Rooting up the plum trees
FOR IMMEDIATE RELEASE DATED JAN. 2, 2002
THE LIBERTARIAN, By Vin Suprynowicz
Rooting up the plum trees
Back in the early and mid-1990s, prices soaring to $1,100 per ton led optimistic prune growers to greatly expand their acreage in California, where most of America's crop is grown. In 1994, nurseries sold 1.5 million plum trees, five times more than usual. And the trees planted in 1994 are now beginning to bear fruit.
Which is the problem. Combine the traditional rules of supply and pricing with the fact that most prune consumers are over 60 ("Our consumers are diminishing in number," sighs Richard Peterson, executive director of the Prune Marketing Committee in Sacramento) and the results could have been predicted.
America's 86,000 acres of plum trees are now producing about 200,000 tons of prunes annually, while another 10,000 "nonbearing" acres have trees that aren't yet fruiting but will soon. Wholesale prices have recently dropped to $700 to $800 a ton, while the break-even price for most growers is more than $800 a ton.
In an interim attempt to help with the problem, the Food and Drug Administration last year granted permission for growers to change the name of their product from prunes to "dried plums" (One might ask why the permission of the federal government is required to describe dried plums as "dried plums," but let's not get sidetracked just now.)
The hope was to expand the stagnant market of older prune consumers to include a new target audience of women ages 35 to 50, and the approach seems to have had limited success. Domestic prune shipments have indeed increased by 5 percent last year and are still growing. "But the recent modest growth in demand hasn't offset a burgeoning supply," The Washington Post reported last week.
So, racing to the rescue, the Department of Agriculture is preparing to pay California farmers $17 million to root up thousands of acres of tree orchards in hopes of boosting the price of their product.
That's right, the taxpayers will pay them to destroy their own trees - in a conspiracy to fix prices which would probably bring prosecution under the Sherman Anti-Trust Act if it were undertaken without the government's blessing.
A century ago, the federal government subdued the hostile Navajo by sending soldiers to tear down their fruit trees. Now, the department's Agricultural Marketing Service has announced, it will pay our own farmers $8.50 for every plum tree they remove from their orchards.
The goal is to remove 20,000 acres of trees from production by June 30, 2002. Farmers participating in the voluntary program would not be allowed to replant prune/plum trees until 2004. Because it takes about six years for the trees to become productive, that should mean about eight years of reduced supply.
"It's buying us eight years of a more balanced supply, which should help pricing for the grower," explains Peterson, whose Prune Marketing Committee will administer the program for the Agriculture Department.
But why?
In the past, such government interventions have been rationalized for industries like coal, steel, and railroads on the theory that allowing the inevitable miscalculations and misallocations of private investment to "work themselves out" through buyouts and mergers and bankruptcies and reorganization might put the nation on an unsound footing in the event of war -- those industries being presumably vital to any rapid mobilization.
But prunes? Precisely how would the "national security" -- or any other legitimate concern of the federal government -- be affected if a handful of California plum growers had to take the natural consequences of their miscalculations, now seven years past, by selling out to their more prudent competitors, or even (gasp) converting a few hundred more acres of orchards into subdivisions, thus helping to rectify California's fearfully undersupplied (and thus inflated) domestic housing market?
Agriculture Department officials defend the root-out-the-prune-trees program as a "long-term solution" to the growers' economic problems that could actually benefit the government. How? Robert Keeney, deputy administrator for fruit and vegetable programs, points out that last year the department spent about $15 million buying prunes and prune products for school lunches and other domestic food programs.
No, Mr. Keeney is not arguing that higher prune prices will cause children to be less hungry next year. The reason they used to hand us a weekly bowl of prunes in the elementary school lunch line was never about feeding the starving, in the first place. Mr. Keeney is arguing that the new program will reduce the need for the old program because the old program was only about propping up prune prices, which will now be taken care of by destroying the trees. All such schemes are designed to prop up high fruit prices -- making them, in effect, an unseen tax on those who buy their own fruit, a tax which must necessarily weigh most heavily on the working poor.
Farming is a notoriously unpredictable business. Those who enter the field do so with this knowledge. No one wishes the plum growers any ill, but this is a classic, expensive, counterproductive, and market-warping government boondoggle. Once such interventions begin, the attempts to "stabilize the market" never end, and can reach dizzying heights of expense and absurdity. (Look at the Caribbean nations on whose political stability we endlessly labor ... rather than merely letting them prosper by shipping us their low-priced sugar.)
Enough. Prunes are not a matter of national security. Let the fruit -- and its price -- fall where they may.
Vin Suprynowicz is assistant editorial page editor of the Las Vegas Review-Journal. Subscribe to his monthly newsletter by sending $96 to Privacy Alert, 561 Keystone Ave., Suite 684, Reno, NV 89503 -- or dialing 775-348-8591.
Vin Suprynowicz, vin@lvrj.com
"When great changes occur in history, when great principles are involved, as a rule the majority are wrong. The minority are right." -- Eugene V. Debs (1855-1926)
"The whole aim of practical politics is to keep the populace alarmed -- and thus clamorous to be led to safety -- by menacing it with an endless series of hobgoblins, all of them imaginary." -- H.L. Mencken
