Iowa Conference Warns of Concentration Perils

September 9, 1999

Agricultural concentration is not about production efficiency, it's about corporations capitalizing on economic power, says Sen. Tom Harkin (D-IA). Also speaking at an Iowa conference on concentration, Iowa State University economist Neil Harl said high profile mergers place keys to evolving technologies in the hands of fewer players.

"Far too little attention has been paid to the tremendous consequences of transforming American agriculture from a system of independent family farms to one based on the corporate, industrial model," says Harkin. "Ever greater economic concentration in the food and agriculture sectors affects not only farm families and rural communities. Everyone eats. Consumers ought to ask whether they will enjoy the same high quality food at reasonable cost if our food supply is in the hands of a few corporate giants instead of family farms."

Harkin hinted that congressional intervention may be needed if laws already in effect "are not adequate to do the job." What was meant by "the job" wasn't spelled out. Harkin did say the rapidly growing economic concentration in the food and agriculture sector "stands on its head" the "underlying principle of our nation's antitrust laws," the Sherman and Clayton Acts and the Packers and Stockyards Act.

The principle is that the country is better off with a system of full, free and fair competition in markets, says Harkin. "We must step up the level of scrutiny and enforcement under the laws already on the books" and change the laws if they can't "do the job."

By placing evolving technologies in the hands of fewer players, said Harl, a smaller share of the revenue from production will go to the producer.

The Justice Department's top antitrust attorney, Joel Klein, said concentration issues in agriculture "are front and center" and Justice. But "you have to analyze each merger to see whether it is helpful or harmful. If we start to overreact, we are going to do more harm than good."