ranch hand
Well-known member
THE VOCAL POINT
THE VOCAL POINT: Secretary charms, Luter disarms, competitors alarmed
by Dan Murphy on 3/10/2006 for Meatingplace.com
SAN FRANCISCO — If ever someone needed a quick study in contrast between government and the private sector, Exhibits A and B were on display at the National Meat Association's 60th Annual Convention held here last week.
Two well-known, high-profile speakers book-ended the three-day meeting: USDA Secretary Mike Johanns at the beginning, and Smithfield Foods Chairman and CEO Joe Luter III to wrap things up.
Talk about an odd couple.
Of course, one wouldn't expect a boatload of similarities between a button-down Cabinet officer whose primary role revolves around delivering carefully crafted messages to assuage often antagonistic constituencies, and a hard-driving, no-nonsense business leader famous for his blunt analysis and bold risk-taking in pursuit of nothing less than a reinvention of the business model for pork production.
Any such expectations wouldn't have been shattered in this case.
Johanns, who has certainly made himself much more accessible than his media-phobic predecessor, Ann Veneman, is a very likeable guy. Partly because he's a former Nebraska governor who won two statewide elections, and partly because that's apparently the way he's put together, Johanns works a roomful of reporters like a Chicago alderman at a campaign fund-raiser.
But although the human touch is a welcome change from official Washington's practiced indifference to the media (unless your business card happens to include the phrase Wall Street Journal), what Johanns actually said in nearly an hour of talking and responding to questions was about as credible as those Oscar night acceptance speeches noting just how much the recipient (sob) "believed in this film," even when the rest of Hollywood said it would never get made.
Right.
In the case of Johanns' speech, it was longer but apparently as tightly scripted as the Oscar "patter" the award presenters — who are supposed to be top-tier actors! — woodenly recite before opening the envelope. I say that because a veteran Capitol Hill reporter sitting behind our table during his keynote address was actually reciting the Ssecretary's speech word-for-word as he delivered it.
For a public official charged with projecting credibility among the very businesspeople his agency regulates, that ain't good.
Let me hasten to add that Johanns never gives the appearance of being scripted. Like most seasoned politicos, he's at home in front of a crowd, liberal with his name dropping — if not his views on trade policy — and quick with a self-deprecating anecdote (in Johanns' case, a too-long tale about mistakenly crashing a private wedding reception during a gubernatorial campaign swing in 2002).
But for all the D.C. dark-suit-and-rep-tie respectability, for all the glad-handing, photo-op sincerity — which seems genuine, by the way — Johanns' remarks could have been stocked next to the Campbell's soup, they were so canned.
Which makes them suspect.
On the tough issues, we've come to expect our politicians to say little and to do next to nothing. But Cabinet leaders are supposed to function as ... well, leaders.
Happy talk about how hard everyone's working back in Washington to solve all those tough problems is center-of-the-plate stuff for candidates on the stump.
It's a lot less appetizing when it's delivered by officials who do, in fact, have the power to effect changes that might mitigate those tough issues.
Case in point: In addition to tap-dancing around a question whether meat and poultry industry officials should just assume that federal subsidies for program crops like corn and soybeans will "stay the course" over the next few farm-bill funding cycles, Johanns dodged an even more pointed question about a much more immediate issue: Should USDA appoint a special negotiator to head up its trade mission to Japan? In other words, does the department have leadership with the right skill set spearheading the effort to reopen our nation's largest and most profitable beef export market?
That's a legitimate question, and more than one industry insider privately criticized USDA's stubborn insistence that ag economists and career administrators are the best they could get to handle sensitive, complex negotiations with the government of Japan.
Johanns' response: "We've got the right people in place."
He didn't add that they were all doing "a heckuva job," but since when is it politically incorrect for a top administration official to tell his largest single constituency that we're going to bring in some top-flight talent to help solve the most important economic issue you have on the table right now?
To pretend that interminable delays in resuming beef exports is the fault of Japanese "sensitivities" is playing politics. And it's a stance that can only be characterized as unacceptable for anyone with a stake in somehow bringing the rest of the world around to the idea that international scientific standards can — and must — be the criteria by which animal and human health issues related to food exports are judged.
