TIME: Almanac 1995

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<text id=94TT0990> <title> Jul. 25, 1994: Political Interest:Chicken Got Loose </title> <history> TIME--The Weekly Newsmagazine--1994 Jul. 25, 1994 The Strange New World of the Internet </history> <article> <source>Time Magazine</source> <hdr> THE POLITICAL INTEREST, Page 29 How the Chicken Got Loose </hdr> <body> By Michael Kramer The first crisis for Bill Clinton's Secretary of Agriculture came on the day of his swearing in, Jan. 22, 1993. A child died after eating government-inspected meat at a Seattle-area Jack in the Box restaurant. Two more died and hundreds of other Westerners fell ill from the contaminated food; some of them developed a life-threatening kidney syndrome. The new President, in office for only two days, expressed his shock. The Agriculture Secretary, Mike Espy, ordered an investigation to trace the outbreak's cause, a mystery never conclusively solved. In the midst of that emergency, Espy found time to intervene in an obscure Puerto Rico dispute of great concern to the U.S. poultry industry, and especially to Tyson Foods, the world's largest chicken producer and the No. 1 poultry exporter to the island commonwealth. The story of Espy's role in the Puerto Rico issue, which TIME has assembled from dozens of interviews and documents, emerges at a time when the White House has been struggling to refute allegations that Tyson enjoys undue influence with Clinton and his staff. As Arkansas' Governor, Clinton had close ties with Tyson, the state's largest employer. Several company executives helped finance Clinton's many campaigns. Tyson general counsel Jim Blair guided Hillary Clinton's fabulously successful commodities trades. Tyson was also the second largest contributor to a $220,000 fund Clinton used to pursue his Arkansas political agenda, an enterprise uncovered last week by the Associated Press. Espy, too, was intimately familiar with the poultry industry from his days as a Mississippi Congressman. The Justice Department and Congress are currently investigating Espy's association with Tyson, prompted by accusations that he accepted plane trips and football tickets from the chicken producer. (He later reimbursed the company.) The Agriculture Secretary's intervention in the Puerto Rican matter offers a vivid example of how Tyson benefits from its historic connections to Clinton. The case illustrates that such influence is best wielded subtly, and better still when third parties can front as the ones seeking favors and getting them. The target of Tyson's irritation was Puerto Rico's 1961 poultry law, a classic protectionist measure. Off-island producers found it difficult and costly to enter the isolated market. Until the 1980s, though, no one much cared. Then, as chicken consumption surged, the giant mainland producers faced a problem for which Puerto Rico seemed an ideal solution. Chicken parts, rather than whole broilers, had become popular and were the most profitable way of marketing the birds. But in the states, only the white meat sold well. Since most Latins prefer dark meat, Puerto Rico became a logical place to sell what many mainland Americans wouldn't buy. Starting in 1988, Tyson sought to farther penetrate the island market by changing the regulations. "We tried talking it out," recalls Guillermo Garcia, Tyson's exclusive Puerto Rican importer, "but that failed." So, with the support of the Federal Government, which filed a brief endorsing their position, Garcia and some other importers sued, claiming Puerto Rico's statute unconstitutionally protected local producers because its stringent rules exceeded U.S. law. In late 1992, the case was settled. The consent decree, approved by a San Juan federal judge, liberalized the regulations, thus permitting more imports. All sides seemed satisfied with the deal. Not everyone, however, was content with the terms. One of the new rules required that the importer's name appear on each consumer-size package. "We fought for that so we'd be able to trace back where the product came from if people got sick," says Kermidt Troche, the Puerto Rico agriculture department official in charge of enforcing the poultry regulations. "Tyson and others were sending in frozen chicken and thawing it out to sell as fresh. With our power outages and water shortages, we worried about food poisoning from bad chicken. If that happened, we wanted to know who was responsible." As Clinton took office in Washington on Jan. 20, 1993, Troche detained several million pounds of chicken on the docks in San Juan because the importer's name was missing. Some of the importers, including Tyson's Garcia, argued that a mistake had been made, that they had never intended to agree to a provision that would permit tracing the chicken's origin. Others said the regulation was fine but argued they needed more time to comply. Back in court on Jan. 27, the judge was incredulous. The settlement deliberations had been lengthy and detailed. The parties to the litigation, the judge concluded, had agreed to the new rules with their eyes open. There wasn't any mistake. The embargoed chicken could not be sold. "It was going to rot," says Garcia. "We were furious." Garcia called Tyson's Arkansas headquarters, where officials promised swift action. "We expected a good result because of Tyson's support of Clinton," says Garcia, "but we were told that it wouldn't look good for Tyson to seek Espy's help directly. For that, we were told, the National Broiler Council would be used as a kind of shield." The broiler group serves as the trade association for the poultry industry as a whole, but Tyson dominates the council since dues are paid according to company size. To get action on the Puerto Rican problem, a Tyson executive called George Watts, president of the Broiler Council, who in turn called