4 ms·

Correct, that is what a cartel is for

dehrmann 5y ago
Cartels and unions both tightly control the supply of what they are selling, so they're not all that different economically.
meheleventyone 5y ago
Isn’t a cartel more about illicit collusion (often outright illegal) rather than forming a public organisation to act collectively?
- celestialcheese 5y ago
  It seems like it depends on the industry. OPEC is the largest, and definitely not illegal, cartel, but there are others. [1] 1 - https://guides.loc.gov/oil-and-gas-industry/organizations https://guides.loc.gov/oil-and-gas-industry/organizations
  - aksss 5y ago
    OPEC would be illegal if replicated by a band of American companies, no? I think it's only "legal" because the sovereign entities running it transcend any laws of commerce as we understand them in America. Not dependent upon the industry so much as the scale of the participants and the laws those participants are beholden to.
- AnthonyMouse 5y ago
  Cartels violate antitrust laws. Labor unions in particular have an antitrust exception. But both of them are solving the problem from the wrong end. The question isn't how to negotiate with an existing monopolist that can screw you over with monopoly power, it's how to break their monopoly. "Get your own monopoly" not only doesn't fix it, it just makes it worse for everybody else. Congratulations, humans who eat food, there are now two monopolies in your supply chain.
  - giantg2 5y ago
    That's a duopoly, which is hopefully better than a monopoly. It forces competition and will at least keep the independent people solvent. Hell, you can structure it where the processing fee is set and the producers set their own sale prices. What other options. Is there for beef production?
    - AnthonyMouse 5y ago
      You misunderstand. It's not that there was one monopoly wholesaler and now there are two. It's that there was one monopoly wholesaler, and there still is, but now it's negotiating with a new cartel of manufacturers. That's not better. Don't form a new cartel, break up the old monopoly.
      - giantg2 5y ago
        Who is this monopoly wholesaler? Also, it's not a cartel if they don't control/regulate production.
        AnthonyMouse 5y ago
        I see the confusion, you're the OP and you're talking about what you suggested instead of what azemetre suggested. The independents creating their own meat packing plant is a fine idea. Increase competition. It's like a co-op in reverse. They could even accept third party jobs. If they were even smarter they'd open one, sell it as a going concern, use the money to open another one, and repeat until the concentrated market is good and thoroughly disintegrated. Having the independents come together to form a cartel to negotiate with the existing concentrated market of meat packing plants is the bad idea.
ipaddr 5y ago
Association is a better concept or industry group
- bobthepanda 5y ago
  Farmers already do this, and they're called cooperatives. Some US big name brands that are cooperatives are Darigold, Land O' Lakes, Organic Valley, and Sunkist. The largest company in New Zealand is a dairy cooperative: https://en.wikipedia.org/wiki/Fonterra https://en.wikipedia.org/wiki/Fonterra It's interesting that this is not common for meat, when it is for dairy. Wonder why that is.
  - Mandatum 5y ago
    Because meat isn't as commoditized, there's too many different grades and products. When 70%+ of your output turns into shelf-stable milk powder, it's all the same. Fonterra has kept local milk supplies in New Zealand at export prices for more than 15 years. It wasn't until recently that smaller independent co-op's formed and began selling processor-to-table and exporting themselves. However now many of the processors are owned by the same companies or people, so processors who'd previously deal with these co-ops are signing exclusivity deals with Fonterra and they're being shut out of the market. But we also have the income and GDP brought by Fonterra for the last 10-15 years to thank. Unfortunately we're seeing a lot of those profits off-shored or eaten up by corporate middlemen owned by conglomerates now.
    - chrisseaton 5y ago
      Meat is literally traded as a commodity. https://en.wikipedia.org/wiki/Lean_Hog https://en.wikipedia.org/wiki/Lean_Hog

Cartels and unions both tightly control the supply of what they are selling, so they're not all that different economically.

meheleventyone 5y ago

Isn’t a cartel more about illicit collusion (often outright illegal) rather than forming a public organisation to act collectively?

celestialcheese 5y ago
It seems like it depends on the industry. OPEC is the largest, and definitely not illegal, cartel, but there are others. [1] 1 - https://guides.loc.gov/oil-and-gas-industry/organizations https://guides.loc.gov/oil-and-gas-industry/organizations
- aksss 5y ago
  OPEC would be illegal if replicated by a band of American companies, no? I think it's only "legal" because the sovereign entities running it transcend any laws of commerce as we understand them in America. Not dependent upon the industry so much as the scale of the participants and the laws those participants are beholden to.
AnthonyMouse 5y ago
Cartels violate antitrust laws. Labor unions in particular have an antitrust exception. But both of them are solving the problem from the wrong end. The question isn't how to negotiate with an existing monopolist that can screw you over with monopoly power, it's how to break their monopoly. "Get your own monopoly" not only doesn't fix it, it just makes it worse for everybody else. Congratulations, humans who eat food, there are now two monopolies in your supply chain.
- giantg2 5y ago
  That's a duopoly, which is hopefully better than a monopoly. It forces competition and will at least keep the independent people solvent. Hell, you can structure it where the processing fee is set and the producers set their own sale prices. What other options. Is there for beef production?
  - AnthonyMouse 5y ago
    You misunderstand. It's not that there was one monopoly wholesaler and now there are two. It's that there was one monopoly wholesaler, and there still is, but now it's negotiating with a new cartel of manufacturers. That's not better. Don't form a new cartel, break up the old monopoly.
    - giantg2 5y ago
      Who is this monopoly wholesaler? Also, it's not a cartel if they don't control/regulate production.
      - AnthonyMouse 5y ago
        I see the confusion, you're the OP and you're talking about what you suggested instead of what azemetre suggested. The independents creating their own meat packing plant is a fine idea. Increase competition. It's like a co-op in reverse. They could even accept third party jobs. If they were even smarter they'd open one, sell it as a going concern, use the money to open another one, and repeat until the concentrated market is good and thoroughly disintegrated. Having the independents come together to form a cartel to negotiate with the existing concentrated market of meat packing plants is the bad idea.

ipaddr 5y ago

Association is a better concept or industry group

bobthepanda 5y ago
Farmers already do this, and they're called cooperatives. Some US big name brands that are cooperatives are Darigold, Land O' Lakes, Organic Valley, and Sunkist. The largest company in New Zealand is a dairy cooperative: https://en.wikipedia.org/wiki/Fonterra https://en.wikipedia.org/wiki/Fonterra It's interesting that this is not common for meat, when it is for dairy. Wonder why that is.
- Mandatum 5y ago
  Because meat isn't as commoditized, there's too many different grades and products. When 70%+ of your output turns into shelf-stable milk powder, it's all the same. Fonterra has kept local milk supplies in New Zealand at export prices for more than 15 years. It wasn't until recently that smaller independent co-op's formed and began selling processor-to-table and exporting themselves. However now many of the processors are owned by the same companies or people, so processors who'd previously deal with these co-ops are signing exclusivity deals with Fonterra and they're being shut out of the market. But we also have the income and GDP brought by Fonterra for the last 10-15 years to thank. Unfortunately we're seeing a lot of those profits off-shored or eaten up by corporate middlemen owned by conglomerates now.
  - chrisseaton 5y ago
    Meat is literally traded as a commodity. https://en.wikipedia.org/wiki/Lean_Hog https://en.wikipedia.org/wiki/Lean_Hog