The Federal Government and the Peanut Industry

Abstract

Until 1932, the federal government limited its activities in behalf of peanuts, as it did in behalf of all agricultural commodities, to those extending aid and protection. Under the dominant laissez-faire concept of the day, agriculture in general and peanuts in particular remained free and unhindered by governmental direction or control. Like many other crops, however, peanuts did receive the benefits of a tariff1 and the protection the Interstate Commerce Commission extended to all agricultural products shipped in interstate commerce.2 In addition, the Department of Agriculture gave them occasional attention in its research, informational, educational and analytical activities, especially after the turn of the century, when peanuts became for the first time a significant commercial crop. Thus peanuts were included in the Department's outlook reporting service, and with the establishment of grades for peanuts, the services of inspection were made available to the peanut industry as well. Later on, specifications for peanut products sold to the federal government were laid down by the Federal Standard Stock Catalogue Board, and the manner in which peanut products were made was included in the purview of the various pure food laws passed by Congress before 1932. Likewise, the manner in which peanuts and peanut products were sold was made subject to the regulation of the Federal Trade Commission, and liberal credit facilities were made available to peanut farmers, as to all producers of agricultural commodities, under the terms of the Farm Credit Act of 1916 and the Agricultural Act of 1923. Although peanuts benefited from services available and protection offered to all agricultural enterprises, they received no special attention except during World War I. Then peanut production was pushed by the government, both to provide a substitute for wheat flour and to increase the amount of oil available for domestic use. To that end, peanut dealers, brokers, importers and refiners were brought under special licensing regulations. In no other way, however, were peanuts regulated by governmental action prior to the early thirties.