From its beginning in 1998, the Ranchers-Cattlemen Action Legal Fund United Stockgrowers of America (R-CALF USA) has stirred disunity within the U.S. cattle industry. The debate's roots go back to 1999 when the National Cattlemen's Beef Association (NCBA) International Markets Committee voted against supporting R-CALF's original trade investigations.
Over time, the split between R-CALF and NCBA has widened, boiling over into outright hostility. This past summer, R-CALF founder and president Leo McDonnell, Jr., accused NCBA of “slanderous attacks” on his organization. He charged NCBA — and BEEF magazine — with launching a “hate campaign” against it and the consumer groups it allied with in June to gain a beef import injunction against USDA.
BEEF Senior Editor Clint Peck met recently with McDonnell to discuss these and other issues.
BEEF: At the organizational meeting of R-CALF held in Denver in 1998, you said your trade cases would have a defined timetable and structure — something like 8-12 months, and disband thereafter. How did R-CALF evolve into what it is today?
McDonnell: It was our feeling that cow-calf producers and independent cattle feeders weren't being fairly represented on market and trade issues in Washington, D.C.
We knew we were going to receive opposition from foreign countries, packers, wholesalers, retailers and importers. But, the opposition we found most disheartening came from NCBA, whose lobbying efforts compromised our trade cases with what we thought was biased information.
I had been on NCBA's trade committee, and NCBA had strong policy that NAFTA rules were to be enforced. NCBA opposed the Mexico case, and halfheartedly supported the Canada countervailing case, because it affected the Canadian Wheat Board (CWB) on feed costs.
BEEF: Were you satisfied with the resolution of the original trade cases?
McDonnell: We were disappointed with the findings that came out of the U.S. Department of Commerce, and that the U.S. government didn't put more pressure on the CWB to give us more information. We were also dissatified with the decision to kick the Mexico case out. Under trade law we should have been allowed to keep it in. There was a tremendous amount of pressure not to bring the case against Mexico.
Many positive aspects that came out of the investigation have been helpful in teeing up issues that will be important to the U.S. cattle industry.
BEEF: How does R-CALF elect its officers? What's the governance structure?
McDonnell: R-CALF directors can serve two, three-year terms. Directors are nominated and voted on by members within the regions. The president and vice president are selected by the board of directors and have to be chosen from among the directors.
I always wanted membership to control the leadership. We supply a financial statement at our annual meeting to members and have an audit done each year. Our financials are far more detailed than other groups I've been involved with.
BEEF: How much did the initial petitions and investigations end up costing R-CALF members?
McDonnell: Between $1.5 and $1.8 million, which includes the challenges to the Mexico case.
BEEF: Has R-CALF morphed into an organization focused more on food safety and human health than economic issues related to cattle imports?
McDonnell: Our focus is still on trade-related issues of which food safety, as it relates to imports or exports, is a part. We continue to retain Stewart and Stewart as our trade firm in Washington, D.C., to assist us in the many trade issues we're facing today.
But, food safety is a part of trade and we want our science for imports harmonized with international applied and practiced standards.
BEEF: What was behind the decision this spring to align R-CALF with the Consumer Federation of America, Consumer's Union and Public Citizen?
McDonnell: The decision to include them in a press conference regarding the USDA injunction on beef and cattle imports came from the law firm that represented us on the injunction — Collier, Shannon and Scott. That firm has also represented other meat industry groups at times.
The criticism we've received for working with them is the single-most immature thing I've ever seen come out of our industry. I think some of our industry groups have reached a new low. You can't tell me, after spending a billion dollars of checkoff resources, that this is the best we can do in working with these consumer groups.
BEEF: But those groups have been labeled as “anti-cattle” and “anti-beef.”
McDonnell: By whom? The same groups that opposed country-of-origin labeling, the trade cases and many of the fair trade issues we've been working on? To give them such labels is overly simplistic. I don't buy into the idea they are anti-beef.
In fact, recently Carol Tucker Foreman of the Consumer Federation stated that BSE was not a real concern once you plug all the holes with regards to things like feeding blood meal.
R-CALF had a four-point goal when we met with them. They had some other things they wanted, but we told them we couldn't agree with them on the other issues, mainly mandatory livestock ID. We worked out our differences. There's nothing novel about this kind of approach.
