• Monthly
  • $25
  • $50
  • $100
  • $other
  • use PayPal

CounterPunch needs you. piggybank-icon You need us. The cost of keeping the site alive and running is growing fast, as more and more readers visit. We want you to stick around, but it eats up bandwidth and costs us a bundle. Help us reach our modest goal (we are half way there!) so we can keep CounterPunch going. Donate today!
FacebookTwitterRedditEmail

Peanuts Prove Congress is Incorrigible

The history of federal peanut policy illustrates why Congress could never competently manage a lemonade stand. The feds sabotage farmer productivity, screw consumers, and sow chaos around the world – all for campaign contributions. Federal spending for peanut subsidies has increased eightfold since 2015 – reaching almost a billion dollars and approaching the total value of the peanut harvest.

For half a century, peanuts offered one of the worst examples of federal feudalism. In 1949, to curtail subsidy outlays, Congress made it a federal crime to grow peanuts for fellow Americans without a federal license. The feds closed off the peanut industry, distributing licenses to existing farmers and prohibiting anyone else from entering the business.

The federal government maintained draconian controls to prevent any unlicensed peanuts from entering Americans’ stomachs. The Washington Post noted in 1993, “USDA [Department of Agriculture] employees study aerial photographs to help identify farmers who are planting more than their allotted amount of peanuts. Violators are heavily fined. USDA also issues each farmer a card imbedded with a computer chip that lists his quota. The farmer must present that card before he can sell his peanuts at a buying point.”

The federal program destroyed peanut farmers’ productivity, exhausting the soil and driving down peanut yields in many places. The program effectively prohibited crop rotation. Farmers responded by using more fertilizer – often harming the environment in the process.  Land with peanut allotments was more expensive, thereby driving up farmers’ cost of production.

Strict controls on farmers were complemented by draconian import restrictions. Americans were long permitted to buy only 1.7 million pounds of foreign peanuts annually — roughly two foreign peanuts per year for each American citizen. That quota ended thanks to a 1990s-era trade agreement. Unfortunately, the Clinton administration placated U.S. peanut growers by slapping a 155 percent tariff on peanut butter imports – thereby shafting farmers in Argentina and Africa.

Peanut are one of the cheapest relatively foods American can buy.  For generations, peanut butter has been the bedrock of many freelance writers’ diets (not that I’m bitter). But, after decades of peanut interventions, Americans’ peanut consumption was falling sharply by the mid-1990s. The General Accounting Office estimated that the program cost consumers more than half a billion dollars a year in higher prices.

The peanut program was created supposedly to help save family farms. But the number of peanut farmers plunged by more than 75 percent after the licensing scheme began. Many farmers sold their licenses to investors. The program sharply inflated the cost of production because most farmers had to rent the license to raise their crops.

Congress ended the peanut licensing scheme in 2002 with a $4 billion buyout that provided a windfall to license holders such as  the John Hancock Insurance Company, which collected $2 million. There was no excuse for “bailing out” peanut-license holders but members of Congress pocketed plenty of “contributions” as a result.

Congress replaced the feudal program with a new program that was far more generous than other crop-subsidy programs. Peanut farmers can collect twice as much in federal subsidies as other farmers ($250,000 per year). In 2014, Congress passed a farm bill that guaranteed peanut farmers prices that were much higher than have prevailed for most of this century. Farmers responded by sharply boosting peanut production and USDA expects to spend nearly $50 million a year to store surplus peanuts.

USDA is anxious to hide the evidence of its failing policy. The solution? Dumping more than a million pounds of surplus peanuts on Haiti. Sixty organizations signed a letter to USDA warning that the donation “could potentially set off a series of devastating consequences” for Haiti’s 150,000 peanut farmers. The peanut  industry is “a huge source of livelihood” for nearly 500,000 people, Claire Gilbert of Grassroots International, told NPR, “especially women, if you include the supply chains that process the peanuts.” One of the leaders of Haiti’s largest rural organization, the Peasant Movement of Papaye, denounced the peanut donation as “a plan of death” for the country’s farmers. Raymond Offenheiser, the president of Oxfam America, complained that “USDA has not done any market analysis in Haiti to ensure that this project does not interfere with local markets and does not reduce the opportunities for Haitian peanut farmers to sell their crop.”

Peanut policy has long sacrificed consumers and freedom to an endless series of desperate political schemes to drive up crop prices. This epitomizes how the feds have mismanaged agriculture since the 1930s. There is no reason to expect Congress to suddenly start caring about the havoc it sows.   The only way to successfully reform farm subsidies is to abolish them.

