LOWRY/Farmer reparations rife with fraud
Wednesday, May 1, 2013 1:00 AM
Abraham Carpenter Jr., a farmer in Grady, Ark., has more insight into human nature than the average sociologist. "Anytime you are going to throw money up in the air," he told The New York Times, "you are going to have people acting crazy."
Carpenter is quoted in an astonishing 5,000-word Times expose on the federal government's wildly profligate program to compensate minority and women farmers for alleged discrimination. The government rigged the game against itself and in favor of anyone claiming taxpayers' dollars. It was like a gambling house that fixed its slot machines to always come up triple cherries (and pay out other people's money).
The enormous scam was set in motion by a 1997 class-action lawsuit called Pigford v. Glickman, with black farmers alleging that the Department of Agriculture discriminated against them in allocating loans. The Government Accountability Office and the Agriculture Department found no evidence of ongoing discrimination, but black farmers had been treated unfairly in the past. This injustice became the predicate for officially sanctioned fraud amounting to reparations for non-white, non-male farmers.
The Clinton administration decided on a $1 billion settlement, "more a political decision than a litigation decision," one lawyer told the Times. The presiding judge expanded the definition of claimants to include anyone who had "attempted to farm," and no written complaint of discrimination was necessary. The judge wanted to set up a mechanism to provide "those class members with little or no documentary evidence with a virtually automatic cash payment of $50,000."
He succeeded brilliantly. Staff from lawyers' offices filled out forms for claimants at mass meetings. People filled out applications for their kids. Entire families filled out applications. Most applicants had never received any loans, making it impossible to check the record to verify their claims.
The Times examined 16 ZIP codes in Alabama, Arkansas, Mississippi and North Carolina, and found that "the number of successful claimants exceeded the total number of farms operated by people of any race in 1997, the year the lawsuit was filed. Those applicants received nearly $100 million." In Little Rock, Ark., 10 members of one extended family reaped a cool half a million dollars.
Tens of thousands of applicants missed the 1999 deadline of the original suit. Their claims were probably even weaker than the original ones. But as a senator, Barack Obama supported paying the late applicants, and as president, he successfully sought another $1.15 billion for the purpose.
Other groups felt left out of the bonanza. Lawyers at the Justice Department thought that they were winning a court battle with Hispanic and female farmers. That didn't matter. "Political appointees at the Justice and Agriculture Departments," the Times writes, "engineered a stunning turnabout: they committed $1.33 billion to compensate not just the 91 plaintiffs but thousands of Hispanic and female farmers who had never claimed bias in court."
The government settled for another $760 million with Native Americans, even though it appeared to have a strong case. Even with the lure of this cash, the government could only give away $300 million. Another $400 million will go to Native American nonprofits, if appropriate ones can be found. And $60 million to the plaintiffs' lawyers for the service of helping fleece the U.S. government.
Agriculture Secretary Tom Vilsack told the Times that the blowout means at his department "we celebrate diversity instead of discriminate against it." Couldn't he find a cheaper way to do it? The settlements altogether could cost more than $4.4 billion.
The Pigford case is like something out of a Tom Wolfe novel. It would be hard to invent a more damning fable of modern government. It is a tale of special-interest pleading and of the politicians who give in to it (at first, Barack Obama wanted to pander to rural blacks, then he needed to do catch-up pandering to Hispanics). It is a story of greedy lawyers and hapless bureaucrats. It is equally ludicrous and dismaying. Take a good long look, and then recoil.
Rich Lowry is editor of National Review. Reach him at email@example.com.