around the room. "If people want to keep it that way, they have to stay involved."
R-CALF's popularity is throwing a stumbling block at economists, agribusinesses and others who say American agriculture is best served by more trade and less government interference -- a group that includes President Bush and U.S. Secretary of Agriculture Ann Veneman.
Bullard said R-CALF doesn't oppose all trade, and he doesn't like the word "protectionist." But all trade agreements should take the livelihood of U.S. cattle producers into account, he said.
The group supported a recent U.S.-Morocco free-trade agreement because Morocco doesn't have any cattle. But even before mad cow disease was discovered in North America, it called for a two-year ban on all cattle and beef imports.
One of the group's first battles was lobbying Congress to support a bill requiring meat labels to include a product's country of origin. R-CALF hopes such labels would help consumers avoid foreign beef. The bill passed in 2002, but a challenge remains tied up in Congress.
The NCBA supports only voluntary labeling. But its Nebraska affiliate, the Nebraska Cattlemen, polled its members and then joined R-CALF in supporting mandatory labeling. Other state affiliates also have bucked the NCBA on the issue.
R-CALF's greatest victory, Bullard said, came in a 2002 law giving the president greater power to negotiate free-trade agreements. The group won a provision retaining some protections for cattle and beef by designating them "perishable and cyclical" products.
"Congressmen were surprised when cattle producers came into their offices and said, 'Our prices have been depressed,'" Bullard said. "The general response was, 'Why are you here? We've been hearing from the beef industry for years that everything's fine in the cattle industry.'"
Interviews with R-CALF and NCBA members across Nebraska show the most R-CALF support in the west, especially in Sand Hills ranching country. Eastern Nebraska cattlemen, who rely on feedlots more than ranches and therefore both pay and receive more when cattle prices are high, seem to give more support to the NCBA.
When asked why they joined a particular group, R-CALF members talked about political issues, especially trade. NCBA members were more likely to mention loyalty, tradition and services the group provides, such as cattle pricing information and television ads that promote beef, including the "Beef, it's what's for dinner" ads.
"The problem that some other groups have is that they just focus on one or two issues, like keeping the Canadian border closed," said Gary Kaup, an NCBA member who works at a feedlot near West Point, Neb. "The NCBA does more for us."
Though R-CALF's members come mostly from conservative western cattle states, the group has created some unusual alliances with political liberals.
In May, R-CALF joined two consumer groups -- the Consumer Federation of America and Public Citizen -- in calling on the government to keep out Canadian cattle until all risks had been assessed. In the past, the two consumer groups had fought the beef industry over such issues as irradiating meat.
Most cattlemen criticized R-CALF over the unusual alliance, said Joe Roybal, editor of Beef magazine. "These are groups that have an anti-beef reputation."
Bullard makes no apologies and said R-CALF will continue to work with any group that shares its positions. Its allies in Congress come from both parties, but U.S. Sen. Tom Daschle of South Dakota, a Democrat, has consistently backed the group.
"One difference between us and R-CALF is that R-CALF wants more government intervention. That lines up with the Democrats," said NCBA President Jan Lyons, who owns a cow-calf operation near Manhattan, Kan. "We support the Republican agenda more."
NCBA gave six times as much money to Republicans as Democrats in the current election cycle, according to the Federal Election Commission. The U.S. Department of Agriculture under Bush has hired four NCBA employees to top positions. R-CALF gives no money to politicians.
R-CALF's populism echoes the NCBA in its early years, when it fought big business on behalf of small ranchers.
In 1898, two Colorado ranchers founded the National Live Stock Association, the NCBA's predecessor. Their goal was to harness the power of ranchers against the powerful economic interests of their day.
At the group's first convention, rancher G.F. Patrick attacked meat packers, banks and stockyards, before making the case for cattlemen to unite:
"The single shipper (cattleman) . . . is fighting an individual battle against a thousand combined in one, against hundreds of thousands of dollars controlled by a single mind, the will of the organization."
The group supported the 1921 Packers and Stockyards Act, a signature piece of the Progressive movement's agenda that broke up some of the large meat packers and curtailed their activities.
Some liken R-CALF to that wave of agricultural populism, which included William Jennings Bryan's progressive Democrats and the Grange movement. But Bullard dismisses the comparison.
"We are unique in the history of agriculture groups. We are not promoting a philosophy," he said.
"These are rural issues, as opposed to liberal or conservative issues."
Rivals over beef
R-Calf
Year founded: 1998
How founded: Ranchers created a foundation to file anti-dumping charges against Canada and Mexic in the International Trade Commission.
Headquarters: Billings, Mont.
Leadership: President Leo McDonnell, CEO Bill Bullard
Membership: 10,500
Affiliates: 63, representing 43,000 members
Annual budget: $700,000 in 2003
Source of funding: Membership dues, contributions
Major issues: International trade, industry consolidation, country of origin labeling
NCBA
Year founded: 1898
How founded: Ranchers banded together to counter the economic power of the big businesses they dealt with.
Headquarters: Centennial, Colo.
Leadership: President Jan Lyons, CEO Terry Stokes
Membership: 26,000
Affiliates: 85, representing 230,000 members
Annual budget: $58 million in 2002
Source of funding: Government funding to promote beef, membership dues, contributions
Major issues: Public image of the beef industry, industry regulation, environmental issues, international trade
