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Speaker 1: Bloomberg Audio Studios, podcasts, radio news.

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Speaker 2: But besides being a good egg layer, the chicken of

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Speaker 2: tomorrow will be an improved meat producer. Here's an example

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Speaker 2: of the progress that's been made already. Notice how breeding

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Speaker 2: has increased the amount of meat on the breast. Look

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Speaker 2: at that drumstick. This bird was fattened in the same

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Speaker 2: length of time and on the same amount of feed

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Speaker 2: as the other one. Thank your own guess as to

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Speaker 2: which is the more profitable to raise.

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Speaker 3: For much of America's history, chickens look different to the

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Speaker 3: way they do today. They were thin, elegant, even slim

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Speaker 3: and upright. The average bird weighed about two and a

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Speaker 3: half pounds in the nineteen twenties, and chickens were raised

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Speaker 3: differently too, on small farms and homesteads. The birds and

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Speaker 3: their eggs provided a valuable source of extra protein and

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Speaker 3: the occasional Sunday roast for millions of Americans.

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Speaker 4: But today chickens are front loaded feathered freaks. After years

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Speaker 4: of commercial breeding, the weight of your run of the

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Speaker 4: mill roaster has more than doubled to a chunky five

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Speaker 4: or six pounds, way more than chickens of the past.

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Speaker 1: Chickens as our great grandparents would have understood them looked

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Speaker 1: very different from chickens today. They were scrawny, they were rangier,

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Speaker 1: they could move around a barnyard, and they could flap

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Speaker 1: up into trees and avoid predators. And that's almost nothing

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Speaker 1: like the chickens that we eat today. So if you

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Speaker 1: went back to the time of I guess our great grandparents,

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Speaker 1: let's say, at the beginning of the twentieth century, people

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Speaker 1: didn't eat chicken that and that seems very bizarre to

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Speaker 1: us now in the era when there are a million

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Speaker 1: forms of chicken nuggets in the cold case at the

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Speaker 1: supermarket and there's a chicken sandwich on every corner. But

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Speaker 1: chicken used to be kind of special.

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Speaker 3: Welcome to the second installment of Beat Capitalism, our add

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Speaker 3: thoughts special series in which we are examining the US

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Speaker 3: economy through the lens of chicken. If you haven't listened

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Speaker 3: to our first episode where we talked about chicken prices

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Speaker 3: and the consumer experience of eating chickens and eggs, you

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Speaker 3: should definitely go back and do that.

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Speaker 4: In this episode, we're going to focus on the birds

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Speaker 4: themselves and the people that grow them, because chicken actually

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Speaker 4: has a lot to say about the structure of the

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Speaker 4: labor market too, and the relationship between big companies and

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Speaker 4: their workers. And a lot has changed from the backyard

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Speaker 4: birds of yesteryear.

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Speaker 3: To understand what's happened to chickens and the people who

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Speaker 3: grow them, it helps to consider where they started from.

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Speaker 3: Maren McKenna is a journalist and author who specializes in

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Speaker 3: public health, and she wrote a book called appropriately Enough,

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Speaker 3: Big Chicken.

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Speaker 4: As we said, chickens used to be a lot. Smaller

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Speaker 4: families might keep a few egg layers in their backyards,

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Speaker 4: and once the birds reached the end of their laying life,

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Speaker 4: they might be put in the proverbial pot. One key

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Speaker 4: thing is that chicken meat, for a long time was

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Speaker 4: a tree, not a stable.

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Speaker 5: Now.

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Speaker 3: As a rule, older chickens that have been running around

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Speaker 3: a backyard don't usually taste as good. They're leaner, they're chewier,

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Speaker 3: and there just aren't that many of them compared to today's

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Speaker 3: industrial scale farming. But things started to change in the

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Speaker 3: nineteen twenties and nineteen thirties. To satisfy increased demand for

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Speaker 3: chicken meat, farmers started scaling up and raising their birds

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Speaker 3: in big chicken houses. We'll talk more about those in

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Speaker 3: just a little bit.

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Speaker 4: In the nineteen forties, after the Second World War, something

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Speaker 4: big happen on the way to Big Chicken.

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Speaker 1: To understand where the industrialization of chicken comes from, and

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Speaker 1: after that the industrialization of almost all the other proteins

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Speaker 1: that we eat, you really have to go back to

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Speaker 1: the middle to the end of World War II, and

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Speaker 1: a couple of things are happening at the same time.

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Speaker 1: The first is that there's a war on and there's

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Speaker 1: a lot of soldiers and sailors deployed around the globe

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Speaker 1: who need to be fed, so there's a great deal

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Speaker 1: of pressure on meat producers to increase their production. Pressure

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Speaker 1: that goes away when the war is over, and when

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Speaker 1: that guaranteed market from the military forces suddenly vanishes, leaving

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Speaker 1: them pretty over extended. The second is that immediately after

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Speaker 1: World War two, kind of extraordinarily, there are a number

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Speaker 1: of extreme weather events in growing areas around the globe.

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Speaker 1: There are typhoons, there are storms, and this is added

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Speaker 1: to the destruction of growing areas that occurred during the

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Speaker 1: war and the destruction of naval fleets and of fishing vessels.

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Speaker 1: So there's both an over extension of meat production and

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Speaker 1: also a sense of frigility of the food system.

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Speaker 4: It was against this backdrop the biologist Thomas Jukes entered

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Speaker 4: the picture. With more and more chickens now being kept

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Speaker 4: in big houses, the birds were no longer able to

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Speaker 4: forage for bugs and grubs and graints on their own.

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Speaker 4: They needed help to survive indoors, and that's where Jukes

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Speaker 4: comes in.

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Speaker 1: Jukes was attached to a team that had produced the

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Speaker 1: first antibiotic of the tetracyclines that we still use today.