James Bovard, a policy advisor to the Future of Freedom Foundation, is the author of Public Policy Hooligan, Attention Deficit Democracy, The Bush Betrayal, Terrorism and Tyranny, and other books. More info at www.jimbovard.com; on Twitter @jimbovard

More articles by:

James Bovard is the author of Attention Deficit Democracy, The Bush Betrayal, Terrorism and Tyranny, and other books. Bovard is on the USA Today Board of Contributors. He is on Twitter at @jimbovard. His website is at www.jimbovard.com  This essay was originally published by Future of Freedom Foundation.

bernie-the-sandernistas-cover-344x550

May 23, 2019
Kenn Orphan
The Belligerence of Empire
Ralph Nader
What and Who Gave Us Trump?
Ramzy Baroud
Madonna’s Fake Revolution: Eurovision, Cultural Hegemony and Resistance
Tom Engelhardt
Living in a Nation of Political Narcissists
Binoy Kampmark
Challenging Orthodoxies: Alabama’s Anti-Abortion Law
Thomas Klikauer
Why Reactionaries Won in Australia
John Steppling
A New Volkisch Mythos
Cathy Breen
So Many Wars: Remembering Friends in Iraq, Jordan, Syria, Kurdistan and Turkey 
Chuck Collins
Ending the Generational Abuse of Student Debt
Robert J. Burrowes
Understanding NATO, Ending War
Nyla Ali Khan
Dilution of “Kashmiriyat” and Regional Nationalism
May 22, 2019
T.J. Coles
Vicious Cycle: The Pentagon Creates Tech Giants and Then Buys their Services
Thomas Knapp
A US War on Iran Would be Evil, Stupid, and Self-Damaging
Johnny Hazard
Down in Juárez
Mark Ashwill
Albright & Powell to Speak at Major International Education Conference: What Were They Thinking?
Binoy Kampmark
The Victory of Small Visions: Morrison Retains Power in Australia
Laura Flanders
Can It Happen Here?
Dean Baker
The Money in the Trump/Kushner Middle East Peace Plan
Manuel Perez-Rocha – Jen Moore
How Mining Companies Use Excessive Legal Powers to Gamble with Latin American Lives
George Ochenski
Playing Politics With Coal Plants
Ted Rall
Why Joe Biden is the Least Electable Democrat
May 21, 2019
Jeremy Kuzmarov
Locked in a Cold War Time Warp
Roger Harris
Venezuela: Amnesty International in Service of Empire
Patrick Cockburn
Trump is Making the Same Mistakes in the Middle East the US Always Makes
Robert Hunziker
Custer’s Last Stand Meets Global Warming
Lance Olsen
Renewable Energy: the Switch From Drill, Baby, Drill to Mine, Baby, Mine
Dean Baker
Ady Barkan, the Fed and the Liberal Funder Industry
Manuel E. Yepe
Maduro Gives Trump a Lesson in Ethics and Morality
Jan Oberg
Trump’s Iran Trap
David D’Amato
What is Anarchism?
Nicky Reid
Trump’s War In Venezuela Could Be Che’s Revenge
Elliot Sperber
Springtime in New York
May 20, 2019
Richard Greeman
The Yellow Vests of France: Six Months of Struggle
Manuel García, Jr.
Abortion: White Panic Over Demographic Dilution?
Robert Fisk
From the Middle East to Northern Ireland, Western States are All Too Happy to Avoid Culpability for War Crimes
Tom Clifford
From the Gulf of Tonkin to the Persian Gulf
Chandra Muzaffar
Targeting Iran
Valerie Reynoso
The Violent History of the Venezuelan Opposition
Howard Lisnoff
They’re Just About Ready to Destroy Roe v. Wade
Eileen Appelbaum
Private Equity is a Driving Force Behind Devious Surprise Billings
Binoy Kampmark
Bob Hawke: Misunderstood in Memoriam
J.P. Linstroth
End of an era for ETA?: May Basque Peace Continue
Weekend Edition
May 17, 2019
Friday - Sunday
Melvin Goodman
Trump and the Middle East: a Long Record of Personal Failure
Joan Roelofs
“Get Your Endangered Species Off My Bombing Range!”
Jeffrey St. Clair
Roaming Charges: Slouching Towards Tehran
FacebookTwitterRedditEmail