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Meat Industry Could Shut Down Temporarily Over Federal Spending Cuts

Budget Cuts Meat Industry

The US meat industry could shut down for two weeks or longer because of federal spending cuts, the White House warned on Friday.

The temporary shut down could be caused by across-the-board spending cuts set to take effect on March 1. The spending cuts run the risk of furloughing every US meat and poultry inspector for two weeks.

The furlough would shut the industry down, because meatpackers and processors are not allowed to ship their beef, pork, lamb, and poultry without the Agriculture Department’s inspection seal, reports The Huffington Post.

The White House also warned about the effects of the spending cuts on everyday life beyond the US meat industry. Meatpackers also warned that the shut down would not only devastate consumers, it would also devastate the industry.

President Barack Obama and congressional Republicans have still been unable to resolve the so-called “fiscal cliff,” which was delayed from January 1 to March 1. As the date approaches, anxiety has increased over whether the two sides will be able to put aside differences and solve the problem together.

Should they be unable to do so and the USDA’s Food Safety and Inspection Service be forced to furlough its employees, the meat industry could lose an estimated $10 billion in production over those two weeks. Consumers would also be affected, as they would likely see a meat shortage and higher prices as a result, notes The New York Daily News.

Tom Vilsack, US Agriculture Secretary, lamented the across-the-board spending cuts last week, saying, “There is not much we can do when Congress says to cut every line item by a certain percent.” Employee pay accounts for the majority of spending at the meat safety agency.

The USDA currently spends roughly $1 billion per year on meat safety. IT employs 8,400 inspectors at 6,290 slaughter and processing plants nation-wide.

Chicago livestock inspectors were skeptical of the White House threat and Joseph Ocrant, a trader who is skeptical that the White House would actually furlough inspectors for two weeks, stated, “Can you imagine the flak?” The American Meat Institute stated that the USDA should work to keep meat plants open while meeting the targeted cuts, instead of causing a mass furlough.

[Image via ShutterStock]

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