Every time a head of cattle is sold, the seller must pay a one-dollar tax to the checkoff. Almost always, an organization called a Qualified State Beef Council (QSBC) collects that fee — for example, the Texas Beef Council collects checkoff money for sales made in Texas. The QSBCs can keep up to fifty cents of that dollar to use themselves — more on that later — but they must send at least fifty cents from each dollar up to the Cattlemen’s Beef Board (Beef Board). The Beef Board is the organization that oversees and manages the national checkoff program. It’s made up of 101 members who represent different cattle-producing regions and are appointed by the USDA secretary. In 2023, $42 million flowed from the beef checkoff to the Beef Board.

The Beef Board oversees something called the Beef Promotion Operating Committee (BPOC). The committee has twenty members. Ten members are elected from the Beef Board; the other ten members are elected from something called the Federation of State Beef Councils, a division of the National Cattlemen’s Beef Association (NCBA). These twenty people decide how and where to spend the checkoff money by making contracts with organizations for marketing campaigns, research to further promote beef, and more.

Every year, an overwhelming majority of beef checkoff money is sent to one organization: the NCBA (yes, the same NCBA that comprises half of the committee that decides the contracts). In 2023, NCBA was awarded $26 million dollars in contracts with the BPOC. That’s more than half of the money the Beef Board was responsible for spending, sent straight to the powerful NCBA.

Other powerful industry groups also win contracts with the BPOC, including the American Farm Bureau Foundation ($1 million in 2023), the North American Meat Institute ($1 million), and the U.S. Meat Export Federation ($1 million).

And what about the other 50 cents that QSBCs collect? The QSBC can keep the other 50 cents to use for their own checkoff activities like advertising and research specific to their state, or they can send some portion of that money to the Federation division of NCBA. Why would state QSBCs send more money back to the Federation instead of keeping it to spend in their own state? In part, because by sending money to the Federation they can guarantee representation for their state on the Federation Board of Directors, and thus on the BPOC. In other words, QSBCs can buy seats on the board to gain political influence over how checkoff money from around the country is spent. In 2023, QSBCs sent back $8.5 million to the Federation. That means NCBA ended up with a grand total of $34.5 million dollars of checkoff money that year.

Sound confusing? It is! And not by coincidence. All the boards, the acronyms, and the many steps of money changing hands make it hard for producers, consumers, and lawmakers to understand what’s really happening with the checkoff. It’s a complicated system with a simple result: NCBA is hoarding producers’ money to benefit the biggest meatpackers.

What’s the big problem with NCBA getting so much checkoff money? The Federation and NCBA are limited by law to using checkoff funds only for approved uses like research and promotion, but the rest of NCBA is heavily involved in lobbying for agriculture policies that the biggest meat companies want and that threaten to put independent beef producers out of business, such as lobbying against mandatory Country of Origin Labeling. NCBA likes to pretend it speaks for every rancher in America. It especially likes to capitalize on the iconic image of the American cowboy to boost sales. But when you look past the slick PR to how it spends time and money, NCBA puts the interests of massive meatpackers ahead of ranchers fighting to make a living time and time again.

While checkoff money cannot not be spent directly on lobbying, all that checkoff funding ends up supporting the lobbying anyway. Money from the checkoff (which really is tax money from ranchers) makes up almost all of NCBA’s funding. A 2014 report from the Office of the USDA Inspector General found that 82.3% of NCBA’s total budget comes from the checkoff.

Under the current scheme, NCBA is allowed to spend checkoff money on things like overhead expenses and market rates for staff time. This guarantees income and frees up other resources for NCBA to use for lobbying. It’s like if every month a relative gave you a hundred dollars and told you not to spend it going to the movies. If every month you spent that hundred dollars on groceries — an acceptable use according to your benefactor, and a necessity you have no choice but to spend on — you’d still find yourself with a free hundred dollars to take to the theater. In the same way, checkoff money offsets NCBA’s key costs and effectively subsidizes their pro-big business lobbying.

FarmSTAND and independent ranchers take the checkoff to court to demand accountability.

With any checkoff money they don’t send to NCBA, state beef councils pay for their own promotion programs. For decades, QSBCs spent their millions of dollars of checkoff money with practically no oversight from the government. Many QSBCs used their money to work with huge multinational corporations to promote big business interests over those of independent ranchers. Independent ranchers had enough and sued to rein in the checkoff.