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Speaker 1: It was called oreomycin. He also happened to have been

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Speaker 1: given an assignment to address the dietary needs of chickens

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Speaker 1: because part of the issue of the meat industry feeling

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Speaker 1: over extended after the end of World War II was

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Speaker 1: that they felt they needed to cut costs. This is

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Speaker 1: actually the point at which we start entering in to

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Speaker 1: the part of American agricultural history where livestock starts getting

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Speaker 1: fed a lot of grain, but there was concern that

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Speaker 1: grain didn't have a full nutritional profile, and so they

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Speaker 1: were looking for inexpensive supplements, and in a very famous experiment,

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Speaker 1: Jukes bought a whole bunch of baby chicks, divided them

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Speaker 1: into groups gave each group some kind of supplement that

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Speaker 1: was available on the market at the time, cod liver oil,

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Speaker 1: synthesized vitamins, brewers yeast. To one group, he gave the

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Speaker 1: ground up dried remains of the growing medium in which

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Speaker 1: his company's drug had been made, oreomycin, and when he

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Speaker 1: assessed the results of the experiment on Christmas Day in

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Speaker 1: nineteen forty eight, he found that the chicks in his

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Speaker 1: experiment who'd been given the oreomcein leftovers, had gained more

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Speaker 1: weight than any other set of animals in the experiment,

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Speaker 1: and from that recognition, an entire industry of giving an

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Speaker 1: biotics to animals began. Jukes called that effect growth promotion,

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Speaker 1: and they filed for a patent for the.

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Speaker 3: So The introduction of growth promoters helped the birds survive

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Speaker 3: the great indoors and get bigger. But that wasn't the

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Speaker 3: last of the chicken revolution.

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Speaker 1: One was that chickens themselves changed physically, thanks largely to

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Speaker 1: the US Department of Agriculture, which in the late nineteen

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Speaker 1: forties and early nineteen fifties sponsored a contest among chicken

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Speaker 1: breeders called the Chicken of Tomorrow.

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Speaker 2: Help in developing the Chicken of tomorrow. You can't take

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Speaker 2: it regretted that every hand is earning her keeper. Even

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Speaker 2: though laying an egg ought to be easy for any.

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Speaker 1: Chicken, that's a few thing big twe.

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Speaker 2: Well.

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Speaker 6: Anyhow, the idea of.

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Speaker 1: The Chicken of Tomorrow contest was to make chickens meteor

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Speaker 1: to produce a bird that would have more breast, that

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Speaker 1: would have big enough to feed a family, which was

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Speaker 1: kind of hard at that point for a four or

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Speaker 1: five person family to eat one chicken and be satisfied,

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Speaker 1: and also to be very predictable in a number of ways,

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Speaker 1: to be a single breed. And after a couple of

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Speaker 1: years of competition, the Chicken of Tomorrow Contest produced the

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Speaker 1: prototype for the most of the chickens that are raised today.

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Speaker 1: Blocky muscles, white feathered, docile, not interested in running around

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Speaker 1: a barnyard and flapping up into a tree, content to

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Speaker 1: sit in one place.

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Speaker 4: So antibiotics and breeding helped turn the chicken of tomorrow

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Speaker 4: into the chicken of today.

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Speaker 3: Well that's not quite all. Actually, a lot of things

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Speaker 3: were happening on the chicken innovation front around that time.

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Speaker 1: The second thing that drove the difference between the Chicken

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Speaker 1: of yesterday and the chicken of tomorrow is that we

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Speaker 1: changed our orientation to how we eat chicken from buying

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Speaker 1: birds that were whole and had to be roasted or

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Speaker 1: cut up into pieces and had to be pan fried

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Speaker 1: or broiled into a source of protein that was disassembled

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Speaker 1: at the manufacturing level into things like nuggets, so that

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Speaker 1: people could consume chicken without having to deal with the

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Speaker 1: physical reality of a chicken.

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Speaker 3: It's hard to imagine a world without chicken nuggets now,

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Speaker 3: but as Marin lays out, it wasn't until the nineteen

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Speaker 3: sixties that these became a thing, and it was a

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Speaker 3: very deliberate decision. After all, if you want to sell

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Speaker 3: more chicken, you have to get people to eat more chicken,

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Speaker 3: and one way of doing that is giving them more

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Speaker 3: options to consume it. And then boom, the chicken nugget

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Speaker 3: was born, and these little nuggets of chicken proved to

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Speaker 3: be pure gold for some businesses like McDonald's McDonald's, Yes

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Speaker 3: and Joe. You might be surprised to find out that

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Speaker 3: McDonald's didn't actually invent the chick and nugget. Here's Marin again.

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Speaker 1: So we all think of the chicken nugget as a

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Speaker 1: creation of McDonald's, and certainly McDonald's would claim that the

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Speaker 1: chicken nugget is their thing. Introduced in the late seventies,

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Speaker 1: by nineteen eighty they were blowing the doors off in

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Speaker 1: the McDonald's restaurants where they were sort of secretly introduced.

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Speaker 1: But it's pretty widely understood in the poultry industry that

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Speaker 1: McDonald's shouldn't get all the credit because the prototype, the

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Speaker 1: predecessor of the McDonald's chicken nugget, was actually invented by

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Speaker 1: a kind of tinkereer scientist in a basement laboratory at

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Speaker 1: Cornell University, a guy named Robert Baker, who was not

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Speaker 1: primarily interested in chicken, but rather was interested in essentially

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Speaker 1: how to avoid food waste. And he was very troubled

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Speaker 1: by how much of the carcass of a chicken goes

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Speaker 1: to waste, and he wanted to find ways to use

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Speaker 1: as much of the carcass as possible, as much of

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Speaker 1: the meat on the carcass as possible. And he came

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Speaker 1: up in this basement laboratory with a bunch of graduate

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Speaker 1: students with things that we now take for granted in

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Speaker 1: supermarkets chicken, bacon, chicken cold cuts, chicken sausages. But his

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Speaker 1: signature contribution to the future of chicken was a thing

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Speaker 1: that he called the chicken stick, modeled some degree on

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Speaker 1: fish sticks, which had been introduced about ten years earlier.

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Speaker 1: The chicken stick was chopped, formed, pressed chicken meat sucked

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Speaker 1: off the bones, covered with a breaded coating, frozen and

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Speaker 1: frozen in such a way that when you took it

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Speaker 1: out of the freezer and fried it or baked it,

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Speaker 1: the coating wouldn't disassemble from the rest of the meat.

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Speaker 1: That was a kind of secret process that Baker invented,

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Speaker 1: but it didn't stay a secret. It was released in

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Speaker 1: an agricultural extension bulletin that Cornell published and sent all

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Speaker 1: over the country. They didn't in any way attempt to

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Speaker 1: keep any ip in this, and as a result, the

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Speaker 1: idea of something that looked like at chicken nugget was

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Speaker 1: out there in the world, and seventeen years later out

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Speaker 1: came the McDonald's snugget.

