November 16, 2024 • 36 mins
The Odd Lots team is analyzing the US economy through the lens of chicken. In this second episode of our special three-part series, we look at the birds themselves and the people who farm them. Because the way we actually get chicken has changed a lot over the years, with the industry evolving from backyard birds to huge poultry companies that outsource chicken growing to independent contractors. Farmers often say they are taking on most of the risk of raising chicks, while the big poultry companies get most of the upside. And this model of farming is becoming more popular in other agricultural areas too. So what does the way chickens are produced say about the labor market, the way it’s structured, and the distribution of risk and profits? We speak with chicken growers, agricultural experts, and more.
This episode was updated on November 19th, 2024 to reflect a clarification —it wasn’t until 2013 that Craig Watts sent a film of his barns to his production manager. In 2014 is when he partnered with a human rights activist to produce that exposé on chicken farming.
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Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:03):
Bloomberg Audio Studios, podcasts, radio news.
Speaker 2 (00:15):
But besides being a good egg layer, the chicken of
tomorrow will be an improved meat producer. Here's an example
of the progress that's been made already. Notice how breeding
has increased the amount of meat on the breast. Look
at that drumstick. This bird was fattened in the same
(00:37):
length of time and on the same amount of feed
as the other one. Thank your own guess as to
which is the more profitable to raise.
Speaker 3 (00:47):
For much of America's history, chickens look different to the
way they do today. They were thin, elegant, even slim
and upright. The average bird weighed about two and a
half pounds in the nineteen twenties, and chickens were raised
differently too, on small farms and homesteads. The birds and
their eggs provided a valuable source of extra protein and
(01:08):
the occasional Sunday roast for millions of Americans.
Speaker 4 (01:15):
But today chickens are front loaded feathered freaks. After years
of commercial breeding, the weight of your run of the
mill roaster has more than doubled to a chunky five
or six pounds, way more than chickens of the past.
Speaker 1 (01:28):
Chickens as our great grandparents would have understood them looked
very different from chickens today. They were scrawny, they were rangier,
they could move around a barnyard, and they could flap
up into trees and avoid predators. And that's almost nothing
like the chickens that we eat today. So if you
(01:49):
went back to the time of I guess our great grandparents,
let's say, at the beginning of the twentieth century, people
didn't eat chicken that and that seems very bizarre to
us now in the era when there are a million
forms of chicken nuggets in the cold case at the
(02:09):
supermarket and there's a chicken sandwich on every corner. But
chicken used to be kind of special.
Speaker 3 (02:21):
Welcome to the second installment of Beat Capitalism, our add
thoughts special series in which we are examining the US
economy through the lens of chicken. If you haven't listened
to our first episode where we talked about chicken prices
and the consumer experience of eating chickens and eggs, you
should definitely go back and do that.
Speaker 4 (02:40):
In this episode, we're going to focus on the birds
themselves and the people that grow them, because chicken actually
has a lot to say about the structure of the
labor market too, and the relationship between big companies and
their workers. And a lot has changed from the backyard
birds of yesteryear.
Speaker 3 (03:04):
To understand what's happened to chickens and the people who
grow them, it helps to consider where they started from.
Maren McKenna is a journalist and author who specializes in
public health, and she wrote a book called appropriately Enough,
Big Chicken.
Speaker 4 (03:19):
As we said, chickens used to be a lot. Smaller
families might keep a few egg layers in their backyards,
and once the birds reached the end of their laying life,
they might be put in the proverbial pot. One key
thing is that chicken meat, for a long time was
a tree, not a stable.
Speaker 5 (03:33):
Now.
Speaker 3 (03:33):
As a rule, older chickens that have been running around
a backyard don't usually taste as good. They're leaner, they're chewier,
and there just aren't that many of them compared to today's
industrial scale farming. But things started to change in the
nineteen twenties and nineteen thirties. To satisfy increased demand for
chicken meat, farmers started scaling up and raising their birds
(03:55):
in big chicken houses. We'll talk more about those in
just a little bit.
Speaker 4 (04:00):
In the nineteen forties, after the Second World War, something
big happen on the way to Big Chicken.
Speaker 1 (04:06):
To understand where the industrialization of chicken comes from, and
after that the industrialization of almost all the other proteins
that we eat, you really have to go back to
the middle to the end of World War II, and
a couple of things are happening at the same time.
The first is that there's a war on and there's
(04:27):
a lot of soldiers and sailors deployed around the globe
who need to be fed, so there's a great deal
of pressure on meat producers to increase their production. Pressure
that goes away when the war is over, and when
that guaranteed market from the military forces suddenly vanishes, leaving
them pretty over extended. The second is that immediately after
(04:50):
World War two, kind of extraordinarily, there are a number
of extreme weather events in growing areas around the globe.
There are typhoons, there are storms, and this is added
to the destruction of growing areas that occurred during the
war and the destruction of naval fleets and of fishing vessels.
(05:12):
So there's both an over extension of meat production and
also a sense of frigility of the food system.
Speaker 4 (05:20):
It was against this backdrop the biologist Thomas Jukes entered
the picture. With more and more chickens now being kept
in big houses, the birds were no longer able to
forage for bugs and grubs and graints on their own.
They needed help to survive indoors, and that's where Jukes
comes in.
Speaker 1 (05:34):
Jukes was attached to a team that had produced the
first antibiotic of the tetracyclines that we still use today.
It was called oreomycin. He also happened to have been
given an assignment to address the dietary needs of chickens
because part of the issue of the meat industry feeling
over extended after the end of World War II was
(05:54):
that they felt they needed to cut costs. This is
actually the point at which we start entering in to
the part of American agricultural history where livestock starts getting
fed a lot of grain, but there was concern that
grain didn't have a full nutritional profile, and so they
were looking for inexpensive supplements, and in a very famous experiment,
Jukes bought a whole bunch of baby chicks, divided them
(06:17):
into groups gave each group some kind of supplement that
was available on the market at the time, cod liver oil,
synthesized vitamins, brewers yeast. To one group, he gave the
ground up dried remains of the growing medium in which
his company's drug had been made, oreomycin, and when he
(06:39):
assessed the results of the experiment on Christmas Day in
nineteen forty eight, he found that the chicks in his
experiment who'd been given the oreomcein leftovers, had gained more
weight than any other set of animals in the experiment,
and from that recognition, an entire industry of giving an
(07:00):
biotics to animals began. Jukes called that effect growth promotion,
and they filed for a patent for the.
Speaker 3 (07:09):
So The introduction of growth promoters helped the birds survive
the great indoors and get bigger. But that wasn't the
last of the chicken revolution.
Speaker 1 (07:17):
One was that chickens themselves changed physically, thanks largely to
the US Department of Agriculture, which in the late nineteen
forties and early nineteen fifties sponsored a contest among chicken
breeders called the Chicken of Tomorrow.
Speaker 2 (07:33):
Help in developing the Chicken of tomorrow. You can't take
it regretted that every hand is earning her keeper. Even
though laying an egg ought to be easy for any.
Speaker 1 (07:45):
Chicken, that's a few thing big twe.
Speaker 2 (07:51):
Well.
Speaker 6 (07:52):
Anyhow, the idea of.
Speaker 1 (07:54):
The Chicken of Tomorrow contest was to make chickens meteor
to produce a bird that would have more breast, that
would have big enough to feed a family, which was
kind of hard at that point for a four or
five person family to eat one chicken and be satisfied,
and also to be very predictable in a number of ways,
(08:15):
to be a single breed. And after a couple of
years of competition, the Chicken of Tomorrow Contest produced the
prototype for the most of the chickens that are raised today.
Blocky muscles, white feathered, docile, not interested in running around
a barnyard and flapping up into a tree, content to
(08:36):
sit in one place.
Speaker 4 (08:38):
So antibiotics and breeding helped turn the chicken of tomorrow
into the chicken of today.