The checkoff, of course, says the opposite and offers its own “expert” research. But our litigation uncovered that their so-called expert is sloppy and lazy in his methodology, purposefully and accidentally interpreting data in a way that erases the experience of independent cattle producers, allowing him to draw conclusions that benefit big corporations over small farmers.

The beef checkoff claims that its advertising benefits all the beef producers who are forced to pay the tax. When ranchers question how this can be when so many are struggling to stay in business, the checkoff points to studies it says prove its ads are working for producers. Many of these studies come from one man: Dr. Harry Kaiser. Kaiser is an economist whose decades-long career has been spent publishing favorable studies about the beef checkoff and other checkoffs. He’s their go-to guy when they need to convince farmers, Congress, and the public that checkoff tax dollars are well spent. But our litigation revealed that Kaiser’s research doesn’t hold up under scrutiny, and especially doesn’t back up the checkoff’s claims that the program benefits independent producers.

Quite a lot of checkoff tax dollars have been spent on Kaiser himself. When we deposed him, he admitted that he has personally been paid at least a million dollars by checkoffs for his research. That’s on top of the several million dollars of checkoff money he’s taken as funding for his research projects.

The beef checkoff loves to tout Kaiser’s research to show a positive return on investment for dollars spent. The beef checkoff says independent producers should feel good paying checkoff taxes because, according to Kaiser, every dollar they pay will come back to them many times over. Kaiser’s 2024 report for the checkoff concluded that for each dollar paid, producers and importers received $13.41 back.

By trumpeting this $13 return figure, Kaiser and the checkoff attempt to pull a fast one on concerned ranchers. They pretend that Kaiser’s studies answer the question “how does the checkoff benefit independent producers?” when really this number only shows an impact on total beef sales and reflects the boost the checkoff gives the world’s largest beef producers and packers.

Kaiser’s studies look only at beef sales in general, measuring how checkoff-funded advertising increases overall demand. But Kaiser’s research is skewed from the get-go. The checkoff’s expert admitted his analysis is very broad and doesn’t account for the experiences of small and mid-sized producers. This intentional vagueness obscures the reality that independent ranchers know all too well: They don’t see the same benefit from the checkoff that massive meat corporations do. When we deposed him, he admitted that his studies and the research he relies on “are all 10,000 feet, very aggregate, macro kind of views of the way generic advertising works.”

• Q: So you’ve never assessed whether R-CALF’s members who are just domestic producers could have potentially received a higher baseline price than other beef; is that right?
• A: That’s correct.
• Q: And none of the articles do that, right?
• A: That is correct. They’re all 10,000 feet, very aggregate, macro kind of views of the way generic advertising works.
• —Deposition of Dr. Harry Kaiser, expert witness for USDA

Kaiser’s research may show that the “pie” of the beef market is getting bigger, but it doesn’t show whether the slice belonging to independent ranchers is growing — or shrinking. The whole pie could be getting bigger, while the slice for independent producers is getting thinner and thinner.

• Q: You say the point of generic advertising is to increase the total consumption of beef, not individual market shares. Is that right?
• A: That is correct.
• …
• Q: So, but generic advertising’s goal is not to increase the slices evenly: it’s to increase the total box. Is that right?
• A: That is correct.
• Q: And so that may mean that it increases the pie without increasing specific slices in proportion to what the total pie is; is that right?
• A: That is correct
• —Deposition of Dr. Harry Kaiser, expert witness for USDA

This is no accident. By keeping the analysis broad and avoiding the hard questions, the checkoff avoids revealing the truth: Independent producers are being left behind. These reports tell us that someone is making a lot of money from checkoff spending, but they don’t tell us who. By only showing us these generalized conclusions, the checkoff hides the dirty details of how checkoff advertising, paid for by everyone including independent producers, pays off only for the corporate giants who control the program.

The checkoff’s preferred expert never asks questions like “who benefits most from the checkoff?” or “could changes to the checkoff redistribute the benefits more fairly?” That’s where FarmSTAND and the independent producers we represent come in.

Our work has uncovered how the checkoff system is gaming the process, using taxpayer dollars to promote a narrative that protects the interests of the largest players while obscuring the harm done to small ranchers. It’s a vicious cycle for independent producers. They’re forced to pay the checkoff, their money is used to boost big meat at their expense AND to fund shoddy research, and that research is used to justify forcing them to continue paying the checkoff.

Independent ranchers who are struggling to make a living know the truth: Checkoff advertising in its current form benefits the corporations that dominate the system and leaves the little guys in the dust.

