Monsanto's political influence and lobbying strategies

Monsanto Lobbying and Beyond

MONSANTO lobbying +

Monsanto. The name alone makes millions cringe. How can a company named after a middle-aged homemaker become so controversial? The major complaints against Monsanto include that they are poisoning the poor; trying to own everything; destroying the food supply; suing small farmers over the very robocrops they themselves unleashed; and patenting plants, animals, genes and the building blocks of life itself. Abetting these crimes are the press; regulators and the courts; international political institutions and individuals who act within them, and science / higher education. This is all achieved through the manipulation of public officials by Monsanto's army of hired lobbyists. This view is only partially correct, for many of Monsanto's alleged crimes have been adjudicated, and the nature of political influence has changed from the days when hired lobbyist promised campaign contributions to incumbent or potential lawmakers for implied agreement to look the other way. The modern route to influence is developing more toward direct participatory control of the political process, achieving monetary settlement in the private sector in exchange for silence, or obtaining favorable outcomes using the only lobbyists supposedly allowed access to the judiciary, lawyers. This paper will review these themes and try to make sense of all the controversy, clarify what truth is verifiable and question the many accusations of varying accuracy and exaggeration.

Restricting the scope of investigation

Monsanto itself publishes the lobbying expenses it filed with the U.S. Federal Elections Commission on its homepage, along with pre-emptive messaging that attempts to frame and shape discussion of a number of the issues introduced above (Monsanto Company, 2012a, n.p.). What appears on the surface as half a dozen issue topics, however, quickly reveals numerous threads that explain Monsanto's stance on perhaps forty legal and social conflicts surrounding the corporation's products and market behavior, and that an exhaustive inquiry would not only require a staff of legal consultants, but many of the complaints activists level at the firm have been closed to some degree and therefore can be ruled out. Likewise there are so many accusations against Monsanto in the media, by individuals and organizations ranging from farmers' groups to anti-globalization activists to governments, claiming a wide range of offenses that sound like science fiction, but in general boil down to several classes of objection more easily comprehended in summary than in specific. These issues indicate why a corporation like Monsanto would incur the expense of influencing regulation surrounding what would seem to be the most commonplace of human activities, subsistence.

The easiest allegations to dispense with are those that Monsanto wants to eventually market genetically modified animal products (Organic Consumers Association, 2012, n. p.). Monsanto asserts the firm has shed its pig and dairy operations on its "Issues" page (Monsanto Company, 2012b), and while the firm claims its goal was never to patent animal genes or traits but rather a particular in vitro fertilization method, a pig gene marker and omega-3-enriched feeds, the issue is moot now because they are out of the livestock business and Monsanto's annual 10-K report to the U.S. Securities and Exchange Commission (SEC) cross-verifies that these subsidiaries have been sold (Monsanto Company, 2012c, p. 48). The 10-K is a form all publicly traded U.S. companies with various characteristics must file with the SEC showing their audited financial statements, and as the official statement of the company's revenues before federal regulators including the Internal Revenue Service and the Department of Justice, this is about as definitive a statement as the public is allowed to see for any U.S. corporation. There are many other ways to track political lobbying activity for corporations but the 10-K is the most transparent statement of financial returns available to the public for Monsanto. If they lie to the SEC, they have to go back and re-file anyway under costly legal and accounting oversight. Monsanto has had such an accounting dispute with the SEC regarding the inclusion in 2010 of some distributor incentives that materially affected prior 2009 filings (Monsanto Company, 2012c, p. 93) and while this is an accounting irregularity the company would likely be charged with had it gone unaddressed, the company is rectifying this essentially technical matter that is neither large nor sinister enough to justify further examination here. This SEC investigation does however provide ammunition for Monsanto's enemies on the street however, (Reuters, 2011, n.p.), which illustrates more how both sides can distort otherwise mundane information to serve their own objectives. Monsanto is by no means less guilty of such framing, they demonstrate on their "Issues" page, committing to total transparency and then limiting that to the issues they "are willing to discuss" in the subsequent paragraph (Monsanto Company, 2012a). The other main insight the 10-K provides is where the firm outlines risk to its shareholders, and that discussion will inform this investigation both as to what Monsanto might have an interest in lobbying for or against, and how they present that information to their stakeholders and regulators.

