I have included Pam Helmsing and Dan Hanauer, Jr.’s articles in an effort to provide some balance to the check-off discussion. Dan had submitted his article for the Journal and it was rejected for publication. Pam’s article follows Dan’s because some of her points addressed the issues Dan presented.
Are check-off programs constitutional? Well, Pam’s correct that they have been tested all the way to the Supreme Court. But her statement that “they were definitely ruled constitutional” is misleading. Check out “Choices, The Magazine of Food, Farm, and Resource Issues, the 2nd Quarter, 2006.” Constitutionality of check-off programs has not been clear-cut. In fact, in 2001, the U.S. Supreme Court ruled in U.S. v. United Foods, that the federally mandated mushroom advertising program was unconstitutional as compelled private speech. Check-off programs have been deemed “government speech” in order to side step the “right to free speech”, but there is a downside to this argument. “Government speech” must pass three tests. 1. Government must exercise sufficient control over the source of the message to be deemed ultimately responsible for the message. 2. The main purpose of the message and program must be identified as the government’s. 3. The source of the assessments must come from a large, non-discrete group. Since Christmas producers are a discrete group, a challenge to our proposed check-off may very well succeed. And as a producer, are you happy with 1 and 2?
Check-off programs are designed to assist agricultural industries. The sticking point with most of them is that they cannot help one agricultural industry at the expense of another. (for example, one cannot say pork is healthier than beef). However, our competition is nonagricultural and yet I have been told that we will be restricted as to what we can say about artificial Christmas trees. Why?
Is some self-appointed group claiming to represent the entire industry? Well, she is correct in that the Secretary of Agriculture will appoint Board members from nominations received, but since nominations come from the committee, we should expect to see check off committee members on the final Board. For example, last March at our Winter Meeting, one of our members told me that Paul Schroeder will be a member of this “as yet to be determined Board.” Really? How can that be?” I asked. “Are these Board members self-appointed?”
Will a check-off solve all our current problems? No. I think it will add to them. Graphs, charts, and statistics can be useful, but their usefulness is limited to the hard conclusions that can be drawn from them. Her graph offers no “proof.” In fact, this chart purported to “show” the connection between demand and promotional dollars spent, doesn’t even track those promotional dollars. There is no cause and effect here, only her conjecture.
Will it encourage more people to grow more trees? Maybe. If people perceive that Christmas tree farming is profitable, with few barriers to production, more of them could begin producing trees, and existing growers could expand their production. And assuming that they all harvest more than 500 trees, assessments would increase—turning over more dollars to the check-off board. I am sure they would like that.
Is a bigger industry better? Maybe, maybe not.
Is it going to replace my individual marketing? No, nor should it.
Is NCTA for a Check-off? Yes, and it should be no surprise. Pam suggests that they reached that position only after the passage of time and an overwhelming number of growers voting for a check-off. I did not get a chance to vote. Of those that voted—how many of them informed themselves about agricultural check-off programs? How many of them know anything substantive now?
Why can’t we vote up front? With all due respect, this argument is spurious. Had they wanted to test the pulse of the growers nationwide, they only had to consult their members and those of state associations. All they had to do was ask the growers what they thought and how many trees they sold. They’ve had more than two years to do this. But before the discussion went so far as a “vote,” this committee should have remained objective about the check-off. They should have done a better job informing themselves and growers of all the ramifications, instead, I think they became starry-eyed about the possibility of collecting $ 3 million.
What is taking so long? We are talking about government, right?
Are you personally for or against it? Check out the industry-wide task force that was formed to study the merits of a Christmas tree check-off in April of 2008. Pam Helmsing was listed as an ex-officio member. Exactly, when did she cross the line from an objective Drake & Company employee to a check-off supporter? In fact, since Drake & Company seems poised to help manage those check-off dollars, can anyone associated with them offer unbiased comment?
What she said:
There is a “Need To Do Something!”
We cannot do this “something” without a check-off.