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Speaker 3: Suddenly a lot more of a chicken could be used,

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Speaker 3: and thanks to antibiotics and breeding, there was more chicken

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Speaker 3: around to sell.

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Speaker 4: One way to think about it is that raising chickens

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Speaker 4: went from being a really small scale agriculture process to

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Speaker 4: more of an industrial thing. There's a reason it's called

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Speaker 4: factory farming, after all. The idea is to produce as

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Speaker 4: much meat as you can at the lowest possible cost,

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Speaker 4: and then use it as efficiently as possible. And to

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Speaker 4: do that you need standardization, new technology in the form

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Speaker 4: of growth promoters and scale.

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Speaker 1: I really think we can say that it's because of

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Speaker 1: antibiotic use that we have the modern industrial scale meat

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Speaker 1: production that we have today. Without that early use of

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Speaker 1: antibiotics as growth promoters, no one would have understood that

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Speaker 1: you could actually produce animals almost like widgets in a

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Speaker 1: kind of Henry Ford model. And so once people moved

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Speaker 1: to doing that, then it made sense for farms to

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Speaker 1: get larger and for profit to increase. And for farms

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Speaker 1: to get larger, you had to protect animals against being

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Speaker 1: held in more crowded conditions than they traditionally would have

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Speaker 1: been in smaller open farms.

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Speaker 3: The upside of all of this is that we get

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Speaker 3: plentiful white meat, all the stuff that goes into delicious

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Speaker 3: sandwiches and convenient chicken nuggets. The downside is a lot

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Speaker 3: of that comes at the expense of the animals themselves,

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Speaker 3: and as we're about to see, also the farmers who

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Speaker 3: grow them. There's another seminal moment in the transformation of

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Speaker 3: America's chicken industry, one that has more to do with

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Speaker 3: where they're grown and by whom.

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Speaker 4: In nineteen twenty three, a Delaware housewife by the name

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Speaker 4: of Cecil long Steel by the way, great name, got

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Speaker 4: a surprise in the mail. She had ordered fifty baby chicks,

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Speaker 4: but the mailman came to her door with five hundred

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Speaker 4: chicks instead.

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Speaker 3: Instead of sending the hundreds of extra chicks back in

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Speaker 3: the mail, Cecil decided to make do. She kept them

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Speaker 3: in a cardboard box and set about building a shed

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Speaker 3: to house them. Over the next five months or so,

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Speaker 3: she raised the chicks to adulthood, fattening them up and

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Speaker 3: eventually selling them to local hotels and restaurants as a

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Speaker 3: delicious meal. Then she decided to do it all over again.

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Speaker 3: Soon she was ordering one thousand chicks, then ten thousand,

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Speaker 3: and then she just kept going.

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Speaker 4: So what Cecil pioneered is the first broiler house, a

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Speaker 4: big step in the history of poultry farming. Today, chickens

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Speaker 4: are raised in huge barns that cost large amounts of

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Speaker 4: money to build, and in order to keep these big

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Speaker 4: barns filled with chickens, farmers have to participate in something

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Speaker 4: called the tournament system.

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Speaker 3: In fact, everything about modern chicken is big. In the

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Speaker 3: tournament system, farmers get baby chicks from large chicken breeders

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Speaker 3: they're called integrators companies like Tyson, Purdue or Pilgrim's Pride,

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Speaker 3: and then they raise them using feed and growth promoters

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Speaker 3: sent to them by those same companies. Eventually, the mature

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Speaker 3: birds are handed back to the chicken company that sold

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Speaker 3: them as babies and they fulfill their chicken destiny of

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Speaker 3: becoming sandwiches, nuggets, or other snacks.

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Speaker 6: Basically, what we do is we supply the buildings and

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Speaker 6: the labor and all the stuff needed to actually raise

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Speaker 6: birds for these big what they call integrators or chicken

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Speaker 6: companies like a Tyson or Purdue. Tyson or Purdue actually

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Speaker 6: owns the chicks, and they actually own the feed and

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Speaker 6: vaccinations and that sort of thing.

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Speaker 3: Meet Craig Watts. He's a former contract poultry producer who

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Speaker 3: raised chickens in North Carolina. As part of the tournament system.

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Speaker 6: We just basically get them on what lack of better terms,

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Speaker 6: consignment there, there's just a few hours old. When we

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Speaker 6: get them and we raise them up to market age.

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Speaker 6: They give us some guidelines on doing that, and then

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Speaker 6: they come pick them up, and then we get ready

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Speaker 6: and start all over again.

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Speaker 4: It all sounds pretty simple and efficient, and the integrators

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Speaker 4: themselves argue that they're basically taking on the messier, more difficult,

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Speaker 4: and more capital intensive parts of the chicken business, like

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Speaker 4: hatching chicks, transporting them back and forth to farmers, and

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Speaker 4: then processing them into chicken nuggets and so on.

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Speaker 3: So that's the tournament system, but Craig Craig calls it

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Speaker 3: something different.

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Speaker 6: Basically, what it boils down to is who can get

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Speaker 6: the chicken to the plant the quickest, Who can get

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Speaker 6: that chicken the fattest on the least amount of feed

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Speaker 6: least amount of feed meaning least amount of cost. So

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Speaker 6: and that sounds perfect. I mean, you figure things out,

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Speaker 6: you grasp concepts, you tweet things, do what you have

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Speaker 6: to do, and if you work smarter and you work

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Speaker 6: harder than the next guy, you're gonna get compensated a

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Speaker 6: little more perfect.

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Speaker 2: Right.

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Speaker 6: The problem is, there's the flaw in this whole tournament

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Speaker 6: system scenario. I call it thunder doom. It's ten men

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Speaker 6: enter and five men leave. Because every week, if you

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Speaker 6: have ten growers go out, you're gonna have some that

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Speaker 6: make at or above the base pay, which is my

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Speaker 6: base pay, well I think was around five cents a

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Speaker 6: pound at that time. Then you're going to have five

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Speaker 6: or so out of the ten that are at base

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Speaker 6: or below. Right, so they take the bonuses to the

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Speaker 6: five growers that are above average, is taking the pay

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Speaker 6: of the growers that are below average. So for the company,

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Speaker 6: it's a zero sum game. They're only going to have

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Speaker 6: a nickel invested in a pound. A pie, so to speak,

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Speaker 6: is finite. The size of the pie is finite. The

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Speaker 6: farmer is fighting for the slice.