Speaker 3 (08:43):
Well that's not quite all. Actually, a lot of things
were happening on the chicken innovation front around that time.
Speaker 1 (08:49):
The second thing that drove the difference between the Chicken
of yesterday and the chicken of tomorrow is that we
changed our orientation to how we eat chicken from buying
birds that were whole and had to be roasted or
cut up into pieces and had to be pan fried
or broiled into a source of protein that was disassembled
(09:13):
at the manufacturing level into things like nuggets, so that
people could consume chicken without having to deal with the
physical reality of a chicken.
Speaker 3 (09:24):
It's hard to imagine a world without chicken nuggets now,
but as Marin lays out, it wasn't until the nineteen
sixties that these became a thing, and it was a
very deliberate decision. After all, if you want to sell
more chicken, you have to get people to eat more chicken,
and one way of doing that is giving them more
options to consume it. And then boom, the chicken nugget
(09:45):
was born, and these little nuggets of chicken proved to
be pure gold for some businesses like McDonald's McDonald's, Yes
and Joe. You might be surprised to find out that
McDonald's didn't actually invent the chick and nugget. Here's Marin again.
Speaker 1 (10:02):
So we all think of the chicken nugget as a
creation of McDonald's, and certainly McDonald's would claim that the
chicken nugget is their thing. Introduced in the late seventies,
by nineteen eighty they were blowing the doors off in
the McDonald's restaurants where they were sort of secretly introduced.
But it's pretty widely understood in the poultry industry that
(10:23):
McDonald's shouldn't get all the credit because the prototype, the
predecessor of the McDonald's chicken nugget, was actually invented by
a kind of tinkereer scientist in a basement laboratory at
Cornell University, a guy named Robert Baker, who was not
primarily interested in chicken, but rather was interested in essentially
(10:47):
how to avoid food waste. And he was very troubled
by how much of the carcass of a chicken goes
to waste, and he wanted to find ways to use
as much of the carcass as possible, as much of
the meat on the carcass as possible. And he came
up in this basement laboratory with a bunch of graduate
(11:07):
students with things that we now take for granted in
supermarkets chicken, bacon, chicken cold cuts, chicken sausages. But his
signature contribution to the future of chicken was a thing
that he called the chicken stick, modeled some degree on
fish sticks, which had been introduced about ten years earlier.
(11:28):
The chicken stick was chopped, formed, pressed chicken meat sucked
off the bones, covered with a breaded coating, frozen and
frozen in such a way that when you took it
out of the freezer and fried it or baked it,
the coating wouldn't disassemble from the rest of the meat.
(11:48):
That was a kind of secret process that Baker invented,
but it didn't stay a secret. It was released in
an agricultural extension bulletin that Cornell published and sent all
over the country. They didn't in any way attempt to
keep any ip in this, and as a result, the
idea of something that looked like at chicken nugget was
(12:10):
out there in the world, and seventeen years later out
came the McDonald's snugget.
Speaker 3 (12:17):
Suddenly a lot more of a chicken could be used,
and thanks to antibiotics and breeding, there was more chicken
around to sell.
Speaker 4 (12:24):
One way to think about it is that raising chickens
went from being a really small scale agriculture process to
more of an industrial thing. There's a reason it's called
factory farming, after all. The idea is to produce as
much meat as you can at the lowest possible cost,
and then use it as efficiently as possible. And to
do that you need standardization, new technology in the form
of growth promoters and scale.
Speaker 1 (12:46):
I really think we can say that it's because of
antibiotic use that we have the modern industrial scale meat
production that we have today. Without that early use of
antibiotics as growth promoters, no one would have understood that
you could actually produce animals almost like widgets in a
kind of Henry Ford model. And so once people moved
(13:10):
to doing that, then it made sense for farms to
get larger and for profit to increase. And for farms
to get larger, you had to protect animals against being
held in more crowded conditions than they traditionally would have
been in smaller open farms.
Speaker 3 (13:27):
The upside of all of this is that we get
plentiful white meat, all the stuff that goes into delicious
sandwiches and convenient chicken nuggets. The downside is a lot
of that comes at the expense of the animals themselves,
and as we're about to see, also the farmers who
grow them. There's another seminal moment in the transformation of
(13:54):
America's chicken industry, one that has more to do with
where they're grown and by whom.
Speaker 4 (14:00):
In nineteen twenty three, a Delaware housewife by the name
of Cecil long Steel by the way, great name, got
a surprise in the mail. She had ordered fifty baby chicks,
but the mailman came to her door with five hundred
chicks instead.
Speaker 3 (14:15):
Instead of sending the hundreds of extra chicks back in
the mail, Cecil decided to make do. She kept them
in a cardboard box and set about building a shed
to house them. Over the next five months or so,
she raised the chicks to adulthood, fattening them up and
eventually selling them to local hotels and restaurants as a
delicious meal. Then she decided to do it all over again.
(14:38):
Soon she was ordering one thousand chicks, then ten thousand,
and then she just kept going.
Speaker 4 (14:43):
So what Cecil pioneered is the first broiler house, a
big step in the history of poultry farming. Today, chickens
are raised in huge barns that cost large amounts of
money to build, and in order to keep these big
barns filled with chickens, farmers have to participate in something
called the tournament system.
Speaker 3 (14:58):
In fact, everything about modern chicken is big. In the
tournament system, farmers get baby chicks from large chicken breeders
they're called integrators companies like Tyson, Purdue or Pilgrim's Pride,
and then they raise them using feed and growth promoters
sent to them by those same companies. Eventually, the mature
birds are handed back to the chicken company that sold
(15:20):
them as babies and they fulfill their chicken destiny of
becoming sandwiches, nuggets, or other snacks.
Speaker 6 (15:27):
Basically, what we do is we supply the buildings and
the labor and all the stuff needed to actually raise
birds for these big what they call integrators or chicken
companies like a Tyson or Purdue. Tyson or Purdue actually
owns the chicks, and they actually own the feed and
vaccinations and that sort of thing.
Speaker 3 (15:46):
Meet Craig Watts. He's a former contract poultry producer who
raised chickens in North Carolina. As part of the tournament system.
Speaker 6 (15:53):
We just basically get them on what lack of better terms,
consignment there, there's just a few hours old. When we
get them and we raise them up to market age.
They give us some guidelines on doing that, and then
they come pick them up, and then we get ready
and start all over again.
Speaker 4 (16:10):
It all sounds pretty simple and efficient, and the integrators
themselves argue that they're basically taking on the messier, more difficult,
and more capital intensive parts of the chicken business, like
hatching chicks, transporting them back and forth to farmers, and
then processing them into chicken nuggets and so on.
Speaker 3 (16:25):
So that's the tournament system, but Craig Craig calls it
something different.
Speaker 6 (16:30):
Basically, what it boils down to is who can get
the chicken to the plant the quickest, Who can get
that chicken the fattest on the least amount of feed
least amount of feed meaning least amount of cost. So
and that sounds perfect. I mean, you figure things out,
you grasp concepts, you tweet things, do what you have
(16:52):
to do, and if you work smarter and you work
harder than the next guy, you're gonna get compensated a
little more perfect.
Speaker 2 (16:59):
Right.
Speaker 6 (17:00):
The problem is, there's the flaw in this whole tournament
system scenario. I call it thunder doom. It's ten men
enter and five men leave. Because every week, if you
have ten growers go out, you're gonna have some that
make at or above the base pay, which is my
base pay, well I think was around five cents a
pound at that time. Then you're going to have five
or so out of the ten that are at base
(17:21):
or below. Right, so they take the bonuses to the
five growers that are above average, is taking the pay
of the growers that are below average. So for the company,
it's a zero sum game. They're only going to have
a nickel invested in a pound. A pie, so to speak,
is finite. The size of the pie is finite. The
farmer is fighting for the slice.
Speaker 4 (17:43):
So in the tournament system, you're basically graded on a curve.
