Sunday, March 2, 2014

Christopher Leonard's "The Meat Racket"

Christopher Leonard is the former national agribusiness reporter for the Associated Press. His work has appeared in Fortune, Slate, and the New York Times. He is a fellow with The New America Foundation, a nonpartisan public policy institute in Washington, DC. A graduate of the University of Missouri School of Journalism, he lives outside Washington, DC.

Leonard applied the “Page 99 Test” to his new book, The Meat Racket: The Secret Takeover of America's Food Business, and reported the following:
Page 99 of The Meat Racket describes one of my favorite characters in the book: The attorney Jim Blair.

Jim Blair was the close confidante and adviser to Don Tyson, a business genius who built the largest meat company in the world. (Blair also happened to be close friends with Bill and Hillary Clinton). Blair worked with Don Tyson for decades and became the top lawyer for his company, Tyson Foods. But, as page 99 describes it: Blair “didn’t just handle lawsuits or regulatory matters. He was more like a well-trained attack dog, with a deep and creative understanding of U.S. law. Don Tyson kept him on a short leash.”

As page 99 begins, Blair is conducting a secret mission. He quietly buys up corporate debt owed by one of Don Tyson’s biggest rivals, and uses the debt as a lever to ultimately take over the rival company. It was just one of many acquisitions that fueled Tyson Foods explosive growth through the 1980s and 1990s.

Jim Blair’s story reveals two deeper themes of The Meat Racket.

The first is that the state of our current meat industry is not the result of some historical accident. It is the result of human agency. Today, just four companies control over 85 percent of the beef market and just three firms make almost half of our chicken (that’s compared to more than 36 that did so back in the 1970s). Some people describe this state of affairs in passive terms, as if it just “happened.”

The Meat Racket shows that today’s consolidation is the result of an audacious business strategy. Don Tyson and a few other CEOs with deep pockets saw a business opportunity, and they took it.

The second theme is that Tyson was able to do this because it was a new kind of business, a fact of which Jim Blair was keenly aware. Tyson was neither a farm nor a factory, but a combination of the two. It used this ambiguity to take advantage of every possible loophole in U.S. law. For example, Tyson took advantage of tax breaks meant for small farmers, saving more than $20 million a year by the mid-1980s.

By following the exploits of people like Jim Blair and Don Tyson, readers get a detailed look at how a handful of companies came to control our meat supply.
Visit Christopher Leonard's website.

--Marshal Zeringue