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Speaker 4: So in the tournament system, you're basically graded on a curve.

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Speaker 4: If you're a chicken farmer who does well relative to

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Speaker 4: other growers in the area, you'll get more money from

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Speaker 4: the pot, and the ones who do badly you get

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Speaker 4: less money from the same pot. So you want to

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Speaker 4: be ranked higher relative to other growers.

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Speaker 3: When Craig decided to become a farmer, heating against his

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Speaker 3: fellow chicken growers for pay wasn't quite what he had

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Speaker 3: in mind. In fact, let's go back to how Craig

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Speaker 3: got into the chicken business in the first place, back

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Speaker 3: when he saw a big opportunity when Purdue started building

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Speaker 3: a processing plant just seven miles south of his home.

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Speaker 6: They were looking for farmers to contract. We had to

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Speaker 6: build buildings to raise their birds. I saw advertisement in

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Speaker 6: the paper. I called the representative. We had a meeting.

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Speaker 6: He gave me an income and expense kind of pro

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Speaker 6: form a sheet. It wasn't get rich quick. I took

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Speaker 6: it to my accountant. He cash floated there again. It

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Speaker 6: was steady, but it wasn't get rich. But it was enough.

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Speaker 6: And the guy at farm Credit was excited about the

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Speaker 6: possibility of poetry moving the entire area. He told me

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Speaker 6: it was the best thing that might be the best

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Speaker 6: thing that ever happened to farm in Robinson County.

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Speaker 3: So there was Things went okay at first. Craig spent

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Speaker 3: his days monitoring his birds, making sure they weren't overheating

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Speaker 3: or getting sick, or eating too much or too little,

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Speaker 3: basically following the instructions and the chicken growing rules sent

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Speaker 3: by Perduit.

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Speaker 6: Well, the first thing I would do, I would wake

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Speaker 6: up and I would go and I would open all

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Speaker 6: the houses up and I would just basically stick my

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Speaker 6: head in the look and then I would and then

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Speaker 6: we had a control room that the monitor things from,

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Speaker 6: and I would make sure that the controller was set properly.

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Speaker 6: They call it a computer, but it's basically a glorifly

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Speaker 6: thermostat basically where you can control all the temperature settings,

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Speaker 6: fan settings, that kind of stuff from a central location.

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Speaker 6: So I would I would look at all that and

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Speaker 6: make sure everything was right, you know, take a sniff test,

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Speaker 6: you know, is ammonia up, is it good? You know?

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Speaker 6: Is the house too humid? You know? And what did

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Speaker 6: the birds look like? Are they spread out comfortable? Are

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Speaker 6: they active or are they just huddled up? Or are

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Speaker 6: they panting? I mean, it was just it was just

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Speaker 6: a lot of observations. Initially I would have to run

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Speaker 6: to kids to school, but then when i'd come back,

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Speaker 6: the next thing I would do. I'd actually physically walk

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Speaker 6: through the houses and I would look for birds that

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Speaker 6: had died or maybe were deformed, or just maybe weren't

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Speaker 6: performing as they should. Either I pick up the dead

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Speaker 6: or we would have to call out and just just

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Speaker 6: a nice word for kill birds that weren't going to

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Speaker 6: make it the entire six weeks, you know, for whatever reason.

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Speaker 4: But there was a limit to what Craig could do

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Speaker 4: for his flock. After all, the integrators are the ones

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Speaker 4: sending him the baby birds themselves. They owned the chickens,

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Speaker 4: and they're the ones making decisions about what they eat,

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Speaker 4: what medicines they get, what conditions they're kept in, and

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Speaker 4: how much room they have to grow up in.

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Speaker 6: The deal was is each of my houses were twenty

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Speaker 6: thousand square feet. Well, they put thirty thousand birds in

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Speaker 6: every house, so when those chickens were they had the

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Speaker 6: same amount of space all the time. But when they

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Speaker 6: got market age, I mean it was walled a wall

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Speaker 6: in to end, just a sea of white chickens. So

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Speaker 6: if you do the math, thirty thousand chickens and twenty

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Speaker 6: thousand square feet is zero point sixty seven square foot

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Speaker 6: per bird. So there's issues within the structure of the

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Speaker 6: system that I had no control over that. It's not cruel,

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Speaker 6: but it's not about quality of life for an animal

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Speaker 6: by any means. It's about homogenizing a widget and getting

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Speaker 6: it to the plant. These chickens traits have been selected

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Speaker 6: over the years. The word that what they are. The

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Speaker 6: Americans desire for white meat is what drove what we

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Speaker 6: call the frankin chicken. The breast is very large, it's

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Speaker 6: oversized compared the rest of his body. They do have

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Speaker 6: trouble standing and they're very docile. They're not a hearty breed.

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Speaker 6: I mean, they're bread to just barely stay alive long

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Speaker 6: enough to get to the plant. So what they do

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Speaker 6: is they take a bite of feed, they take a

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Speaker 6: drink of water. They sit down. I called it three

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Speaker 6: steps and flop boom, boom, boom boom, sit down. That's

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Speaker 6: what they do all day.

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Speaker 4: In two thousand and eight, Craig reached a tipping point

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Speaker 4: frustrated by a particularly feeble flock of floppy chicken.

390
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Speaker 3: Sentence say that ten times fast yo.

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Speaker 4: Frustrated by a particularly feeble flock of floppy chickens, he

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Speaker 4: filmed the conditions in his own chicken house and uploaded

393
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Speaker 4: them to YouTube to send to his production manager at Purdue.

394
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Speaker 4: Soon after, he partnered with a reporter and an animal

395
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Speaker 4: rights activist produce an expose on chicken farming.

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Speaker 7: Craig has no control over the health or genetics of

397
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Speaker 7: the chicks that are delivered to him by Purdue. Bound

398
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Speaker 7: by contract, Craig is not even allowed to give them

399
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Speaker 7: sunshine or fresh air. Just thirty seven days later, they

400
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Speaker 7: are a sea of panting birds. Panting indicates birds are overheated.

401
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Speaker 7: These birds find it too painful to bear the weight

402
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Speaker 7: of their unnaturally large breasts on their legs.

403
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Speaker 3: Craig Watts ultimately prove to be something of a renegade.