If you're a chicken farmer who does well relative to
other growers in the area, you'll get more money from
the pot, and the ones who do badly you get
less money from the same pot. So you want to
be ranked higher relative to other growers.
Speaker 3 (17:57):
When Craig decided to become a farmer, heating against his
fellow chicken growers for pay wasn't quite what he had
in mind. In fact, let's go back to how Craig
got into the chicken business in the first place, back
when he saw a big opportunity when Purdue started building
a processing plant just seven miles south of his home.
Speaker 6 (18:17):
They were looking for farmers to contract. We had to
build buildings to raise their birds. I saw advertisement in
the paper. I called the representative. We had a meeting.
He gave me an income and expense kind of pro
form a sheet. It wasn't get rich quick. I took
it to my accountant. He cash floated there again. It
was steady, but it wasn't get rich. But it was enough.
(18:38):
And the guy at farm Credit was excited about the
possibility of poetry moving the entire area. He told me
it was the best thing that might be the best
thing that ever happened to farm in Robinson County.
Speaker 3 (18:48):
So there was Things went okay at first. Craig spent
his days monitoring his birds, making sure they weren't overheating
or getting sick, or eating too much or too little,
basically following the instructions and the chicken growing rules sent
by Perduit.
Speaker 6 (19:02):
Well, the first thing I would do, I would wake
up and I would go and I would open all
the houses up and I would just basically stick my
head in the look and then I would and then
we had a control room that the monitor things from,
and I would make sure that the controller was set properly.
They call it a computer, but it's basically a glorifly
thermostat basically where you can control all the temperature settings,
(19:25):
fan settings, that kind of stuff from a central location.
So I would I would look at all that and
make sure everything was right, you know, take a sniff test,
you know, is ammonia up, is it good? You know?
Is the house too humid? You know? And what did
the birds look like? Are they spread out comfortable? Are
they active or are they just huddled up? Or are
they panting? I mean, it was just it was just
a lot of observations. Initially I would have to run
(19:47):
to kids to school, but then when i'd come back,
the next thing I would do. I'd actually physically walk
through the houses and I would look for birds that
had died or maybe were deformed, or just maybe weren't
performing as they should. Either I pick up the dead
or we would have to call out and just just
a nice word for kill birds that weren't going to
make it the entire six weeks, you know, for whatever reason.
Speaker 4 (20:09):
But there was a limit to what Craig could do
for his flock. After all, the integrators are the ones
sending him the baby birds themselves. They owned the chickens,
and they're the ones making decisions about what they eat,
what medicines they get, what conditions they're kept in, and
how much room they have to grow up in.
Speaker 6 (20:23):
The deal was is each of my houses were twenty
thousand square feet. Well, they put thirty thousand birds in
every house, so when those chickens were they had the
same amount of space all the time. But when they
got market age, I mean it was walled a wall
in to end, just a sea of white chickens. So
if you do the math, thirty thousand chickens and twenty
(20:45):
thousand square feet is zero point sixty seven square foot
per bird. So there's issues within the structure of the
system that I had no control over that. It's not cruel,
but it's not about quality of life for an animal
by any means. It's about homogenizing a widget and getting
it to the plant. These chickens traits have been selected
(21:06):
over the years. The word that what they are. The
Americans desire for white meat is what drove what we
call the frankin chicken. The breast is very large, it's
oversized compared the rest of his body. They do have
trouble standing and they're very docile. They're not a hearty breed.
I mean, they're bread to just barely stay alive long
(21:26):
enough to get to the plant. So what they do
is they take a bite of feed, they take a
drink of water. They sit down. I called it three
steps and flop boom, boom, boom boom, sit down. That's
what they do all day.
Speaker 4 (21:37):
In two thousand and eight, Craig reached a tipping point
frustrated by a particularly feeble flock of floppy chicken.
Speaker 3 (21:42):
Sentence say that ten times fast yo.
Speaker 4 (21:45):
Frustrated by a particularly feeble flock of floppy chickens, he
filmed the conditions in his own chicken house and uploaded
them to YouTube to send to his production manager at Purdue.
Soon after, he partnered with a reporter and an animal
rights activist produce an expose on chicken farming.
Speaker 7 (22:02):
Craig has no control over the health or genetics of
the chicks that are delivered to him by Purdue. Bound
by contract, Craig is not even allowed to give them
sunshine or fresh air. Just thirty seven days later, they
are a sea of panting birds. Panting indicates birds are overheated.
(22:27):
These birds find it too painful to bear the weight
of their unnaturally large breasts on their legs.
Speaker 3 (22:33):
Craig Watts ultimately prove to be something of a renegade.
Speaker 4 (22:36):
For its part, a Produced spokeswoman said it works with
over eighteen hundred poultry farmers and the retention rate with
those contracts is around ninety eight percent. In a statement
to odd Lats, they also said it's been nearly ten
years since Watts was a farmer for Purdue, and in
that time it has established farmer advisory councils to gather
important feedback and insights from them on how the company
(22:57):
can improve.
Speaker 3 (22:58):
But Craig's complaints about the imbalance of power in the
poultry industry and the health of the birds are things
that come up again and again in our conversations with
chicken farmers. For instance, Karen Crutchfield, she goes by Susie,
was a contract grower for Tyson for many years, but
she started out raising cows.
Speaker 8 (23:19):
We already had a cattle farm, and so we wanted
to kind of expand out and add something else, some
more income coming in. The difference in farming cattle and
farming chickens is farming cattle, you own all the inputs.
You own, the cattle get you on the feed. You
(23:41):
decide what type of cattle you're going to buy. You
decide what time they leave your farm, You decide the
breeding periods. All of it is decided, but you and
you are a truly independent cattle farmer. You're independent. You
don't have nobody giving you orders or telling you what
you need, what size, what kind of feed. With chickens,
(24:03):
it's totally different. With chickens. You have no control over
any of the inputs. They deliver the chickens at third time,
they give them the feed that they want them to have,
They pick them up on their time. They tell you
what to do in controlling the inputs in the house,
what temperature it needs to be, what size you need
to let them out into full house. They control all
(24:24):
of the inputs. You were only a serf more or less.
You just have to do what they tell you. And
actually it's more like your employee of theirs.
Speaker 3 (24:34):
So for Susie, following the instructions of the chicken integrator
was a must because if you don't, you risk losing
out on that contract and you might not have any
other companies to sell chickens too.
Speaker 8 (24:46):
For poltry goers, there is no option of going independent
because there's nothing you can do with your barns except
raised chickens for Tyson or whatever integrator as the occasion
had to be. In my area, Tyson was the only
company in the area that we could go to. So
if your houses was shut down, they were just shut down.
(25:06):
You had nowhere else to go or anything else you
could do with your barns other than maybe put hay
in them. That was the only option you had. You
could not grow chickens in them.
Speaker 4 (25:16):
Again, the barns are really expensive and the farmers are
often on their own when it comes to building them,
even though the integrators may be the ones asking for improvements,
which is exactly what happened to Susie.
Speaker 8 (25:27):
Tyson Food started doing upgrades probably in the mid nineties,
and each time they decided to do an upgrade, it
kept costing more money. It was bigger upgrades than before,
and so the last upgrade that they called for us
to do was in twenty ten. They sent a letter
(25:49):
out saying that we had to do all of these upgrades.
One of the upgrades that they requested us to do
at the time was add two extra royal lights, just
one massive upgrade, and it was going to end up
costing us over three hundred thousand dollars to upgrade, and
that would actually cost on the two older houses that
(26:11):
were built in eighty seven, it was going to cost
us more than we had originally built the houses for
them for. And so at that point we said, no,
we're not going to do any more upgrades. The incentive
for Tyson to ask for upgrades is keep the grower
in debt. As long as the grower's in debt, they're
(26:32):
going to do exactly what Tyson tells them. If they
get out of debt, then they have more freedom to
say no, I don't want to do that, and I'm
not going to do that. And if they catch you off,
then you've got everything paid for. But if you're a
million dollars in debt and going to lose your home,
you're more likely to do what they say.