BEEF: Has R-CALF received any money from those groups?
BEEF: Do you think you can trust those groups to be unbiased?
McDonnell: Is anybody unbiased without the effort to correct such biases? What we should be doing is working with these folks so they have a better understanding of our concerns and we have a better understanding of theirs.
What's being said is typical of an entrenched industry that's trying to find its way — you get very defensive. Whether it's markets or trade, we've become very entrenched.
BEEF: Preliminary data show beef demand in the U.S. has increased nearly 22% since 1998. Do you believe demand is an important factor in the profitability of the American cattle industry?
McDonnell: Let me say first that what R-CALF USA is trying to do is increase demand by improving demand transparency. You can have a strong market demand for a finished product and still have a production sector that suffers as an industry. Those demand transparencies can be shifted to an imported product or masked in a dysfunctional market arena.
Everyone in the production industry has benefited from the demand increase. But, this isn't the time to rest on our laurels. We have to increase demand anyplace we can — like convenience products, export markets and healthy new products through muscle profiling. We need to make sure those demands are focused on U.S.-produced products.
BEEF: The message coming out of R-CALF has been to differentiate “cattle” producers from “beef” producers. What you're saying doesn't follow that vein.
McDonnell: It's meant more as a differentiation of the markets. You can have a healthy beef market and an unhealthy cattle market — and we've seen that situation.
BEEF: You've been characterized as an industry isolationist. Is that fair?
McDonnell: If you're talking in the context of trade, I fully understand that trade will continue to be liberalized. But, we shouldn't embrace trade without offering producers more opportunity and ensuring trade is truly enhancing.
Trade in itself is not bad. However, R-CALF's vision for trade is that it be meaningful and enhancing to U.S. cattle producers. That means taking a different approach. I think we all realize the debate today is not whether we'll have trade, but whether it will be free trade or fair trade.
BEEF: It's been alleged some R-CALF members have taken advantage of Canada's depressed cattle market by buying Canadian feeder calves. Doesn't this fly in the face of an organization that's been so vehemently critical of the Canadian cattle industry?
McDonnell: We have nothing against the Canadian cattle industry. However, we do have some real concerns with subsidy and dumping violations going on up there. Do some of our 11,500 members own cattle in Canada? Yes, but that's an old story. I don't see the problem.
What doesn't get reported is that three of the four people I know who own feeder cattle in Canada contributed in five figures to the injunction limiting beef and cattle imports from Canada. These are men who have historically fed cattle in Canada. They did not want to see the U.S. lower its import standards below international levels.
Those guys are my heroes. Yet, they're being persecuted. They not only took a financial beating, they contributed to the injunction knowing they'd take a beating for the betterment of our industry.
What's interesting is that no one talks about the folks who jumped in last spring and bought cattle up there hoping NCBA and USDA would succeed in lowering the standards and opening the border so they could make a windfall profit. Those are the bad people. They were the ones trying to benefit from the corruption of our import standards — and many of them are NCBA members.
BEEF: Do you foresee any kind of olive branch being extended between R-CALF and NCBA?
McDonnell: I'd be glad to sit down and talk with them. Certainly, on issues where we have like concerns, we should work together. But, there needs to be some meaningful changes in NCBA staff, leadership and in who can be a voting member, if they want to truly work with U.S. cattle producers on issues that can be antagonistic to beef industry segments.
BEEF: Do you think one organization can effectively represent all segments of the U.S. cattle/beef industry?
McDonnell: There's no way one organization can effectively represent all industry segments. The old National Cattlemen's Association (NCA) is a good example. We started getting into trouble when NCA merged with the large feeding states and formula feeders. And, that was compounded when they merged with the Beef Board. It refocused a lot of their attention and put them in a position where they had to compromise on price-sensitive issues like trade and competition.
It's a huge mistake not to have a separate voice for cattle producers. I believe the true cattle producers in NCBA and R-CALF agree on at least 80% of the issues, but some issues are extremely antagonistic.
BEEF: Where does R-CALF stand on the beef checkoff?
McDonnell: R-CALF neither supports nor opposes the checkoff. Members agreed early on to keep the checkoff out of R-CALF, as it would be decided in other arenas.
BEEF: Is R-CALF going to support a candidate for U.S. president?
