[House Hearing, 118 Congress]
[From the U.S. Government Publishing Office]


                    WHERE'S THE BEEF? REGULATORY BARRIERS TO 
                     ENTRY AND COMPETITION IN MEAT PROCESSING

=======================================================================

                                HEARING

                               BEFORE THE

                 SUBCOMMITTEE ON THE ADMINISTRATIVE STATE, 
                    REGULATORY REFORM, AND ANTITRUST

                       COMMITTEE ON THE JUDICIARY

                     U.S. HOUSE OF REPRESENTATIVES

                    ONE HUNDRED EIGHTEENTH CONGRESS

                             FIRST SESSION

                               __________

                         TUESDAY, JUNE 13, 2023

                               __________

                           Serial No. 118-26

                               __________

         Printed for the use of the Committee on the Judiciary
         
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]         


               Available via: http://judiciary.house.gov
               
                              __________

                                
                    U.S. GOVERNMENT PUBLISHING OFFICE                    
52-864                     WASHINGTON : 2023                    
          
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                       COMMITTEE ON THE JUDICIARY

                        JIM JORDAN, Ohio, Chair

DARRELL ISSA, California             JERROLD NADLER, New York, Ranking 
KEN BUCK, Colorado                       Member
MATT GAETZ, Florida                  ZOE LOFGREN, California
MIKE JOHNSON, Louisiana              SHEILA JACKSON LEE, Texas
ANDY BIGGS, Arizona                  STEVE COHEN, Tennessee
TOM McCLINTOCK, California           HENRY C. ``HANK'' JOHNSON, Jr., 
TOM TIFFANY, Wisconsin                   Georgia
THOMAS MASSIE, Kentucky              ADAM SCHIFF, California
CHIP ROY, Texas                      ERIC SWALWELL, California
DAN BISHOP, North Carolina           TED LIEU, California
VICTORIA SPARTZ, Indiana             PRAMILA JAYAPAL, Washington
SCOTT FITZGERALD, Wisconsin          J. LUIS CORREA, California
CLIFF BENTZ, Oregon                  MARY GAY SCANLON, Pennsylvania
BEN CLINE, Virginia                  JOE NEGUSE, Colorado
LANCE GOODEN, Texas                  LUCY McBATH, Georgia
JEFF VAN DREW, New Jersey            MADELEINE DEAN, Pennsylvania
TROY NEHLS, Texas                    VERONICA ESCOBAR, Texas
BARRY MOORE, Alabama                 DEBORAH ROSS, North Carolina
KEVIN KILEY, California              CORI BUSH, Missouri
HARRIET HAGEMAN, Wyoming             GLENN IVEY, Maryland
NATHANIEL MORAN, Texas               Vacancy
LAUREL LEE, Florida
WESLEY HUNT, Texas
RUSSELL FRY, South Carolina

                                 ------                                

               SUBCOMMITTEE ON THE ADMINISTRATIVE STATE,
                    REGULATORY REFORM, AND ANTITRUST

                     THOMAS MASSIE, Kentucky, Chair

DARRELL ISSA, California             Vacancy, Ranking Member
KEN BUCK, Colorado                   HENRY C. ``HANK'' JOHNSON, Jr., 
MATT GAETZ, Florida                      Georgia
MIKE JOHNSON, Louisiana              ERIC SWALWELL, California
DAN BISHOP, North Carolina           TED LIEU, California
VICTORIA SPARTZ, Indiana             PRAMILA JAYAPAL, Washington
SCOTT FITZGERALD, Wisconsin          MARY GAY SCANLON, Pennsylvania
CLIFF BENTZ, Oregon                  JOE NEGUSE, Colorado
LANCE GOODEN, Texas                  LUCY McBATH, Georgia
JEFF VAN DREW, New Jersey            ZOE LOFGREN, California
BEN CLINE, Virginia                  STEVE COHEN, Tennessee
HARRIET HAGEMAN, Wyoming             GLENN IVEY, Maryland
NATHANIEL MORAN, Texas

               CHRISTOPHER HIXON, Majority Staff Director
          AMY RUTKIN, Minority Staff Director & Chief of Staff
                           
                           
                           C O N T E N T S

                              ----------                              

                         Tuesday, June 13, 2023

                                                                   Page

                           OPENING STATEMENTS

The Honorable Thomas Massie, Chair of the Subcommittee on the 
  Administrative State, Regulatory Reform, and Antitrust from the 
  State of Kentucky..............................................     2
The Honorable Jerrold Nadler, Ranking Member of the Committee on 
  the Judiciary from the State of New York.......................     3
The Honorable Jim Jordan, Chair of the Committee on the Judiciary 
  from the State of Ohio.........................................     4

                               WITNESSES

Joel Salatin, Co-Owner, Polyface Farm, Swoope, Virginia
  Oral Testimony.................................................     5
  Prepared Testimony.............................................     8
Rosanna Bauman, Co-Owner/General Manager, Bauman's Cedar Valley 
  Farm, Garnett, Kansas
  Oral Testimony.................................................    11
  Prepared Testimony.............................................    13
Joe Trotter, Director, American Legislative Exchange Council, 
  Energy, Environment and Agriculture Task Force
  Oral Testimony.................................................    23
  Prepared Testimony.............................................    25
Greg Gunthorp, Owner/Artisan Farmer, Gunthorp Farms, LaGrange, 
  Indiana
  Oral Testimony.................................................    29
  Prepared Testimony.............................................    31

          LETTERS, STATEMENTS, ETC. SUBMITTED FOR THE HEARING

All materials submitted for the record by the Subcommittee on the 
  Administrative State, Regulatory Reform, and Antitrust are 
  listed below...................................................    58

A collaborative letter from organizations recommending reforms 
  regarding meat processing, June 13, 2023, submitted by the 
  Honorable Henry C. ``Hank'' Johnson, Jr., a Member of the 
  Subcommittee on the Administrative State, Regulatory Reform, 
  and Antitrust from the State of Georgia, for the record

 
                 WHERE'S THE BEEF? REGULATORY BARRIERS
                      TO ENTRY AND COMPETITION IN
                            MEAT PROCESSING

                              ----------                              


                         Tuesday, June 13, 2023

                        House of Representatives

               Subcommittee on the Administrative State,

                    Regulatory Reform, and Antitrust

                       Committee on the Judiciary

                             Washington, DC

    The Subcommittee met, pursuant to notice, at 10:08 a.m., in 
Room 2141, Rayburn House Office Building, Hon. Thomas Massie 
[Chair of the Subcommittee] presiding.
    Present: Representatives Massie, Jordan, Issa, Buck, Gaetz, 
Spartz, Fitzgerald, Bentz, Cline, Hageman, Nadler, Johnson of 
Georgia, Jayapal, Correa, Scanlon, and Ivey.
    Also present: Representative Tiffany.
    Mr. Massie. The Subcommittee will come to order.
    Without objection, the Chair is authorized to declare a 
recess at any time.
    Without objection, the gentleman from Wisconsin, Mr. 
Tiffany, will be allowed to participate in today's hearing.
    We welcome everyone to today's hearing on the regulatory 
barriers to entry and competition in meat processing. I 
anticipate this will be a very bipartisan Committee hearing, 
and I want--so I want to begin with a quotation from President 
Biden's State of the Union in 2022. He's very aware of the 
problem that we're trying to address here today. He said in his 
State of the Union:

        When corporations don't have to compete, their profits go up, 
        and your prices go up when they don't have to compete. Small 
        businesses and farmers and ranchers--I need not tell some of my 
        Republican friends from those States, guess what, you got four 
        basic meatpacking facilities. That's it. You play with them, or 
        you don't get to play at all. You pay a hell of a lot more. A 
        hell of a lot more because there's only four.

So, that's from our President, Joe Biden.
    Just a housekeeping thing to begin with, I'm going to keep 
the Members to five minutes as much as I can with the gavel, 
but if in five seconds you ask an existential question to a 
witness and they need more than four seconds to respond, we 
will let the witness finish their answer. So, I know we're 
famous for doing that.
    I will now recognize myself for an opening statement.
    In today's hearing, we will explore how various laws create 
barriers to entry and expansion in the meat processing 
industry. Federal laws concerning meat processing needlessly 
undercut federalism by requiring that State-enforced 
requirements are at least equal to Federal requirements. These 
one-size-fits-all regulatory barriers entrench the largest meat 
processors and prevent small independent processors from 
competing effectively.
    Allowing States to set their own regulatory standards means 
that small processors would likely flourish and would be able 
to better serve ranchers and farmers and the consumers who want 
to buy the food from them.
    During COVID, we saw the results of having only a few large 
facilities and not enough functioning small facilities. Large 
facilities with employees in close quarters struggled through 
the outbreaks and at times slowed or even stopped operations. 
Some farmers and ranchers were forced to take extreme and 
costly measures, such as euthanizing livestock. For farmers who 
care about their animals--and most farmers do--this was a 
terrible situation to be in, to euthanize livestock instead of 
to have them go serve as nutrition for consumers.
    Consumers saw meat become less affordable, if they could 
find it in the grocery store shelves. Removing artificial and 
unnecessary restrictions and regulations will help encourage 
smaller-scale processing. Increasing the number of small-scale 
processors will help counteract disruptions in the supply 
chain.
    It's important to note that deregulation will not result in 
compromised food safety. State and local health agencies will 
inspect independent processors to ensure they are meeting 
safety standards. Small custom slaughterhouses have been 
operating safely for decades. We're going to hear from some of 
the owners of these small slaughterhouses.
    Federal and legislative regulatory reform would benefit 
farmers and ranchers and allow a broader variety of local, 
safe, and humane meat to reach the American people. There's 
bipartisan agreement about some of the problems in the 
meatpacking industry. Just four companies account for over 80 
percent of beef processed in the United States. Similarly, four 
companies process approximately 70 percent of hogs.
    Of these companies that I mention, one is owned by China, 
and one is owned by Brazil. These companies process most of the 
meat in just a few massive facilities. Less than 10 percent of 
the facilities in the United States process over 95 percent of 
all cattle. Less than five percent of facilities in the U.S. 
process over 90 percent of all hogs.
    There's also bipartisan agreement about some of the 
solutions. The bipartisan Processing Revival and Intrastate 
Meat Exemption Act, or PRIME Act, is one of the proposals that 
would increase competition and enhance consumer choice.
    Today we have the opportunity to hear from our witnesses 
about their real-world experiences, their work in the meat 
industry, and the difficulties they face. A better 
understanding of these issues will aid us as we work to make 
impactful change and find solutions that benefit processors, 
ranchers, farmers, and consumers.
    I now recognize the Chair of the Full Committee--or the 
Ranking Member--sorry, I almost gave him a promotion that Mr. 
Jordan would not approve of.
    Mr. Nadler. It's OK. It's OK.
    Mr. Massie. I now recognize the Ranking Member of the Full 
Committee for an opening statement.
    Mr. Nadler. Thank you, Mr. Chair.
    Mr. Chair, as we examine barriers to entry and competition 
in the meat processing industry, we should focus our attention 
on the key barrier to entry: Massive consolidation and 
concentration of power in just a handful of companies.
    Consolidation in the meat processing industry is an issue 
that has plagued our country for over a hundred years. In the 
late 1890's, our meat marketplaces dominated by just a handful 
of stockyards and packers. This dominance led to the passage of 
the Sherman Anti-Trust Act in 1890. Years following, Congress 
doubled down on its commitment to protect the market from 
dominant forms of abuse by passing the Clayton Antitrust Act, 
the Federal Trade Commission Act, and the Packers and 
Stockyards Act.
    Meanwhile, the publication of Upton Sinclair's ``The 
Jungle'' in 1906, brought public attention to the deplorable 
conditions that workers in the meat processing industry were 
facing and the poor sanitary standards employed by the five 
dominant meat processing firms. Rising to meet these concerns, 
Congress passed the Nation's foundational consumer protection 
laws in this area, the Pure Food and Drug Act and the Federal 
Meat Inspection Act.
    We face similar concerns today about market concentration 
in the meat processing industry as our predecessors faced at 
the turn of the last century. Then there were five firms that 
dominated the market. Now, we have only four. Although on 
balance, our food is safer and standards for workers are 
higher, meat processing is less competitive and more 
concentrated than it was in the 1900's, leading to a range of 
harms for small business, consumers, and workers.
    Today, 85 percent of all beef processing, 70 percent of all 
pork processing, and 54 percent of all chicken processing is 
controlled by four companies: Tyson, JBS, Marfrig, and 
Seaboard. By relying on these big four companies for our meat 
production, we have allowed our food system to become highly 
fragile and beset with bottlenecks. As the COVID-19 pandemic 
showed us, our current food system can easily be disrupted.
    This rise in dominance has resulted in lower operating 
costs for the large meat plants, but these lower costs have not 
been passed on to consumers, have not resulted in higher wages 
for workers, and have not led to increased profits for farmers. 
Rather, these large companies exploit their dominant position 
as middlemen to extract high profits and pad their own bottom 
lines.
    In the face of these concerns, we must consider ways to 
roll back the mergers that created this consolidation, explore 
methods of supporting smaller meat processors, and increase 
oversight where possible to rein in abusive and deceptive 
practices.
    What we should not do is consider rolling back meat 
inspection requirements that keep our food safe. Doing so would 
not help create more competition in the market, but instead 
would result in the commercial sale of meat that does not meet 
minimum Federal safety standards.
    Currently, meat sold commercially in the U.S. must either 
be processed at a Federally inspected facility or at a State-
inspected facility that enters into a cooperative agreement 
with the U.S. Department of Agriculture's Food and Safety 
Inspection Service.
    Twenty-seven States allow processors to operate under 
cooperative agreement. Under this arrangement, facilities must 
enforce requirements, quote, ``at least equal,'' to those 
imposed by the Federal government under Federal law. Unless 
these States opt into an additional program with USDA, they can 
only sell their meat within the State.
    Whether the meat is processed in a Federally inspected 
facility or one of the State-run facilities under a cooperative 
agreement with the USDA, inspectors continuously conduct 
oversight of the facility to ensure the safety and quality of 
meat and the health and wellness of livestock. These 
inspections not only ensure that our meat is safe for 
consumption, but also that any health issues that do arise with 
the processed meat can be traced back to the facility that 
produced it.
    By contrast, facilities that are not operated under either 
program, also known as custom slaughterhouses or processing 
plants, are only inspected periodically. For this reason, they 
are only eligible for personal, household, guest, and employee 
use. Proposals to weaken the system by allowing custom 
slaughterhouses to serve commercial customers would inject far 
too much risk into our food safety system without addressing 
the root problem that is holding back competition in the meat 
processing industry.
    Instead, we must find solutions that will support the entry 
of smaller meat processors into the market and ways of leveling 
the meat processing market generally to encourage more 
competition and more choices for suppliers, buyers, and 
processors, while maintaining strict safety standards.
    I look forward to hearing from our witnesses, and I yield 
back the balance of my time.
    Mr. Massie. I thank the Ranking Member of the Full 
Committee.
    I now recognize the Chair of the Full Committee, Mr. 
Jordan, for a comment.
    Chair Jordan. I thank the Chair.
    I'll be brief. I just wanted to thank you, Chair, and the 
staff for putting this important hearing today. I look forward 
to hearing from our panel.
    Thank you.
    Mr. Massie. Without objection, all other opening statements 
will be included in the record.
    We will now introduce today's witnesses.
    Mr. Joel Salatin and his family own Polyface Farm in 
Virginia's Shenandoah Valley. He also co-owns Honest Meats, 
LLC, a small Federally inspected meat producer in Harrisonburg, 
Virginia. His farm produces beef, pork, poultry, and other 
products, selling to roughly 10,000 families through an online 
farm store, nationwide direct shipping--I'm sorry--on-farm 
store, nationwide direct shipping, and urban drop points. It 
also services boutique retail markets and some institutional 
food services.
    Ms. Rosanna Bauman is a co-owner and General Manager of 
Bauman's Cedar Valley Farm in Anderson County, Kansas. Bauman 
and her family operate a farm growing non-GMO crops and raising 
cattle, sheep, and poultry, as well as a poultry processing 
facility, a butcher store, a farm feed business, a custom 
agricultural services business, and a pet food business. In 
addition to on-farm sales and their butcher store, Bauman's 
Farm sells their meat and poultry at farmers markets.
    Mr. Joe Trotter is Director of the Energy, Environment, and 
Agriculture Task Force at the American Legislative Exchange 
Council. Prior to joining ALEC, he was a Congressional staffer 
and worked for free-market organizations and campaigns. He is 
an avid outdoorsman and a conservationist, and spent two years 
on the Board of Governors at the Bethesda-Chevy Chase Isaac 
Walton League, a local nonprofit organization that maintains a 
624-acre conservation farm.
    Mr. Greg Gunthorp and his family own and operate a pasture-
based livestock operation in Northeast Indiana. Their operation 
includes an on-farm USDA-inspected slaughter and processing 
plant. His farm provides pork, poultry, and lamb to restaurants 
in Chicago, Indianapolis, and the surrounding region. He is a 
past Board Member of the American Pasture Poultry Producers 
Association.
    We welcome our witnesses and thank them for appearing 
today. I also want to thank the folks in the crowd who came 
here to witness the witnesses.
    We're going to begin by swearing you in, just the 
witnesses, not the observers.
    Would you please rise and raise your right hand?
    Do you swear or affirm under penalty of perjury that the 
testimony you're about to give is true and correct to the best 
of your knowledge, information, and belief, so help you God?
    Let the record reflect that the witnesses have answered in 
the affirmative.
    Thank you, and please be seated.
    Please know that your written testimony will be entered 
into the record in its entirety. Accordingly, we ask that you 
summarize your testimony in five minutes.
    Mr. Salatin, you may begin.
    Mr. Salatin. Thank you.
    Mr. Massie. Make sure your microphone is on. Press the 
button.
    Mr. Salatin. Is it on?
    Mr. Massie. Yes. Now, Mr. Salatin, you may begin.