Beef checkoff ads hurt independent producers, but there’s a simple fix

The checkoff is so out of touch with real ranchers and consumers that ­— according to its well-funded campaigns — all “beef is beef.” All the independent ranchers and producers we know would disagree. When it comes to beef, the place the animals are raised, the food they eat, and so many other factors mean that not all beef is the same. Consumers at the grocery store know this too and many want to buy the best beef they can.

Independent producers who go the extra mile to make sure their product has superior qualities want consumers to know that their beef is different and worth paying a little more for. The checkoff’s “beef is beef” approach erases all those special qualities, diminishing the potential advantages of selling this kind of beef and leaving independent producers competing with a mass-produced, cheap product.

Unfortunately, checkoff ads like the famous “Beef. It’s what’s for dinner.” commercials advertise beef as a generic product, meaning that they sell beef as a commodity — a product that is the same no matter where it comes from. In other words, generic checkoff advertising flattens all beef into the same category, to the detriment of anyone trying to sell a product that is different or special.

Illustration by Tania Lee

Publicly, proponents of the beef checkoff and these generic ads argue that this type of advertising benefits all beef producers because it raises demand for beef generally. But really, the powerful meatpacking companies backing the checkoff know that these ads boost their sales while leaving smaller competitors behind. After all, if people just want beef — any beef — why wouldn’t they choose the cheapest steak on the shelf instead of a more expensive but higher-quality product?

As part of our litigation against the checkoff, FarmSTAND commissioned a first-of-its-kind study to reveal the true impact of generic checkoff advertising on consumer choices when buying beef. This new research confirms what small and mid-size American ranchers have been saying for decades: The way the checkoff uses their taxes for generic advertisement hurts them by homogenizing their unique and superior products into the flat category of just beef.

Our study confirmed that current beef checkoff advertising does not differentiate American beef from other types of beef in the mind of consumers. Generic beef ads prime people to think of all beef as the same, which makes them less likely to pay more for beef with attributes they might prefer if they were thinking about it — like American, grass-fed, or organic beef. That means producers who make high-quality, domestic beef pay into the checkoff, but then they do not benefit fairly from the ads. At FarmSTAND, we took on this litigation because we think that ranchers and farmers who use regenerative grazing or ensure higher standards of animal welfare should be able to command higher prices for their products and shouldn’t be forced to subsidize ads that suggest their higher standards don’t matter.

At the same time generic checkoff advertising makes things harder for small producers, it also rewards Big Ag for its damaging practices. Because generic advertising keeps beef prices low, it further incentivizes concentrated, industrial meat companies to source the cheapest possible beef to maximize their profits. This cheap beef can come at huge costs to the environment, climate, and animal welfare — yet the checkoff encourages it.

“The checkoff does one thing, and one thing only, it advertises, and promotes generic beef. We are forced by law to pay into the program by law. We are forced to pay into it to promote generic beef.”

—Deposition of David Wright, fourth-generation rancher, R-CALF member, and former Beef Promotion and Research Board member

It doesn’t have to be this way. Our study found that when ads provide even simple information that differentiates beef, it helps people make a more informed choice. People want to buy food that is better for their families, for animals, and for the earth. When they were shown ads that told them that “beef that is produced domestically uses high quality feed, advanced standards of care, and a limited carbon footprint,” they were more likely to choose and spend more money on beef. It’s a simple fix that would make it easier for independent and small and mid-size producers to sell their products at a fair price that keeps them in business and rewards them for the high quality of their products. Independent ranchers pay their tax to the checkoff. It’s about time they get their fair share of the benefit.

Big corporate beef companies who like how the checkoff currently works in their favor claim that producers overall would be harmed by ads that differentiate distinct qualities of beef — but our study proves them wrong. When advertising distinguishes that some beef is different, and better, it can grow the general market for beef and support specialized producers.

If the checkoff really wanted to, it could easily change the way it operates to treat independent producers fairly — our study proves it. This would come at no harm to overall demand for beef. Yet the powerful Big Ag interests who control the checkoff won’t make that change, because they don’t want to give up the unfair advantage they’ve gained from decades of generic advertising.

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The beef checkoff tried to discredit FarmSTAND’s research — and failed spectacularly.

Remember Dr. Kaiser, the man the checkoff pays millions to produce favorable research? They also hired him to try and refute our expert study that showed how simple changes to the checkoff could make the system fairer for independent producers. During the course of our litigation, we showed that Dr. Kaiser is unqualified to comment on how the checkoff impacts consumer behavior and that his methods are sloppy and unfit for an expert witness.