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The ethics of a pig

Posted on March 4th, 2020

Note: some of these ideas came from Smith Fellow Dr. Bonnie McGill.

Writing with a great nom de plume, O. Henry1 (William S. Porter) may have been the G.O.A.T. short story writer and his best one was the ironic comedy, The Gift of the Magi. O. Henry also wrote one titled The Ethics of Pig, a double-crossed grifter’s story of trying to work a swindle for a pricey porcine. Ok, there’s my segue to Iowa hog production. More on O. Henry later.

O. Henry. 1862-1910. Photo credit: W. M. Vanderweyde, 1909

It’s no secret that the production of Iowa hogs is nothing like it was 40 years ago.  In 1980, 65,000 Iowa farmers raised a total of 13 million hogs (about 200 hogs per farmer); by 2002 the number of hogs had increased to 14 million but the farmers raising them had dwindled to 10,0002. At any one time, today’s Iowa has about 25 million hogs raised by ~6000 farmers3.  A market weight hog is 6 months old and thus the annual total brought to market by Iowa farmers is about double the inventory.

Many of today’s hogs are never owned by the Iowa farmer; rather they are raised on contract for large meat processing companies like Tyson, Smithfield Foods, and JBS. You may hear otherwise, but from what I’ve read, many farmers prefer these types of arrangements and I’m not questioning them.

These big companies are “vertically integrated”, meaning their business strategy ties together two or more functions within one entity—in other words, they try to cut out some of the “middle men” to create efficiencies that ultimately benefit them and perhaps lower the retail price the consumer pays for the product. This did in fact happen for pork, especially in the early stages of consolidation when prices dropped $29/year for the average U.S. customer4.

The number of Iowa live hogs owned by food and processing companies (versus farmer-owned) is not an easy figure to obtain. But it hardly matters. They own them all once they’re in a box. The JBS processing facility in Ottumwa produces 1 billion pounds of pork per year—almost 3 million pounds per day5. This much pork would require more than 7 million hogs to be processed per year.6 That’s 800 per hour, assuming three shifts per day. Marshalltown and Council Bluffs are also home to JBS hog processing facilities. JBS profits in 2018 totaled more than $7 billion5. JBS is a Brazilian company that entered the U.S. market in 2007 with the purchase of Swift Packing Company.5

Smithfield Foods is the largest pork producer in the world7 with a presence in the U.S., Mexico, Poland, Romania, Germany and the U.K. They own facilities in Mason City, Carroll, Denison, Orange City, Sioux Center, Sioux Falls and Omaha. Smithfield was once an American company but is now owned by the Chinese conglomerate WH Group.8 The company has ~50,000 employees that generate $15 billion in annual revenues.8

Now it’s undeniable that many Iowa residents—thousands in fact—earn their bacon working for these foreign-held companies. Hog production and processing here also puts bacon on the plates and in the pockets of lots of people in some other countries.

In an interview for a Reuters article, one Smithfield worker put it simply: “They got an order to fill: China.”9

So back to O. Henry. Curiously enough, he coined the phrase “Banana Republic” in his 1904 story The Admiral to describe the mythical country of Anchuria, which is thought to represent Honduras where O. Henry was living at the time. The phrase soon gained popular use to describe the Central American countries ruthlessly compromised and exploited by the United Fruit Company and other American corporations for the purposes of supplying cheap bananas to the U.S. After a few decades of being casually used by parrotheads and folks shopping for spring break clothes, the phrase’s more sinister overtones have resurfaced of late thanks to economists using it to describe a plutocracy, i.e. government by the wealthy.

Now when I started writing this, my objective was to hammer on the point that hog production pollutes Iowa’s water so that Chinese people can eat more pork chops and foreign billionaires can eat more caviar and then as they pick the fish eggs out of their teeth they at least indirectly affect policy decisions that keep our water polluted. Iowa as a Banana Republic. Indeed, The Swine Republic. I sorta doubt that you’ll hear Jimmy Buffett croon those words, or for that matter see it embroidered on the back pocket of a pair of cargo shorts.

But two things happened that made me rethink my original objective. One, I realized that I had already burned the obvious title for this one (Swine Republic) several months ago and I’m a better titler (long “i” sound) than I am a writer and I have expectations for myself. So I added a letter to O. Henry’s title.

Second, I started to think about all the human and environmental wreckage our own country has wrought elsewhere so we can have cheap(er) iPhones, energy, clothes and a whole bunch of other stuff we use, wear, eat and drink. Outsourcing pollution, it’s been a thing10 for a while now. I interrupted writing this to look at my own clothes. Shirt: Sri Lanka. Pants: Vietnam. Shoes: China. I’m all about south Asia until I put my jacket on: Portugal, although the brand is Norwegian. How much pollution my own clothes generated in these other countries: don’t know. Shipping them to the U.S. certainly created some. Anyway, I thought I better not get too self-righteous here. What goes around comes around, as they say.

