Sunday, April 19, 2015


When weakness appears strong

In his column in today's Washington Post, George Will writes about an important case that will be presented to the Supreme Court this week. Mr. Will is correct that this case is important but he's wrong about why.

The case – Horne v. Department of Agriculture – involves raisin producers who must involuntarily contribute crop to a product reserve when raisin prices fall below a predetermined level in order to keep raisin prices at a level that is higher than market price should all raisins make it to market. Mr. Will goes on at great length about "government sprawl and meddlesomeness", "kleptocratic behavior", and "shriveled liberty". He declares: "The government is bullying and stealing property to maintain programs that make Americans pay higher commodity prices than a free market would set."

But it's not the government that benefits from higher prices; it's producers.

As stated at "The Raisin Administrative Committee is a federal marketing order, led by 47 growers, packers and a public member. The RAC is directly overseen by the United States Department of Agriculture and was created in 1949 as a result of the Agricultural Marketing Agreement Act of 1937." [my emphasis]

Basically it's OPEC for raisins.

If Mr. Will's argument against marketing orders results in their elimination then I'm all for that. But his presentation of a pernicious government bent on raising consumer prices for no apparent reason is misdirection from the root cause: producers using the government as a puppet for economic gain.

A strong government can act in its own benefit or – more appropriately – should act as an advocate for consumers by promoting and enforcing markets. A weak government rolls over for strong vested interests, bestowing favoritism and excessive profits. Limited government cannot be weak; it must be strong and perform its limited functions well.

With tax season out of the way, many will forget how Congress cut the IRS's enforcement and customer service budgets yet left it burdened with a million-word tax code. As a result noncompliance amounts to nearly $500 billion a year and compliant taxpayers are left to untangle their tax returns on their own. Shrink the task, shrivel the budget, shirk the responsibility. That's our Congress.

If Mr. Will needs someone to blame he should start with market-rigging producers and their Congressional enablers.