Independent ranchers fight corporate control

Lawsuits seek to eliminate mandatory checkoff payments


SHEPHERD, Mont. - As you pull in the dirt driveway of Steve and Jeanne Charter's ranch, the place has a feel of independence. You pass a windmill, a stock pond and a pile of sugar beet tailings, the remains of inexpensive local cattle feed. The ranch house, built into a berm according to passive-solar principles, shelters three generations of the family and gives the barking flock of border collies something to guard.

One collie perches in the cab of an old pickup, ready for the next trip up to the Bull Mountains, where the Charters graze their 250 cow-calf "units" during the summer. The herd also runs on an independent rhythm: Instead of timing the birth of calves for winter as most ranchers do, the Charters do their calving on the mountain grass in late June.

"The late calving is very easy. They're on good nutrition, there's no weather pressure," Steve Charter says. "It's timing with peak forage." It pays off come March, when the calves weigh about 500 pounds each, and the Charters auction them in the feeder-calf market.

But for every head the Charters sell, they're required, like all U.S. cattle ranchers, to pay a $1 "checkoff" fee, which is whisked off to promote beef around the country. The total take, as much as $90 million a year, also pays for developing and pushing new products, such as microwavable pot roasts.

Led by the slogan, "Beef, it's what's for dinner," checkoff-funded ads make no distinction between the natural, grass-fed calves the Charters raise and the hormone-fattened beeves cranked out by corporate feedlots - or, just as unfair, cheap South American imports.

"It would be like Congress asking small businesses to pay for Wal-Mart's advertising," Jeanne Charter says. "It's lucrative to the (beef) processor, but it's a disaster for us."

So the Charters and many other independent thinkers in the West's cattle business want the checkoff turned off.

As good as grandma's

Checkoff programs were created to boost demand for a range of agricultural commodities. Sheep ranchers adopted the first one in 1954, and there are now 14 operating for products including dairy, honey and peanuts. Typically, the money is collected by the U.S. Department of Agriculture and funneled into the dominant industry trade associations, where large corporations can influence how it is spent.

"Checkoffs have not served producers," says Mike McMahon of the Minnesota-based Land Stewardship Project. Using checkoff fees from hog farmers, for example, the National Pork Producers Council has pushed consolidation and factory farms, McMahon says. "It's bad for family farms. Environmentally, it's a threat to their air, water and quality of life."

Hundreds of thousands of independent hog farmers and cattle ranchers have signed petitions seeking to end their checkoff programs, but the USDA under the Clinton and Bush administrations has kept the programs in place.

The beef checkoff money cycles through a network of state Beef Councils and the national Cattlemen's Beef Board, dominated by traditional cattlemen groups and including cattle importers. Ultimately, as much as 94 percent of the money lands in the National Cattlemen's Beef Association, which does the promotion and product development, based in the same suburban Denver office building as the Beef Board.

Politically, the Beef Association promotes antibiotics and growth-enhancing drugs in beef production, as well as irradiating food. It supports the increasing dominance of meatpackers and three huge ag corporations * ConAgra, Cargill and IBP. The Beef Association's political lobbying is supposed to be separate from the checkoff, but the Charters see an overlap, with the beef promotions favoring corporations that seek the cheapest meat from any source.

Working with what it calls "industry partners," the Beef Association emphasizes "convenience foods," such as breaded beef sticks and Hormel's dehydrated "Beef Tips with Gravy," a mix of two dozen ingredients, including hydrogenated cottonseed oil, hydrolyzed soy protein and diglycerides.

"Americans increasingly choose easy-to-prepare ... foods, snack items and appetizers over classic sit-down dinners," says the Beef Association's Web site.

The Beef Board's chief executive, Monte Reese, says all cattle ranchers benefit from the checkoff program, which fosters research to improve safety in packing plants and kitchens.

Demand for beef has plummeted to half what it was in the early 1970s, but has begun to rebound in the last three years thanks to checkoff work, Reese says. "Today, you can buy a precooked pot roast, pop it in the microwave for seven minutes, and it's as good as the one grandma made."

Carved up in the courts

Steve Charter might serve a microwave pot roast to his collies, but never to his family, because, he says, the processing and added ingredients destroy the natural flavor. He suspects these products are developed to make use of substandard beef from Brazil and Argentina.

"Beef is at record prices in the store, and yet we're getting 1960s prices," Charter says. "Every dollar you put into checkoff, you're supporting an organization that's undermining market reform."

Fed up, small producers and their allies are pressing constitutional challenges to six checkoff programs. They're inspired by a recent U.S. Supreme Court ruling, which held that a mushroom-producer checkoff was "compelled speech" that violated the First Amendment.

One of two court actions targeting the beef checkoff originated at the Charter ranch in 1998, when the couple refused to pay their $250 checkoff. An administrative law judge levied a $12,000 fine, but the Charters fought back by suing the USDA in federal court. They're seeking a refund of all ranchers' checkoff fees, and are supported by 130 other ranchers and nine conservation groups, organized as intervenors in the lawsuit by the Billings, Mont.-based Northern Plains Resource Council.

Meanwhile, the Livestock Marketing Association has challenged the beef checkoff in federal court in South Dakota. The association represents 800 auctioneers, whose livelihoods are threatened by corporate processors that buy cattle under long-term contracts without competitive bidding. The South Dakota court declared the beef checkoff unconstitutional on June 21, but the USDA is appealing.

The Charters' case is being weighed by U.S. District Judge Richard Cebull in Billings. Steve Charter says the checkoff puts yet more stress on ranchers struggling with drought, chronically low prices and a dedication to quality: "The whole system is crumbling."

The author writes from Bozeman, Montana.

You can contact ...

  • Steve and Jeanne Charter, Shepherd, Mont., 406/947-2151;
  • Northern Plains Resource Council, Billings, Mont., 406/248-1154,;
  • National Cattlemen's Beef Association, Centennial, Colo., 303/694-0305,
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