Restricting scope: lawsuits settled and dismissed

Therefore discussion of genetic modification of animals, their products and claims Monsanto is being investigated by the SEC at least can be closed. They were doing that, they got out of it, the SEC investigation is true but unremarkable, although their tactic of subsidizing distributors is at the core of many complaints. Monsanto may easily be pursuing weird-science animals abroad or through its vast research expenditures, but none of those are transparent enough to be tracked back to the parent firm in its reporting to the U.S. federal government at least, and thus exceed the power of this research to command disclosure. One significant and high-profile complaint surrounding the manufacture of Viet Nam War-era defoliant Agent Orange can also be closed, as earlier this year the company settled out of court with the final class of appellants not excluded through legal technicalities in Nitro, West Virginia, not for the manufacture of that carcinogenic chemical itself (the class action suit by Vietnamese survivors was not deemed adjudicable in the U.S. And never made it to the bench (Rusche, 2012, n. p.)), but for the handling of it in and around the facility subsequently acquired by Monsanto before the class action. Monsanto is the "successor in interest" to Pharmacia (Monsanto, 2012, 10K p. 90); Pharmacia and other litigants may have spilled dioxins all over Nitro, which caused many people cancer and other problems, this settlement suggests, but since the settlement took place out of court, that would preclude Monsanto from having to admit guilt, and presumably carry a gag order for aggrieved parties if it did.

Recently adjudicated as well was the high-profile farmers' groups' pre-emptive lawsuit seeking an injunction against Monsanto's widespread and ongoing practice of suing small farmers when wind- or insect-borne proprietary genetics show up in native, 'legacy' crops. Class status for the appellants was recently denied in the U.S. courts on grounds Monsanto had not yet taken action against those particular individuals (Gerken, 2012, n. p.). The suits the individuals were trying to preempt are also at the core of Monsanto's offending market tactics but the case itself looking forward remains as of this writing a non-issue, although this probably remains of considerable interest to Monsanto's lobbyists and legal squadrons in that the success of future lawsuits will be affected to the degree the campaign was able to turn public opinion against the company, and thus provoke more scrutiny by legislators, regulators and ultimately the courts. The pre-emptive attempt at injunction apparently failed to claim any high-name lawmakers, who would presumably face Monsanto in their career afterward if they continued as legislators.

Legal disclosure not always complete

What are the campaign lobbying activities Monsanto admits to? The names of committees and individual candidates the firm donated to are clearly listed as a mix of Democratic and Republican candidates for office from local levels up to Congress, in apparently every state, including John Boehner; the Blue Dog PAC; Orrin Hatch, but also Raul Labrador, David Leobsback, and the Preserving America's Traditions and Rely on Your Beliefs PACs in 2011, whoever they are (Federal Election Commission, 2012). Even convicted crack dealer / D.C. Mayor Marion Berry got a piece of the Monsanto funding pie back in 2009, and John D. Ashcroft in 1999 (Federal Election Commission, 2012). Many of these constitute the arch-conservative leadership but these records display "Committees and Candidates Supported / Opposed," and attempting to disaggregate exactly who and what was supported, opposed, and how, from the influence traded at the "1997 Republican Senate-House Dinner" (Monsanto gave $1,500, 10 Jul. 1997) (Federal Election Commission, 2012) for example or from any of these records, would mislead more than it would reveal. Nonprofit watchdog group Open Secrets.org (2012) summarizes the Senate Disclosure Act information into about four registered activities last year per some ten or fifteen agencies on several dozen bills, to an expense of over $6 million, which is less than is clearly displayed on the Senate's own disclosure engine (U.S. Senate, 2012). Monsanto's displayed total comes to less than $500,000 (Monsanto Company, 2012d, n.p.). These may be different PACs. What to make of this conflicting, labyrinthine and apparently contradictory paper trail?

The major issues reveal where Monsanto's interests lie, as reported by the corporation itself, and by the actions brought against it in various courts around the world, including that of public opinion. The quality of all this information must be viewed as suspect given the interest all of these parties set out to defend, spin and frame (McGrath, 2007, p. 269-70). Where Monsanto discloses it settled on the Nitro poisoning, it frames that on its "Issues" page as that the "U.S. Supreme Court agreed that the companies were not responsible for the implications of military use of Agent Orange in Vietnam, because the manufacturers were government contractors, carrying out the instructions of government" (Monsanto Company, 2012a, n.p.). The "Court agreed that the companies were not responsible" sounds far different than a negligent company settling because its erstwhile partner spilled dioxins all over a West Virginia company town. Returning to the remaining disclosures in the Monsanto 10-K shows the firm expects "to face unpredictable regulatory environments that may be highly politicized" (Monsanto Company,. 2012c, 35), there specifically in India. "We operate in volatile, and often difficult, economic and political environments," the firm explains, and as such the genetically-modified cotton operation "is currently operating under state governmental pricing directives that we believe limit near-term earnings potential in India" (Monsanto 2012c, p. 35). What the 2011 10-K could not report but the 2012 edition will, is that the agrichemical giant is being charged with Indian partner firms for biopiracy by the Indian National Biodiversity Authority, for stealing eggplants (Laursen, 2012, p. 11). Monsanto stole or has received from a partner it allegedly owns 26% of (Barker, n.d.), stolen eggplant varietals from India in order to develop GM versions, allegedly, in violation of clear local statutes (Laursen, 2012, p.11). The verdict on this charge is still out, but the accusation is ironic considering that Monsanto's intense prosecution for exactly this type of property violation is the major complaint by U.S. farmers against the company.

