Former Missouri Democratic Lieutenant Governor Joe Maxwell, who has been a farmer since the 1980s, is calling on the Department of Government Efficiency to investigate commodity checkoff funds, having accused the $1 billion a year fund of being ridden with fraud and abuse.
“While farmers have been paying in billions, literally they have paid in billions of dollars into the commodity checkoff programs, we have lost hundreds of thousands of farmers,” Maxwell, who is with Farm Action Fund, told the Washington Examiner. “These checkoff programs tout that they have as much as $11 or $12 return on investment for every dollar invested, but that return is not going back to the farmer.”
Commodity checkoff funds were created under the Reagan administration for the purpose of the government to fund research, marketing and promotions for the agricultural industry. A prime example of commodity checkoff funds in work would be the Got Milk ad campaign. These funds are managed by the United States Department of Agriculture (USDA), and there are a total of 22 commodity checkoff funds such as the United Soybean Board and the Cattleman’s Beef Board, which collect the money from farmers.
“If I sell something as a farmer, a bushel of soybeans, or I sell a calf or a lamb, money is taken out of my check,” Maxwell said. “It’s a tax right on that animal or that bushel, and then that money goes out to these boards. Those boards then spend that money.”
The National Beef Board collects $1 per every cow sold. The board will then contract with nine organizations like the National Cattleman’s Beef Association, which will then use the funds to conduct “beef promotion, education, and research.”
“All checkoff work is done on a “cost-recovery basis,” meaning that the contracting organizations perform the work first then submit receipts for reimbursement,” Ihrman wrote in an email to the Washington Examiner. “No contractor can earn a profit from the work they conduct. Each contractor must be a verified industry non-profit organization. By law, no funds can be used for policy or lobbying work.”
But Maxwell shared FOIA requests with the Washington Examiner that revealed some organizations that have received checkoff funds illegally used the money for lobbying and also lacked a paper trail of USDA approving funds for promotion and research.
Documents show that the North Dakota Soybean Council, which is responsible for collecting and spending federal checkoff dollars, spent $85,000 in federal checkoff funds for lobbying in 2023.
Missouri Soybean Merchandising and Iowa Soybean Council also failed to show evidence of USDA approval for budgeting or programming, with most of the records redacted.
Meanwhile, documents reveal “a notable lack of materials and evidence of approval of marketing content” by the USDA for Montana Beef Council since 2020.
“A farmer or consumer can’t even find how this money is spent. DOGE can find out how much DOD paid for a hammer, but they will not be able to find how a billion dollars is spent,” Maxwell said.
Maxwell also believes that a conflict of interest exists between having organizations like the National Beef Association handle commodity checkoff funds while also having the organization lobbying, accusing NCBA of lobbying for legislation that serves the best interest of meat packagers.
Four companies — Tysons, Cargill, JBS and National Beef Company — slaughter 85% of the cattle in the United States and face accusations that they are seeking to squeeze out smaller producers in an effort to increase their profits.
NCBA, which 63% of its budget came from checkoff funds in 2023, has lobbied against Mandatory Country of Origin labeling. A USDA report shows that consumers are willing to pay more for beef that is produced in the United States.
“They want to be able to bring in beef from all over the world — Australia, Brazil, Argentina, wherever it might come from, and not let the public know it’s foreign beef,” Maxwell said. “And so NCBA, representing the packers instead of the farmers that have to pay in, even opposes that legislation.”
NCBA also voiced its opposition to measures that would strengthen the Packers and Stockyards Rule, an antitrust law created in the 1920s.
Consolidation in the agricultural sector began in the 1980s when the Reagan administration decided to change how it interrupted antitrust impacting consumers rather than competition between farmers.
“It went from a lens of competition, a good thing, because it’s a market dynamic, to where if the consumer does not benefit, then we don’t care about competition.” Maxwell said.
Between 1985 — the year checkoff funds were established — and 2017, America has lost 43% of its independent family producers, averaging 15,000 per year. The number of feedlots have fallen by 68% between 2002 and 2017, while the number of cattle being fed remained constant.
Meanwhile, NCBA says that without checkoff funds, total domestic beef demand would have been 2.4 billion dollars lower than actual results between 2019 and 2023. NCBA President and Nebraska Cattle Producer says the Beef Checkoff has delivered a return on investment of $13.41 for every $1 invested into the program.
“In additi on to being an effective program that increases beef demand—which helps cattle farmers and ranchers —the Beef Checkoff operates under full oversight of the U.S. Department of Agriculture, uses no taxpayer dollars, and completes annual audits for full transparency,” Wehrbein said in a statement. “Having raised cattle and served as a volunteer leader on the Beef Promotion Operating Committee, I have seen firsthand how the Beef Checkoff supports America’s cattle producers.”
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