                   STATEMENT OF JOEL SALATIN

    Mr. Salatin. Good. Thank you.
    Right now, nationwide, a farmer wanting to get a slaughter 
slot in a small Federal-inspected meat processing plant often 
must book six months to a year in advance for pork. That's 
before the piggy is even born. It's never been like this. What 
happened?
    In short, regulatory extortion tyranny. Inspection 
regulations are size prejudicial. I know one facility that was 
ordered closed because it wasn't processing fast enough. The 
Food Safety Inspection Service measures its efficiency by 
pounds inspected per personnel hour, creating an adversarial 
discriminatory attitude toward small plants.
    In 1906, when Upton Sinclair wrote ``The Jungle,'' seven 
large companies controlled half the Nation's meat processing 
capacity. After a century of government intervention, four now 
control almost 85 percent. When licenses and compliance make 
entering and maintaining an abattoir more burdensome to small 
facilities than large, concentration and centralization is not 
an antitrust issue. It's discriminatory regulatory issue.
    It's a perfect example of mission creep. What started 
sincerely as a food safety objective morphed into regulatory 
overburdensome harassment. A small plant operator dare not 
object to subjective and political inspector decisions because 
``poke and sniff'' allows retribution toward folks with 
questions. Entrepreneurs are en-
slaved and held hostage by bureaucrats who share no business 
risk and rule without restraint.
    Meanwhile, more Americans desire a more localized, stable, 
secure, transparent, nutrient-dense, relational, trustworthy 
food supply than centralized industrial facilities offer. We 
have eager and willing buyers, farmers desperate to direct 
market to their neighbors, but a bureaucracy that stands in the 
way of voluntary consenting adults exercising freedom of choice 
for their bodies' microbiome fuel. Few human decisions speak to 
freedom like what we have the right to swallow.
    I can butcher a beef in the field, process it, and give it 
away. If I sell an ounce, I'm a criminal. What is it about 
exchanging money that suddenly makes meat unsafe? Clearly, 
current market regulations are not about safety; they are about 
market access.
    Our society recognizes scale and relationship when 
assessing risk. In Virginia, we can keep three daycare children 
in our private home without a license and governmental 
oversight. Why? Because an entity and arrangement that small 
inherently offers seller-buyer intimacy that vets itself equal 
to licenses and inspectors. In Virginia, we can keep three 
elder care patients in our private home without licenses and 
government oversight. Why? Because such an intimate arrangement 
protects equal to the government.
    Expectations and trust provide context in any transaction. 
People who want to disentangle from the agri-industrial 
government crony complex don't expect their provenance to be 
squeezed through the regulatory process. They trust their 
farmer more than a government agent. While this group, both 
farmer and customer, may represent a lunatic fringe of the 
society, we all know that's where innovation comes from. How 
society deals with its unorthodox element defines its march 
toward tyranny or freedom.
    Our society, desperate for food security and stability, 
wallows in a morass of regulatory impediments to what we need 
and desire. Well, what remedies exist?
    Right now, 1968's Public Law 90-492, known as the producer-
grower exemption, allows 20,000 head of poultry to be processed 
on-farm without inspection. This has enabled thousands of 
community-scaled neighbor-to-neighbor entrepreneurs to launch 
small broiler operations. To my knowledge, not a single 
customer has been harmed by this exemption. Why not extend it 
to beef or to pork?
    Right now, custom processing designation allows me to sell 
preslaughter portions of an animal, usually in wholes, halves, 
and quarters. Well, why limit my customers to large volumes? 
Let them buy by the cut. Congressman Thomas Massie's PRIME Act 
would enable this.
    Another remedy could simply be a food emancipation 
proclamation, allowing farmers currently enslaved by regulatory 
shackles to sell meat to neighbors. Right now, farmers can give 
it away, they just can't sell it. Neighbors can buy and feed it 
to their children. Clearly, if uninspected meat is hazardous, 
the commerce prohibition should be on the buyer as well as the 
seller, but it's not, which clearly illustrates the 
prohibition's hypocrisy.
    Surely, if we really want freedom of food choice and food 
security, we can create a remedy that refuses to criminalize 
neighborly meat transactions. The only reason food freedom was 
not written into our Bill of Rights was because our Nation's 
Founders could not have imagined a time when neighbors could 
not exchange a chuck roast or sausage. At some point, requiring 
professional league infrastructure and referees on a sandlot 
pickup ball game is both inappropriate and malicious.
    It's time to remove the heavy hand of tyranny from 
America's food system by allowing market access, opportunity, 
and competition for producers and consumers seeking freedom of 
food choice.
    Thank you.
    [The prepared statement of Mr. Salatin follows:]
    [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
    
    Mr. Massie. Thank you, Mr. Salatin.
    Ms. Bauman, you may begin your testimony.

                  STATEMENT OF ROSANNA BAUMAN

    Ms. Bauman. OK. Is this going now? Anyway.
    All right. Thank you for inviting me here. It's rare that I 
get to talk about butchery, because usually that's like a 
conversation killer, especially if you're on airplanes.
    So, a year ago I probably wouldn't have been a good 
candidate. I do poultry processing. I agreed to speak here 
because I figured it would be good therapy for me, actually. I 
had an incident last summer, after 15 years of operating USDA-
inspected poultry and beef plants that really helped bring to 
light some of the flaws in the inspection system, I guess, and 
it took me 90 days to get my voice heard. My business lost a 
significant amount of money in the meantime.
    In short--it's a very long story--but in short, we had a 
small mechanical failure that led--that opened the door to a 
overly aggressive FSIS supervisor who come in and placed all of 
my 3,000 chickens on hold, wouldn't review basically any of my 
corrective actions. It's a situation that if it happened in a 
large plant, it could be
resolved in a matter of hours. It took me 90 days to resolve 
this. My business lost $80,000. All 3,000 of those birds were 
condemned. My process was not complete without a personal farm 
visit from the head of the Food Safety Inspection Service, the 
administra-
tor there. In the end, all those 3,000 birds got the wholesome 
stamp of inspection from the USDA, and they all went back to 
their farmers.
    A lot of layers in there, but the concern and the takeaway 
that I got from that experience was I was a 15-year-old plan. 
They're all over--we have the USDA. It's one of their 
priorities. We've all seen it. We do have a nice increase of 
new plants. We do have a lot of attractive grants that are 
being dangled for folks to move toward USDA inspection. If I 
was a baby businesswoman and had the same experience, I would 
have folded. In fact, last summer, that was a very stressful 
time for us in the business, and I had to take a step back and 
ask myself, why in the world am I doing this, why am I a 
butcher at all?
    It was like a Queen Esther moment for me, because I didn't 
need the inspection services for my own farm stability, for my 
own markets, for any of my own thing, but my community did. I 
processed for a lot of other farmers. I had survivor's guilt. I 
could reduce my stress, but they needed that inspection service 
to access their markets. If that would have occurred to me 
younger in my inspection journey, I would have been yet another 
plant closure.
    During this process--I've talked to a lot of other plants 
around the Nation that's ran into similar problems, not knowing 
how to navigate the entire inspection system. I found out the 
hard way that the Food Safety Inspection Service is set up 
completely contrary to the American judicial system in to where 
we are presumed guilty first, even worse. So, my product was 
consumed--or presumed contaminated with no evidence of 
contamination. Even worse, my judge and jury was also the same 
as my accusers. So, nothing that I did or said would have to be 
considered.
    The USDA FSIS does not have an ombudsman, unlike a lot of 
Federal agencies. I don't believe that an ombudsman would be 
very helpful. We need like a mediation board.
    The other thing that the USDA has an overreach of purpose 
with the Food Safety Inspection Service. They are to inspect 
food safety, not public health, and they're there to inspect 
food as it moves about within commerce that's not the direct-
to-consumer markets at all. That really helps clarify the 
purpose in a lot of where we bump into our--against things that 
feel like overburdensome regulations are sometimes just simply 
an entire misapplication of them trying to apply them where 
they don't belong at all.
    Barriers to entry beyond just regulations also include 
labor and waste management. That's inclusive of access to labor 
and with the waste management from--that's how Tyson makes 
their money. That's how the small plants used to make their 
money. Those value streams have disappeared. Labor access, the 
same way. If we're going to open up, say, operating, those 
things need to happen.
    Do appreciate you guys coming--or inviting me here. Come on 
out anytime to our butcher shops; we'll put you to work.
    [The prepared statement of Ms. Bauman follows:]
    [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
    
    Mr. Massie. Thank you, Ms. Bauman.
    Mr. Trotter, you may begin your opening statement.