404
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Speaker 4: For its part, a Produced spokeswoman said it works with

405
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Speaker 4: over eighteen hundred poultry farmers and the retention rate with

406
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Speaker 4: those contracts is around ninety eight percent. In a statement

407
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Speaker 4: to odd Lats, they also said it's been nearly ten

408
00:22:47,880 --> 00:22:50,800
Speaker 4: years since Watts was a farmer for Purdue, and in

409
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Speaker 4: that time it has established farmer advisory councils to gather

410
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Speaker 4: important feedback and insights from them on how the company

411
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Speaker 4: can improve.

412
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Speaker 3: But Craig's complaints about the imbalance of power in the

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Speaker 3: poultry industry and the health of the birds are things

414
00:23:04,800 --> 00:23:07,800
Speaker 3: that come up again and again in our conversations with

415
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Speaker 3: chicken farmers. For instance, Karen Crutchfield, she goes by Susie,

416
00:23:13,240 --> 00:23:16,040
Speaker 3: was a contract grower for Tyson for many years, but

417
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Speaker 3: she started out raising cows.

418
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Speaker 8: We already had a cattle farm, and so we wanted

419
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Speaker 8: to kind of expand out and add something else, some

420
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Speaker 8: more income coming in. The difference in farming cattle and

421
00:23:33,880 --> 00:23:38,760
Speaker 8: farming chickens is farming cattle, you own all the inputs.

422
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Speaker 8: You own, the cattle get you on the feed. You

423
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Speaker 8: decide what type of cattle you're going to buy. You

424
00:23:45,960 --> 00:23:49,040
Speaker 8: decide what time they leave your farm, You decide the

425
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Speaker 8: breeding periods. All of it is decided, but you and

426
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Speaker 8: you are a truly independent cattle farmer. You're independent. You

427
00:23:56,960 --> 00:23:59,399
Speaker 8: don't have nobody giving you orders or telling you what

428
00:23:59,440 --> 00:24:03,800
Speaker 8: you need, what size, what kind of feed. With chickens,

429
00:24:03,800 --> 00:24:07,120
Speaker 8: it's totally different. With chickens. You have no control over

430
00:24:07,200 --> 00:24:10,520
Speaker 8: any of the inputs. They deliver the chickens at third time,

431
00:24:10,840 --> 00:24:13,040
Speaker 8: they give them the feed that they want them to have,

432
00:24:13,119 --> 00:24:15,760
Speaker 8: They pick them up on their time. They tell you

433
00:24:15,800 --> 00:24:19,080
Speaker 8: what to do in controlling the inputs in the house,

434
00:24:19,200 --> 00:24:21,920
Speaker 8: what temperature it needs to be, what size you need

435
00:24:21,920 --> 00:24:24,520
Speaker 8: to let them out into full house. They control all

436
00:24:24,640 --> 00:24:29,200
Speaker 8: of the inputs. You were only a serf more or less.

437
00:24:29,320 --> 00:24:31,080
Speaker 8: You just have to do what they tell you. And

438
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Speaker 8: actually it's more like your employee of theirs.

439
00:24:34,600 --> 00:24:38,000
Speaker 3: So for Susie, following the instructions of the chicken integrator

440
00:24:38,119 --> 00:24:41,200
Speaker 3: was a must because if you don't, you risk losing

441
00:24:41,280 --> 00:24:43,800
Speaker 3: out on that contract and you might not have any

442
00:24:43,840 --> 00:24:45,720
Speaker 3: other companies to sell chickens too.

443
00:24:46,480 --> 00:24:49,800
Speaker 8: For poltry goers, there is no option of going independent

444
00:24:50,640 --> 00:24:52,920
Speaker 8: because there's nothing you can do with your barns except

445
00:24:52,960 --> 00:24:57,800
Speaker 8: raised chickens for Tyson or whatever integrator as the occasion

446
00:24:57,920 --> 00:25:01,720
Speaker 8: had to be. In my area, Tyson was the only

447
00:25:01,760 --> 00:25:04,040
Speaker 8: company in the area that we could go to. So

448
00:25:04,119 --> 00:25:06,440
Speaker 8: if your houses was shut down, they were just shut down.

449
00:25:06,680 --> 00:25:09,199
Speaker 8: You had nowhere else to go or anything else you

450
00:25:09,200 --> 00:25:11,880
Speaker 8: could do with your barns other than maybe put hay

451
00:25:11,960 --> 00:25:14,480
Speaker 8: in them. That was the only option you had. You

452
00:25:14,520 --> 00:25:16,000
Speaker 8: could not grow chickens in them.

453
00:25:16,400 --> 00:25:18,879
Speaker 4: Again, the barns are really expensive and the farmers are

454
00:25:18,920 --> 00:25:20,880
Speaker 4: often on their own when it comes to building them,

455
00:25:21,040 --> 00:25:23,840
Speaker 4: even though the integrators may be the ones asking for improvements,

456
00:25:24,240 --> 00:25:25,840
Speaker 4: which is exactly what happened to Susie.

457
00:25:27,200 --> 00:25:32,760
Speaker 8: Tyson Food started doing upgrades probably in the mid nineties,

458
00:25:33,720 --> 00:25:36,679
Speaker 8: and each time they decided to do an upgrade, it

459
00:25:36,800 --> 00:25:41,480
Speaker 8: kept costing more money. It was bigger upgrades than before,

460
00:25:42,200 --> 00:25:45,440
Speaker 8: and so the last upgrade that they called for us

461
00:25:45,480 --> 00:25:49,760
Speaker 8: to do was in twenty ten. They sent a letter

462
00:25:49,800 --> 00:25:54,000
Speaker 8: out saying that we had to do all of these upgrades.

