There has been a long-simmering question about farm subsidies and race entitlement, which was mentioned extensively in the 2012 presidential campaigns.
The Washington Times wrote in an editorial, “Race hustlers are shaking down taxpayers for payoffs, and the U.S. Department of Agriculture (USDA) is falling for the scam.The controversy involves a discrimination claim against the USDA for allegedly denying loans because of race. A federal judge approved payments of $50,000 or more based on low levels of proof. This encouraged a mad scramble for cash based on false claims.”
Pigford I & II
In 1997, Timothy Pigford filed suit against the United States Department of Agriculture (USDA) and the secretary of agriculture at the time, Dan Glickman, on allegations that the USDA treated Black farmers unfairly in decisions to allocate price support, disaster payments, farm capital loans and operating loans, and that the USDA failed to investigate complaints about racial discrimination.
Four hundred additional African-American farmers joined the suit as co-plaintiffs. Pigford moved for blanket mediation to cover all of the perceived 2,000 farmers that may have been discriminated against, which the U.S. Department of Justice opposed, claiming that each case must be investigated separately. It was ruled, however, that all Black farmers who filed discrimination complaints against the USDA between 1983 and 1997 were certified as a class for this case.
The ruling on this case created two separate “tracks” for resolution: Track A offered a settlement of $50,000, plus relief in the form of loan forgiveness and cancellation of tax liability if the claimant can prove that he owned or attempted to own farmland, that the claimant applied for specific credit with the USDA during the applicable period, that the USDA denied, delayed, reduced or encumbered the loan which would have otherwise not have been affected should the applicant have been White and the USDA’s action created economic trauma to the claimant.
Track B, however, only required claimants to prove that there is a preponderance to the validity of their claim. As the burden of proof is less for this track, the settlement amount is typically less — primarily, reconsideration of denied loans.
Allegations of seeking “easy money”
Beyond the perceived 2,000 farmers included in the certified class, 22,505 claimants applied for “track A,” with 13,348 claimants — 58 percent of all applicants — being approved. Only 200 claimants applied for “track B.” Ultimately,$995 million was disbursed or credited, making this the largest class-action case to be settled in the United States.
In 2008, the Farm Bill was passed, making it easier for more people to bring suit against the government for past discrimination and making additional monies available for settlement. Many farmers were unable to file a settlement claim during the settlement window, and ultimately sued the federal government in a series of lawsuits consolidated into In re Black Farmers Discrimination Litigation, or Pigford II. The Farm Bill permitted the courts to hear these late claims and budgeted $100 million to pay off the cases proven to be meritorious. Presidential candidate Barack Obama ran on a promise to push this through the Congress in 2008.
In the article from Freedom’s Phoenix, Pigford II was equated as “the great farm robbery,” — “The vast majority of those 30,000-plus black-operated farms were either hobby farms or part-time endeavors. Half of black-operated farms in the mid-1980s had gross sales of less than $2,500 per year and almost 90 percent had gross sales of less than $20,000, according to a 2001 report by the Land Tenure Center at the University of Wisconsin at Madison … Then there were the claimants who merely ‘attempted to farm.’”
“David Frantz, one of the lead counsels for the Pigford claimants, explained in late 2010 how the settlement class vastly expanded,” the article continued. “CNS.com reported: ‘The case is not limited to those who were farming, Mr. Frantz added, but included those who were prevented from farming because they did not get USDA loans. ‘I personally worked with many, many young individuals who went through that,’ Mr. Frantz said. ‘A typical scenario would be that ‘I was born and raised on a farm, and then I went into the Army after high school. When I came back, I wanted to get back into farming, and I went to the Farm Service Agency to get a loan so I could rent some land. My uncle was going to rent me 250 acres, so I was going to raise beans. I went to get a loan, and they turned me down.’ That’s a very common scenario.”
The problem with perceptions
The Pigford settlements stroked long-term frustrations that have been brewing about the way the nation offers farm subsidies. Many feel that the farm assistance program equates to a form of corporate welfare, in which large mega-farms are paid millions to grow grains that are not needed and will ultimately go to processed products, such as high fructose corn syrup.
Others saw the settlements on purely racial terms and saw it as a form of government entitlement. Still others pointed to the numbers not adding up and used this to point out that while Pigford I and II may have helped some who were honestly discriminated against, more people used the settlements illegally to make themselves richer.
As stated by the Washington Times, “For months, the liberal Huffington Post and Andrew Breitbart’s libertarian BigGovernment.com have reported growing numbers of Pigford fraud allegations. Numerous black farmers have complained they get short shrift while grifters and lawyers get the loot. In January, these websites posted videos of black farmers saying they brought fraud concerns to Rep. Sanford Bishop, Georgia Democrat, but he advised them to stay quiet “as long as the money was flowing” because otherwise ‘they’ll shut this thing down.’ Three men — including Eddie Slaughter, vice president of the Black Farmers and Agriculturalists Association — agree Mr. Bishop said this in his Columbus, Ga., office.”
While there may indeed have been fraud involved in this settlement, there is reason to believe that the settlement was well-intentioned and adequately apportioned toward undoing a long-sitting wrong.
FactCheck.com points out that the number of claimants and the discrepancies between the claims and the Census numbers is due to the fact that the farms typically had more than one farmer, that estates of the original farmer made claims to the settlement and and that the families of the farmers — who may have co-signed the loan — were discriminated against, too.