                    STATEMENT OF JOE TROTTER

    Mr. Trotter. Good morning and thank you for the invitation 
to testify before the Committee.
    I'm Joe Trotter, Director of ALEC's Energy, Environment, 
and Agriculture Task Force, and I look forward to bringing our 
nonpartisan analysis to this.
    ALEC is America's largest nonpartisan, voluntary membership 
organization of State legislators dedicated to the principles 
of limited government, free markets, and federalism. Our 
members represent more than 60 million Americans and provide 
jobs for 30 million people across the country.
    The issue at hand cuts to the very core of ALEC's 
principles of encouraging free, competitive markets, and 
balancing State and Federal authority.
    A little over 50 years ago, Congress passed the Wholesome 
Meat Act, prohibiting States from setting their own inspection 
rules on slaughterhouses and meat processing facilities. 
Congress also prohibited the intrastate sale of meat from 
cattle, sheep, swine, and goats, unless it was processed at a 
facility with an onsite inspector subject to Federal 
regulations.
    Today, farmers--local farmers that are looking to serve 
their communities by supplying grocery stores or farm-to-table 
restaurants face essentially the same statutory and regulatory 
burdens applied to multinational, vertically integrated 
corporate conglomerates. It often means that local farmers 
engaging in traditional commerce truck their cows and pigs to 
the same slaughterhouses and processing facilities as major 
animal agriculture producers, which could be hundreds of miles 
away.
    Thousands of meat processing facilities shuttered their 
operations over the last four decades, leaving farmers and 
ranchers with significantly less options for slaughtering and 
processing their meat. As it currently stands, less than a 
hundred slaughterhouses are responsible for over 95 percent of 
the country's meat production.
    As a result of the laws and regulations governing who can 
process meat for commercial consumption, there are high 
barriers to entry for small businesses looking to increase 
their market capacity.
    Facilities staffed by FSIS and State inspectors usually 
operate at full capacity, meaning farmers and ranchers have 
fewer choices on where to have their animals slaughtered and 
processed. While the supply of processing facilities 
contracted, the demand for meat products throughout the country 
surged, creating an even higher demand for the processing 
facilities. Farmers are increasingly forced to book 
appointments months in advance and often have to travel over 
State lines.
    Centralization also leaves the meat supply chain, and by 
extension the country's food security, vulnerable to massive 
disruption. When a large plant shutters its operations, the 
capacity within the market to pick up the slack largely does 
not exist, causing meat prices to skyrocket. Unfortunately, we 
saw this play out to a degree during the COVID-19 pandemic and 
in other instances when plants were forced to halt their 
operations due to, say, fire or flood.
    Similarly, when things go wrong with these large-
centralized processing facilities, the impacts on the immediate 
supply chain are enormous. With 85 percent of grain-fed cattle 
processed by the four largest producers, if one plant has an 
outbreak of a foodborne pathogen that forces a recall, there's 
a massive, immediate economic impact on food pricing and 
availability. When these recalls happen from the largest 
processing facilities, millions of pounds of meat are pulled 
off the shelves and ultimately destroyed.
    Now, there are other options to decentralize the 
production, but they can't currently bring their products to 
market because of Federal law and regulation. Custom 
slaughterhouses exist all throughout the United States, but by 
statute, they are only allowed to slaughter meat for personal 
consumption. With over a thousand of these facilities all 
across the country, they are well positioned to provide the 
option of locally sourced meat to their communities.
    Now, custom slaughterhouses are required to follow all USDA 
as well as State law and regulation, but they don't have onsite 
inspectors. Instead of having a persistent inspector presence, 
they are examined by Federal, State, and local authorities 
throughout the year.
    With legislative updates to the Federal Meat Inspection 
Act, States could, if they wish, they're not required to allow 
custom slaughterhouses and processing businesses to sell meat 
commercially. This would empower small businesses, including 
ranchers, farmers, processors, restaurants, and local grocers, 
while also ensuring food security on a State and local level.
    Farmers and ranchers who just want to serve the local 
restaurants and grocers should not be forced to compete for the 
same space in slaughterhouses with the multinational 
corporations. They are ready and willing to be inspected up to 
standards. This is a perfect example of well-meaning Federal 
regulation run amuck.
    There is an opportunity to empower small businesses, 
decrease regulation, and improve food security if Congress 
decides to act.
    Thank you for the opportunity to speak.
    [The prepared statement of Mr. Trotter follows:]
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    Mr. Massie. Thank you, Mr. Trotter.
    Mr. Gunthorp, you're recognized now for your opening 
statement.

                   STATEMENT OF GREG GUNTHORP

    Mr. Gunthorp. I'm Greg Gunthorp, an artisan farmer, 
processor, and meat distributor. I'm a member of the American 
Grass Fed Association and Farm Action.
    Thank you, Mr. Chair, for the opportunity to present today.
    I grew up on a diversified family farm in the 1970's and 
1980. After attending a land-grant university, I came home to 
farm with my family.
    In 1994, the hog market dipped, and dad said the hog 
industry was over for the independent hog farmer. My wife and I 
bought the sow herd and went off on our own. We found out in 
1998, dad was right. The market crashed. We sold live pigs for 
less than what my grandpa sold them for in the depression.
    After selling commodity pig--selling pigs in the commodity 
market for four generations, we sold our first dressed pig to a 
restaurant in Chicago that same year. Our first customer, 
Charlie Trotter, was rated No. 1 in the world for food and wine 
by Wine Spectator Magazine. We capitalized on the popular farm-
to-table movement. Had we filled out the paperwork, we would 
have made the Inc.'s 5,000 list in 2011 as one of the fastest 
growing independent businesses in the United States, with 
product being served at O'Hare Airport, the Sears Tower, 
Wrigley Clubhouse, and Disney, just to name a few.
    Today, we are in a fight for our life. I'd love to tell you 
that rural America has thrived with niche marketing wholesale 
opportunities like I once had. I'd love to tell you that 
dealing with USDA is easy rather than the major challenge it 
is. Finding, keeping, and affording a skilled workforce in 
today's descaled industry is virtually impossible. Market 
access for small, local, regional plants in today's wholesale, 
predatory, and concentrated marketplace is no longer possible.
    Food that tastes better and is better for you, agriculture 
that rebuilds soils and community, food system resilience, 
greater biodiversity, and more opportunities for all should be 
the goal. The global food supply is in peril. For too long, get 
big or get out policies touting false efficiencies and economy 
of scale have favored today's failed top-down controlled and 
concentrated food system, wiping out the safer, more 
dependable, and resilient local/regional infrastructure 
essential for our food security.
    The issue to me is like the local little league committee. 
We aren't here to argue balls and strikes. We need a new game 
where everyone has a chance for success, including us smaller 
scrappy players who are willing to put the time and energy into 
it.
    New processing plants quickly realize that attaining a 
grant of inspection from USDA is a difficult hill to climb. 
Only after we climb the USDA inspection hill do we see the 
mountain--fair market access--today's insurmountable challenge.
    Fixing USDA inspection issues is the first step in 
rebuilding local/regional food systems. I've spent several 
decades of my own time and resources doing advocacy work for 
the independent family farm and small processor. If we want 
successful local and regional food systems, we need subsidy 
reform, antitrust enforcement, truth in labeling, and 
inspection reform, and we must support the infrastructure with 
government purchasing.
    Here are my suggestions on inspection reform and antitrust 
enforcement. First and foremost, we need to create an ombudsman 
to deal with USDA dysfunction concerning existing and 
perspective small and very small establishments. Small plants 
have more issues with the process than they do with the 
regulations. It's 1st, 4th, and 14th Amendment issues, i.e., 
the ability to challenge and criticize without retribution; the 
differences in opinions when plants have facility, product, 
and/or equipment retained; and the ability to have realistic 
due process during unprofessional inspection behavior and/or 
differences in opinion. There are way too many nightmare 
stories. We could go on all day talking about those.
    We need to redefine plant size so that overtime fees, grant 
funds, procurement funds, and implementation of regulations are 
actually appropriate. You guys need to look at the National 
Advisory Committee for Meat and Poultry Inspection--I served on 
that--and we don't actually even get to present topics for the 
Committee.
    I have some--ensure that rulemaking processes are complete 
before USDA enforces rules. Salmonella performance standards; 
excellent example.
    We need to do everything we can to expand the Talmage Aiken 
or cooperative State inspection. Most of the little plants in 
this country are actually in those, because they can deal with 
the politics and bureaucracy of State programs easier.
    Please restore truth in labeling. Every viable niche we've 
come up with has been stole by Big Ag without any meaningful 
change.
    USDA procurement program should prioritize some of its 
purchasing from local and regional suppliers.
    Fix the agency revolving door and ethics issues.
    Restore strict antitrust enforcement. Oligopolies and 
monopolies harm both producers and consumers. It's clear that 
cheap food isn't cheap.
    Today, the essentially unregulated big food cartel 
continues to extract the wealth and resources of rural America, 
while local independent businesses, claimed to be the backbone 
of America, fail under abusive regulatory pressure and lack of 
market access. The people who best steward our land and 
livestock and who grow and process our Nation's agricultural 
production are being left to die under the boot of monopoly 
power, unprotected and unrepresented at all levels of 
government. It's time for a change.
    Thank you.
    [The prepared statement of Mr. Gunthorp follows:]
    [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
    