McDonnell: I think we need to keep it bipartisan, and we've had good luck in a short amount of time doing it that way.
BEEF: What's your future with R-CALF?
McDonnell: Every time I get ready to step off this boat, something happens that requires me to stay on it. Now, it's NCBA's campaign of criticizing us for working with consumer groups. This was going to be my last year. However, I'd like to see some common ground found between R-CALF and NCBA before I step down.
BEEF: Can R-CALF survive without Leo McDonnell?
McDonnell: I think so. If the organization has merit, and if it's needed, it will survive on its own. If it can't survive without me, I've done a very poor job.
The R-CALF story
The Ranchers-Cattlemen Action Legal Fund United Stockgrowers of America (R-CALF) began in 1998 as a foundation supporting investigations into international trade violations believed to be damaging to U.S. cattle prices. R-CALF sought trade remedies through the U.S. Department of Commerce (DOC) and U.S. International Trade Commission (ITC), specifically on:
Anti-dumping margins against Canada and a separate petition against Mexico.
A countervailing duty petition against Canada charged that up to 39 federal and provincial subsidies gave Canadian cattle producers a $100/head edge over U.S. producers.
The ITC quickly dismissed the Mexico case in 1999. But, that summer the DOC determined Canada was subsidizing the production of live cattle but not at a high enough rate to warrant penalty tariffs.
The DOC also found Canada was dumping cattle into the U.S. at a high enough rate to warrant tariffs equivalent to the violation. But, the ITC ruled in November 1999 that U.S. cattle producers were not “materially injured” by the dumping of Canadian cattle and the ITC lifted the anti-dumping tariffs earlier imposed by the DOC.
In the summer of 1999, R-CALF expanded into a national association for “cattle producers and independent cattle feeders.” Today, R-CALF claims 11,000+ members in 46 states, and expects to raise more than $850,000 this year.
Anti-beef? You decide
Last spring, several “consumer groups” joined forces with R-CALF in condemning USDA's handling of the post-Dec. 23 BSE situation. The groups openly questioned the safety of the U.S. beef supply and accused USDA of systematically excluding both the public and human health experts from any meaningful role in shaping U.S. policy to combat BSE.
R-CALF has been criticized for its association with these groups that have been labeled as “anti-beef.” We invite you to research these groups for yourself; then let us know what you think by contacting BEEF at: [email protected].
Consumer Federation of America (CFA, www.consumerfed.org). CFA's Food Policy Institute is run by Carol Tucker Foreman, who oversaw food safety and nutrition programs in the Carter administration. Under her leadership, dietary guidelines were designed to decrease consumption of meat, and increase consumption of poultry and fish.
In a 2002 interview, Foreman said: “My concern is that I don't want a system that says you can have fecal matter all over it (meat), and then irradiate it. Irradiated poop won't make you sick, but it's still poop.”
Tucker-Foreman and CFA have opposed efforts to allow “state-inspected” beef processors to sell products across state lines or in international markets. CFA also supports proposals to increase the amount of soy and reduce the amount of meat in school lunch programs.
Consumers Union (CU, www.consumersunion.org), has an ongoing campaign to promote organic-only eating. When the Canadian BSE story broke in 2003, Michael Hansen of CU's Consumer Policy Institute suggested that American consumers should eat only grass-fed, “organic,” and other specialty beef.
Former U.S. Surgeon General C. Everett Koop once singled out Hansen and CU, saying: “Unfortunately, a few fringe groups are using misleading statements and blatant falsehoods as part of a long-running campaign to scare consumers about a perfectly safe food…”
Public Citizen (PC, www.citizen.org), was founded by Ralph Nader. PC has a long-standing campaign against irradiation of beef, saying “it does nothing to remove the feces, urine, pus and vomit that often contaminate beef.”
PC was quoted in a Reuters report in 2000 saying USDA's decision to give meat packing plants more responsibility for safety (HACCP programs) will unravel public health gains made since author Upton Sinclair documented grisly slaughterhouse conditions in “The Jungle.”
In May 2004, PC released a report entitled “Hamburger Hell: The Flip Side of USDA's Salmonella Testing Program” as the industry kicked off the summer grilling season. “Dirty meat from the plants in this report is reaching consumers, killing them and making them sick,” the report says.