Then the scare tactic, we need the check-off–or else.
What we should be asking:
What will be the total cost of this program? Will it be cost effective?
What will the generic industry-wide promotion look like? WHAT IS THE PLAN?
What proof do you have that this program will do what you say it will?
The check-off is a trade-off. We have been told that in return for our money, we will be blessed with increased Christmas tree sales with hints of good prices. But no real proof of this promise has been offered. Think about the trade-offs we do know. We pay, we get another auditor inspecting our operations. We pay, we get more forms to complete. We pay, a Board, managed by government officials is created to control our promotional dollars.
Our national representative reported that the check-off expects to collect $ 3,150,000 in its first year. Of that, they expect only $ 1.7 million will be available to the Board. Where did the rest of the money go? What kind of national, industry-wide advertising program can they mount with that? What kind of promotion will satisfy growers in the Pacific Northwest, North Carolina, and everywhere in between? And will the money remaining after all the expenses have been paid, be enough to do it?
Near the end of her article, Pam has some bulleted statements.
Promotion works. Not always. Remember the Edsel?
Misinformation has to be countered with facts. I agree. Give us some.
Voluntarily funded promotion programs are destined to be short-lived because those who don’t contribute gain a competitive advantage over those that do. I had to reread this one because it did not make sense. (But then I remembered the great bugaboo that promoters have…I’m talking about free ridership.) According to her, voluntary programs do not last because growers who donate are financially penalized because they give money to support them–and those who do not–benefit from the promotion without paying for it. The first huge assumption one has to make for this to be true, is that all promotions are equally successful among all producers. And–that all variables between all producers are equal–with this exception–the ONLY difference being some donated and some did not. First, not all promotions are successful, even spending millions does not guarantee success. Second, I don’t know how anyone would be able to control all the market place variables to prove this hypothesis. It makes more sense to me that a grower who donates to a promotional program might actually use it to his advantage and therefore benefit more than someone who does not donate. (And this check-off does not end free ridership because anyone harvesting fewer than 500 trees would be exempt from the assessments. All these producers would by definition, be free-riders. Is this how the Board plans to help the little guy?)
The Real Tree industry is going to continue to face challenges…. Maybe, but how is the check-off going to fight these battles? Other than a steady stream of funding, the check-off can guarantee nothing. Supporters should be able to give specifics about their plans, how these funds will be spent, how much administration will cost, but they haven’t done that.
The fake tree industry is commissioning “research” aimed at finding someone….Some growers in Minnesota, Wisconsin, Illinois, and Indiana are collecting money to have an independent laboratory analyze an artificial Christmas tree. Care to donate? Contact email@example.com.
If it’s not worth 15 cents a tree to answer these serious challenges as an industry, the handwriting is on the proverbial wall. Maybe the issue is not so much the $.15 per tree. Maybe it’s the mandatory assessment, the lack of concrete information about the promotions, the government scrutiny, or the idea that a lot of growers feel they did not have a voice in the process.
Like I said before, the check-off is a trade-off. Supporters have said that the industry is in real trouble, that we must do something, and that the check-off is the answer. My experience, after talking to quite a few of them–is they have not taken the time to read about agricultural check-off programs. Their decision is not an informed one.
Take the guy that harvests 2000 cut your own trees. He watches his income and expenses and works hard, so he’s doing okay. Someone comes to him and says, “You’re in real trouble and I can help. Give me $ 300.00 and I’ll promote trees.” That someone doesn’t tell him how he plans to do this, but he does say he is going to take the money out of his market and spend it “for the industry.” But not all of it. The USDA, the Secretary of Agriculture, the U.S. Customs Service and auditors will take pieces of it. So about half will be spent on actual promotion. Oh, and auditors will come out to check his records to ensure that he is complying with the program. Wouldn’t that grower ask some questions? Shouldn’t we ask questions?
Maybe you are saying, “It’s only $ 300.00.” Well, how do you feel about $ 3+million? Is that enough to get you to ask some questions?