Biggest problem in U.S. is aggressive competition by Monsanto

As introduced briefly above, Monsanto apparently sues American small farmers when its proprietary genetics show up in surrounding non-GM crops (Gerken, 2012, n.p.). The point is that these farmers save seed, which carries the genetics Monsanto developed and thus owns, but which the farmers also do not want, because this lowers the value of their organic or at least non-GM-labeled products. The result is that the farmers either have to change crops to something Monsanto does not sell, purchase license from Monsanto and stop claiming their crop is organic / non-GM, or stop saving seed. The result of that is higher costs for the independent farmers, who must then buy non-GM seed in the market. The outcome of that would be higher seed prices for Monsanto's competitors, and thus lower relative prices and higher demand for Monsanto's GM seed. The point is that Monsanto sues independent farmers for pollution the farmers don't want (GM genes), probably in order to stimulate demand for its GM products or at least raise relative prices for substitutes. Once farmers convert to the GM crops, the best way to cultivate them is to spray them with Monsanto's other major income generator, the herbicide Roundup, which "Roundup Ready" crops are genetically engineered to resist. Farmers also complain the GM corn, canola, soy and alfalfa are causing resistance in the weeds and predators these crops and chemicals were developed to overcome, a negative externality the University of Illinois is apparently investigating (Kaskey, 2011, n.p.). The farmers vs. Monsanto class action suit, thrown out because it attempted to forestall actions that specifically had not happened yet and thus was unactionable, was aimed at taking away Monsanto's power to do what they apparently have to many farmers in the past. Unfortunately for the farmers, like assault, the police cannot prosecute a crime that has not been committed, even if the stalker has a record a mile long.

So, if Monsanto is convicted of stealing Indian genetics in order to develop their typical genetically herbicide-resistant hybrids, the result will be that the firm wins product-theft lawsuits at home against potential consumers who decline to purchase (organic farmers), using wind, insects and gravity to spread GM pollen to crops whose owners are materially damaged before and after the lawsuit, at the same time it deliberately steals or accepts stolen source genetics from impoverished countries where it operates abroad. What has this got to do with lobbying? Presumably Monsanto and the partners in India will lobby that government to look the other way, change the law, or find some loophole so Monsanto can expand its GM operations there. Monsanto points out on 10-K p. 11 that regulations and public sentiment in importing countries (and in the U.S.) against these accidental, trace "adventitious presence" (2012c, p. 11) genes could provoke further legislation against the firm and thus materially damage sales.

Back home however, outside of the purview of the Indian courts, the reverse-piracy, unwanted-stealing-lawsuit tactic has gotten a boost that Monsanto references in its 10-K on page 34 (2012c). The U.S. Environmental Protection Agency and its Canadian analog have "allowed reduction of the typical structured farm refuge from 20% to 5% for Genuity SmartStax in the U.S. Corn Belt and Canada and from 50% to 20% for the U.S. Cotton Belt." A "structured farm refuge" is a buffer zone where GM farmers must separate their crops from non-GM strains. If this buffer zone has been reduced, the GM corn will now be closer to the organic / 'natural' competitors' crops, increasing the potential for "adventitious presence" transmission, and hence more lawsuits; higher prices for competitors; the whole unwanted pollution lawsuit trick which Monsanto apparently calls later "our indemnification collection system" (2012c, p. 34) for GM cotton at least, if this translation from corporate-speak is accurate. Further expanding the buffer reduction was approval of "refuge-in-a-bag" (Monsanto, 2012c, p. 34) blended GM and 'natural' corn, so that Monsanto's customers can now perhaps grow GM corn right up to the neighbor's fence instead of the necessary buffer crop. One possible result is total market domination and ownership of the U.S. corn, soy, alfalfa and canola supply. What has this to do with eggplants? "We plan to improve and grow our vegetable seeds business, which has a portfolio focused on 23 crops," Monsanto explains to the SEC (2012c, p. 34). "We continue to apply our molecular breeding and marker capabilities to our vegetable seeds germplasm, which we expect will lead to business growth." What works in the U.S. may work all over the world, through vegetable seed exportation. That these statements were pasted out of sequence from Monsanto's report does not change the fact that Monsanto uses "adventitious presence" as an competitive tactic, but itself may turn out to be the thief in India