463
00:25:54,440 --> 00:25:57,560
Speaker 8: One of the upgrades that they requested us to do

464
00:25:57,760 --> 00:26:02,080
Speaker 8: at the time was add two extra royal lights, just

465
00:26:02,160 --> 00:26:04,679
Speaker 8: one massive upgrade, and it was going to end up

466
00:26:04,720 --> 00:26:08,520
Speaker 8: costing us over three hundred thousand dollars to upgrade, and

467
00:26:08,600 --> 00:26:11,720
Speaker 8: that would actually cost on the two older houses that

468
00:26:11,720 --> 00:26:13,800
Speaker 8: were built in eighty seven, it was going to cost

469
00:26:13,880 --> 00:26:18,200
Speaker 8: us more than we had originally built the houses for

470
00:26:18,280 --> 00:26:22,919
Speaker 8: them for. And so at that point we said, no,

471
00:26:23,160 --> 00:26:26,240
Speaker 8: we're not going to do any more upgrades. The incentive

472
00:26:26,280 --> 00:26:29,600
Speaker 8: for Tyson to ask for upgrades is keep the grower

473
00:26:29,720 --> 00:26:32,400
Speaker 8: in debt. As long as the grower's in debt, they're

474
00:26:32,440 --> 00:26:35,040
Speaker 8: going to do exactly what Tyson tells them. If they

475
00:26:35,080 --> 00:26:38,760
Speaker 8: get out of debt, then they have more freedom to

476
00:26:38,800 --> 00:26:40,480
Speaker 8: say no, I don't want to do that, and I'm

477
00:26:40,520 --> 00:26:43,240
Speaker 8: not going to do that. And if they catch you off,

478
00:26:43,359 --> 00:26:46,359
Speaker 8: then you've got everything paid for. But if you're a

479
00:26:46,440 --> 00:26:48,480
Speaker 8: million dollars in debt and going to lose your home,

480
00:26:48,520 --> 00:26:53,959
Speaker 8: you're more likely to do what they say.

481
00:26:54,720 --> 00:26:57,840
Speaker 4: A Tyson spokesperson did respond for comment. When we reached out,

482
00:26:57,960 --> 00:27:01,280
Speaker 4: they said, and I quote, Foods contracts with a network

483
00:27:01,320 --> 00:27:04,240
Speaker 4: of thousands of independent growers across the country, and we

484
00:27:04,320 --> 00:27:07,080
Speaker 4: value the contributions that these growers make to our business.

485
00:27:07,520 --> 00:27:09,879
Speaker 4: We depend on growers, and the contracts we have in

486
00:27:09,920 --> 00:27:12,679
Speaker 4: place incentivized growers to raise high quality birds.

487
00:27:13,800 --> 00:27:17,000
Speaker 3: One contract grower who did lose it all is Michael Diaz.

488
00:27:17,680 --> 00:27:20,639
Speaker 3: The Diasas used their life savings to put down a

489
00:27:20,720 --> 00:27:24,040
Speaker 3: deposit on fifty acres of land back in twenty eighteen,

490
00:27:24,560 --> 00:27:27,760
Speaker 3: with a home and four chicken houses. It was supposed

491
00:27:27,800 --> 00:27:29,520
Speaker 3: to be agricultural bliss.

492
00:27:31,400 --> 00:27:34,560
Speaker 5: Farming was something that I had always dreamed of doing,

493
00:27:35,080 --> 00:27:38,240
Speaker 5: but it wasn't something that I saw as being very

494
00:27:38,280 --> 00:27:44,240
Speaker 5: feasible to do given the monetary constraints. I mean, you

495
00:27:44,280 --> 00:27:46,320
Speaker 5: need a large piece of property. You needed to make

496
00:27:46,359 --> 00:27:48,600
Speaker 5: a lot of capital investments to get into any kind

497
00:27:48,600 --> 00:27:51,720
Speaker 5: of farming. The magnitude of what we had bought didn't

498
00:27:51,800 --> 00:27:58,879
Speaker 5: sink in. But there were other farmers in the area.

499
00:27:59,000 --> 00:28:03,360
Speaker 5: They weren't poultry farmers, but some of them knew of

500
00:28:03,400 --> 00:28:07,800
Speaker 5: some poultry farms. They were friends with some of these guys,

501
00:28:08,680 --> 00:28:12,720
Speaker 5: and there was always this kind of this thought process

502
00:28:12,800 --> 00:28:16,000
Speaker 5: that these guys that own these poultry farms that you know,

503
00:28:16,080 --> 00:28:18,840
Speaker 5: these barns are fifty by five hundred feet long, and

504
00:28:20,000 --> 00:28:22,679
Speaker 5: some of them bigger than that. You know, you always

505
00:28:22,680 --> 00:28:25,119
Speaker 5: felt like they were because they had a lot of

506
00:28:25,160 --> 00:28:28,880
Speaker 5: capital investments. You thought they must have had good cash flow,

507
00:28:28,920 --> 00:28:32,239
Speaker 5: they must have been living good lives. They were in

508
00:28:32,320 --> 00:28:36,320
Speaker 5: contract with some of these household brands that you see

509
00:28:36,359 --> 00:28:39,760
Speaker 5: on every grocery store shelf that you tend to start trusting,

510
00:28:39,840 --> 00:28:46,440
Speaker 5: right you see these names. You know, I'll pick on others.

511
00:28:46,480 --> 00:28:49,000
Speaker 5: You know, you see a name like Heinz Ketchup, or

512
00:28:49,000 --> 00:28:53,680
Speaker 5: you see a name like Hormel or whatever. What I'm

513
00:28:53,720 --> 00:28:56,880
Speaker 5: trying to allude to is you see these brands that

514
00:28:56,920 --> 00:29:00,600
Speaker 5: have been in your face year after year from childhood

515
00:29:00,600 --> 00:29:04,320
Speaker 5: to adulthood, a staple in our food system. Say you

516
00:29:04,400 --> 00:29:06,680
Speaker 5: tend to trust these brands or doing the right thing.

517
00:29:07,360 --> 00:29:10,320
Speaker 4: But Michael's integrator kept asking for more investments, and he

518
00:29:10,360 --> 00:29:13,200
Speaker 4: struggled to keep up on this loan payment. Michael thinks

519
00:29:13,200 --> 00:29:16,040
Speaker 4: he spent something like one hundred thousand dollars on unexpected

520
00:29:16,120 --> 00:29:17,840
Speaker 4: upgrades in just two years.

521
00:29:18,480 --> 00:29:21,760
Speaker 5: I kept thinking that this is just going to sink

522
00:29:21,840 --> 00:29:25,240
Speaker 5: me deeper and deeper and deeper and deeper into debt.

523
00:29:25,680 --> 00:29:28,240
Speaker 5: This dream of me being able to pay this place

524
00:29:28,320 --> 00:29:32,840
Speaker 5: off and eventually build something that's generational for my family

525
00:29:32,960 --> 00:29:35,640
Speaker 5: is not going to exist, and I said, I'm not

526
00:29:35,680 --> 00:29:35,920
Speaker 5: doing it.

