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Why Is a Corruption Watchdog Doing Corporations' Dirty Work Going After an Obscure USDA Official?

CREW has an admirable record on exposing corrupt politicians, but it has also intervened in a high-stakes fight on the side of corporations.

The problem of money in politics is simple -- those with more resources too often have a stronger voice in the democratic process, regardless of the merits of their position. Watchdog organizations exist to uncover those who would use wealth to improperly influence politics. One such organization, Citizens for Responsibility and Ethics in Washington, has an admirable record of exposing corrupt members of Congress, but in recent months, CREW has for a second time sided with corporate interests and intervened in policy questions where no evidence of corruption can be found.

In October, the American Prospect reported on CREW's criticism of student-loan reform advocates. CREW's position was based on talking points disseminated by the for-profit education industry and relied on biased sources, including lobbyists later hired by the education industry.

CREW's own executive director, Melanie Sloan, was hired by one of those lobbyists, Lanny Davis, in November, to begin work this month. Before Sloan's departure from the organization, CREW asked a federal official to step down from his central duty, once again echoing the arguments of lobbyists for a major industry -- this time, the largest meatpackers in the country.

Earlier this year, J. Dudley Butler, the director of the Grain Inspection, Packers and Stockyards Administration (GIPSA), a division of the Department of Agriculture, announced new rules designed to increase competition and give independent farmers the ability to challenge potentially monopolistic practices in the meatpacking industry.

The 1921 Packers & Stockyard Act gave the Department of Agriculture authority to regulate the meatpacking industry. Without clear rules for implementation, the Act has since been subject to judicial interpretation: A precedent set during the George W. Bush administration made it nearly impossible for independent producers to sue meatpackers, because they must show "industry-wide damage" -- a very difficult standard.

In 2008, Congress passed a farm bill that included a provision instructing GIPSA to more clearly define the criteria used in enforcing the Packers & Stockyard Act, such as what constitutes "undue or unreasonable preference or advantage." GIPSA, under Butler's leadership, published draft rules for public comment in June 2010.

"Butler is the first administrator of the GIPSA to issue rules about how to implement the Packers and Stockyards Act in the nearly 90-year history of the act," says Robert Taylor, a professor of agricultural economics at Auburn University in Alabama who advises family farmers. "He is the first head of GIPSA to actually enforce the law to do what it was intended to do -- promote competition in the marketplace."

Before joining the USDA in 2009, Butler worked for 30 years as a lawyer, often representing family farmers across the United States in arbitration proceedings. "Butler is to family farmers what Elizabeth Warren is to consumer advocates," says rancher Bill Bullard, chair of the family-farmer organization R-CALF.

R-CALF and organizations like it say current rules allow the "Big Four" companies, which control more than 80 percent of the U.S. meat market, to set prices and therefore pay more to the farms with which they contract and less to smaller independent producers. The Department of Justice has ongoing antitrust investigations into these practices.

"Only the big farmers owned through contract by their conglomerates can even play the game," says Fred Stokes, a rancher from Mississippi who serves as executive director of the Organization for Competitive Markets (OCM). According to the USDA's Economic Research Service, the number of farms in the U.S. has plummeted in the past 20 years, with hundreds of thousands of family farms closing due to economic pressure.

Yet CREW argues that Butler's experience should make him ineligible to work on these issues. Sloan wrote a letter in November to USDA Acting General Counsel Steven Silverman asking that Butler be removed from the rule-making process, even as she acknowledged that Butler was not in violation of any regulation governing conflict of interest or lobbying. Sloan cited the perception that the new rules could benefit other plaintiff's lawyers and perhaps Butler himself in the future. Further, Sloan demanded that GIPSA reopen the rule-making process -- a key demand of the meatpacking industry, which hopes to delay implementation of the new rules.

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