Sunday, May 05, 2013

Misleading Aspects of Portrayal of Pigford Settlement

The Times article, U.S. Opens Spigot After Farmers Claim Discrimination, the subject of several recent posts, continues to circulate, with others relying on the information provided. This is unfortunate, as there are many areas where the information presented is misleading, and few outside of the specialized world of agricultural law are likely grasp the significance.

I offer some examples specifically related to the Pigford settlement with African American farmers. First, I provide a quote from the article, and then I explain why it is misleading.

“In 16 ZIP codes in Alabama, Arkansas, Mississippi and North Carolina, 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.”
  • The number of farms in 1997 is essentially a meaningless statistic. While the lawsuit was filed in 1997, it relates to the preceding 15 year period (1986-1997). Farms, particularly smal farms, are not static. During this time period, there was marked consolidation of farmland throughout the country. Nationwide, trom 1978 to 1998, the number of farms declined by 300,000. Farmland changed ownership; small farmers were often forced out with larger operations purchasing their land. Farmers rented farmland one year, but not the next. Farmers went in and out of business. Reliance on a one-year snapshot near the end of a period of consolidation is misleading.

"Thirty percent of all payments, totaling $290 million, went to predominantly urban counties — a phenomenon that supporters of the settlement say reflects black farmers’ migration during the 15 years covered by the lawsuit. Only 11 percent, or $107 million, went to what the Agriculture Department classifies as “completely rural” counties.” 
  • Research backs up what "the supporters of the settlement say," and the article should have said so. The settlement monies were paid out 15-20 years after the discrimination occurred. In many instances, discrimination had caused farmers to lose their farm and forced them give up on their farming ambitions. Many moved to an urban area to seek other employment. Nationwide rural-urban migration statistics from this time period provide further confirmation. The changing character of “rural” counties, and the changing definition of what it means to be a "rural" area provide additional complexity and represent relevant information that has been left out.

“Two government reports that year found no evidence of ongoing, systemic discrimination. The Government Accountability Office reported that 16 percent of minority farmers were denied loans, compared with 10 percent of white farmers, but traced the difference to objective factors like bad credit. An Agriculture Department study also found “no consistent picture of disparity” over the previous two years.”
  • The article does not reference the 1997 USDA CRAT Report that concluded that minority farmers had lost significant amounts of land and farm income as a result of USDA discrimination or the 1997 USDA OIG Report that found a backlog of discrimination complaints that had never been processed, investigated, or resolved. The article does not address the string of subsequent reports (1998-2008) that found continuing problems with the processing of discrimination complaints at the USDA.
  • Moreover, the loan denial rate is only one simplistic indication of loan discrimination. Discrimination complaints, when processed appropriately, reveal a host of other more common and insidious methods of discrimination including late loan approval, reduced loan amounts, lack of notice of programs, interest rate deviations, and provision of erroneous information, all of which can be devastating to a farming operation.

“Just five months after the lawsuit was filed, and without the investigative step of discovery, the Justice Department opened settlement negotiations.”
  • A lengthy discovery period was hardly necessary when the government’s own investigations indicated that discrimination had occurred in a systemic and prolonged manner.  Consider this listing of some of the relevant reports: 
 1965 U.S. Civil Rights Commission study
 1966 U.S. Civil Rights Commission study
 1968 U.S. Civil Rights Commission study
 1970 U.S. Civil Rights Commission study
 1980 OEO Investigation
 1981 “A Time to Choose” USDA Report
 1982 U.S. Civil Rights Commission study, The Decline of Black Farming in America”
 1983 USDA Disbanded Office of Civil Rights
 1987 OIG Report
 1990 House Gov’t Operations Committee Hearings
 1997 CRAT Report
 1997 OIG Report

“The billion-dollar settlement, the judge’s opinion said, was designed to provide ‘those class members with little or no documentary evidence with a virtually automatic cash payment of $50,000.’”
  • This quote is particularly frustrating to me as a law professor. It is taken from the 1999 court order approving the Pigford settlement. When I teach the Pigford litigation to my class, I highlight this predictive statement - for its inaccuracy.  The large number of claims filed was a challenge to the claims review process, yet the process worked methodically to separate claims based on the evidence. While the article jumps back and forth rather carelessly between the discussing the number of applicants and the number of successful claimants, readers should be cautioned that 31% of the claims were denied. To allege that Pigford provided a “virtually automatic settlement” is wrong. The quote itself is accurate, but the story’s use of it is seriously misleading.
There are many complex issues to be debated in light of our experience with these cases, but I fear that the Times article is but another barrier to this debate. The over-use of anecdotes of fraud at the expense of more thoughtful analysis is just very disappointing. It reopens wounds from the past and divides those who should be thinking about ways to foster a diverse, sustainable agriculture going forward.

As a final point, I notice in the comments to the Times article that some are using this story to raise criticism of the millions spent each year on farm program payments. This is particularly ironic. The minorities and women farmers that make up the discrimination claimants are generally not the recipients of any significant portion of the farm program payments. Those go to the largest of the farms. The discrimination claimants are among the most vulnerable groups of farmers -  farmers whose smaller operations have most often been disadvantaged by an overall farm policy that rewards large scale production. The article essentially charges USDA with giving them too much support.  I have been working with these issues for over 25 years, and that is just not the way I see it.

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