527
00:29:36,040 --> 00:29:39,480
Speaker 3: Michael Diaz ended up selling the farm, losing his life

528
00:29:39,560 --> 00:29:43,120
Speaker 3: savings in the process. He later sued his integrator, arguing

529
00:29:43,120 --> 00:29:46,240
Speaker 3: that chicken farmers in the tournament system should be classified

530
00:29:46,280 --> 00:29:51,520
Speaker 3: as employees of integrators instead of independent contractors. That litigation

531
00:29:51,800 --> 00:29:52,560
Speaker 3: is still pending.

532
00:29:53,240 --> 00:29:56,320
Speaker 4: Susie Crutchfield filed for bankruptcy and is still paying off

533
00:29:56,320 --> 00:30:00,000
Speaker 4: her debt. Interestingly, Craig Watts didn't lose his chicken farming

534
00:30:00,080 --> 00:30:03,560
Speaker 4: contract with Purdue after filming his barns, but the relationship

535
00:30:03,600 --> 00:30:08,480
Speaker 4: obviously soured. Craig filed a whistleblower complaint Purdue countersuit that's

536
00:30:08,560 --> 00:30:09,120
Speaker 4: pending too.

537
00:30:09,680 --> 00:30:11,840
Speaker 3: All three of them are now part of the Socially

538
00:30:11,880 --> 00:30:16,600
Speaker 3: Responsible Agriculture Project SRAP, where they work on a contract

539
00:30:16,640 --> 00:30:20,720
Speaker 3: Grower Transition program, which aims to help poultry farmers navigate

540
00:30:20,760 --> 00:30:25,120
Speaker 3: the thunderdome and the pile of manure, both figurative and literal,

541
00:30:25,400 --> 00:30:28,080
Speaker 3: that comes with it. Here's Michael Diez again.

542
00:30:28,920 --> 00:30:32,800
Speaker 5: The person that has all the risk, all the liability

543
00:30:33,680 --> 00:30:36,720
Speaker 5: is the farmer. He's the one that's in debt for

544
00:30:36,760 --> 00:30:39,520
Speaker 5: these barns. He's the one that's in debt for all

545
00:30:39,560 --> 00:30:43,160
Speaker 5: the facilities, the upgrades, the equipment. He's the one that's

546
00:30:43,200 --> 00:30:45,440
Speaker 5: in debt that he's got to figure out, what in

547
00:30:45,440 --> 00:30:47,800
Speaker 5: the world do I do with all this manure that

548
00:30:47,840 --> 00:30:50,040
Speaker 5: I have here on this on this site. I've got

549
00:30:50,080 --> 00:30:51,960
Speaker 5: to get rid of at half of them have nothing

550
00:30:52,000 --> 00:30:55,080
Speaker 5: that they can do with it. Everything that is that

551
00:30:55,240 --> 00:31:00,280
Speaker 5: is a liability the farmer has. The integrator is the

552
00:31:00,280 --> 00:31:02,640
Speaker 5: only one that's got anything that's able to build a profit.

553
00:31:12,760 --> 00:31:15,520
Speaker 3: That is not the sound of chickens, clearly, but I

554
00:31:15,600 --> 00:31:19,160
Speaker 3: promise it will be relevant in a second contract growers

555
00:31:19,200 --> 00:31:22,360
Speaker 3: in the poultry world carry most of the potential downside

556
00:31:22,440 --> 00:31:26,560
Speaker 3: risks of chicken farming, while big chicken the integrators, enjoy

557
00:31:26,640 --> 00:31:29,760
Speaker 3: most of the upside. They hog the benefits and pass

558
00:31:29,800 --> 00:31:32,720
Speaker 3: on the risks, and that model is becoming more common,

559
00:31:33,320 --> 00:31:36,080
Speaker 3: as the state of pig farming in Iowa shows.

560
00:31:36,280 --> 00:31:38,600
Speaker 4: At any given time, there are some twenty eight million

561
00:31:38,720 --> 00:31:41,600
Speaker 4: hogs being raised in Iowa, making it America's biggest pig

562
00:31:41,640 --> 00:31:44,840
Speaker 4: farming state, Iowa now produces nearly a third of America's

563
00:31:44,880 --> 00:31:46,040
Speaker 4: total hog supply.

564
00:31:46,160 --> 00:31:49,720
Speaker 3: And speaking of manure, Iowa's pig population and what it

565
00:31:49,800 --> 00:31:54,080
Speaker 3: produces has become a big debate. People generally don't want

566
00:31:54,080 --> 00:31:56,920
Speaker 3: to live next to big pig farms for obvious reasons,

567
00:31:57,200 --> 00:32:00,719
Speaker 3: and huge lagoons of manure can get into the water supply.

568
00:32:01,160 --> 00:32:04,840
Speaker 3: One analysis of USDA data shows that the manure produced

569
00:32:04,880 --> 00:32:09,000
Speaker 3: by Iowa's pigs has grown by almost eighty percent between

570
00:32:09,000 --> 00:32:10,680
Speaker 3: twenty two and twenty twenty.

571
00:32:12,000 --> 00:32:15,239
Speaker 4: Austin Ferk is also a member of the SRAP. He's

572
00:32:15,280 --> 00:32:18,280
Speaker 4: an agricultural Ana Trust expert who grew up in Iowa

573
00:32:18,360 --> 00:32:20,800
Speaker 4: had a front row seat to the state's transformation to

574
00:32:20,920 --> 00:32:22,520
Speaker 4: prime pig territory.

575
00:32:23,160 --> 00:32:26,920
Speaker 3: As Austin points out, Iowa's pork industry didn't always look

576
00:32:27,040 --> 00:32:30,200
Speaker 3: like this. Modern pig producers took a lot of inspiration

577
00:32:30,320 --> 00:32:32,840
Speaker 3: from you guessed it, chickens.

578
00:32:34,600 --> 00:32:36,560
Speaker 9: What you saw happened in the eighties is a state

579
00:32:36,640 --> 00:32:40,600
Speaker 9: senator deregulated the pork industry in North Carolina to allow

580
00:32:40,960 --> 00:32:44,800
Speaker 9: the industrialization of pork production, copying that model chickenization, where

581
00:32:44,840 --> 00:32:48,160
Speaker 9: he owned the animal. He had other people and these

582
00:32:48,200 --> 00:32:51,080
Speaker 9: metal sheds. You'd give them his pigs, they would grow

583
00:32:51,120 --> 00:32:53,360
Speaker 9: them out, and then he would sell them, butcher them,

584
00:32:53,400 --> 00:32:56,720
Speaker 9: what have you. The business elite in Iowa saw what

585
00:32:56,840 --> 00:32:59,760
Speaker 9: was happening in North Carolina and they saw the massive

586
00:33:00,120 --> 00:33:02,520
Speaker 9: production increase is going on there, and they were like,

587
00:33:02,760 --> 00:33:05,040
Speaker 9: we're not going to lose our number one status. We're

588
00:33:05,040 --> 00:33:06,600
Speaker 9: going to gauge in this race to the bottom.