Speaker 4 (26:54):
A Tyson spokesperson did respond for comment. When we reached out,
they said, and I quote, Foods contracts with a network
of thousands of independent growers across the country, and we
value the contributions that these growers make to our business.
We depend on growers, and the contracts we have in
place incentivized growers to raise high quality birds.
Speaker 3 (27:13):
One contract grower who did lose it all is Michael Diaz.
The Diasas used their life savings to put down a
deposit on fifty acres of land back in twenty eighteen,
with a home and four chicken houses. It was supposed
to be agricultural bliss.
Speaker 5 (27:31):
Farming was something that I had always dreamed of doing,
but it wasn't something that I saw as being very
feasible to do given the monetary constraints. I mean, you
need a large piece of property. You needed to make
a lot of capital investments to get into any kind
of farming. The magnitude of what we had bought didn't
(27:51):
sink in. But there were other farmers in the area.
They weren't poultry farmers, but some of them knew of
some poultry farms. They were friends with some of these guys,
and there was always this kind of this thought process
(28:12):
that these guys that own these poultry farms that you know,
these barns are fifty by five hundred feet long, and
some of them bigger than that. You know, you always
felt like they were because they had a lot of
capital investments. You thought they must have had good cash flow,
they must have been living good lives. They were in
contract with some of these household brands that you see
(28:36):
on every grocery store shelf that you tend to start trusting,
right you see these names. You know, I'll pick on others.
You know, you see a name like Heinz Ketchup, or
you see a name like Hormel or whatever. What I'm
trying to allude to is you see these brands that
(28:56):
have been in your face year after year from childhood
to adulthood, a staple in our food system. Say you
tend to trust these brands or doing the right thing.
Speaker 4 (29:07):
But Michael's integrator kept asking for more investments, and he
struggled to keep up on this loan payment. Michael thinks
he spent something like one hundred thousand dollars on unexpected
upgrades in just two years.
Speaker 5 (29:18):
I kept thinking that this is just going to sink
me deeper and deeper and deeper and deeper into debt.
This dream of me being able to pay this place
off and eventually build something that's generational for my family
is not going to exist, and I said, I'm not
doing it.
Speaker 3 (29:36):
Michael Diaz ended up selling the farm, losing his life
savings in the process. He later sued his integrator, arguing
that chicken farmers in the tournament system should be classified
as employees of integrators instead of independent contractors. That litigation
is still pending.
Speaker 4 (29:53):
Susie Crutchfield filed for bankruptcy and is still paying off
her debt. Interestingly, Craig Watts didn't lose his chicken farming
contract with Purdue after filming his barns, but the relationship
obviously soured. Craig filed a whistleblower complaint Purdue countersuit that's
pending too.
Speaker 3 (30:09):
All three of them are now part of the Socially
Responsible Agriculture Project SRAP, where they work on a contract
Grower Transition program, which aims to help poultry farmers navigate
the thunderdome and the pile of manure, both figurative and literal,
that comes with it. Here's Michael Diez again.
Speaker 5 (30:28):
The person that has all the risk, all the liability
is the farmer. He's the one that's in debt for
these barns. He's the one that's in debt for all
the facilities, the upgrades, the equipment. He's the one that's
in debt that he's got to figure out, what in
the world do I do with all this manure that
I have here on this on this site. I've got
(30:50):
to get rid of at half of them have nothing
that they can do with it. Everything that is that
is a liability the farmer has. The integrator is the
only one that's got anything that's able to build a profit.
Speaker 3 (31:12):
That is not the sound of chickens, clearly, but I
promise it will be relevant in a second contract growers
in the poultry world carry most of the potential downside
risks of chicken farming, while big chicken the integrators, enjoy
most of the upside. They hog the benefits and pass
on the risks, and that model is becoming more common,
(31:33):
as the state of pig farming in Iowa shows.
Speaker 4 (31:36):
At any given time, there are some twenty eight million
hogs being raised in Iowa, making it America's biggest pig
farming state, Iowa now produces nearly a third of America's
total hog supply.
Speaker 3 (31:46):
And speaking of manure, Iowa's pig population and what it
produces has become a big debate. People generally don't want
to live next to big pig farms for obvious reasons,
and huge lagoons of manure can get into the water supply.
One analysis of USDA data shows that the manure produced
by Iowa's pigs has grown by almost eighty percent between
(32:09):
twenty two and twenty twenty.
Speaker 4 (32:12):
Austin Ferk is also a member of the SRAP. He's
an agricultural Ana Trust expert who grew up in Iowa
had a front row seat to the state's transformation to
prime pig territory.
Speaker 3 (32:23):
As Austin points out, Iowa's pork industry didn't always look
like this. Modern pig producers took a lot of inspiration
from you guessed it, chickens.
Speaker 9 (32:34):
What you saw happened in the eighties is a state
senator deregulated the pork industry in North Carolina to allow
the industrialization of pork production, copying that model chickenization, where
he owned the animal. He had other people and these
metal sheds. You'd give them his pigs, they would grow
them out, and then he would sell them, butcher them,
what have you. The business elite in Iowa saw what
(32:56):
was happening in North Carolina and they saw the massive
production increase is going on there, and they were like,
we're not going to lose our number one status. We're
going to gauge in this race to the bottom.
Speaker 4 (33:06):
And actually there's a name for this trend, chickenization.
Speaker 9 (33:10):
We are going to chickenize the pork industry in Iowa,
and if we have to kill the family farm, so
be it, because it's all about selling more quarancy the
whole supply chain around it, maintaining that dominance instead of
having chicken behave like the other industries. It became a
race to the bottom chickenization. Everything is being chickenized, where
(33:30):
you just apply this really abusive power structure to different
modes of commodity production because it shifts the riskiest part
to the worker and the corporate shareholders get the upside
of it.
Speaker 3 (33:44):
And that's arguably helped big Chicken just get bigger. Chicken
is now dominated by large commercial breeders and processors. With
a handful of companies commanding sixty percent of the US
chicken market, the.
Speaker 9 (33:56):
Chicken industry is pretty concentrated. It's not even just the
concentrate of slaughtering the animal, it's the whole supply chain.
The whole goal of the company is from the genetics
of the thing that hatches to the chicken tenders eating
the store. That whole thing has been highly vertically integrated.
Speaker 3 (34:12):
So chickens have grown fatter, more horizontal. At the same time,
the chicken industry as a whole has become more concentrated,
more top down, more vertical, more powerful in terms of
what they can extract from farmers and their birds. And
that business model is spreading across agriculture and even beyond.
Speaker 2 (34:32):
Right.
Speaker 4 (34:32):
You know, people think of companies like Uber as pioneering
some novel business model, but the rise of independent contractors
with more risk being foisted on people who resemble employees
is a large and growing phenomenon.
Speaker 3 (34:44):
Next up on beat capitalism, what can be done to
tip the balance of power back towards consumers and workers.
It's time to talk about unclucking the system.
Speaker 4 (34:59):
Beat Capitalism is written by Tracy Alloway, Carmen Rodriguez and
Joe Wisenthal.
Speaker 3 (35:03):
This short series was produced and edited by Carmen with
the help of Kale Brooks and Dashel Bennett.
Speaker 4 (35:08):
The fact checking of industry puns and other information was
brought to you by Dash and Kale.
Speaker 3 (35:13):
The chickenization of our regular All Blocks theme song and
the mixing is done by our sound engineer, Blake Maples.
Speaker 4 (35:19):
Brendan Newnham is our executive producer, and Sage Bauman is
Bloomberg's Head of Podcasts.
Speaker 3 (35:24):
Special thanks to Compassion.