Bold new business model
By contrast, Joe Luter III took the podium for the final NMA session looking like the hapless attendee whose luggage got lost on the fight into town. His faded jeans, off-the-rack blazer and shirt-sans-tie "look" fit perfectly with his down-on-the-farm, good ol' Southern gentleman conversational style that many might mistakenly be considered a liability in the hard-charging, hard-edged world of big business deal-making.
They'd do so at their own peril.
For starters, Luter has taken a modest regional meat company and turned it into the industry's premier pork company and its most striking financial success story. As big-name competitors all around him have sold off brands and business lines, merged themselves out of existence or simply cut loose their meatpacking operations to be scooped up by the nearest available bidder — Luter — Smithfield Foods has shrewdly created and quietly perfected a vertical integration model that the "smart people" in the industry and on Wall Street were certain would never work.
News flash: It's working.
Now, Luter plans to develop and implement a vertical integration model for the beef industry, and again, the chorus of naysayers was in full throat mere minutes after he candidly discussed exactly how and why Smithfield felt confident it could reshape the beef industry as the company has done with pork production.
It's a bold vision, no doubt, to attempt to do what every industry analyst I've ever heard has dismissed as economically impossible. But the truth is that a quick check of beef-industry players shows that, profit-wise, most of them aren't exactly hanging around the Exxon-Mobil lounge of late.
Moreover, as Luter so bluntly — and accurately — put it: "I'm the only packer around who gets excited when hog prices rise. Why wouldn't I want to have similar leverage in beef?"
Good question. And one that his competitors ought to be very, very nervous in contemplating.
The bottom line to this little comparative study seems obvious. Convention attendees who listened to both Luter and Johanns hold forth on the industry's future would be well-advised in either case: Don't judge a man by his appearance.
Dan Murphy is a freelance writer and former editor of MMT magazine based in the Pacific Northwest . His column, THE VOCAL POINT, appears in this space each Friday.
THE VOCAL POINT: Secretary charms, Luter disarms, competitors alarmed
by Dan Murphy on 3/10/2006 for Meatingplace.com
SAN FRANCISCO — If ever someone needed a quick study in contrast between government and the private sector, Exhibits A and B were on display at the National Meat Association's 60th Annual Convention held here last week.
Two well-known, high-profile speakers book-ended the three-day meeting: USDA Secretary Mike Johanns at the beginning, and Smithfield Foods Chairman and CEO Joe Luter III to wrap things up.
Talk about an odd couple.
Of course, one wouldn't expect a boatload of similarities between a button-down Cabinet officer whose primary role revolves around delivering carefully crafted messages to assuage often antagonistic constituencies, and a hard-driving, no-nonsense business leader famous for his blunt analysis and bold risk-taking in pursuit of nothing less than a reinvention of the business model for pork production.
Any such expectations wouldn't have been shattered in this case.
Johanns, who has certainly made himself much more accessible than his media-phobic predecessor, Ann Veneman, is a very likeable guy. Partly because he's a former Nebraska governor who won two statewide elections, and partly because that's apparently the way he's put together, Johanns works a roomful of reporters like a Chicago alderman at a campaign fund-raiser.
But although the human touch is a welcome change from official Washington's practiced indifference to the media (unless your business card happens to include the phrase Wall Street Journal), what Johanns actually said in nearly an hour of talking and responding to questions was about as credible as those Oscar night acceptance speeches noting just how much the recipient (sob) "believed in this film," even when the rest of Hollywood said it would never get made.
Right.
In the case of Johanns' speech, it was longer but apparently as tightly scripted as the Oscar "patter" the award presenters — who are supposed to be top-tier actors! — woodenly recite before opening the envelope. I say that because a veteran Capitol Hill reporter sitting behind our table during his keynote address was actually reciting the Ssecretary's speech word-for-word as he delivered it.
For a public official charged with projecting credibility among the very businesspeople his agency regulates, that ain't good.