    Mr. Massie. Thank you, Mr. Gunthorp.
    Thank you to all the witnesses who speak from experience.
    I'm now going to recognize the Ranking Member, Mr. Hank 
Johnson from Georgia, for his opening statement.
    Mr. Johnson of Georgia. Thank you, Mr. Chair, and thank you 
for holding this hearing on barriers to entry and competition 
in meat processing.
    In my State of Georgia, we have nearly 50 poultry 
processors alone, with at least two in my district. Although 
concentration in meat processing is an issue industrywide, no 
other sector is more vertically integrated than the poultry 
industry. Fifty-four percent of all chicken processing is 
controlled by just four giant corporations: Tyson, JBS, 
Marfrig, and Seaboard. While these poultry processors account 
for more than half of the market, this was not always the case. 
In 1986, for instance, these companies only controlled 35 
percent of the market.
    Chicken integrators who perform a similar function as meat 
packers, such as Tyson Foods or Pilgrim's Pride, control every 
step of the poultry production, from breeding to slaughtering. 
Chicken growers across the country and in my State are contract 
farmers. They sign contracts to grow chicks on a roughly six-
week basis, and they must agree to substantial capital 
commitments.
    At a hearing before the USDA and DOJ, poultry farmers 
explained how this process forced them to take on debt, had 
little security that their contracts with the big chicken 
companies would last long enough for them to pay off their 
debts, and they faced retaliation, such as losing their 
contracts if they complained.
    Dominance in this sector has resulted in measurable harms 
to our local farmers. The Small Business Administration Office 
of the Inspector General found in 2018 that the large chicken 
companies exercised, quote, ``such comprehensive control over 
growers,'' that it nullifies, quote, ``practically all of a 
grower's ability to operate their business independently.''
    More than half of all chicken growers only have one or two 
potential integrators in their area. Growers claim that even 
when they have multiple integrators nearby, they do not, as a 
matter of practice, compete for growers. The dominance of just 
four large corporations in this sector does not hurt just the 
farmers and meat suppliers, but it also affects worker wages 
and consumer prices.
    Although large meat processing plants should result in 
lower operating costs that should positively impact workers' 
wages and consumer prices, these big firms have instead used 
their control over the market to extract more profit from the 
system, while paying workers less and charging consumers more. 
Charging consumers for meat is not a small issue. Meat prices 
are the single largest contributor to the rising cost of 
groceries.
    Finally, as the COVID-19 pandemic demonstrated, our 
reliance on these four meat processors has created a fragile 
food supply system that contains numerous bottlenecks that are 
highly sensitive to shocks in the market. For all these reasons 
we should closely examine what we can do as Members of the 
Judiciary Committee to increase competition in the meat 
processing market, protect workers, and ensure that smaller 
meat plants are getting the support they need to compete and 
thrive.
    Although Federal standards for meat processing facilities 
can pose a high burden to smaller processors, we should explore 
ways of supporting them and breaking up the big four meat 
processing companies, not rolling back inspection regulations 
that have roots in the late 1800's and support a safe and 
sanitary food system. Maybe we should add more Federal workers 
to get the job efficiently and effectively and, hopefully, 
those workers can have a heart and treat the people that they 
work with humanely and with some compassion.
    I thank the witnesses for coming here today. I want to 
especially thank Ms. Bauman, our Queen Esther exemplar. Thank 
you all for sharing your perspectives.
    I yield back the balance of my time.
    Mr. Massie. I thank the Ranking Member.
    We'll now begin the questions, and we'll proceed under the 
five-minute rule.
    I'm going to yield to the Chair of the Full Committee, Mr. 
Jordan.
    Chair Jordan. I thank the Chair.
    Mr. Salatin said it best when he said: ``They trust their 
farmer more than a government agent.'' Amen to that. Someone 
once said, when someone from the government shows up at your 
front door, your first response is not usually, oh, joy, one of 
my public servants is here to help me today. That is the 
fundamental issue.
    I appreciate what the Chair's doing and everyone's 
testimony. It's amazing, we got four witnesses. I don't know 
which one came from the Democrats, but they all understand we 
have to change this system. So, God bless you all for what you 
do.
    I'm going to yield to the good man who knows a little bit 
about agriculture, from Wisconsin, Mr. Tiffany.
    Mr. Tiffany. Thank you, Mr. Chair.
    I believe you used the phrase, Mr. Salatin, ``rule without 
restraint.'' I wrote a letter on August 27, 2021, to the Food 
Safety Inspection Service, it actually went to Secretary 
Vilsack, in regard to forced mask mandates that were put on 
processing facilities. As I quoted in here, ``they do not have 
the authority to abate hazardous conditions directly.'' That 
was what FSIS said, ``they do not have the authority.''
    Do you see these things regularly from the Food Safety 
Inspection Service?
    Mr. Salatin. Yes. Yes. There is, as I mentioned, the word 
``extortion.'' The problem is that if you dare question a 
judgment because of the subjective nature of inspection, it's 
not empirical at all. They can retribute pretty easily. So, 
every owner of a plant, like us, has been down this road 
where--well, I can tell you the example. For us it happened in 
the last five years. We've had two new inspectors at our plant. 
Because we're a small plant, it's a training ground for new 
ones. So, because we sell grass-finished beef, not grain 
finished, many times our liver has just a bit of a green patina 
around the edge because it's not feedlot.
    So, two years in the last five, we've had new inspectors 
that condemned all our livers. That's $30,000 a year, times two 
is $60,000 a year. We take them 50 miles up to another plant 
with another inspector, all our livers come back. Same animals, 
same farm, same day, and same rules. One, we lose several 
thousand. One, we gain several thousand.
    If you dare question or say anything, then, well, we can 
find a fly here, we can find a post wrong here, this room has 
to be blue instead of pink. So, you just are under this 
extortion all the time.
    Mr. Tiffany. It kind of brings back a funny story, Mr. 
Chair. When I was a kid on a dairy farm, all the dairy farmers 
in the area used to always say, you got to make sure you got 
one thing wrong for the inspector to see because you can't get 
a perfect score.
    Mr. Gunthorp, I believe you used the phrase ``presumed 
guilty.'' I think you used that in your testimony. To this same 
point, is this something that you found also.
    Mr. Gunthorp. As I mentioned in my testimony, I think that 
we see this on a regular basis. I would argue that--and I've 
actually read the regulations, I probably can cite to any of 
them imaginable--but I think the problem is the interpretation, 
and it is the dysfunction that we see with the inspection. As I 
mentioned, I think it's our First Amendment rights, because I 
think it's our ability to challenge and criticize the 
inspectors, and we can't do that because of, as Mr. Salatin 
said, ``retaliation.'' I think it's the--we can't question or 
even have them have proper probable cause or suspicion when 
they either withhold our ability to use our facility, our 
equipment, or hold our product.
    Then we don't have legitimate due process in this. If I 
actually wanted to fight over an issue with the USDA, I'd have 
to go completely through the appeal process. So, starting at 
the inspector that wrote us up for noncompliance, I'd have to 
go through the whole way through the chain of command before I 
could get an administrative court hearing. So, I'd have two 
years that we wouldn't be open without even being able to get 
due process. That's not due process.
    Mr. Tiffany. Thank you very much for that. I just got a 
brief time.
    Mr. Gunthorp, you sound like you could be interchangeable 
with our ALEC representative here. I really appreciate the 
Democrats bringing you forward.
    To the Ranking Member, you hope to have a heart, you hope 
these regulators have a heart, but sometimes that is not how it 
works, and you force some of these plants to close. We've seen 
it in our district where we have a plant closing. They were 
subject to those mask mandates. It really did great harm to 
their business. I know it caused them to reconsider whether 
they should do an expansion.
    I would just close with this, Mr. Chair. I am so--we are so 
fortunate in Wisconsin. We have, I believe, almost 500 of these 
small processors. Many States do not have the diversity of 
processors. I get a quarter to a half every year, my wife and I 
do, from one of those small plants. We are so fortunate. I hope 
this can happen in the rest of the country.
    I yield back to the Chair--or yield back to you, Mr. Chair.
    Mr. Massie. Thank you, Mr. Tiffany.
    I'm going to yield to the Ranking Member of the Full 
Committee at this moment for questions, Mr. Nadler.
    Mr. Nadler. Thank you, Mr. Chair.
    Mr. Gunthorp, the meat processing market is highly 
concentrated with only four firms controlling most of the 
processing in this country. Why was it important to your family 
business to start your own plant to become involved in the meat 
processing plant?
    Mr. Gunthorp. Thank you for the question. We had no choice 
but to start a processing plant. My family raised pigs and sold 
live pigs on the commodity market for four generations. The 
commodity market is virtually done for the independent hog 
farmer, especially somebody like us that raises heritage breeds 
of pigs on pasture seasonally. The commodity market's not going 
to buy those hogs at any price that we could be profitable. We 
have no choice but to establish our own markets.
    Mr. Nadler. How hard has it been for your meat processing 
plant to stay in business and compete against large-scale 
processing facilities owned by one of the big four meat 
processors?
    Mr. Gunthorp. It's been an amazing journey. Unlike Mr. 
Salatin, we wholesale virtually all our stuff. We're not direct 
to consumers. So, we sell mostly to restaurants, upscale 
retailers. Up until about 2015, it was an amazing journey. We 
could sell product virtually anywhere. I think that the whole 
farm-to-table movement woke the big guys up, and the big guy's 
now with misleading labels. It's part of a requirement for 
antitrust enforcement is that you have a fair and competitive 
market.
    The big guys co-oped every single thing that we produce 
nowadays, whether that's natural, whether that's grass fed, 
whether that's product of USA, and whether that's the organic 
label. Those same big companies dominate all these markets, and 
they dominate them without the production of--
    Mr. Nadler. More since 2015?
    Mr. Gunthorp. What.
    Mr. Nadler. You implied more since 2015.
    Mr. Gunthorp. Oh, it's been--I mean, it started about 2015. 
We corresponded to it by expanding our region. We sell outside 
of our local region so, as far west as Oregon, as far south as 
Florida, into Pennsylvania, and New York. Expanding regionally 
works for so long. Eventually, when it becomes--I should send 
you a link to the Joe Rogan show. A good friend of mine, Will 
Harris, explaining his whole situation with Whole Foods. It's 
all the niche farmers that are wholesaling.
    Mr. Nadler. Thank you.
    Mr. Gunthorp, how do USDA inspections help protect the 
quality and safety of the meat produced to ensure the health 
and well-being of the livestock?
    Mr. Gunthorp. I think there should be some improvements in 
the USDA inspection system, but I'm actually a fan of USDA 
inspection. I think for the overwhelming majority of meat and 
poultry sold in the United States we need a basic standard for 
safety and wholesomeness.
    USDA is supposed to be there to be another set of eyes to 
ensure that we're doing what we're supposed to do. I would say 
about 80 percent of the inspectors fall in that category. You 
actually got a problem with 10 percent. I like to call them the 
lazies and the crazies. You got 10 percent that don't do their 
job, and they're a problem for both of us as a plant and 
consumers. Then you got 10 percent that there's not a person on 
the planet that can make them happy. USDA has nothing, 
whatsoever, to do to be able to deal with those inspectors. 
Little plants can't deal with them at all. So, you guys really 
need to fix both ends of it.
    Mr. Nadler. Now, Chair Massie's PRIME Act would propose to 
carve out meat sold commercially within the State from the 
Federal baseline inspection requirements. Do you expect 
consumers in your State to have an appetite for this 
uninspected meat?
    Mr. Gunthorp. I would say I'm not opposed to the PRIME Act. 
I think that if you put the restrictions poundswise the same 
week--we have the equivalent right now in poultry inspection, 
and it's 1,000 birds per year and 20,000 birds per year. We 
don't have problems with that. Indiana is actually one of the 
exemplary States. I would tell Mr. Johnson that Georgia is 
actually right now eliminating their--
    Mr. Nadler. Thank you. I have two more questions, which 
I'll ask as one. Are there tracing mechanisms in use at the 
State level that are like the tracing that a USDA inspection 
supplies? If meat is sold without a USDA inspection mark and 
thus unable to be traced, how might consumers who later fall 
ill thanks to contaminated meat find out if the meat came from 
a specific meat processing location?
    Mr. Gunthorp. I think that it's that accountability of 
actually there--the person buys from the actual producer and 
processor. So, I think that's the tracing there. That's why I 
say we need USDA inspection when it's a no-name transaction and 
it's in the grocery store and you don't know who the producer 
or the processor is. That's why USDA creates that basic level 
there. When it's an interaction between two people, the 
traceability is you know the person you got the meat from.
    Mr. Nadler. Thank you. My time has expired. I yield back.
    Mr. Massie. I thank you, Mr. Nadler.
    I yield five minutes to Mr. Cline for his questioning.
    Mr. Cline. Thank you, Mr. Chair. I want to thank you for 
holding this important hearing on this critical topic. I 
support your legislation. I've been a co-sponsor for many 
years. It's important to my district.
    I want to welcome my constituent, Mr. Salatin, here today. 
The Sixth District of Virginia is the No. 1 agriculture 
district in the Commonwealth. So, I see that he has been 
writing nonstop since he gave his testimony, and everybody else 
has been asking questions. So, I'm going to give you a minute 
just to kind of respond to what was said before I launch into 
my questions.
    One thing Mr. Tiffany mentioned was the proliferation of 
small processors in Wisconsin. I asked him why and what was the 
kind of reason for that magic that happens in Wisconsin as 
opposed to what might happen in Virginia.
    Mr. Salatin, thank you for being here.
    Mr. Salatin. Well, Wisconsin has a really small farm. It's 
the cheese capital. It has a really small farm feel about it. 
To my knowledge, Perdue is not there, Tyson's not there. So, in 
Virginia, we have Smithfield. So, it just has a small farm 
feel.
    Also, that as you head into Wisconsin, you get a kind of--
it's not in the center, it's out there. A lot of homesteaders 
are moving to Wisconsin. So, it's got that smallholder feel.
    Mr. Cline. Well, in Virginia, we have a State-level program 
that allows meat to be inspected and sold for intrastate 
commerce. However, we're one of only 27 States that have this 
kind of program in place.
    How would the PRIME Act improve on our system in Virginia, 
if at all?
    Mr. Salatin. Well, the PRIME Act would allow by-the-cut 
sales. I know Mr. Nadler has kept harping on safety, safety, 
safety, but we've got to realize that safety is actually quite 
subjective. I think a lot of people do things that are unsafe. 
Like drinking three Cokes a day is pretty unsafe. Maybe, I'll 
not go too far here, but there are a lot things that people do 
that are maybe bungee jumping, whatever, OK. So, 50 kids 
drowned in backyard swimming pools last year. That's more than 
have ever been hurt by any kind of meat problem. We're not 
filling in swimming pools.
    What I'm saying is you choose your risk. It's a personal 
choice of how you choose your risk.
    So, the beauty of the PRIME Act creates a parallel 
competition based on voluntary consensual choice among adults 
to opt out of a system. Just like homeschooling has now created 
a competition and opt-out chance and charter schools for people 
that are upset with the public school and don't trust the 
public school system. Or Uber created an opt-out option for the 
chauffeuring business. Or Airbnb created an opt-out position 
for the hospitality industry. We need an opt-out--the only way 
to really break up these big outfits is to create a universe 
that allows a competitive free-market option.
    So, the PRIME Act allows a competitive free-market option 
that will create accountability within the system.
    Mr. Cline. You have a long history of helping small farmers 
and processors get started in the industry and navigate Federal 
laws, USDA regulatory requirements, and food safety inspector 
relationships. Starting at the beginning, what are the biggest 
problems faced by processors and just getting a grant of 
inspection that enables the facility to even operate?
    Mr. Salatin. The biggest problems for getting around the 
inspection?
    Mr. Cline. No, getting a grant of inspection.
    Mr. Salatin. Oh, getting a grant of inspection. Oh. Well, 
it's basically a $2 million process. You've got a million 
dollars to build a facility and a million dollars to get the 
paperwork done.
    Mr. Cline. Once a facility is operating, what difficulties 
do processors face in complying with all the Federal laws and 
regulations?
    Mr. Salatin. Well, I think you heard a lot of it right 
here.
    Mr. Cline. We've heard a lot.
    Mr. Salatin. When we were talking here before the meeting, 
Greg--Mr. Gunthorp--I'm sorry, be formal here--mentioned that 
if we started down the path of each of us telling stories, we 
could be here well into the night. The problem is that these 
stories don't have easy resolutions because of the nonappellate 
situation within the industry.
    So, that's why trying to say, be nice, agency. FSIS, could 
you be nicer? Could you be kinder? That doesn't work. The 
reform needs to come from an option that allows people to take 
control of their own microbiome.
    Mr. Cline. Thank you for being part of a discussion that's 
long overdue.
    I yield back.
    Mr. Massie. I thank the gentleman from Virginia.
    I recognize Ms. Jayapal now for her questions.
    Ms. Jayapal. Thank you, Mr. Chair.
    After decades of corporate consolidations, small and 
independent farmers are limited to fewer larger meat processing 
facilities to prepare their product for consumption. Over 20 
years ago, the market share of the two largest meatpacking 
firms was 21 percent. Today, there are just four companies--
these are the four companies--that occupy over 50 percent of 
the market, even though there are almost 6,000 meat processing 
businesses in the United States. These conditions, as we're 
hearing, have led to a scarcity of options for many independent 
farmers, many of whom must now travel great distances to 
process their meat.
    I really appreciated, Mr. Gunthorp, your description of the 
boot of monopoly power. I think that is an apt description for 
how small independent farmers are being crushed.
    Before we get to that, I just wanted to pick up on 
something that Mr. Salatin was just saying. Do you think that 
the essential components of food safety are subjective?
    Mr. Gunthorp. For me?