589
00:33:06,880 --> 00:33:09,320
Speaker 4: And actually there's a name for this trend, chickenization.

590
00:33:10,240 --> 00:33:12,440
Speaker 9: We are going to chickenize the pork industry in Iowa,

591
00:33:13,080 --> 00:33:15,520
Speaker 9: and if we have to kill the family farm, so

592
00:33:15,600 --> 00:33:18,600
Speaker 9: be it, because it's all about selling more quarancy the

593
00:33:18,640 --> 00:33:22,560
Speaker 9: whole supply chain around it, maintaining that dominance instead of

594
00:33:22,600 --> 00:33:25,880
Speaker 9: having chicken behave like the other industries. It became a

595
00:33:25,960 --> 00:33:30,280
Speaker 9: race to the bottom chickenization. Everything is being chickenized, where

596
00:33:30,360 --> 00:33:34,360
Speaker 9: you just apply this really abusive power structure to different

597
00:33:34,400 --> 00:33:38,680
Speaker 9: modes of commodity production because it shifts the riskiest part

598
00:33:38,880 --> 00:33:43,560
Speaker 9: to the worker and the corporate shareholders get the upside

599
00:33:43,600 --> 00:33:43,840
Speaker 9: of it.

600
00:33:44,160 --> 00:33:47,960
Speaker 3: And that's arguably helped big Chicken just get bigger. Chicken

601
00:33:48,040 --> 00:33:51,640
Speaker 3: is now dominated by large commercial breeders and processors. With

602
00:33:51,680 --> 00:33:55,040
Speaker 3: a handful of companies commanding sixty percent of the US

603
00:33:55,160 --> 00:33:56,920
Speaker 3: chicken market, the.

604
00:33:56,920 --> 00:33:59,520
Speaker 9: Chicken industry is pretty concentrated. It's not even just the

605
00:33:59,560 --> 00:34:02,960
Speaker 9: concentrate of slaughtering the animal, it's the whole supply chain.

606
00:34:03,240 --> 00:34:06,040
Speaker 9: The whole goal of the company is from the genetics

607
00:34:06,040 --> 00:34:08,399
Speaker 9: of the thing that hatches to the chicken tenders eating

608
00:34:08,440 --> 00:34:11,680
Speaker 9: the store. That whole thing has been highly vertically integrated.

609
00:34:12,400 --> 00:34:16,920
Speaker 3: So chickens have grown fatter, more horizontal. At the same time,

610
00:34:17,080 --> 00:34:20,360
Speaker 3: the chicken industry as a whole has become more concentrated,

611
00:34:20,640 --> 00:34:24,480
Speaker 3: more top down, more vertical, more powerful in terms of

612
00:34:24,480 --> 00:34:27,520
Speaker 3: what they can extract from farmers and their birds. And

613
00:34:27,560 --> 00:34:31,720
Speaker 3: that business model is spreading across agriculture and even beyond.

614
00:34:32,280 --> 00:34:32,480
Speaker 2: Right.

615
00:34:32,600 --> 00:34:35,480
Speaker 4: You know, people think of companies like Uber as pioneering

616
00:34:35,520 --> 00:34:39,160
Speaker 4: some novel business model, but the rise of independent contractors

617
00:34:39,160 --> 00:34:42,120
Speaker 4: with more risk being foisted on people who resemble employees

618
00:34:42,600 --> 00:34:43,960
Speaker 4: is a large and growing phenomenon.

619
00:34:44,560 --> 00:34:47,600
Speaker 3: Next up on beat capitalism, what can be done to

620
00:34:47,719 --> 00:34:51,240
Speaker 3: tip the balance of power back towards consumers and workers.

621
00:34:51,800 --> 00:34:58,760
Speaker 3: It's time to talk about unclucking the system.

622
00:34:59,000 --> 00:35:02,000
Speaker 4: Beat Capitalism is written by Tracy Alloway, Carmen Rodriguez and

623
00:35:02,080 --> 00:35:02,840
Speaker 4: Joe Wisenthal.

624
00:35:03,200 --> 00:35:05,960
Speaker 3: This short series was produced and edited by Carmen with

625
00:35:06,040 --> 00:35:08,440
Speaker 3: the help of Kale Brooks and Dashel Bennett.

626
00:35:08,600 --> 00:35:11,440
Speaker 4: The fact checking of industry puns and other information was

627
00:35:11,480 --> 00:35:13,120
Speaker 4: brought to you by Dash and Kale.

628
00:35:13,280 --> 00:35:16,520
Speaker 3: The chickenization of our regular All Blocks theme song and

629
00:35:16,600 --> 00:35:19,600
Speaker 3: the mixing is done by our sound engineer, Blake Maples.

630
00:35:19,880 --> 00:35:22,840
Speaker 4: Brendan Newnham is our executive producer, and Sage Bauman is

631
00:35:22,880 --> 00:35:24,279
Speaker 4: Bloomberg's Head of Podcasts.

632
00:35:24,719 --> 00:35:26,680
Speaker 3: Special thanks to Compassion.

633
00:35:26,160 --> 00:35:29,319
Speaker 4: In World Farming and if you enjoyed this deep dive

634
00:35:29,400 --> 00:35:32,720
Speaker 4: into the chicken industry, please consider leaving a positive review

635
00:35:32,760 --> 00:35:35,280
Speaker 4: on your favorite podcast platform. Thanks for listening.

636
00:35:39,440 --> 00:35:43,239
Speaker 3: This episode has been updated to reflect a clarification. It

637
00:35:43,400 --> 00:35:47,000
Speaker 3: wasn't until twenty thirteen that Craig Watts sent a film

638
00:35:47,040 --> 00:35:50,320
Speaker 3: of his barnes to his production manager. In twenty fourteen,

639
00:35:50,480 --> 00:35:53,719
Speaker 3: he partnered with a human rights activist and journalist to

640
00:35:53,800 --> 00:36:01,799
Speaker 3: produce a documentary on chicken farm um