Let me hasten to add that Johanns never gives the appearance of being scripted. Like most seasoned politicos, he's at home in front of a crowd, liberal with his name dropping — if not his views on trade policy — and quick with a self-deprecating anecdote (in Johanns' case, a too-long tale about mistakenly crashing a private wedding reception during a gubernatorial campaign swing in 2002).
But for all the D.C. dark-suit-and-rep-tie respectability, for all the glad-handing, photo-op sincerity — which seems genuine, by the way — Johanns' remarks could have been stocked next to the Campbell's soup, they were so canned.
Which makes them suspect.
On the tough issues, we've come to expect our politicians to say little and to do next to nothing. But Cabinet leaders are supposed to function as ... well, leaders.
Happy talk about how hard everyone's working back in Washington to solve all those tough problems is center-of-the-plate stuff for candidates on the stump.
It's a lot less appetizing when it's delivered by officials who do, in fact, have the power to effect changes that might mitigate those tough issues.
Case in point: In addition to tap-dancing around a question whether meat and poultry industry officials should just assume that federal subsidies for program crops like corn and soybeans will "stay the course" over the next few farm-bill funding cycles, Johanns dodged an even more pointed question about a much more immediate issue: Should USDA appoint a special negotiator to head up its trade mission to Japan? In other words, does the department have leadership with the right skill set spearheading the effort to reopen our nation's largest and most profitable beef export market?
That's a legitimate question, and more than one industry insider privately criticized USDA's stubborn insistence that ag economists and career administrators are the best they could get to handle sensitive, complex negotiations with the government of Japan.
Johanns' response: "We've got the right people in place."
He didn't add that they were all doing "a heckuva job," but since when is it politically incorrect for a top administration official to tell his largest single constituency that we're going to bring in some top-flight talent to help solve the most important economic issue you have on the table right now?
To pretend that interminable delays in resuming beef exports is the fault of Japanese "sensitivities" is playing politics. And it's a stance that can only be characterized as unacceptable for anyone with a stake in somehow bringing the rest of the world around to the idea that international scientific standards can — and must — be the criteria by which animal and human health issues related to food exports are judged.
Bold new business model
By contrast, Joe Luter III took the podium for the final NMA session looking like the hapless attendee whose luggage got lost on the fight into town. His faded jeans, off-the-rack blazer and shirt-sans-tie "look" fit perfectly with his down-on-the-farm, good ol' Southern gentleman conversational style that many might mistakenly be considered a liability in the hard-charging, hard-edged world of big business deal-making.
They'd do so at their own peril.
For starters, Luter has taken a modest regional meat company and turned it into the industry's premier pork company and its most striking financial success story. As big-name competitors all around him have sold off brands and business lines, merged themselves out of existence or simply cut loose their meatpacking operations to be scooped up by the nearest available bidder — Luter — Smithfield Foods has shrewdly created and quietly perfected a vertical integration model that the "smart people" in the industry and on Wall Street were certain would never work.
News flash: It's working.
Now, Luter plans to develop and implement a vertical integration model for the beef industry, and again, the chorus of naysayers was in full throat mere minutes after he candidly discussed exactly how and why Smithfield felt confident it could reshape the beef industry as the company has done with pork production.
It's a bold vision, no doubt, to attempt to do what every industry analyst I've ever heard has dismissed as economically impossible. But the truth is that a quick check of beef-industry players shows that, profit-wise, most of them aren't exactly hanging around the Exxon-Mobil lounge of late.
Moreover, as Luter so bluntly — and accurately — put it: "I'm the only packer around who gets excited when hog prices rise. Why wouldn't I want to have similar leverage in beef?"
Good question. And one that his competitors ought to be very, very nervous in contemplating.
The bottom line to this little comparative study seems obvious. Convention attendees who listened to both Luter and Johanns hold forth on the industry's future would be well-advised in either case: Don't judge a man by his appearance.
Dan Murphy is a freelance writer and former editor of MMT magazine based in the Pacific Northwest . His column, THE VOCAL POINT, appears in this space each Friday.