    Ms. Jayapal. Yes.
    Mr. Gunthorp. Yes, I think it is. As I mentioned earlier, 
80 percent of the inspectors, by my estimation, do a great job. 
They're there to ensure we have a safe and wholesome food 
supply. Ten percent of them probably don't do their job, and 10 
percent--
    Ms. Jayapal. That 80 percent are judging on standards that 
it sounds like you think are appropriate, their core essential 
functions of food safety?
    Mr. Gunthorp. Yes. Employee hygiene, preoperational, 
operational sanitation, ensuring that you're meeting critical 
control points. Those things are essential whether we'd have 
USDA there or not.
    Ms. Jayapal. Thank you. So, they're essential. I just 
wanted to make it clear that it's not like we're looking at 
food safety and saying this is a whole set of things that we 
can just judge whether or not they're safe. There are certain 
clear standards, and that is what the regulators are trying to 
regulate.
    I understand your point. You've been nuanced in saying that 
they're not necessarily all doing a great job. I understand the 
things we need to do better, but that you're in favor of having 
some regulations, and that the majority, 80 percent of them, do 
a good job.
    Mr. Gunthorp. Oh, yes. Those four large corporations, and 
even down to a much smaller scale, it'd be a free-for-all if we 
didn't have inspection. I still think person to person is a 
different--
    Ms. Jayapal. Of course, understood.
    The U.S. Department of Agriculture reported in 2002 that 
four-firm concentration in hog slaughter increased from 30 
percent in 1989 to 57 percent in 1999.
    In 2004, Mr. Gunthorp, you began operating your own USDA-
inspected processing plant due to limited processing 
availability. Can you talk about why you think there was 
limited processing availability at that time?
    Mr. Gunthorp. That's a story that would probably take a 
whole book. The hog industry consolidated. The big guys kept 
getting bigger and pushed out the little guys. As I mentioned 
earlier, in 1998, we sold live pigs for less than what my 
grandpa sold them for in the depression. We really had no 
choice but to quit the hog market. It was over. Went from 
600,000 hog farmers to 60,000 today. Everybody quit. We just 
chose to try a different path so that I could still raise pigs.
    Ms. Jayapal. Yes. You've been really successful at that. 
You've maintained your processing facility for almost 20 years.
    As companies have consolidated more during that time, has 
access to processing facilities improved?
    Mr. Gunthorp. In some ways it's improved, but in lots of 
ways that it hass gotten worse. I tell people processing plants 
disappeared, but we forget the kind of processing plants that 
farmers need to be able to direct market had completely gone 
away. The little processors that had a truck that did a route 
that actually made a whole bunch of different products, served 
restaurants and retailers, those didn't exist when we started 
direct marketing. We've had to rebuild this whole process.
    Ms. Jayapal. You've had to really rethink the whole thing.
    Mr. Gunthorp. Yes.
    Ms. Jayapal. Currently, just four companies, as I 
mentioned, control more than half of the market in chicken 
processing, close to 70 percent in pork, and nearly three-
quarters in beef. How does that consolidated power--and you've 
spoken to this in different ways, but briefly, how does that 
consolidate power impact the pricing for independent farmers 
and consumers?
    Mr. Gunthorp. It drastically impacts the pricing for 
farmers and consumers. We've been told economy of scale, 
economy of sale. I have a degree in economics from Purdue 
University. It realistically has not worked for farmers or 
producers. It has not increased farmers' prices. It's 
drastically reduced farmers' prices, and it's increased 
consumers' prices. All that improvement has went to the people 
in the middle. In my opinion, the Department of Justice, the 
USDA, and the Federal Trade Commission have been on vacation 
since the 1970's on antitrust issues.
    Ms. Jayapal. I absolutely agree, and they're coming back in 
a big way, and I really support that.
    Mr. Gunthorp. I'm ready for them to go back to work.
    Ms. Jayapal. Fantastic. Well, I really appreciate it.
    Mr. Chair, I yield back.
    Mr. Massie. Thank you, Ms. Jayapal.
    I now recognize the Chair of the IP Subcommittee, Mr. Issa, 
for five minutes.
    Mr. Issa. Thank you, Mr. Chair.
    This is an incredibly important hearing, and hopefully I 
can ask a couple of questions to bring a few things out.
    Mr. Salatin, you're probably the most qualified to answer a 
fairly straightforward question. Is there a record of a 
difference between State inspection and USDA's inspection as to 
tainted meat getting into the market?
    Mr. Salatin. I don't know. I assume that there is some data 
base that records--
    Mr. Issa. Are you aware of any record that somehow the 
States didn't care enough about people's health where the 
Federal government did a better job?
    Mr. Salatin. Oh, no. The Federal government never does a 
better job.
    Mr. Issa. OK. I'll take that one for the record.
    Mr. Salatin. Probably not even a better job than a direct 
farmer to consumer where a farmer doesn't have a bureaucracy to 
hide behind.
    Mr. Issa. Similarly--I once worked in a slaughterhouse. I 
worked for Rabbi Kaizen (ph). I'm not sure how far over 1,000 
chickens he went, but let me assure you there were hundreds 
every single day as I came to work, so it was a lot. He 
slaughtered them according to religious beliefs. We stripped 
the feathers off, we soaked them in brine, and later that day I 
got to deliver them in a very old station wagon to one after 
another customers, if I was lucky, because I got tipped for 
that. I didn't get tipped for slaughtering.
    So, is there a record, similarly, of the small processor, 
including the one-of-a-kind rabbi who operates both retail and 
wholesale? Is there any history that small is somehow less able 
to do the job properly?
    Mr. Salatin. Not to my knowledge.
    Mr. Issa. So, as we see over 50 percent of processing done 
by just four processors and we see, to my recollection, that 
most of the time when I hear about it, they're the ones that 
have the shutdowns and the recalls and so on. Now, maybe that's 
because of their volume, but it doesn't seem like bigger is 
better from the standpoint of safety. Is that fair?
    Mr. Salatin. That's absolutely fair, just like--think about 
your own kitchen. If you're cooking five meals a day in your 
own kitchen, as long as you keep it clean, then if suddenly 
you're doing 50, scale does matter.
    Mr. Issa. Ms. Bauman, you haven't been asked very much, but 
would you like to, as we say here, opine on those two questions 
of bigger versus better and who cares more about the health and 
safety, the processor and your local inspector or somebody 
who's brought in from somewhere in the country for USDA?
    Ms. Bauman. Yes. I would say, from a safety perspective, if 
there's any difference between small processors versus large, 
it depends maybe which data base you'd be looking at, because 
if--the USDA does publish all the testing that goes on in small 
and large plants. They have a public access data base. I don't 
know how to get there, but--and you will find that the small 
plants do have a higher incident rate of testing failures. 
However, that's--you'd want to call the word ``failure,'' but 
that is directly proportionate to the ratio of products tested.
    So, small plants are tested an incredibly lot more than 
large plants. So, they can look really bad on the data base 
until you realize which representation you're looking at. From 
a State versus USDA, I'm not aware of any difference in that 
either.
    Mr. Issa. Mr. Gunthorp--I could ask either of you this--
but, is it fair to say that when your name is on the meat and 
your business goes from whatever it is to zero, maybe 
permanently from a standpoint of high-end restaurants and so on 
buying, that you're probably more likely to pull back any 
dubious meat because you cannot afford to have your brand hurt, 
where, quite frankly, the majors, yes, they have a brand, but 
they've had all these problems and they survived them.
    Mr. Gunthorp. I tell people all the time, there's a huge 
correlation between food quality and food safety. If you're 
selling to high-end restaurants, high-end retailers, our name 
is all about quality. So, we can't put anything out there. 
Small guys with one recall are done. Big guys, no name, it goes 
on.
    Mr. Issa. I'm going to have a rhetorical question for a 
moment for the record, and that is, a big chunk of our meat, 
not the majority, but a chunk of it comes from outside the 
United States. I think of New Zealand lamb and so on. My 
understanding is it's inspected when it gets here. So, to a 
great extent, meats from around the world enjoy the ability of 
being inspected after the fact, rather than intrusive visits to 
the factory. That may, in fact, be just as much of a double 
standard for the USDA to try to explain.
    So, with that, Mr. Chair--that one was for the record--I 
yield back.
    Mr. Massie. Thank you, Mr. Issa.
    Now, I recognize Mr. Correa for his questions.
    Mr. Correa. Thank you, Mr. Chair. I just thank you for 
holding this most important hearing.
    As I think about your comments, USDA versus the PRIME Act, 
we've got to have safety standards. I don't represent an area 
that we do any farming, primarily very urban southern 
California. We still care about safety of the products we 
consume.
    USDA, I've heard testimony today, fixing the USDA 
inspection. Do we need a nicer, kinder USDA?
    Ms. Bauman, you mentioned this in your comments that you 
get inspected more often. You feel you're held to a higher 
level of scrutiny because you're small versus a larger--the big 
four, so to speak. Is that because they're trusted more than 
you are? What is it, in your opinion, that drives more scrutiny 
of your operation as opposed to the larger guys?
    Ms. Bauman. Well, part of it is just how the regulations 
are written and exemptions made for high-speed slaughter. So, 
whenever animals are being slaughtered, an inspector is 
required to be present. Because of I can do far fewer in a 
day--what I do in a day is equivalent to like maybe what some 
of them do in a second--they have more time to see more stuff, 
bottom line. It doesn't mean that the big guys don't mess up 
more--
    Mr. Correa. So, that would argue that the inspection of 
your process, your product sounds to be more safer than that of 
a high-speed operation.
    Ms. Bauman. I would tend to think so myself. I have--and 
likewise--
    Mr. Correa. So, is there an ombudsman? Is there an 
inspector? Do you have a personal relationship with your 
personal USDA person that comes out to see you?
    Ms. Bauman. You have to because you're with them literally 
all the time.
    Mr. Correa. They would know how you do business, that you 
don't take shortcuts--
    Ms. Bauman. Exactly.
    Mr. Correa. --that you're actually there to do a good job.
    Ms. Bauman. Half of the skill of being a USDA plant owner 
is developing that relationship because they're your coworker. 
You have to figure out how to get along and how to achieve 
your--they can do their job and you can achieve your goals.
    Mr. Correa. I'm trying to get at why is it that you have 
same rules, same regulations, same set of law, same objectives, 
yet the outcomes seem to be different? You're held to a higher 
level of scrutiny, when safety appears to be something that at 
the end of the system is accomplished, so to speak.
    So, how do we change the system so that you're as 
competitive as the big four and you can essentially compete 
with the rest and those benefits of competition are passed on 
to my consumers?
    Ms. Bauman. Some of that would be--I'm never going to 
achieve the level of--I'm never going to be able to reduce my 
levels of inspection, if that makes sense, like the big guys 
can, because I can't--
    Mr. Correa. I don't want you to reduce levels of 
inspection. What I want you to do is be able to work with USDA 
so you're not at a competitive disadvantage.
    Ms. Bauman. Right. Part of that is plant owner education. I 
don't have the resources that Tyson does to explain 
microbiology and defend my practices. I don't have the 
resources to access--
    Mr. Correa. Explain that to who?
    Ms. Bauman. What's that?
    Mr. Correa. Explain that to who?
    Ms. Bauman. To the inspectors. Because everything I do in 
my plant has to be backed with scientific documentation to 
prove that I'm not doing anything to make my product worse.
    So, one, there's the small plant owner doesn't have that 
depth of knowledge. In Tyson, they can fly someone in if they 
need to know more information. That's a rhetorical company 
named there, but--in the large processors.
    Additionally, so it is that the small processors are--don't 
have the knowledge base by means of who they are, if that would 
explain it. Then there is the FSIS, diametrically opposed to--
    Mr. Correa. Let me cut you off in the last 30 seconds that 
I have.
    Ms. Bauman. OK. Go ahead.
    Mr. Correa. What would you--all of you, would you have a 
set of recommendations for us to look at, short of, of course, 
the PRIME Act, if we have to continue to work with USDA? What 
would be some of the top two or three recommendations that you 
would have to make your business models more successful?
    I only have 15 seconds.
    Ms. Bauman. Sure.
    Mr. Correa. I would welcome some testimony if you could 
provide that to my office.
    Ms. Bauman. I would say two things. Once again, not 
requiring inspection of stuff that doesn't need it. So, back 
to, if stuff's exempt, if it's being directly sold to 
consumers, let me save some time with the inspector and do the 
stuff that needs it.
    The other thing is being able to have a better 
conversation, an ombudsman, a mediation board, for when me and 
the inspector have a disagreement, we have somebody to go to, 
and we don't waste a year trying to get our voice heard.
    Mr. Correa. Thank you, Mr. Chair. I yield.
    Mr. Massie. Thank you, Mr. Correa.
    Now, I recognize Mr. Gaetz for questions.
    Mr. Gaetz. Thank you, Mr. Chair.
    I'm a proud cosponsor of the PRIME Act. I appreciate this 
hearing, if for no other reason that I'm not going to eat the 
bugs. So, I'm here for the where's the beef hearing.
    Mr. Chair, I would also observe that there's a great deal 
of economic opportunity here. As we look at the buying patterns 
of millennials, there's often great interest in having a 
greater connection to the farmer or the individual who was 
involved directly in the production of that food source, rather 
than moving through a lot of these branded processors.
    So, if we were to pass the PRIME Act, I don't just think we 
would achieve a great regulatory accomplishment, but I think 
you would actually be able to sell product at a higher price to 
people who are willing to pay it by virtue of that direct 
consumer relationship that is only being impaired right now 
because of what the government has done, wrapping the apparatus 
of government around these large businesses.
    I'm sure I'll learn a great deal more yielding my time to 
Ms. Hageman of Wyoming and allowing her to ask some questions.
    Ms. Hageman. Well, thank you, Mr. Gaetz.
    I appreciate the opportunity to be here as well. I'm also 
proud to be a cosponsor of the PRIME Act.
    Wyoming is one of the 29 States currently operating a State 
inspection program known as the Meat and Poultry Inspection 
program. Under current law, as has been repeated here several 
times, the meat processed at the State-inspected plants can 
only be sold intrastate.
    Now, as a product of my family ranch outside of Fort 
Laramie, Wyoming, and having dozens of family members who are 
in the livestock business, I can assure everyone here and the 
American public that every farmer, rancher, and every meat 
processing facility has every incentive to protect our meat 
supply and ensure the safe handling of our food.
    One of the other reasons that we are here today is to rebut 
some of the misguided arguments pertaining to this bill, and 
arguments which are mainly coming from the large corporations 
and packers who have essentially a monopoly when it comes to 
meat pricing and packing.
    Mr. Trotter, if the PRIME Act became law, do you believe 
that farmers and ranchers would abandon the existing supply 
chains whereby they sell to the feedlots which then serve the 
existing meat processors and packers, or would they continue to 
use the same process that they use now?
    Mr. Trotter. I think you'd see an expansion. You'd have a 
lot of the--look, the big feedlots have their purpose. These 
large industries do have their purpose, but what you have here 
is an opportunity for small businesses to expand. This would 
just be a result in net economic growth here.
    The large processors do have their place. When it comes to 
local businesses, like within your own State, making sure that 
they have products from the farm down the road that didn't need 
to be trucked 300 miles away to get processed at a USDA 
facility, there is a market for that. It's simply an expansion 
of everything else.
    You're not going to see the big four necessarily go away, 
but you are going to see competition around the edges, and 
you're going to see the biggest benefit for the smaller 
producers.
    Ms. Hageman. Well, so I think it's fair to say, then, that 
the PRIME Act merely gives farmers and ranchers more options 
when it comes to selling their cattle, and these increased 
options in turn provide increased benefits to the producers and 
stave off vertical integration, as well as allowing these 
producers to determine their own destiny rather than being at 
the mercy of the packers.
    We contacted some of the producers in the State of Wyoming 
and asked them to weigh in on some of the challenges that they 
have related to producing food, producing our beef, pork, and 
chicken, et cetera. One of the things that I thought was 
interesting was a comment from one of my constituents who said 
that our industry is crippled by the endless regulations coming 
from the EPA, FDA, and USDA. We spend countless dollars and 
hours tracking, documenting, and proving things that we do as a 
regular part of our operation. We have to pay experts to file 
reports because the regulations are so complicated to follow. A 
few examples of our struggles include the FD rules, CAFO 
nutrient management regulations, cattle tagging rules, and 
animal feeding operations and registrations.
    The other challenges that they talked about is that there 
is the industry monopoly that has been discussed several times 
today. Then the other thing is the unwillingness of the packers 
to work with our cattle producers, our livestock producers to 
actually address the price. We also have to be concerned about 
vertical--continued vertical integration.
    These are all challenges that our small businesses, our 
farmers and ranchers, really the backbone of so many of our 
communities, are facing with overregulation.
    I want to thank all of you for being here today, for 
sharing your stories, for discussing the importance of the 
PRIME Act, and for coming to Congress to find ways that we can 
fix the problems that your industries are suffering from. I can 
tell you that we're all committed to doing that. We're all 
committed to making sure that we're providing a safe food 
supply for the American citizens, the great people of this 
country. So, again, thank you for everything.
    I yield back.
    Mr. Gaetz. I yield back.
    Mr. Massie. The gentleman from Florida yields back.
    I'll recognize Ms. Scanlon from Pennsylvania for her 
questions.
    Ms. Scanlon. Thank you, Mr. Chair. I want to thank you for 
calling today's hearing, so we have the opportunity to 
highlight the high degree of consolidation that has occurred in 
our agricultural industry, obviously not a new problem for the 
country.
    Consolidation in grain, livestock, and meat processing has 
plagued the U.S. since the 1800's. It was those early 
monopolies that set the stage to pass most of our key antitrust 