But still, have these foreign meat conglomerates brought general prosperity to rural Iowa? There’s very little evidence that they have. Sure, thousands of people work in the slaughterhouses. The JBS Ottumwa facility employs 2200 people and is the largest employer in Wapello County. And yet, the county’s population has dropped 25% since 1950 and 11.5% since 198011. And about those jobs. The average wage earned by a meat packing worker was 14-18% greater than the rest of US manufacturing up until the 1970s. Now: 32% lower.12

So I know, globalization blah blah blah, what can I add to the discussion. Well, this: it’s polluting your water. And this: as we stand at the brink of taxing ourselves to help clean up this pollution, our state asks nothing of the people that benefit most from the arrangement.

Why?

 

References

1https://en.wikipedia.org/wiki/O._Henry.

2Herriges, J.A., Secchi, S. and Babcock, B.A., 2005. Living with hogs in Iowa: the impact of livestock facilities on rural residential property values. Land Economics81(4), pp.530-545.

3Iowa Pork Facts. 2019. https://www.iowapork.org/news-from-the-iowa-pork-producers-association/iowa-pork-facts/.

4U.S. Hog Giant Transforms Eastern Europe. New York Times, May 5, 2009. https://www.nytimes.com/2009/05/06/business/global/06smithfield.html.

5M. Perret. JBS sees growth in revenue and profits. April 1, 2019. https://www.globalmeatnews.com/Article/2019/04/01/JBS-sees-growth-in-revenue-and-profits.

6https://www.gourmetsleuth.com/articles/detail/pork-cut-yield-per-hog.

7K. Blankfeld. JBS: The story behind the world’s biggest meat producer. April 21, 2011. https://www.forbes.com/sites/kerenblankfeld/2011/04/21/jbs-the-story-behind-the-worlds-biggest-meat-producer/#77013a587e82.

8https://www.reuters.com/companies/0288.HK.

9T. Polansek. At Smithfield Foods’ slaughterhouse, China brings home U.S. bacon. November 5, 2019. https://www.reuters.com/article/us-china-swinefever-smithfield-foods-foc/at-smithfield-foods-slaughterhouse-china-brings-home-u-s-bacon-idUSKBN1XF0XC

10H. Devlin. Thousands of pollution deaths worldwide linked to western consumers – study. March 29, 2017. https://www.theguardian.com/environment/2017/mar/29/western-consumers-fuelling-tens-of-thousands-of-air-pollution-related-deaths

11Unitesd States Census. https://www.census.gov/prod/www/decennial.html

12Post-Farmgate Employment in the U.S., book chapter in Davidova, Sophia; Mishra, Ashok; and Thomson, Kenneth eds. Rural Policies and Employment: Transatlantic Experiences. World Scientific. 2019.http://www2.econ.iastate.edu/prosci/swenson/Publications/17_Swenson_PostFarmgate_KJT22Corrected.pdf

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10 Responses

  1. Jim R says:

    Your stats on hog ownership and production are amazing. Raising animals is nothing like how I remember it as a kid when I grew 8 pigs at a time for FFA projects.

    My wife is a quilter. She has done a lot of research into fabrics, especially cotton production over the years. The stories of human misery and big money are heartbreaking.

    • cjones says:

      Thanks for reading Jim, and for your wife’s insights. Certainly at times, we all blissfully go through our own lives without considering the many others that we affect.

  2. Marie DeVries says:

    I love your column!

  3. Lee Gross says:

    Great writing Chris. We need more people to discuss these issues of wealth extraction, and most importantly, to realize that we can do something about it. Many of us, me included, have stood by and watched, thinking, this is the way it’s going to be.

    Our problem is that the winners control much of the political process, and have convinced the losers that the status quo is inevitable. Time for our own Yellow Vest movement. How to start?

    • cjones says:

      Thanks for reading Lee. I speak and present to groups a fair amount, and people often ask me what the answers are. I don’t have them. Writing these essays is my own “how to start”. I hope they give a few people some courage.–CJ

  4. Chris Gould says:

    Interesting comments. I wonder what would happen to Wapello County if JBS weren’t there? A lot less employment, less pork production, less corn and soybean demand, lower grain prices, lower land rents, etc, etc, etc. It all trickles down hill, if you’ll pardon the pun.

    • cjones says:

      This is an excellent point, what would happen. It’s also fair ask what Wapello County would look like without consolidation in the hog industry.

    • Cindy Hildebrand says:

      I wonder what would have happened in Story County last year if Iowa’s CAFO siting system allowed reasonable local control so municipalities and counties could make their own decisions about the costs and benefits of CAFOs and where CAFOs should and should not be sited? I’m pretty sure that a new CAFO would not now be going up close to the City of Nevada, which officially objected to that siting but of course had no decision power.

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