Last week’s Empire Press profiled Tom Stahl’s fight to forestall genetically modified wheat from firms such as Monsanto in eastern Washington. Stahl believes growers would be disadvantaged, and I believe he’s right, not just because of gm wheat, but because business and regulatory practices have heaped burdens onto growers.
    The Wenatchee World recently reported lawsuits against Monsanto, which controls as much as 90 percent of some seed genetics. The practices began when Monsanto patented genetically modified seeds so they’d benefit growers with increased characteristics and benefit Monsanto because they couldn’t reproduce.  
    The seeds increase yields and simplify life for growers who no longer have to save seeds to sew. Growers use whatever profit might be left after the harvest to buy Monsanto seeds next year. And growers can more efficiently apply herbicides such as Monsanto’s Round-Up since seeds are unaffected by it.
    Those yields and efficiencies promise growers such value that Monsanto has an irresistible urge to capture part of that value by raising prices of seed where it has quasi-monopoly control. Monsanto’s CEO excited investors by promoting pricing power that leads to increased income.
Consumers are happy with abundant food and lower prices. Monsanto is happy with growth and profits. Investors are happy with increased yields that always raise income.
    Unfortunately, increased yields and efficiencies don’t always increase grower income. Larger yields drive down prices and lower grower income. Growers are pleasing them all with their labor and their debt.
    This reminds me of when Will Rogers was originally thrilled to entertain audiences for $20 per week at a traveling circus. He lost his enthusiasm when he had to pay the circus $.75 per meal or $15.75 per week. Or course he probably saved money by skipping meals. 
    Monsanto defends its right to profit from its patent technology. However if Monsanto abuses that right, the FTC or Department of Justice may restrict that right.
    Monsanto’s second line of defense is to point out that its practices are procompetitive for its competitors and improve consumer welfare through lower prices and innovation.
    Since 1970 those procompetitive arguments, consumer welfare and innovation growth have been the three ideological gods before which courts and regulatory agencies have blessed mergers and acquisitions. For example unregulated financial institutions grew by mergers and acquisitions because they added to consumer welfare. Also permitted have been patents and marketing practices that led to quasi-monopoly companies such as Monsanto.
    Congress sensed something might be wrong with antitrust law that permitted these too-big-to-fail financial companies. And the Federal Trade Commission and the National Academy of Sciences accused the U.S. Patent Office of sloppy approvals of patents, increased processing time and growing backlogs. Poor quality patents and patent processing stifle innovation and competition.
    Taking firm action, Congress appointed an Antitrust Modernization Commission.
    The Commission concluded in the spring of 2007, eight month before the assembled financial firms began to fail, that no changes were needed in antitrust law or patent infringement because data showed that economic efficiencies and innovation were improving consumer welfare. That commission proved Will Rogers’s’ statement once again, “Well, what’s the use of having a lot of statistics and data on something that you don’t know what to do with? That’s the way with commissions.”
    Tolerance of abuse is changing. The Department of Justice is investigating unfair trade practices of faulty financial firms.
    More optimistically, growers should recognize they have the true power. They have the land and the skill to produce food. Eventually courts, Congress and agencies will grant grower welfare equal priority alongside such abstract concepts as competition, innovation and efficiency. When that happens I’ll picture Will Rogers smiling wherever he is.  Meanwhile we need to support Tom Stahl.