Espy's chief of staff and the acting Assistant Agriculture Secretary. Since USDA rules don't require the importer's name on consumer-size packages, Watts urged the department to assert the primacy of federal law. Just nine days after Clinton's Inauguration, when the Administration had barely appointed enough staffers to run the department, a career USDA lawyer drafted a letter to Puerto Rico Governor Pedro Rossello, making that rather technical argument. Espy signed it three days later, on Feb. 1. That night, at a National Governors' Association meeting in Washington, Espy urged Rossello to release the embargoed chicken. Two days later the regulation was suspended. The chicken was in. But Tyson wasn't satisfied with that. Having pressured Puerto Rico to ditch the labeling requirement, the chicken giant struck for more. The Broiler Council began an attempt to craft new regulations even more favorable to the mainland producers. At a Feb. 18 meeting in San Juan attended by Puerto Rican officials and poultry-industry representatives, Tyson momentarily dropped the pretense that the industry group was doing the lobbying. While the Broiler Council had requested the session, records reviewed by TIME show clearly that it was a Tyson vice president, Mike Morrison, who described in detail the many rules Tyson wanted changed. The council threatened a new lawsuit if Puerto Rico didn't agree. "We didn't want that," says an associate of Puerto Rico's governor. Rossello, at the time unaffiliated with either mainland political party, was on the verge of declaring himself a Democrat. Continues the associate: "He didn't want to offend Tyson frontally and get in a lawsuit with the Feds when he was trying to position himself closer to Clinton, who he knew was a good friend of Tyson's. We decided to drag it out, to fight a rearguard action through extended negotiations. We decided to talk." With whom, though? The talks took a strange turn, in which the chicken industry became the mouthpiece of the U.S. government. While USDA officials had the responsibility to bargain with Puerto Rico, as the earlier court order contemplated, the Broiler Council took over instead. USDA staffers in San Juan say their bosses in Washington told them to back off. "Face it," says a career USDA official who has dealt with the poultry industry for two decades. "On something like this we're not going to accept anything the Broiler Council doesn't want and they're not going to accept anything Tyson doesn't want. So why waste time? Let the Broiler Council carry the ball." As it happens, however, Tyson's interest in Puerto Rico has abruptly waned because the company has found hungrier and less restrictive markets for its surplus chicken parts. Tyson is currently sending most of its dark meat abroad. "If it needs to push more stuff down here in the future," says importer Garcia, "the heat will be on again." In pursuing their aggressive actions to influence the government's policy, Tyson and the Broiler Council were justifiably promoting their business. "Our job is to protect our industry," says council president Watts. "Our responsibility is to our interests," says Archie Schaffer, Tyson's spokesman. Espy's USDA, however, has no good explanation for why it caved in so swiftly to the chicken industry. True, previous Secretaries of Agriculture have written letters to earlier Puerto Rican governors asking for rule changes to conform with federal law. But Espy's quick intervention ignored a court-approved settlement as well as Puerto Rico's clear interest in protecting the safety of its citizens. And USDA's decision to allow the Broiler Council to negotiate with Puerto Rico is at best a dubious delegation of the Federal Government's authority. When asked to explain the circumstances of Espy's intervention, his staff offers a confused and shifting picture that seems designed primarily to obscure Tyson's influence in the matter. Espy has refused to comment because of the investigation into his dealings with Tyson. Espy's spokeswoman and close adviser, Mary Dixon, at first insisted that Governor Rossello had asked that Espy write the controversial letter intended to get the chicken freed. "An absolute lie," said Troche, the overseer of chicken regulations in Puerto Rico. "Washington sees us as a backwater," said Rossello assistant Steve Patterson. "They think we're all stupid and don't know what's going on." Faced with those denials, Dixon said, "I'll check." A day later, after claiming she "misspoke," Dixon served up a second explanation. The Espy letter had been generated after the Secretary and Rossello spoke on the night of Feb. 1 in Washington. But USDA lawyer Hal Reuben, who drafted the note, said it was finished and approved three days earlier, which indicates that it wasn't the Puerto Rican governor who was clamoring to get the seized chicken onto the supermarket shelves. Confronted with Reuben's testimony, Espy's spokeswoman introduced a new suspect. "It was all the Boston Sausage company," Dixon cried. "Tyson wasn't any part of it." Boston Sausage, it turns out, was indeed another mainland company whose chicken had been detained. And, in fact, Boston Sausage confirms that it reached out to Espy's office--but only after the Secretary's letter had already been drafted. Espy's aides are clearly loath to acknowledge the real cause of the Secretary's intervention: the Broiler Council's urgent phone calls on Tyson's behalf. Three days after Clinton's Inauguration, Tyson chairman Don Tyson was asked what influence he hoped to have with the new President. "I would be irresponsible to my company and my industry if I didn't have any input," Tyson said following a speech in Anchorage, Alaska. "Clinton understands the needs of business." So too, it seems, does the President's Agriculture Secretary, Mike Espy. </body> </article> </text>