The idea that farmers should be prohibited from selling their produce sounds awfully authoritarian, but the federal government has continued this New Deal-era practice into the 21st century.
Through so-called “marketing orders,” the government allows a cartel of a particular fruit or vegetable’s growers to dictate the quantity their competitors can sell on the open market. Without free competition, farmers can sell their produce at higher prices without having to worry about competition from better or more efficient producers.
Normally, limiting supply this way would be prohibited due to anti-cartel laws, but marketing orders are allowed because the U.S. Department of Agriculture sponsors them under the Agricultural Marketing Agreement Act of 1937, a New Deal provision aimed at fighting the Great Depression.
These provisions go against the core American principle of free enterprise and should be discontinued, writes Heritage expert Daren Bakst:
The very idea that Americans should be unable to sell goods that they produce is outrageous, as is the idea that the federal government allows certain industry players to restrict supply, allegedly to benefit the entire industry. This is a form of price fixing, and the federal government gives such action its blessing. Consumer welfare and market demand is ignored, usually at the expense of maximizing income for an industry or possibly just the biggest members involved with the marketing order cartel.
What do you think? Should the federal government continue to sponsor marketing orders that allow special interests to limit supply and drive up prices?