Speaker 4 (35:26):
In World Farming and if you enjoyed this deep dive
into the chicken industry, please consider leaving a positive review
on your favorite podcast platform. Thanks for listening.
Speaker 3 (35:39):
This episode has been updated to reflect a clarification. It
wasn't until twenty thirteen that Craig Watts sent a film
of his barnes to his production manager. In twenty fourteen,
he partnered with a human rights activist and journalist to
produce a documentary on chicken farm um
Bloomberg Audio Studios, podcasts, radio news.
Speaker 2 (00:15):
But besides being a good egg layer, the chicken of
tomorrow will be an improved meat producer. Here's an example
of the progress that's been made already. Notice how breeding
has increased the amount of meat on the breast. Look
at that drumstick. This bird was fattened in the same
(00:37):
length of time and on the same amount of feed
as the other one. Thank your own guess as to
which is the more profitable to raise.
Speaker 3 (00:47):
For much of America's history, chickens look different to the
way they do today. They were thin, elegant, even slim
and upright. The average bird weighed about two and a
half pounds in the nineteen twenties, and chickens were raised
differently too, on small farms and homesteads. The birds and
their eggs provided a valuable source of extra protein and
(01:08):
the occasional Sunday roast for millions of Americans.
Speaker 4 (01:15):
But today chickens are front loaded feathered freaks. After years
of commercial breeding, the weight of your run of the
mill roaster has more than doubled to a chunky five
or six pounds, way more than chickens of the past.
Speaker 1 (01:28):
Chickens as our great grandparents would have understood them looked
very different from chickens today. They were scrawny, they were rangier,
they could move around a barnyard, and they could flap
up into trees and avoid predators. And that's almost nothing
like the chickens that we eat today. So if you
(01:49):
went back to the time of I guess our great grandparents,
let's say, at the beginning of the twentieth century, people
didn't eat chicken that and that seems very bizarre to
us now in the era when there are a million
forms of chicken nuggets in the cold case at the
(02:09):
supermarket and there's a chicken sandwich on every corner. But
chicken used to be kind of special.
Speaker 3 (02:21):
Welcome to the second installment of Beat Capitalism, our add
thoughts special series in which we are examining the US
economy through the lens of chicken. If you haven't listened
to our first episode where we talked about chicken prices
and the consumer experience of eating chickens and eggs, you
should definitely go back and do that.
Speaker 4 (02:40):
In this episode, we're going to focus on the birds
themselves and the people that grow them, because chicken actually
has a lot to say about the structure of the
labor market too, and the relationship between big companies and
their workers. And a lot has changed from the backyard
birds of yesteryear.
Speaker 3 (03:04):
To understand what's happened to chickens and the people who
grow them, it helps to consider where they started from.
Maren McKenna is a journalist and author who specializes in
public health, and she wrote a book called appropriately Enough,
Big Chicken.
Speaker 4 (03:19):
As we said, chickens used to be a lot. Smaller
families might keep a few egg layers in their backyards,
and once the birds reached the end of their laying life,
they might be put in the proverbial pot. One key
thing is that chicken meat, for a long time was
a tree, not a stable.
Speaker 5 (03:33):
Now.
Speaker 3 (03:33):
As a rule, older chickens that have been running around
a backyard don't usually taste as good. They're leaner, they're chewier,
and there just aren't that many of them compared to today's
industrial scale farming. But things started to change in the
nineteen twenties and nineteen thirties. To satisfy increased demand for
chicken meat, farmers started scaling up and raising their birds
(03:55):
in big chicken houses. We'll talk more about those in
just a little bit.
Speaker 4 (04:00):
In the nineteen forties, after the Second World War, something
big happen on the way to Big Chicken.
Speaker 1 (04:06):
To understand where the industrialization of chicken comes from, and
after that the industrialization of almost all the other proteins
that we eat, you really have to go back to
the middle to the end of World War II, and
a couple of things are happening at the same time.
The first is that there's a war on and there's
(04:27):
a lot of soldiers and sailors deployed around the globe
who need to be fed, so there's a great deal
of pressure on meat producers to increase their production. Pressure
that goes away when the war is over, and when
that guaranteed market from the military forces suddenly vanishes, leaving
them pretty over extended. The second is that immediately after
(04:50):
World War two, kind of extraordinarily, there are a number
of extreme weather events in growing areas around the globe.
There are typhoons, there are storms, and this is added
to the destruction of growing areas that occurred during the
war and the destruction of naval fleets and of fishing vessels.
(05:12):
So there's both an over extension of meat production and
also a sense of frigility of the food system.
Speaker 4 (05:20):
It was against this backdrop the biologist Thomas Jukes entered
the picture. With more and more chickens now being kept
in big houses, the birds were no longer able to
forage for bugs and grubs and graints on their own.
They needed help to survive indoors, and that's where Jukes
comes in.
Speaker 1 (05:34):
Jukes was attached to a team that had produced the
first antibiotic of the tetracyclines that we still use today.
It was called oreomycin. He also happened to have been
given an assignment to address the dietary needs of chickens
because part of the issue of the meat industry feeling
over extended after the end of World War II was
(05:54):
that they felt they needed to cut costs. This is
actually the point at which we start entering in to
the part of American agricultural history where livestock starts getting
fed a lot of grain, but there was concern that
grain didn't have a full nutritional profile, and so they
were looking for inexpensive supplements, and in a very famous experiment,
Jukes bought a whole bunch of baby chicks, divided them
(06:17):
into groups gave each group some kind of supplement that
was available on the market at the time, cod liver oil,
synthesized vitamins, brewers yeast. To one group, he gave the
ground up dried remains of the growing medium in which
his company's drug had been made, oreomycin, and when he
(06:39):
assessed the results of the experiment on Christmas Day in
nineteen forty eight, he found that the chicks in his
experiment who'd been given the oreomcein leftovers, had gained more
weight than any other set of animals in the experiment,
and from that recognition, an entire industry of giving an
(07:00):
biotics to animals began. Jukes called that effect growth promotion,
and they filed for a patent for the.
Speaker 3 (07:09):
So The introduction of growth promoters helped the birds survive
the great indoors and get bigger. But that wasn't the
last of the chicken revolution.
Speaker 1 (07:17):
One was that chickens themselves changed physically, thanks largely to
the US Department of Agriculture, which in the late nineteen
forties and early nineteen fifties sponsored a contest among chicken
breeders called the Chicken of Tomorrow.
Speaker 2 (07:33):
Help in developing the Chicken of tomorrow. You can't take
it regretted that every hand is earning her keeper. Even
though laying an egg ought to be easy for any.
Speaker 1 (07:45):
Chicken, that's a few thing big twe.
Speaker 2 (07:51):
Well.
Speaker 6 (07:52):
Anyhow, the idea of.
Speaker 1 (07:54):
The Chicken of Tomorrow contest was to make chickens meteor
to produce a bird that would have more breast, that
would have big enough to feed a family, which was
kind of hard at that point for a four or
five person family to eat one chicken and be satisfied,
and also to be very predictable in a number of ways,
(08:15):
to be a single breed. And after a couple of
years of competition, the Chicken of Tomorrow Contest produced the
prototype for the most of the chickens that are raised today.
Blocky muscles, white feathered, docile, not interested in running around
a barnyard and flapping up into a tree, content to
(08:36):
sit in one place.
Speaker 4 (08:38):
So antibiotics and breeding helped turn the chicken of tomorrow
into the chicken of today.
Speaker 3 (08:43):
Well that's not quite all. Actually, a lot of things
were happening on the chicken innovation front around that time.
Speaker 1 (08:49):
The second thing that drove the difference between the Chicken
of yesterday and the chicken of tomorrow is that we
changed our orientation to how we eat chicken from buying
birds that were whole and had to be roasted or
cut up into pieces and had to be pan fried
or broiled into a source of protein that was disassembled
(09:13):
at the manufacturing level into things like nuggets, so that
people could consume chicken without having to deal with the
physical reality of a chicken.