Did the "buffer-in-a-bag" amendment just drop freely out of Congress into Monsanto's lap unsolicited? Also not disclosed in the 2011 SEC 10-K is the presence of certain Monsanto past employees in the Obama Cabinet, which also supports the thesis that not all government influence by corporations is reported under federal, state or traditional lobbying definitions. "Millions Against" publicizes a list of about a ten Monsanto employees or consultants spanning the last four administrations, not all of which are currently relevant to this year's policy achievements for Monsanto (Organic Consumers Association, 2012, n.p.). None of the lobbyists cited by Millions Against cross-checked with Open Secrets' list of Monsanto's 2011 lobbyist contracts (Open Secrets, 2012a), but current target of the most criticism Federal Department of Agriculture Deputy Commissioner for Food Safety Michael Taylor apparently worked as a VP-level public policy analyst for Monsanto for sixteen months between jobs working for Clinton and now Obama (Armour, 2012, n. p.). Monsanto claims this is normal in professional circles and that it "makes perfect sense that someone in government who has concluded biotechnology is a positive, beneficial technology might go to work for a biotech company" (Monsanto, 2012d, n. p.). This is a natural agreement between industry and government when the benefits are becoming apparent to so many, according to this view, including many governments like the United Nations' World Health Organization and the French Academy of Medicine for example (Monsanto, 2012d, n. p.), although the French may reconsider after the recent poisoning.

Also not appearing in the 2011 10-K but due to be reported next year is Monsanto's conviction in France for the poisoning of a farmer who used their pesticides a few times too often (Reuters, 2012, n. p.). Monsanto appealed this ruling and so information regarding the specifics is still confidential, but this pattern of appealing to higher jurisdiction is a tactic Monsanto often employs abroad when sovereign nations place regulatory barriers to the genetically modified crops Monsanto derives the majority of its revenue from (Monsanto Company, 2012c, p. 8.), which support much of the revenue derived from supporting products like the defoliants their GM crops are engineered to resist. Straightforward enough. But Monsanto also has come up against reluctance on the part of numerous European nations to admit GM crops as blithely as the U.S. does. Monsanto itself reports to the SEC (2012c, p. 35) that in order to expand into France, Germany, Austria and Luxembourg,. "we have also invoked procedural measures, but we have focused our legal challenges to those countries with significant corn plantings." One consequence of joining the European Union is a growing exposure to U.S. biotechnology and the genetically engineered crops foreign firms use administrative process to force on sovereign countries there, with the result being that the EU slowly dismantles barriers to engineered feed and crops like Monsanto's (Davies, 2011, n. p.).

Conclusions and further research

The result of this investigation has been the conclusion that yes, Monsanto lobbies government heavily in the U.S. And abroad to open markets for their genetically modified agricultural products. Research into any state elections division or Federal Elections Commission records immediately reveals intense activity, going up to millions of dollars spent per year influencing lawmakers on policy from energy to emissions to national security. What such search will not reveal, is what action that money achieves, or what 'lobbying' Monsanto performs without spending money, and how they use the courts to achieve even more competitive advantage than they already have against small, independent farmers here in the U.S., and abroad but on a scale the small independents may very well not have equal access to. Monsanto has committed some illegal actions including pollution of its consumers, courts have ruled, and, if the Indian allegations stick, international biopiracy. Its products are apparently causing resistance to develop in the very competitors (weeds) and predators (insects) those chemicals were synthesized to combat, as scientists have been aware is often if not usually the case at least since Rachel Carson's Silent Spring now these fifty years ago (1962). While Monsanto is "dedicated to providing full transparency about our company," the list of topics they are "willing to discuss" contains only the items they are able to frame (Monsanto Company, 2012a, n.p.). This hardball stance shows up in far more power than average firms, and even some European countries, are able to wield in the halls of government and public opinion. The result will be empirical if the regulators of the world take such risk lightly -- while one result may very well be improved agriculture that could feed the world's starving millions, the other path leads to the centralized ownership, homogenization and thus loss of disease-resistant natural diversity like the world has never seen in the whole of human history.