laws that guide our policy to this day. A lot of Americans 
don't realize how consolidated, particularly the meat 
processing industry's become, and that just a handful of 
companies make, process, and sell most of the food that we eat, 
although they do know that over the past three years they've 
seen their food prices go up at the grocery store.
    The economic shocks of COVID and the Russian invasion of 
Ukraine have certainly highlighted the urgent need to introduce 
more competition. Where there's only two or three companies 
producing a staple good, like grain, eggs, or formula, any 
disruption of one company can lead to shortages and higher 
prices.
    So, today we're talking about meat processing. We've heard 
that three, four, or five companies control between 50-70 
percent of the various markets. In the past couple years, we've 
seen these companies use their size to push higher prices on to 
consumers, while charging farmers less for livestock and 
shortchanging worker wages and working conditions. So, the 
handful of meat processing plants that control the lion's share 
of the market have used their dominance in the market to reap 
record profits.
    The question for Congress should be how to address both 
food safety and competition, because deregulating large sectors 
of the meat industry doesn't really solve either problem.
    I'm particularly concerned about eliminating food safety 
regulations that might push serious health costs on to 
consumers. This includes both the ability to afford and 
purchase food that's been inspected and is safe, because not 
everyone's a millennial able to purchase high-end goods, as 
well as the impact of health costs if safety regulations are 
not enforced to help drive down costs, but then people get 
sick.
    So, I think the Agriculture Committee is the proper place 
to have an informed debate about USDA and food regs and how 
they need to be improved. In fact, traditionally that's where 
bills in this region have been referred. If the goal is lower 
prices and more choices for consumers, then improved and 
targeted antitrust enforcement is needed to help create that 
competition. It's more independent farmers, food processors, 
options for achieving those goals, and bills like the 
Prohibiting Anticompetitive Mergers Act or the Food and 
Agribusiness Merger Moratorium, and Antitrust Review Act are 
going to be helpful.
    So, I would love it if we were able to look at policies to 
strengthen the FTC and the USDA so they can break up 
monopolies, block bad mergers, and protect consumers, workers, 
and farmers from some of these unfair prices. I think that is 
probably a better focus for this Committee.
    Mr. Gunthorp, can you talk a little bit from the boots-on-
the-ground perspective about how large-meat processors are 
using their size to squeeze our independent farmers and how 
they're using that size and influence to shape new regulations 
in a way that hurts our smaller farmers and food producers?
    Mr. Gunthorp. Sure. First, we have to look at the fact 
that--I don't think most people realize--about 25 beef 
slaughter plants, 40 pork slaughter plants, and only 200 
poultry slaughter plants slaughter almost all the meat in this 
country. It's 85-86 percent of the beef, 90 percent of the pork 
for those.
    So, this is a very real problem. I'm here to warn you today 
that this problem is no longer just the United States' problem. 
These companies are multinational corporations that are doing 
this globally, and they're taking this wealth that they're 
extracting from rural America right now to buy up processing 
and slaughter capacity globally. This is going to be a monopoly 
worldwide unless we address it today.
    So, it causes consumers harm. It causes farmers harm. It 
creates a lack of opportunities in rural America. If you look 
at the economic metrics of rural America, they're worse than 
the inner cities. This is because of concentration and 
consolidation taking away opportunities. Most farmers nowadays 
don't even own the livestock or poultry on their farm. We've 
returned to a feudal serf system.
    Ms. Scanlon. Thank you. Really appreciate your insights, 
particularly about how that monopolization is global and really 
hurting our American farmers. So, thank you.
    I yield back.
    Mr. Massie. Thank you, Ms. Scanlon.
    I recognize Ms. Spartz from Indiana for questions.
    Ms. Spartz. Thank you so much, Mr. Chair.
    It's my honor to be here with fellow farmers, as I've been 
involved in a lot of businesses, but this is one of the 
toughest ones when you depend on government and God. So, I 
appreciate being here, also my fellow Hoosier.
    I have seen that food security is also a national security 
issues, especially during COVID times, and we see what the 
power oligopolists have right now in many parts of the market, 
but including food processing, with creating oligarchs, 
cartels, and with some actual child labor issues, including the 
State of Indiana, which raises very significant concerns. So, I 
appreciate Mr. Chair having this hearing.
    Before I came here, since I'm not involved in livestock, I 
do soybean farm, I actually met with farmers in my district to 
get their input. I wanted to run something by you.
    PRIME Act is a great legislation. I'm surprised that we're 
even dealing with intrastate commerce. I don't know how 
Congress gets involved into everything. Just one issue they 
brought up to me was interstate commerce too, where they say we 
have this one-size-fits-all approach with Federal government 
centralizing a lot of regulations. States and businesses have 
liabilities. If you're not going to follow good safety laws, 
you will not be in business for very long. The same States, 
they have agriculture. It is a big part of GDP of States. They 
have an interest to have good production and good standards.
    There is some flexibility, like some regulations, Indiana 
Department of Environmental Management has quite more stringent 
even the Federal government. So, you actually can apply to 
local markets.
    So, one of the things they brought up to give more 
flexibilities for States to do inspections was also State 
inspectors, not maybe this large, huge processes would be 
dealing with just USDA factors. States can develop standards 
within the State to deal with smaller processors where it would 
be more competition and bring ability for actually these 
midsize companies to survive, because they cannot hire 
expensive attorneys and scientists and everything else, but 
they might not need it because they don't have the large type 
of mechanic processes as maybe some other ones.
    So, Mr. Trotter, I wonder, since you represent organization 
of State legislators, I used to be a member of--and I actually 
got an Iron Lady Award from them, but I wanted to get your 
thoughts on actually maybe doing more flexibility in the farm 
bill for States to have ability to do this inspections for 
interstate commerce too.
    Mr. Trotter. Yes. So, for commerce within a State, it's an 
intrastate commerce question, not an interstate commerce 
question. The Federal government definitely has jurisdiction on 
interstate commerce, but at the end of the day, this is a 
federalism question: Does the authority lie with the Federal 
government or does it lie with the State government? If we're 
talking about commerce within its own borders, inspection 
within its own borders for things that only stay in their own 
borders, that's clearly a State authority that's been subsumed 
by the Federal government. It's something that Congress has the 
ability to go ahead and delegate back to the States, and it's--
    Ms. Spartz. So, it's one thing asking them to delegate it, 
but what about interstate commerce to have more flexibility for 
in-State inspectors also to do some inspection maybe for 
smaller plants for interstate commerce also? Because we don't 
have to regulate everything, and we can set baselines, but we 
need to--don't have to one-size-fits-all approaches because 
States are so unique in agriculture.
    Mr. Trotter. Yes. States are the laboratories of democracy. 
We have 50 different opportunities in this great Nation to go 
ahead and figure out what works. You have to enable States to 
be able to do this without doing a one size fits all. Right 
now, what we have is a one-size-fits-all system, the same thing 
that goes through these vertically integrated multinational 
conglomerates as what happens with the small producers that are 
here at the table with me.
    Ms. Spartz. Maybe, Mr. Salatin, if you can briefly--each of 
our presenters--just get your thoughts on that, too.
    Mr. Salatin?
    Mr. Salatin. Yes. So, the germination tray for innovation 
is embryotic prototypes. You cannot have solutions to problems 
without prototype innovation. You don't start big; you start 
small.
    So, one of the problems we have right now is that with this 
overarching Federal domination of State choice, all right, if a 
State--for example, Maine, when they did their food sovereignty 
law, they said, ``In Maine, if a farmer and a consumer want to 
work together, we're not going to get a bureaucrat involved.'' 
That's fine. Somebody at church, you want to sell, we're not 
going to get involved.
    Soon as they passed the law, here came Federal in and said, 
``If you do that, we're going to withdraw all inspection from 
the State.'' Maine won't be able to sell anything to anybody 
out of the State. So, immediately Maine caved, and it was gone.
    So, this body right here has the chance to offer innovative 
experimentation opportunities for our 50-State experiment. We 
hear safety. Well, people are going to get sick if we have 
uninspected food. We don't know that. Maybe they'll actually be 
able to afford better food, it will be more available, and 
their food system will be more secure. Until this body grants 
freedom to try, to create a germination tray of innovative 
ideology, we don't know if we have more people or maybe we have 
healthier people because they wouldn't be condemned to the 
oligarchy. Maybe that would be the outcome.
    Ms. Spartz. Thank you.
    My time has expired. I yield back. Thank you.
    Mr. Massie. Thank you, Ms. Spartz.
    I now recognize Mr. Ivey for his questions.
    Mr. Ivey. Thank you, Mr. Chair. Thank you and the Ranking 
Member for putting this hearing together.
    Thank you to the panel. I appreciate you coming in and 
sharing your thoughts and your insights.
    I come from a district, it's the eastern border of 
Washington, DC, so we don't have a lot of processing plants 
over there. It's been a long time since I've been on or near a 
farm. When I was a little kid in North Carolina, we lived near 
one, and my father owned soybean, actually, somebody mentioned.
    For the track here, it seems to me there's sort of two sets 
of things that are going on that I'm sort of curious about. One 
is the antitrust issue, and all of you haven't talked so much 
about that. I guess there's been more conversation from up here 
about that. The issue seems to be a sense of there is basically 
four entities that are running the show and controlling the 
markets, and they're too big, and they're now growing to become 
international forces in that realm as well.
    As Ms. Scanlon pointed out, that would seem to be the area 
that antitrust legislation or enforcement could address. I know 
you've explicitly called for that, Mr. Gunthorp. I'm interested 
in pursuing that. I didn't realize until this hearing that 
those forces had become that big and had that much market 
dominance.
    First, Mr. Chair, I'd be kind of curious about if we move 
forward with this, because it's not clear to me exactly the 
impact your bill would have on those four entities. So, from 
the standpoint of some suggestions, like Mr. Johnson, he's 
talking about breaking some of them up, and that would be a 
whole set of hearings, it seems to me, on market forces, 
economists telling us, well, what would you have to do from a 
breakup standpoint to actually have an impact to try and 
address some of these issues. I'd be very interested in hearing 
about that. I haven't made a decision one way or the other yet, 
but I'd be curious about it.
    Second, with respect to your bill and some of the things 
that you've raised, it sounds like some of that would make 
sense. I live in a community where we have farmers that come up 
on the weekends, and they sell their goods at the local school 
or community center, and it happens all over the area. Mr. 
Gaetz said something about baby boomers buy that too, right. 
So, there's an openness to it as well. I'm not clear on some of 
the issues as to whether the bill would address that or not.
    There were some points that were raised that I really would 
like to hear more about. I don't know if they're going to be in 
our jurisdiction or the Agriculture Committee. Mr. Gunthorp, 
you suggested possible issues of reform, redefined plant size. 
You mentioned inspection reform. Ombudsman, was your 
suggestion. You mentioned mediation board. As a former 
litigator, I'd be careful about what you ask for on some of 
those.
    The point you're making is that if you have to go all the 
way down the track of litigating the issue, it could take two 
years, and you might be out of business just to challenge one 
inspector's ruling. I'd be open to trying to figure out ways to 
find some kind of expedited appeal or resolution to try and 
address that.
    Ms. Hageman's also over different hearings testify--or 
brought to our attention the heavy weight that regulations can 
bring on some of these entities. You're really at a distinct 
disadvantage if you're trying to take on Uncle Sam without 
having a gigantic budget behind you. So, I'd be open about 
that.
    The truth and labeling issue too, which we didn't get into 
much--and maybe that's an Agriculture Committee issue too, but 
I take your point. I go to the grocery store--we actually had a 
briefing about this a few weeks ago, and there are all these 
things about whether it's organic or whatever. It's hard to 
keep track of what they really mean and who's promising what 
and who should I buy from because my family and others want to 
actually support smaller farms and businesses, but it's hard to 
figure out how to do that sometimes.
    So, Mr. Chair, I think there's definitely room for 
bipartisanship here. I think there are ways we could find ways 
to try and address some of that. I do think if we do the 
antitrust piece, though, one of the questions I'd have is the 
custom slaughterhouse approach. I might have been Mr. Trotter, 
you used the phrase ``around the edges,'' which is important. I 
think we want to make sure we find ways to help small 
businesses, small farms to thrive and find their own markets. 
If it's not going to have an impact on the larger antitrust 
issue that Ms. Scanlon identified, and Mr. Johnson did too, I 
think that can't be our only track for solutions. We have to 
find additional ways to try and address that as well.
    In short, we've got to walk and chew gum in dealing with 
this issue.
    Mr. Chair, I commend you for your legislation and for this 
hearing. Mr. Johnson, I appreciate your comments too. I hope 
that we'll be able to continue working with you and your 
community to try and find ways to address these issues.
    Mr. Massie. Thank you, Mr. Ivey. Mr. Ivey yields back.
    I'm going to yield my--or recognize myself for my questions 
now.
    There's been a lot of discussion here, and I want to put it 
all in context. There's sort of an oligopoly solution where the 
big meat packers control, and then there's this other path 
which is farmers can sell directly to consumers, but they have 
to sell them the animal.
    So, these custom slaughterhouses exist because of one 
exemption right now, these hundreds of thousands of custom 
slaughterhouses. That is the farmer can sell the consumer a 
whole animal or half an animal. The problem with that is it's 
regressive. How many families can afford to buy 500 pounds of 
meat? That's the only alternative that exists.
    So, the PRIME Act seeks to expand that alternate path, 
which has made nobody sick, and it's made a lot more people 
healthier.
    So, I want to talk about, Mr. Salatin, sustainability, 
affordability, traceability, and safety. Those are concerns 
that were all raised.
    Mr. Salatin. Yes.
    Mr. Massie. Can you speak to each of those four--and I'll 
go over them one at a time--sustainability, affordability, 
traceability, and safety--and talk about how enabling or 
empowering a more local food system enhances all those things; 
it doesn't detract from them?
    Mr. Salatin. Yes. We've heard a lot about protecting the 
public here. It's time to protect the private. So, on 
sustainability, one of the beauties of offering this kind of 
choice to the consuming populous is that it does actually 
create options for farmers and consumers who want to opt out of 
whatever the system is, whether it's like the Gunthorp family 
that opted out of the industrial pork system or whether it's a 
consumer who's wanting to opt out of Walmart. The opt-out 
option creates a sustainability because it's about resilience.
    So, when fertilizer--for example, on our farm, when 
fertilizer jumped 400 percent when Putin invaded Ukraine, we 
didn't miss a beat because we don't buy any of it. These are 
the kind of farmers that we're dealing with. So, it works all 
the way up the food chain, building soil, earthworms, 
sustainability.
    Affordability is a big one because, as you mentioned, not 
only does the current system require large volume buying, the 
average American now can't put their hand on $400. So, you 
can't buy volume. It's pretty difficult. Because of the 
overhead and paperwork costs of inspection, it artificially 
elevates the price of food. So, a custom house operating at a 
much lower capitalization cost for infrastructure, a lower 
paperwork cost can actually do what a Federal-inspected plant 
does for, let's just say a dollar, it can do it for 75 cents. 
That cost gets passed on to the product, and so suddenly, not 
only do we have a sustainable secure food supply--does anybody 
think if we'd had 300,000 smaller plants accessing the country 
instead of 300 mega plants at COVID, but we would have had less 
of a hiccup in the food system if we'd had 300,000 plants 
instead of 300. So, affordability is a big deal.
    Traceability is another one. Right now, a typical burger at 
a burger joint has pieces of 600 animals in it. So, if anybody 
thinks that all those 600 animals in a burger at McDonald's is 
traceable, I've got a bridge in Brooklyn to sell you. Trust me, 
it is not traceable. OK? So, the problem is we've built this 
system, and we have a trust in this system that's actually let 
us down. It's not working.
    What was your fourth one?
    Mr. Massie. Safety.
    Mr. Salatin. Safety. That's the big one, because the safest 
food comes from smaller plants that have--somebody over here, I 
don't remember who, was talking about branding--that when you 
put your brand behind it, you have a really vested interest in 
making sure that is a safe product.
    One of the things that you notice with all these recalls--
what's the first thing a CEO says as soon as they've got a 
product recall? Well, we've complied with everything. The big 
industry hides behind the skirts of the inspection service all 
the time. A place like me, we don't have any skirts to hide 
behind. If we sell bad chicken, bad beef, or bad pork chops, it 
comes back on us.
    I'll close with this story because I think this is 
foundational to what we're talking about here. When Michael 
Pollan wrote ``Power Steer'' in The New York Times and 
basically blew the door off grass-finished beef market, I got 
contacted by--I won't mention the name, but the largest fast 
food chain in the country, and they were interested in offering 
a grass-finished burger.
    Well, they saw some of the things that are written about 
them, and they said, ``Oh, maybe we don't want to go visit 
them.'' So, they sent their D.C.--their counsel, their retainer 
attorney, down to check us out, and we spent half a day 
together. As I was talking bought the disparity between the way 
a small plant and a large outfit deal with these subjective 
inspections, he said, ``Oh, that's just business.'' He said,