Speaker 3 (09:24):
It's hard to imagine a world without chicken nuggets now,
but as Marin lays out, it wasn't until the nineteen
sixties that these became a thing, and it was a
very deliberate decision. After all, if you want to sell
more chicken, you have to get people to eat more chicken,
and one way of doing that is giving them more
options to consume it. And then boom, the chicken nugget
(09:45):
was born, and these little nuggets of chicken proved to
be pure gold for some businesses like McDonald's McDonald's, Yes
and Joe. You might be surprised to find out that
McDonald's didn't actually invent the chick and nugget. Here's Marin again.
Speaker 1 (10:02):
So we all think of the chicken nugget as a
creation of McDonald's, and certainly McDonald's would claim that the
chicken nugget is their thing. Introduced in the late seventies,
by nineteen eighty they were blowing the doors off in
the McDonald's restaurants where they were sort of secretly introduced.
But it's pretty widely understood in the poultry industry that
(10:23):
McDonald's shouldn't get all the credit because the prototype, the
predecessor of the McDonald's chicken nugget, was actually invented by
a kind of tinkereer scientist in a basement laboratory at
Cornell University, a guy named Robert Baker, who was not
primarily interested in chicken, but rather was interested in essentially
(10:47):
how to avoid food waste. And he was very troubled
by how much of the carcass of a chicken goes
to waste, and he wanted to find ways to use
as much of the carcass as possible, as much of
the meat on the carcass as possible. And he came
up in this basement laboratory with a bunch of graduate
(11:07):
students with things that we now take for granted in
supermarkets chicken, bacon, chicken cold cuts, chicken sausages. But his
signature contribution to the future of chicken was a thing
that he called the chicken stick, modeled some degree on
fish sticks, which had been introduced about ten years earlier.
(11:28):
The chicken stick was chopped, formed, pressed chicken meat sucked
off the bones, covered with a breaded coating, frozen and
frozen in such a way that when you took it
out of the freezer and fried it or baked it,
the coating wouldn't disassemble from the rest of the meat.
(11:48):
That was a kind of secret process that Baker invented,
but it didn't stay a secret. It was released in
an agricultural extension bulletin that Cornell published and sent all
over the country. They didn't in any way attempt to
keep any ip in this, and as a result, the
idea of something that looked like at chicken nugget was
(12:10):
out there in the world, and seventeen years later out
came the McDonald's snugget.
Speaker 3 (12:17):
Suddenly a lot more of a chicken could be used,
and thanks to antibiotics and breeding, there was more chicken
around to sell.
Speaker 4 (12:24):
One way to think about it is that raising chickens
went from being a really small scale agriculture process to
more of an industrial thing. There's a reason it's called
factory farming, after all. The idea is to produce as
much meat as you can at the lowest possible cost,
and then use it as efficiently as possible. And to
do that you need standardization, new technology in the form
of growth promoters and scale.
Speaker 1 (12:46):
I really think we can say that it's because of
antibiotic use that we have the modern industrial scale meat
production that we have today. Without that early use of
antibiotics as growth promoters, no one would have understood that
you could actually produce animals almost like widgets in a
kind of Henry Ford model. And so once people moved
(13:10):
to doing that, then it made sense for farms to
get larger and for profit to increase. And for farms
to get larger, you had to protect animals against being
held in more crowded conditions than they traditionally would have
been in smaller open farms.
Speaker 3 (13:27):
The upside of all of this is that we get
plentiful white meat, all the stuff that goes into delicious
sandwiches and convenient chicken nuggets. The downside is a lot
of that comes at the expense of the animals themselves,
and as we're about to see, also the farmers who
grow them. There's another seminal moment in the transformation of
(13:54):
America's chicken industry, one that has more to do with
where they're grown and by whom.
Speaker 4 (14:00):
In nineteen twenty three, a Delaware housewife by the name
of Cecil long Steel by the way, great name, got
a surprise in the mail. She had ordered fifty baby chicks,
but the mailman came to her door with five hundred
chicks instead.
Speaker 3 (14:15):
Instead of sending the hundreds of extra chicks back in
the mail, Cecil decided to make do. She kept them
in a cardboard box and set about building a shed
to house them. Over the next five months or so,
she raised the chicks to adulthood, fattening them up and
eventually selling them to local hotels and restaurants as a
delicious meal. Then she decided to do it all over again.
(14:38):
Soon she was ordering one thousand chicks, then ten thousand,
and then she just kept going.
Speaker 4 (14:43):
So what Cecil pioneered is the first broiler house, a
big step in the history of poultry farming. Today, chickens
are raised in huge barns that cost large amounts of
money to build, and in order to keep these big
barns filled with chickens, farmers have to participate in something
called the tournament system.
Speaker 3 (14:58):
In fact, everything about modern chicken is big. In the
tournament system, farmers get baby chicks from large chicken breeders
they're called integrators companies like Tyson, Purdue or Pilgrim's Pride,
and then they raise them using feed and growth promoters
sent to them by those same companies. Eventually, the mature
birds are handed back to the chicken company that sold
(15:20):
them as babies and they fulfill their chicken destiny of
becoming sandwiches, nuggets, or other snacks.
Speaker 6 (15:27):
Basically, what we do is we supply the buildings and
the labor and all the stuff needed to actually raise
birds for these big what they call integrators or chicken
companies like a Tyson or Purdue. Tyson or Purdue actually
owns the chicks, and they actually own the feed and
vaccinations and that sort of thing.
Speaker 3 (15:46):
Meet Craig Watts. He's a former contract poultry producer who
raised chickens in North Carolina. As part of the tournament system.
Speaker 6 (15:53):
We just basically get them on what lack of better terms,
consignment there, there's just a few hours old. When we
get them and we raise them up to market age.
They give us some guidelines on doing that, and then
they come pick them up, and then we get ready
and start all over again.
Speaker 4 (16:10):
It all sounds pretty simple and efficient, and the integrators
themselves argue that they're basically taking on the messier, more difficult,
and more capital intensive parts of the chicken business, like
hatching chicks, transporting them back and forth to farmers, and
then processing them into chicken nuggets and so on.
Speaker 3 (16:25):
So that's the tournament system, but Craig Craig calls it
something different.
Speaker 6 (16:30):
Basically, what it boils down to is who can get
the chicken to the plant the quickest, Who can get
that chicken the fattest on the least amount of feed
least amount of feed meaning least amount of cost. So
and that sounds perfect. I mean, you figure things out,
you grasp concepts, you tweet things, do what you have
(16:52):
to do, and if you work smarter and you work
harder than the next guy, you're gonna get compensated a
little more perfect.
Speaker 2 (16:59):
Right.
Speaker 6 (17:00):
The problem is, there's the flaw in this whole tournament
system scenario. I call it thunder doom. It's ten men
enter and five men leave. Because every week, if you
have ten growers go out, you're gonna have some that
make at or above the base pay, which is my
base pay, well I think was around five cents a
pound at that time. Then you're going to have five
or so out of the ten that are at base
(17:21):
or below. Right, so they take the bonuses to the
five growers that are above average, is taking the pay
of the growers that are below average. So for the company,
it's a zero sum game. They're only going to have
a nickel invested in a pound. A pie, so to speak,
is finite. The size of the pie is finite. The
farmer is fighting for the slice.
Speaker 4 (17:43):
So in the tournament system, you're basically graded on a curve.
If you're a chicken farmer who does well relative to
other growers in the area, you'll get more money from
the pot, and the ones who do badly you get
less money from the same pot. So you want to
be ranked higher relative to other growers.
Speaker 3 (17:57):
When Craig decided to become a farmer, heating against his
fellow chicken growers for pay wasn't quite what he had
in mind. In fact, let's go back to how Craig
got into the chicken business in the first place, back
when he saw a big opportunity when Purdue started building
a processing plant just seven miles south of his home.
