Free Riding Lowers Market Returns 5-20%

[smcgrath76]

MGMT - I am a member of one such
professional organization. In the past
I was a voluntary member and received
what I felt was great benefit. Now I am
a member because by law I have to be and
I consider it a complete and total waste
of my money. There is no longer any
value to me and certainly 0
accountability as the accountability for
the organization is set in regulation by
government, not by the membership.
I agree in principle with a common pool
of $ for use in pursuit of common
interests (non-directional), but I am
not certain how we make the unilateral
decision that ABP in its' current
state/structure should administer that
common pool of resources. The issue of
the best place to administer this common
good is what created ALMA in AB, create
SCA in SK, resulted in voluntary
checkoff in AB, etc. The issue is not
going away, but the discussion is not an
open and shut case of non-refundable
checkoff going directly to ABP no
questions asked.

[smcgrath76]

Forgot to add, most other provinces have a
refundable checkoff.

[grassfarmer]

MGMT, If only ABP had walked the talk when it came
to democracy. The main reason they find
themselves in their current predicament is that they
run roughshod over democracy for too long. Too
many years of producer meetings where resolutions
were made and passed by ranchers only to vanish
and never see the light of day at the AGM. Or the
ones that did be unanimously voted down by the
directors, despite the same directors having backed
the resolutions out at their zone meetings. A lot of
similarities to the Alberta land grab bills - ABP has
long been controlled by their "cabinet room" instead
of being a true voice of producers. No wonder they
support the land grabs - like minded "communist
conservatives"

I find it ironic that this whole ABP stance runs so
contra to the commonly stated Alberta values.
Where is the freedom to choose? the individualism
this industry and province supposedly runs on? This
is nothing but a goddam union under another name
- insisting that all the "employees" must pay in.

I'd really like to hear farmers_son take on all this as
he seemed to be quite a supporter of AB/CCA but
has been unusually absent from this thread.

[MGMT]

Smcgrath76. Yes. The only province remaining with a non refundable check off is Ontario. The free rider problem exists there too.

I think I know the professional organization you refer to and I pretty much agree. Just the same, wasn’t the change a majority decision of the membership? As such shouldn’t the decision be respected?

I am not sure I am getting your point. In Alberta, ABP was established in 1969 at the request of five widely diverse farm groups (the Alberta Cattle Breeders Association, Alberta Dairymen’s Association, Alberta Federation of Agriculture, Farmers Union of Alberta and the Western Stock Growers’ Association. In Alberta all the check off collecting commissions or boards work much the same way.

Are you referring to how the government changed the check off from non refundable to refundable without a producer referendum? That was undemocratic and should never have happened.

Grassfarmer. I have read these threads long enough to know you have a problem with your resolutions being defeated. There is never a guarantee that a resolution passed at the local level will go on at the provincial level. And within ABP the “board” is made up of elected producers. The board needs to make decisions. Everything can’t be decided at an AGM. That is how democracy works.

[MGMT]

I should have said the free rider problem exists in the other provinces with a refundable check off. You would not see it in Ontario.

[grassfarmer]

"The board needs to make decisions...... That is how
democracy works." Or DOESN'T work in this case -
same with the AB Land grab laws.

I happened to read this posting on another forum
today where a similar discussion is going on about
checkoff levy in Kentucky. Thought it was rather
fitting.

"What is a checkoff, but a committee financed by all
to pass on the views of those already in power?"

[smcgrath76]

MGMT - On the first organization - I
don't recall ever getting a chance to
vote. An act was changed and so was the
organization. It is now focused on
serving the oil industry (particularly
reclamation).

Perhaps my take was confusing. I think
the issue that ABP ran into when it hit
the crossroads a few years ago was to
honestly address the questions of
whether the organization was still
relevant, or if many of its
procedures/positions/processes were
outdated. They did try to go through an
assessment of sorts, but producers are
not exactly known as being incredibly
open to change. At that point it is a
question of should things be
restructured or restarted. I think that
is the crux of the debate.
The challenge of democracy is that the
apathy of the many is often trumped by
the tyranny of the few.
One thing I would like to see is that
anyone who requests a refund lose the
right to serve as a director and
possibly the right to vote, but managing
that would be an office nightmare.

[per]

"One thing I would like to see is that
anyone who requests a refund lose the
right to serve as a director and
possibly the right to vote"

Not much of a deterrent.

That's an interesting perspective. It appears to me that in a non directional refund world you are a member in good standing while the ABP has your money until you have received it back. Not likely is there ever a time when a refunder is not a member at least for long.

As far a free riding goes, some of the so called free riders invest much more than the sum of their check off refund into the industry. Hardly free.

MGMT, what was the original mandate of the Cattle Commission?

[Happytrails]

This is an interesting discussion that I am glad to see taking place. A couple (OK 3) points.

1. The checkoff is only 2/3 refundable. So nobody is free riding, just riding cheaper.

2. MGMT, you say that making the checkoff refundable was undemocratic. I would have to disagree. I wasn't there in 1969 but have it on good authority that the Western Stockgrowers only agreed to a non refundable checkoff because of strong pressure from the other organizations. Many stockgrowers regretted caving on that principle. BTW the checkoff was 10 cents a head back then.

3. It is likely a bit of a stretch but the ABP board acted a little like the former CWB in dealing with change. Instead accepting their new reality they both spent too much energy fighting it. And I agree with Sean that there should be ways to reward those who of us who put their money into our industry.

[forage]

Read a very interesting article in Grass Routes, front page has a direct message as if MGMT wrote it himself.