David Hyde: Contractors with cowboy hats have failed the American cattle producers

The recent testimony, interviews and op-eds by the contractors and benefactors of the Beef Checkoff Program has this first-generation cow-calf operator asking and looking for the real facts about the Opportunities for Fairness in Farming Act (OFF Act).

Let’s start with the op-ed criticizing Utah Sen. Mike Lee in The Salt Lake Tribune on May 18. The opening paragraph says it all: “Sen. Mike Lee’s political positions typically align with agriculture. He usually opposes the burdensome regulations that threaten family farmers and ranchers and understands the importance of a fair tax code.” Maybe, just maybe, the family cattle ranchers in his state (like mine) have had a hard time believing that the checkoff dollars have helped us, but believe instead that they have bolstered the profits of the big four beef packers, corporate feeders, and the contractors of the checkoff, and have asked Sen. Lee for help.

Since 1985, the checkoff’s first year, the cattle industry has lost 43% of its independent family producers, losing 15,000 every year; 7 million mother cows and 75% of the independent cattle feeders in the United States.

Since 1985, the producers’ share of the beef dollar has shrunk from 60% to 37%, and average annual beef consumption fell from 79.2 lbs. to 59.1 lbs. in 2022.

Just to be clear, it’s not about the $1 tax ($2 in my state), it’s about transparency and accountability of a program that has repeatedly refused, blocked, and even gone to court to prevent the release of information pertaining to the checkoff. In 2010, an audit of the beef checkoff revealed hundreds of thousands of misused dollars. Those in control of the funds quickly filed an injunction to prevent the release of any further information. When all was said and done the statement from the U.S. Department of Agriculture was, “We are concerned that unwarranted embarrassment could result for USDA” and “that checkoff funds are ‘vulnerable to misuse.’” Then they released 12,200 redacted pages of the checkoff audit and program.

Testimony on Capitol Hill had another contractor of the beef checkoff explain, “The Beef Checkoff, for example, was established by statute in 1985 and ratified by 79% of cattle producers in a national referendum three years later. The Beef Checkoff collects $1 per head from the receipts of cattle sold and uses these pooled resources to conduct research and market U.S. beef to both domestic consumers and foreign importers.”

What the contractor fails to state is the checkoff failed multiple times before changes in voting location, time of year, and vote totals were made. Also, several key provisions have vanished from the original act, such as periodic referendums and the creation of cattle markets, as posted in the original mission statement. They also boast about the acceptance and favorability of the checkoff but fight vigorously to keep a referendum from happening and proving their point.

I worked 35 years as a union electrician before retiring and have paid thousands of dollars in mandatory dues (like the checkoff) to the union, but I received tangible and significant benefits as did other members that paid into this working tax. Recent estimates have the cumulative amount paid into the beef checkoff since 1985 at $1 billion dollars, and the proudest moment has been the development of the Flat Iron steak.

The time has come to turn this program over to the real independent professional marketing experts, with periodic audits and performance reviews. The contractors with cowboy hats have tried but failed the American cattle producers for way too long. Why is it that only those who are benefiting from the checkoff are testifying against the OFF Act, but not the producers that actually pay the tax? Is it really about beef promotion or is it simply about the checkoff dollar itself?

Dave Hyde serves as Region VIII Director of R-CALF USA, the nation’s largest nonprofit trade association exclusively representing cattle producers.