        At our place, when we have an overzealous inspector or a little 
        tyrant or one of the 20 percent top or bottom, they call me. I 
        go to the commissioner at FSIS and get them fired. That's just 
        the way we do business.

    A small plant like ours, we don't have that kind of clout. 
We don't have that option. So, we're held hostage by this 
system that I've already said measures their efficacy in pounds 
per inspector personnel hour. Well, I didn't know that they 
were measuring efficacy by pounds per hour. I thought it was 
about safe food.
    So, the whole thing is incentivized to be prejudicial to 
small outfits, and that's why we need some sort of option that 
allows a parallel universe to exist, because that's the only 
way that you can actually create competition and accountability 
within the monopoly.
    Mr. Massie. Thank you, Mr. Salatin.
    I now recognize the Ranking Member of the Subcommittee, Mr. 
Johnson, for his questions.
    Mr. Johnson of Georgia. Thank you, Mr. Chair.
    I move to enter into the record a letter dated June 13, 
2023, entitled ``Where's the Beef?'' without objection.
    Mr. Massie. Without objection, so ordered.
    Mr. Johnson of Georgia. Thank you.
    Mr. Trotter, you are here with the American Legislative 
Exchange Council, which has, among its members, the 
organization known as the Americans for Tax Reform, which is 
Grover Norquist, correct?
    Mr. Trotter. Yes.
    Mr. Johnson of Georgia. You're familiar with his pledge 
that everybody has signed so as to limit the no new taxes 
pledge? You're familiar with that State, local, and Federal 
legislators have signed, pledging to impose no new taxes, 
correct?
    Mr. Trotter. I have heard of it.
    Mr. Johnson of Georgia. You have heard of his famous pledge 
to make the Federal government--to shrink it so small that you 
can drown it in the bathtub. Everybody's heard of that, and 
you've heard of it too, correct?
    Mr. Trotter. It sounds familiar.
    Mr. Johnson of Georgia. Yes. So, now we've had the DOJ, the 
Federal Trade Commission, the Antitrust Division of DOJ, all 
these Federal agencies that Grover Norquist wants to get rid 
of, wants to shrink so that you can drown it in a bathtub. They 
are the ones responsible for making sure that we don't suffer 
from a lack of competition policy, which leads to consolidation 
in the meat packing industry, which is what we're talking about 
today, correct?
    I mean, if one side wants to cut the Federal government's 
ability to engage in competition policy while the other side is 
talking about where we need more competition policy to prevent 
what we're talking about today that's a basic conflict that's 
hard to resolve.
    Another thing that the government does is to protect food 
quality, safety for Americans. So, if we deregulate the 
Department of Agriculture, as we've been doing, and it hurts 
its ability to actually perform the service that we need it to 
perform, and we're here complaining about the bureaucracy not 
being as quick and agile as it needs to be to deal with small 
meat processors, and it has a lot to do with the shrinkage of 
government, which is something that ALEC has been promoting 
throughout its existence.
    Tell me this, Mr. Gunthorp, chicken processors claim that 
the processors control the system so entirely that the system 
is akin to sharecropping, where the vertically integrated 
poultry companies own most of the supply chain and trap small 
farmers in debt, while keeping the farmers' profit margins at a 
razor-thin edge.
    How has that consolidation hurt family farmers? Have you 
ever been a contract grower?
    Mr. Gunthorp. We've never been a contract grower. I 
ventured off on this wild journey because we would've had a 
choice, could have put up contract barns, and I would quit 
before I'd put up contract barns.
    The farmers--I mentioned earlier it's a feudal serf system. 
They own the mortgage, the mortality, and the manure. That's 
all they own. The opportunities--there's that whole risk-reward 
relationship. They give up some of the risk for no chance at 
any reward. It's not a system that works.
    Mr. Johnson of Georgia. It's really a system of pimping 
that the Federal government has allowed to take place.
    Mr. Gunthorp. Yes, but, let me ask you this question. The 
CDC reports that each year 48 million people get sick from 
foodborne illness, causing 128,000 people to be hospitalized, 
and the result also is the death of $3,000--excuse me--3,000 
people.
    Under the PRIME Act, slaughterhouses and meat processors 
would be able to sell meat within their State without having to 
meet the Federal baseline requirements for commercially sold 
meat.
    If this bill, the PRIME Act, is enacted would instances of 
contaminated meat rise? If so, how could you trace it back to 
the processor? Are States equipped to meet the challenges posed 
by the commercial sale of uninspected meat?
    Mr. Gunthorp. I'd love to see you guys invite me back to--
it's probably not this Committee, but a Committee that we could 
actually talk about food safety from a processor's standpoint. 
We have about a million illnesses from salmonella a year in 
this country. USDA implemented its salmonella performance 
standards in 2011. That number of cases of salmonella has done 
nothing but stay about the same.
    It's a very complex issue, and food safety takes all the 
way from production to the plate to solve, and I don't think 
we've took a holistic approach. USDA takes that approach of 
right there in the middle. Doesn't literally look at 
production. It can't legally, nor can they legally look at it 
after it leaves the plant. It's complex and complicated, and we 
really ought to solve it.
    Mr. Johnson of Georgia. Well, you can blame ALEC for that 
problem.
    Mr. Gunthorp. No, I think it's more complex than that. To 
get back to your other comment it's your guys' job to ensure 
that deregulation doesn't--
    Mr. Johnson of Georgia. We're all Members of ALEC.
    Mr. Gunthorp. Oh, OK. Well, I think it's your guys' job to 
ensure that deregulation doesn't give the big guys free rein to 
do whatever while giving the agencies the tools to harass us. 
That's my argument.
    I'm not a fan of what is, quote,