Speaker 6 (18:17):
They were looking for farmers to contract. We had to
build buildings to raise their birds. I saw advertisement in
the paper. I called the representative. We had a meeting.
He gave me an income and expense kind of pro
form a sheet. It wasn't get rich quick. I took
it to my accountant. He cash floated there again. It
was steady, but it wasn't get rich. But it was enough.
(18:38):
And the guy at farm Credit was excited about the
possibility of poetry moving the entire area. He told me
it was the best thing that might be the best
thing that ever happened to farm in Robinson County.
Speaker 3 (18:48):
So there was Things went okay at first. Craig spent
his days monitoring his birds, making sure they weren't overheating
or getting sick, or eating too much or too little,
basically following the instructions and the chicken growing rules sent
by Perduit.
Speaker 6 (19:02):
Well, the first thing I would do, I would wake
up and I would go and I would open all
the houses up and I would just basically stick my
head in the look and then I would and then
we had a control room that the monitor things from,
and I would make sure that the controller was set properly.
They call it a computer, but it's basically a glorifly
thermostat basically where you can control all the temperature settings,
(19:25):
fan settings, that kind of stuff from a central location.
So I would I would look at all that and
make sure everything was right, you know, take a sniff test,
you know, is ammonia up, is it good? You know?
Is the house too humid? You know? And what did
the birds look like? Are they spread out comfortable? Are
they active or are they just huddled up? Or are
they panting? I mean, it was just it was just
a lot of observations. Initially I would have to run
(19:47):
to kids to school, but then when i'd come back,
the next thing I would do. I'd actually physically walk
through the houses and I would look for birds that
had died or maybe were deformed, or just maybe weren't
performing as they should. Either I pick up the dead
or we would have to call out and just just
a nice word for kill birds that weren't going to
make it the entire six weeks, you know, for whatever reason.
Speaker 4 (20:09):
But there was a limit to what Craig could do
for his flock. After all, the integrators are the ones
sending him the baby birds themselves. They owned the chickens,
and they're the ones making decisions about what they eat,
what medicines they get, what conditions they're kept in, and
how much room they have to grow up in.
Speaker 6 (20:23):
The deal was is each of my houses were twenty
thousand square feet. Well, they put thirty thousand birds in
every house, so when those chickens were they had the
same amount of space all the time. But when they
got market age, I mean it was walled a wall
in to end, just a sea of white chickens. So
if you do the math, thirty thousand chickens and twenty
(20:45):
thousand square feet is zero point sixty seven square foot
per bird. So there's issues within the structure of the
system that I had no control over that. It's not cruel,
but it's not about quality of life for an animal
by any means. It's about homogenizing a widget and getting
it to the plant. These chickens traits have been selected
(21:06):
over the years. The word that what they are. The
Americans desire for white meat is what drove what we
call the frankin chicken. The breast is very large, it's
oversized compared the rest of his body. They do have
trouble standing and they're very docile. They're not a hearty breed.
I mean, they're bread to just barely stay alive long
(21:26):
enough to get to the plant. So what they do
is they take a bite of feed, they take a
drink of water. They sit down. I called it three
steps and flop boom, boom, boom boom, sit down. That's
what they do all day.
Speaker 4 (21:37):
In two thousand and eight, Craig reached a tipping point
frustrated by a particularly feeble flock of floppy chicken.
Speaker 3 (21:42):
Sentence say that ten times fast yo.
Speaker 4 (21:45):
Frustrated by a particularly feeble flock of floppy chickens, he
filmed the conditions in his own chicken house and uploaded
them to YouTube to send to his production manager at Purdue.
Soon after, he partnered with a reporter and an animal
rights activist produce an expose on chicken farming.
Speaker 7 (22:02):
Craig has no control over the health or genetics of
the chicks that are delivered to him by Purdue. Bound
by contract, Craig is not even allowed to give them
sunshine or fresh air. Just thirty seven days later, they
are a sea of panting birds. Panting indicates birds are overheated.
(22:27):
These birds find it too painful to bear the weight
of their unnaturally large breasts on their legs.
Speaker 3 (22:33):
Craig Watts ultimately prove to be something of a renegade.
Speaker 4 (22:36):
For its part, a Produced spokeswoman said it works with
over eighteen hundred poultry farmers and the retention rate with
those contracts is around ninety eight percent. In a statement
to odd Lats, they also said it's been nearly ten
years since Watts was a farmer for Purdue, and in
that time it has established farmer advisory councils to gather
important feedback and insights from them on how the company
(22:57):
can improve.
Speaker 3 (22:58):
But Craig's complaints about the imbalance of power in the
poultry industry and the health of the birds are things
that come up again and again in our conversations with
chicken farmers. For instance, Karen Crutchfield, she goes by Susie,
was a contract grower for Tyson for many years, but
she started out raising cows.
Speaker 8 (23:19):
We already had a cattle farm, and so we wanted
to kind of expand out and add something else, some
more income coming in. The difference in farming cattle and
farming chickens is farming cattle, you own all the inputs.
You own, the cattle get you on the feed. You
(23:41):
decide what type of cattle you're going to buy. You
decide what time they leave your farm, You decide the
breeding periods. All of it is decided, but you and
you are a truly independent cattle farmer. You're independent. You
don't have nobody giving you orders or telling you what
you need, what size, what kind of feed. With chickens,
(24:03):
it's totally different. With chickens. You have no control over
any of the inputs. They deliver the chickens at third time,
they give them the feed that they want them to have,
They pick them up on their time. They tell you
what to do in controlling the inputs in the house,
what temperature it needs to be, what size you need
to let them out into full house. They control all
(24:24):
of the inputs. You were only a serf more or less.
You just have to do what they tell you. And
actually it's more like your employee of theirs.
Speaker 3 (24:34):
So for Susie, following the instructions of the chicken integrator
was a must because if you don't, you risk losing
out on that contract and you might not have any
other companies to sell chickens too.
Speaker 8 (24:46):
For poltry goers, there is no option of going independent
because there's nothing you can do with your barns except
raised chickens for Tyson or whatever integrator as the occasion
had to be. In my area, Tyson was the only
company in the area that we could go to. So
if your houses was shut down, they were just shut down.
(25:06):
You had nowhere else to go or anything else you
could do with your barns other than maybe put hay
in them. That was the only option you had. You
could not grow chickens in them.
Speaker 4 (25:16):
Again, the barns are really expensive and the farmers are
often on their own when it comes to building them,
even though the integrators may be the ones asking for improvements,
which is exactly what happened to Susie.
Speaker 8 (25:27):
Tyson Food started doing upgrades probably in the mid nineties,
and each time they decided to do an upgrade, it
kept costing more money. It was bigger upgrades than before,
and so the last upgrade that they called for us
to do was in twenty ten. They sent a letter
(25:49):
out saying that we had to do all of these upgrades.
One of the upgrades that they requested us to do
at the time was add two extra royal lights, just
one massive upgrade, and it was going to end up
costing us over three hundred thousand dollars to upgrade, and
that would actually cost on the two older houses that
(26:11):
were built in eighty seven, it was going to cost
us more than we had originally built the houses for
them for. And so at that point we said, no,
we're not going to do any more upgrades. The incentive
for Tyson to ask for upgrades is keep the grower
in debt. As long as the grower's in debt, they're
(26:32):
going to do exactly what Tyson tells them. If they
get out of debt, then they have more freedom to
say no, I don't want to do that, and I'm
not going to do that. And if they catch you off,
then you've got everything paid for. But if you're a
million dollars in debt and going to lose your home,
you're more likely to do what they say.
Speaker 4 (26:54):
A Tyson spokesperson did respond for comment. When we reached out,
they said, and I quote, Foods contracts with a network
of thousands of independent growers across the country, and we
value the contributions that these growers make to our business.
We depend on growers, and the contracts we have in
place incentivized growers to raise high quality birds.
