April 18, 2014

Poultry Bail Out: Your Tax Dollars are Buying Factory-Raised Cheap Chicken Nobody Else Wants

Frozen Chicken Poultry Bail Out: Your Tax Dollars are Buying Factory Raised Cheap Chicken Nobody Else Wants

Health Impact News Editor Comments: Cheap Chicken is not really cheap! Your tax dollars pay for all the subsidies used to keep factory farmed chicken cheap. And even so, the massive poultry business needed to be bailed out, so the US government just bought $40 million dollars of chicken while politicians talk about reducing the deficit.

By Paul Shapiro

The federal government “steps forward” for its friends in the poultry industry.

A recent headline on meatingplace.com says it all: “USDA buys chicken products to help ailing industry.”

As demand for chicken meat remains far below the number of birds actually being raised and killed, rather than allowing the market to adjust to basic supply and demand principles, the federal government Monday announced it will buy $40 million of unwanted chicken products that will be dumped on our nation’s school kids and others in federal food programs.

In short, chicken-meat companies have continued increasing the number of birds they raise for food while demand has remained flat. Normally, in a free market, an industry that produces beyond what consumers want will contract. But not the poultry industry. It instead relies on regular government support in times like these—and by that I mean nearly all the time.

According to The Wall Street Journal, the buyout, combined with a similar bonus government purchase last year, “gives producers an extra $86 million in government chicken purchases above the roughly $100 million the USDA buys in scheduled chicken purchases for a year.”

And the support isn’t just in terms of buying unwanted product. The poultry industry receives billions in indirect agricultural subsidies that artificially reduce the cost of the most expensive part of their business: corn and soy grown to feed these billions of birds.

The Global Development and Environment Institute at Tufts University estimates that the broiler chicken industry alone saved $1.25 billion in feed costs from 1997 to 2005 just from taxpayer-funded subsidies. Perhaps now that the Congress is more focused on slashing wasteful spending, these unnecessary and fiscally reckless industry handouts may finally be reduced.

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