Cartel sounds much sexier than “marketing order”, doesn’t it? But that’s basically what it is…and some of the cartel members are not happy.
It didn’t receive the attention some other recent US Supreme Court cases did, but a couple weeks ago in Horne v. Department of Agriculture the SCOTUS heard arguments about whether mandatory marketing order set-asides amount to federal takings and should be compensated. This case has tremendous potential impact for upward of 30 agricultural products governed by marketing orders run under the auspices of the USDA. These marketing orders date back to the 1930s and were an attempt by agricultural producers to increase the prices they received for the products by disposing of “excess production”. In other words, farmers of the 1930s got the federal government to institute a national cartel for the purposes of raising the price of food…and those cartels continue to operate today.
So how does that work?