         . . . text deregulation, because most of the time, from what I 
        see out in the field, it's letting the big guys do what they 
        want while you still allow the tools for the agencies to harass 
        us little guys.

    Ms. Hageman. [Presiding.] Mr. Gunthorp, I appreciate your 
comments and your insight. I agree with you. I think that we do 
need to have a hearing on food safety and address the specific 
issues that you've identified.
    Mr. Gunthorp. A hearing on deregulation on what the 
actual--on the agency capture, because these--I've been 
involved in--I was involved in the Pew/Meridian group that 
looked at a rewrite of food safety inspection laws, because I 
think you have 13 agencies, not just USDA, that deals with all 
the food safety. I was on the National Advisory Committee for 
Meat and Poultry Inspection. These are complex issues--
    Ms. Hageman. They are.
    Mr. Gunthorp. --that we're probably not going to solve 
today, but we ought to take--you eat an elephant one bite at a 
time, and we've got to start.
    Ms. Hageman. Well, then the agency captures something that 
has really affected almost every industry in this country, and 
the livestock packing and food industry is one of them.
    So, I'm going to now recognize Mr. Fitzgerald for five 
minutes of questioning.
    Mr. Fitzgerald. Thank you, Madam Chair.
    I'm going to yield my first minute to Ms. Spartz.
    Ms. Spartz. Thank you.
    As a former proud member of ALEC and State legislator, I 
just wanted to really rebut a little bit what Mr. Johnson just 
said. We're looking here not in a top-down approach. The 
monopoly oligopoly issue was created by government. It's a 
natural--not natural monopoly. We're looking at how we can 
create competition for value bottom up and how we can have more 
quality delivered to consumers. Because, unfortunately, what's 
happening right now, Federal government hasn't been able to 
enforce what they need to do, and they're dealing with core 
functions. All these agencies, including the Federal Trade 
Commission, is dysfunctional. All they're doing, they're 
catering more and more to large special interest groups. They 
become rich and rich, and we are creating oligarchs and cartels 
right here in Congress.
    So, I think we have to know how we can help the little guy 
and create more flexibility and competition on the ground, 
competition for value, and States are much better set up for 
that. Let's deal with issues that are important for this 
institution, like national security, securing the border, 
having strong military, and having good interstate commerce.
    I yield back.
    Mr. Fitzgerald. Reclaiming my time.
    Wisconsin is one of 27 States that offer State-run meat 
inspection programs. As of 2013, participants in the 
Cooperative Interstate Shipment program was over the top. We're 
very supportive of our small meat processors in Wisconsin. I've 
got a handful of them that are within just miles of my home, 
and they do everything from beef to chicken to venison. We have 
a nine-day deer gun season, and there will be a line a mile 
away from the small meat processor trying to do everything from 
hot sticks to venison brats to summer sausage, right. So, 
there's a culture there.
    The result is nearly 500 State, Federal, and custom exempt 
meat processing facilities in Wisconsin that in 2018 processed 
more than 2.2 billion pounds of meat.
    I say this not only to highlight the important work of the 
processors in Wisconsin, but also to stress how impactful 
Federal regs can be on the small processors as well, which you 
hear from all the time.
    So, Mr. Salatin, I thought I'd throw this to you. I know 
it's a big question, but because you have a history of helping 
small processors, do you see a difference in the way that they 
deal with the USDA requirements compared to, obviously, the 
large, the big four, and if they have the capability of dealing 
with these very onerous USDA rules and regulations?
    Mr. Salatin. Yes. The way to deal with them is quite 
different when you're big versus when you're small. I'll give 
you a personal story at our plant. We had our kill floor guy 
retired, and so the second guy moved up. The first day on the 
job, first day for a brand-new inspector--remember when you're 
a small plant, you get the newbies. So, we had a new inspector, 
a lady, and she'd been told, ``Look, you're entering a man's 
world.'' You better make sure that you--so she'd been read the 
Riot Act by her superiors.
    She comes in first day on the job, new kill floor manager. 
Most of the inspectors, they kind of stand back and just kind 
of watch the kill floor, watch the room. Then they're going to 
grab through the guts a little bit. She was hovering right over 
the shoulder, OK, almost like playing piggyback with the guy. 
He was nervous, first day in charge of the kill floor. He 
misses the pig. If you've ever heard of missed pig with a 
captive bolt, if you've ever heard a wounded pig, it's not fun. 
So, he's shaky. He puts a second thing in, hits it, and the pig 
goes down.
    She then goes in and writes us up for a felony level animal 
abuse charge, closes the plant for a week. There's no appeal. 
There's no nothing. We finally got back open. So, we couldn't 
pay our employees. We couldn't serve our customers. People 
didn't eat--all right. We get back open.
    The bottom line is that if our HACCP plan, where it says,

        Administer captive bolt in knot box and then slit throat, step 
        B, if instead it had, A, administer captive bolt; B, if A 
        misses, redo A, we would have been perfectly fine.

As Ms. Bauman said, we don't have the capability--we don't have 
the money to go to all the trade shows and the industry where 
the big guys sit around and play golf and drink and wine and 
dine each other telling them how to game the system. So, we 
didn't know about the option of B in the HACCP plan, 
readminister A, so we get shut down for a week.
    This is the kind of prejudicial thing that happens to us 
small operators routinely. It happens with microbial checking. 
It happens with infrastructure requirements. It happens with 
these kinds of things. That is exactly the kind of thing that 
happens.
    Mr. Fitzgerald. Thank you very much for that answer.
    I yield back, Madam Chair.
    Ms. Hageman. Thank you.
    The Chair now recognizes myself for five minutes of 
questioning.
    One of the things that strikes me as I listen to your 
testimony today and the discussion that we've had is I often 
say that government is always trying to fix its last solution.
    The Federal government, through misguided laws and 
regulations, has created the monopolistic problems that we've 
talked about, the agency capture that has been raised, the 
regulatory burdens that have been discussed, and now we need to 
fix this mess. The PRIME Act is an excellent step in that 
direction.
    Mr. Salatin, if under the PRIME Act farmers and ranchers 
are able to feed their livestock for a longer period of time 
because they're able to sell or contract with the independent 
processors that we've been talking about, rather than a 
feedlot, do you think that there would be benefits to the 
consumers as well?
    Mr. Salatin. That's probably the most unsung story of the 
hearing today is the benefits to the consumer.

    (1)  They wouldn't be subjected to only this oligarchical 
funnel. They would now have lots of options. So, that creates a 
more resilient secure food supply, a more stable food supply 
for shocks and black swan events. All right.
    (2)  They would be able to buy small volumes instead of 
large volumes. So, they wouldn't have to maintain either as 
large a freezer or as large a bank account. It would be a more 
democratic access to people that can't afford the large 
volumes.
    (3)  The price would come down because they don't--because 
it doesn't have to be pushed through this very expensive 
capital and paperwork and regulatory intensive sieve of small 
plant Federal inspection.
    (4)  Finally, that they would know more where their meat 
came from, and there would actually be more overall 
accountability within the system from traceability, 
responsibility.

All those kinds of things would happen because it is a smaller 
relational--it's a more relational intimate transaction rather 
than a nameless, faceless, label on a supermarket shelf.
    Ms. Hageman. Well, I think that's a very good summary. 
Under the Federal program and the Federal laws and regulations 
that have set this up, in Wyoming, we have 12 USDA meat 
processors and 10 State-inspected slaughter facilities. The 
meat that is processed under our State inspection can be bought 
and sold within the State, but not outside of the State.
    Mr. Trotter, is there any reason to believe that there is a 
lesser quality of meat or a less healthy meat or a less safe 
meat that is being produced in our State-regulated facilities?
    Mr. Trotter. The way the current law is set up, the State 
authorities, the State inspectors are held to exactly the same 
standards as their Federal counterparts. The facilities 
themselves are also held to the same standards as their Federal 
counterparts. So, no, it's really up to the same standard. It 
is just a different agency going in and enforcing these 
standards. The agency themselves are reviewed by FSIS and USDA.
    Ms. Hageman. So, it really comes down to just a different 
entity employing the inspector.
    Do you think that Congress should reform the Wholesale Meat 
Act?
    Mr. Trotter. I'm not sure I could comment quite as well as 
some of the other people here on that, but it's something 
definitely worth looking at.
    Ms. Hageman. OK. Do you have any policy recommendations for 
the Subcommittee today?
    Mr. Trotter. I would say that the Subcommittee and 
Congress, in general, has the opportunity here to empower small 
businesses without actually detracting from any Federal 
oversight. At this point, you can empower these small 
companies, the one- or two-person businesses that are 
throughout the Nation, thousands of them, that are able and 
willing and ready to help empower other small businesses, 
restaurants, grocers, and people in their local communities. 
This is not something that necessarily should have Federal 
inspection and Federal--just direct oversight day to day for 
very small parts of the market here.
    There are ways by, essentially, returning this power to the 
States. States can go ahead and set their own standards. That 
is the purpose of State governments and just the concept of 
federalism as a whole.
    Ms. Hageman. Mr. Salatin, you said something today that 
really resonated with me, and you used the word ``freedom.'' 
That is really the foundation of our Constitution and our 
republic. I respect the fact and understand and appreciate your 
understanding of how freedom is related to the very topics that 
we're discussing today.
    All four of you have been wonderful witnesses. We 
appreciate the comments and the commentary that you have 
provided, the personal experiences that you have had, and why 
this is such an important issue, not just for you, not just for 
our small producers, and not just for one segment of our 
industries. This has to do with food supply, this has to do 
with the supply chain, this has to do with being able to 
provide affordable beef, pork, chicken, and venison to the 
citizens of this great country.
    I just truly believe that one of the things that our 
government should be doing is we need to make sure that we are 
adopting policies and regulations and laws that do not increase 
the cost of food, housing, and energy. Your contribution today 
allows us to address one of those very important legs to that 
three-legged stool, and I appreciate it.
    With that, I believe that concludes today's hearing. We 
thank you again for appearing before the Committee today.
    Mr. Johnson of Georgia. If I might, Madam Chair?
    Ms. Hageman. Without--what is it?
    Mr. Johnson of Georgia. I'd just like to make a closing 
comment.
    Ms. Hageman. No. I think that we're just going to go ahead 
and finish the hearing--
    Mr. Johnson of Georgia. Well, the Chair took liberty to do 
a second round of questioning, did she not?
    Ms. Hageman. Oh, no, I didn't. That was my first round of 
questioning. I had Matt Gaetz'--he yielded his time to me. So, 
I did not.
    So, with that--
    Mr. Johnson of Georgia. Well, with a closing statement 
having been rendered by the Chair, I would think that a closing 
statement by the Ranking Member would be appropriate.
    Ms. Hageman. Without objection, all Members will have five 
legislative days to submit additional written questions for the 
witnesses or additional materials for the record.
    So, Mr. Johnson, you have the ability to do that.
    Without objection, this hearing is adjourned.
    [Whereupon, at 12:15 p.m., the Subcommittee was adjourned.]

    All materials submitted for the record by Members of the 
Subcommittee on the Administrative State, Regulatory Reform, 
and Antitrust can be found at: https://docs.house.gov/
Committee/Calendar/ByEvent.aspx?EventID=116086.

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