U.S. Department of Agriculture's Corrupt Seizing of Raisins

July 25, 2013

Depression-era regulations meant to stabilize crop prices endanger the livelihoods of small farmers across the country. Take, for example, raisin farming, says Zach Weissmueller of Reason Magazine.

An elected board of bureaucrats known as the Raisin Administrative Committee decides what the proper yield should be in any given year in order to meet a previously decided-upon price.

  • Once they can estimate the size of the year's harvest, they force every farmer to surrender a percentage of his crop to raisin packers.
  • The packers then place the raisins in a "reserve pool," a special holding vat for raisins that cannot be sold in the United States.
  • Eventually, the packers can sell the reserve pool raisins overseas at highly discounted prices set by the government or funnel them into school lunch programs for next to nothing.

The farmers were always supposed to get a percentage of the money raised from the reserve pool raisins, but as profit margins dwindled over the years, so did the return to farmers. The tipping point came in 2003, when farmers received zero dollars in return for the 47 percent of the crop they had surrendered.

Frustrated and desperate, raisin farmers Marvin and Laura Horne started packing and selling their own raisins, which they believed would allow them to circumvent the marketing order. In doing so, they inadvertently sparked a small revolution, as other independent raisin farmers saw their initial success and began to pack and sell, too. The government wasn't happy. The U.S. Department of Agriculture (USDA) saddled the Hornes with massive fines in addition to demanding payment for the raisins they had failed to surrender.

The Hornes and a few other raisin farmers tried to challenge the USDA. Their case is now awaiting a verdict in the 9th Circuit Court of Appeals.

Source: Zach Weissmueller, "USDA v. Horne: Farmers Fight to Keep Their Own Raisins," Reason Magazine, July 18, 2013.

 

Browse more articles on Economic Issues