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What’s More Important: Mergers or USDA Secretary?
An odd thing happened last week. Maybe it wasn’t as odd as it was curious.
Bayer CEO Werner Baumann and Monsanto CEO Hugh Grant were in New York, meeting with President-elect Donald Trump. Evidently, they wanted the president-elect’s blessing on the companies’ proposed $66 billion merger.
That’s fine. But couldn’t this have waited until a USDA secretary nominee was named?
No doubt, the proposed buyout of Monsanto by Bayer is a big deal. Bayer employs 116,800 people worldwide and is a giant in the world of agricultural pesticides and seed. Even so, agricultural products made up just 22% of its sales in 2015. Pharmaceuticals and consumer health goods are its big hitters, as they made up 49% of Bayer’s sales in 2015.
Monsanto is no shrinking violet, either, as it employs over 20,000 employees at 353 facilities in 69 countries. It’s huge in seeds, traits, agricultural chemicals, and, more recently, digital ag and biologicals. It’s also taken an admirable stand on using modern agricultural techniques to mitigate climate change.
Still, USDA is the driver of all things food in this country, whether it’s farming, food safety, forestry, nutrition, food stamps, plant and animal disease management, agricultural statistics, conservation… The list goes on and on. USDA includes 17 agencies, has over 105,000 employees, and had a nearly $140 billion budget in 2015.
It’s a big deal, too.
Corporate officers get as giddy over mergers and buyouts as an 8-year-old finding a BB gun under the Christmas tree. They spout terms like innovation and synergy. The synergy word makes employees nervous, as that’s often code for layoffs.
From that aspect, a report from Reuters quoting a Trump spokesman that the companies will maintain their more than 9,000 U.S. jobs while adding 3,000 new ones is encouraging. Ditto for the pledge at the time of the merger last fall to spend $2.7 billion annually on agricultural research and development.
There’s more to it, though. That’s what Roger Johnson, National Farmers Union president, was getting at in his statement yesterday. “Corporate consolidation in agriculture leads to less competition and choice in the marketplace and higher input costs for family farmers and ranchers,” he pointed out.
The merger decision is something the U.S. Justice Department and foreign governments will have to make. Time will tell.
If we had a USDA secretary nominee at this time, he or she could weigh in on this subject for farmers. We don’t.
What we do have garnering headlines are two large agricultural companies who bent the president-elect’s ear before a USDA secretary was even nominated.
It’s time to move on USDA. Now.