Speaker 3 (27:13):
One contract grower who did lose it all is Michael Diaz.
The Diasas used their life savings to put down a
deposit on fifty acres of land back in twenty eighteen,
with a home and four chicken houses. It was supposed
to be agricultural bliss.
Speaker 5 (27:31):
Farming was something that I had always dreamed of doing,
but it wasn't something that I saw as being very
feasible to do given the monetary constraints. I mean, you
need a large piece of property. You needed to make
a lot of capital investments to get into any kind
of farming. The magnitude of what we had bought didn't
(27:51):
sink in. But there were other farmers in the area.
They weren't poultry farmers, but some of them knew of
some poultry farms. They were friends with some of these guys,
and there was always this kind of this thought process
(28:12):
that these guys that own these poultry farms that you know,
these barns are fifty by five hundred feet long, and
some of them bigger than that. You know, you always
felt like they were because they had a lot of
capital investments. You thought they must have had good cash flow,
they must have been living good lives. They were in
contract with some of these household brands that you see
(28:36):
on every grocery store shelf that you tend to start trusting,
right you see these names. You know, I'll pick on others.
You know, you see a name like Heinz Ketchup, or
you see a name like Hormel or whatever. What I'm
trying to allude to is you see these brands that
(28:56):
have been in your face year after year from childhood
to adulthood, a staple in our food system. Say you
tend to trust these brands or doing the right thing.
Speaker 4 (29:07):
But Michael's integrator kept asking for more investments, and he
struggled to keep up on this loan payment. Michael thinks
he spent something like one hundred thousand dollars on unexpected
upgrades in just two years.
Speaker 5 (29:18):
I kept thinking that this is just going to sink
me deeper and deeper and deeper and deeper into debt.
This dream of me being able to pay this place
off and eventually build something that's generational for my family
is not going to exist, and I said, I'm not
doing it.
Speaker 3 (29:36):
Michael Diaz ended up selling the farm, losing his life
savings in the process. He later sued his integrator, arguing
that chicken farmers in the tournament system should be classified
as employees of integrators instead of independent contractors. That litigation
is still pending.
Speaker 4 (29:53):
Susie Crutchfield filed for bankruptcy and is still paying off
her debt. Interestingly, Craig Watts didn't lose his chicken farming
contract with Purdue after filming his barns, but the relationship
obviously soured. Craig filed a whistleblower complaint Purdue countersuit that's
pending too.
Speaker 3 (30:09):
All three of them are now part of the Socially
Responsible Agriculture Project SRAP, where they work on a contract
Grower Transition program, which aims to help poultry farmers navigate
the thunderdome and the pile of manure, both figurative and literal,
that comes with it. Here's Michael Diez again.
Speaker 5 (30:28):
The person that has all the risk, all the liability
is the farmer. He's the one that's in debt for
these barns. He's the one that's in debt for all
the facilities, the upgrades, the equipment. He's the one that's
in debt that he's got to figure out, what in
the world do I do with all this manure that
I have here on this on this site. I've got
(30:50):
to get rid of at half of them have nothing
that they can do with it. Everything that is that
is a liability the farmer has. The integrator is the
only one that's got anything that's able to build a profit.
Speaker 3 (31:12):
That is not the sound of chickens, clearly, but I
promise it will be relevant in a second contract growers
in the poultry world carry most of the potential downside
risks of chicken farming, while big chicken the integrators, enjoy
most of the upside. They hog the benefits and pass
on the risks, and that model is becoming more common,
(31:33):
as the state of pig farming in Iowa shows.
Speaker 4 (31:36):
At any given time, there are some twenty eight million
hogs being raised in Iowa, making it America's biggest pig
farming state, Iowa now produces nearly a third of America's
total hog supply.
Speaker 3 (31:46):
And speaking of manure, Iowa's pig population and what it
produces has become a big debate. People generally don't want
to live next to big pig farms for obvious reasons,
and huge lagoons of manure can get into the water supply.
One analysis of USDA data shows that the manure produced
by Iowa's pigs has grown by almost eighty percent between
(32:09):
twenty two and twenty twenty.
Speaker 4 (32:12):
Austin Ferk is also a member of the SRAP. He's
an agricultural Ana Trust expert who grew up in Iowa
had a front row seat to the state's transformation to
prime pig territory.
Speaker 3 (32:23):
As Austin points out, Iowa's pork industry didn't always look
like this. Modern pig producers took a lot of inspiration
from you guessed it, chickens.
Speaker 9 (32:34):
What you saw happened in the eighties is a state
senator deregulated the pork industry in North Carolina to allow
the industrialization of pork production, copying that model chickenization, where
he owned the animal. He had other people and these
metal sheds. You'd give them his pigs, they would grow
them out, and then he would sell them, butcher them,
what have you. The business elite in Iowa saw what
(32:56):
was happening in North Carolina and they saw the massive
production increase is going on there, and they were like,
we're not going to lose our number one status. We're
going to gauge in this race to the bottom.
Speaker 4 (33:06):
And actually there's a name for this trend, chickenization.
Speaker 9 (33:10):
We are going to chickenize the pork industry in Iowa,
and if we have to kill the family farm, so
be it, because it's all about selling more quarancy the
whole supply chain around it, maintaining that dominance instead of
having chicken behave like the other industries. It became a
race to the bottom chickenization. Everything is being chickenized, where
(33:30):
you just apply this really abusive power structure to different
modes of commodity production because it shifts the riskiest part
to the worker and the corporate shareholders get the upside
of it.
Speaker 3 (33:44):
And that's arguably helped big Chicken just get bigger. Chicken
is now dominated by large commercial breeders and processors. With
a handful of companies commanding sixty percent of the US
chicken market, the.
Speaker 9 (33:56):
Chicken industry is pretty concentrated. It's not even just the
concentrate of slaughtering the animal, it's the whole supply chain.
The whole goal of the company is from the genetics
of the thing that hatches to the chicken tenders eating
the store. That whole thing has been highly vertically integrated.
Speaker 3 (34:12):
So chickens have grown fatter, more horizontal. At the same time,
the chicken industry as a whole has become more concentrated,
more top down, more vertical, more powerful in terms of
what they can extract from farmers and their birds. And
that business model is spreading across agriculture and even beyond.
Speaker 2 (34:32):
Right.
Speaker 4 (34:32):
You know, people think of companies like Uber as pioneering
some novel business model, but the rise of independent contractors
with more risk being foisted on people who resemble employees
is a large and growing phenomenon.
Speaker 3 (34:44):
Next up on beat capitalism, what can be done to
tip the balance of power back towards consumers and workers.
It's time to talk about unclucking the system.
Speaker 4 (34:59):
Beat Capitalism is written by Tracy Alloway, Carmen Rodriguez and
Joe Wisenthal.
Speaker 3 (35:03):
This short series was produced and edited by Carmen with
the help of Kale Brooks and Dashel Bennett.
Speaker 4 (35:08):
The fact checking of industry puns and other information was
brought to you by Dash and Kale.
Speaker 3 (35:13):
The chickenization of our regular All Blocks theme song and
the mixing is done by our sound engineer, Blake Maples.
Speaker 4 (35:19):
Brendan Newnham is our executive producer, and Sage Bauman is
Bloomberg's Head of Podcasts.
Speaker 3 (35:24):
Special thanks to Compassion.
Speaker 4 (35:26):
In World Farming and if you enjoyed this deep dive
into the chicken industry, please consider leaving a positive review
on your favorite podcast platform. Thanks for listening.
Speaker 3 (35:39):
This episode has been updated to reflect a clarification. It
wasn't until twenty thirteen that Craig Watts sent a film
of his barnes to his production manager. In twenty fourteen,
he partnered with a human rights activist and journalist to
produce a documentary on chicken farm um
Hosts And Creators
Joe Weisenthal
Tracy Alloway
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