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| Long title | An Act To authorize association of producers of agricultural products. |
|---|---|
| Enacted by | the67th United States Congress |
| Citations | |
| Public law | Pub. L. 67–146 |
| Statutes at Large | Sess. II, ch. 57, 42 Stat. 388–389 |
| Legislative history | |
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| United States Supreme Court cases | |
| Case-Swayne Co. v. Sunkist Growers, Inc., 389 U.S. 384 (1967) National Broiler Marketing Assn. v. U.S, 436 U.S. 816 (1978) | |
TheCapper–Volstead Act, officially the Co-operative Marketing Associations Act, was adopted by theUnited States Congress on February 18, 1922. It gave associations of agriculturalists broad exemptions from antitrust laws. It is therefore sometimes called theMagna Carta of the American farming cooperatives.[1]
The law was passed in response to increasing legal challenges made against cooperatives on the grounds they violated federal antitrust legislation, particularly the Sherman Act (15 U.S.C. 1 et seq.), the Clayton Antitrust Act (15 U.S.C. 12 et seq.), and the Federal Trade Commission Act (15 U.S.C. 41 et seq.). Amid the devastating slump in agricultural prices that followed theFirst World War, farm organizations in the United States intensified their drive for government relief and managed to get afarm bloc established in Congress to advance their interests, including protection against what they argued was the misapplication of antitrust laws against cooperatives. Such legislation, they complained, was intended to break up the powerful amalgamations of industrial and financial firms that acted to drive out competition and ratchet up the prices of manufactured goods (which, unlike those of crops, soared after the First World War, leading to the infamousScissors Crisis of the 1920s), not voluntary partnerships among struggling farmers. SenatorArthur Capper of Kansas belonged to the farmer bloc, and RepresentativeAndrew Volstead of Minnesota allied himself with it. Both played central parts in the formulation and promotion of the Act, which became one of the bloc's most notable and consequential political achievements.
The Act authorized various kinds of agriculturalists to form voluntary co-operative associations for purposes of organizing, handling, and marketing their produce. It thereby exempted such associations from mostantitrust laws. Nevertheless, to quell concerns that these cooperatives would seek to increase agricultural prices grossly and artificially, the Act included provisions to empower theUnited States Secretary of Agriculture to prevent cooperatives from instituting and maintainingmonopolies, albeit purely at his own discretion. To this end, the Agriculture Secretary got the authority to hold hearings, gather information, and issue orders for the breakup of any monopolies judged to have resulted from the formation and activities of the cooperatives. Such decisions, in turn, were made subject to review byfederal district courts.
