White House pledges $1 billion to bolster independent meat producers and drive down prices

The White House announced Monday that it plans to allocate $1 billion to small, independent meat producers to increase competition with conglomerates and drive down prices, CNN reports.

The Washington Post says this move is part of the Biden administration's strategy of responding to criticism over high inflation rates by "criticizing large corporations and arguing that breaking up monopolies will foster competition and drive down prices."

Last month, White House Press Secretary Jen Psaki blamed the spike in meat prices — especially beef, which in November saw an increase of 21 percent relative to the previous year — on "the greed of meat conglomerates." The White House backed up this claim with an analysis that showed large meatpackers' profits increased by 300 percent during the pandemic.

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In response, the North American Meat Institute released a statement accusing the administration of "demonstrating its ignorance of agricultural economics and the fundamentals of supply and demand."

Rich Lowry at National Review poked fun at Psaki for blaming the higher prices "on corporate malefactors who decided to get extra greedy in 2021 when there was no reason for them not to be equally greedy over the last several decades."

Economist Larry Summers also disagreed with the Biden administration's assessment. Summers, who served as an adviser to Presidents Obama and Clinton, predicted in May of 2020 that high rates of inflation would be the natural result of excessively large bailout. In a thread of tweets posted last month, he flatly rejected antitrust action as a strategy for managing that inflation and argued that such measures would be more likely to increase prices than to lower them.

The majority of the $1 billion will be spent on direct grants to independent meat processing plants and subsidized loans for small meat producers.