The proposed GIPSA rules were simply too radical of a departure from the free-market, free-enterprise principles that have long been part of this industry.
Last week’s announcement that Dudley Butler was leaving USDA was taken by both sides of the GIPSA debate as a watershed event. Essentially, it put an end to USDA’s attempts to radically transform the livestock industry.
It was interesting to read the varying reactions. Within the Washington Beltway, it was largely seen as the removal – going into an election year – of a political liability; that is, of an official who pushed a radical agenda that ultimately was thwarted. Those opposed to the proposed GIPSA rule saw it as a triumph for democracy and the free market; those who supported GIPSA saw it as a testament to the power of the conspiracy created by multinational packers. Neither view is entirely accurate.
Certainly Butler’s resignation is a vivid symbol of the failure of the proposed GIPSA rule and the populist agenda that he championed. But, from the beginning, it was simply too radical of a departure from the free-market, free-enterprise principles that have long been part of this industry. What’s striking to me about the whole struggle is that there was never a viable alternative or compromise offered. It was an abject failure of political strategy more than anything else.
While GIPSA proponents claim the defeat underscores the power of multinational packers, the packing industry actually had very little to do with the proposal’s demise. Rather, it was the cow-calf and feeding industries that lined up almost unanimously to oppose such a radical departure. It was a policy doomed for failure because it went so far that it was rejected even by the industry segments it was supposed to help.
It was a defeat of epic proportions for the populists who reject the free market and want government to be intimately involved in the outcomes of the marketplace. In Butler, these folks finally had their ultimate champion in place. But, they elected to pursue an all-or-nothing approach, and ultimately ended up with nothing.
While most of the pundits interpreted the resignation as a testament to the failure of the proposed GIPSA rule, the reverberations of the Butler reign at USDA will be felt for a long time. It extends beyond the failures of the GIPSA rule, mandatory country of original labeling, and the politically motivated actions that created a situation that threatened the very survival of the checkoff.
Here are the lessons I glean from this episode: