Obama Signs Bill Setting Aside Another $1.15 Billion to Pay Discrimination Compensation to Tens of Thousands of Black Farmers

December 9, 2010 - 9:14 AM

Obama caves to GOP

President Barack Obama speaks to reporters on Monday, Dec. 6, 2010. (AP Photo/J. Scott Applewhite)

(CNSNews.com) - President Barack Obama on Wednesday signed the Claims Settlement Act of 2010, a bill awarding $1.15 billion to African American farmers to settle claims that the U.S. Agriculture Department discriminated against them. This is on top of earlier legislation awarding black farmers $100 million.

In 1999, the federal government paid out about $1 billion to 15,640 black farmers who claimed USDA had discriminated against them be refusing to provide them with federally subsidized farm loans in the years 1981-1996.  The compensation was the result of a settlement in a class action lawsuit known as the Pigford case. 

The new $1.25 billion settlement now funded by Congress and signed into law by Obama will go to pay up to an additional 94,000 African Americans who farmed or "attempted" to farm in that same 1981-1996 time frame. But according to the Census Bureau, the number of black farmers in America between 1981 and 1996 peaked at 33,000 in 1982.

Some members of Congress have called for an investigation of potential fraud in the government’s previous payout to the black farmers, and they have expressed doubt that this second settlement is any more legitimate. Rep. Steve King (R-Iowa) said the Pigford settlement program is compromised by fraud and has morphed into a “modern-day slavery reparations programs.”

At Wednesday’s bill signing, President Obama took credit for setting in motion the Pigford II case.

As a senator, he secured $100 million for a second round of payments to African American farmers who missed the filing deadline in the first Pigford case. Combined with the $1.15 billion recently approved by Congress, the total Pigford II settlement was $1.25 billion.

“In 1999, a process was established to settle these claims. But the settlement was implemented poorly, and tens of thousands of African American families who filed paperwork after the deadline were denied their chance to make their case,” Obama said before signing the bill late Wednesday afternoon.

“And that’s why, as senator, I introduced legislation to provide these farmers the right to have their claims heard. That’s why I’m proud that Democrats and Republicans have come together to lay this case to rest.”

The first Pigford case alleged that USDA employees discriminated against African American farmers between 1981 and 1996. As a result of the Clinton-era settlement (Pigford I), the U.S. government paid $1 billion to 15,640 of them.

Pigford II refers to a second round of discrimination claims made since 1999. It is the second settlement made with black farmers, and it involves only black farmers who missed the first deadline.

Three House Republicans, Reps. Steve King of Iowa, Michelle Bachmann of Minnesota and Bob Goodlatte of Virginia, support a congressional investigation into both Pigford settlements.

Rep. King believes the USDA’s denial of wrongdoing and inaction in firing anyone for discrimination speaks to the weakness of the case.

“Who did they punish?” King asked, referring to the USDA.  “At this point...no one. It’s completely outrageous," he told CNSNews.com.

"They admit to no wrong doing; they press the taxpayers and apparently have succeeded in squeezing $2.3 billion out of the taxpayers; but they don’t have any blame and they’re not punishing anybody. So, how can Americans who think logically accept that as a rational position. It’s baffling to me that just that alone isn’t enough to get people up in arms.”

While members of Congress and attorneys for the plaintiffs have said there could be as many as 94,000 potential claimants for the $1.25 billion Pigford II settlement, the U.S. Census Bureau reports that from 1981 to 1996, the number of African American farmers peaked at 33,000.

One plaintiffs' attorney, David J. Frantz, told CNSNews.com the 94,000 number will be narrowed down significantly when the payouts are made. He added that some payments will be made to people who wanted to farm but say they were prevented when the USDA denied them loans for discriminatory reasons.

Obama did not say anything on Wednesday about holding any USDA employees accountable for the alleged discrimination. Agriculture Secretary Tom Vilsack told CNSNews.com earlier that holding employees accountable for past discrimination is not a focus of the administration. Moreover, in the settlement agreement, the USDA denies any wrongdoing.

“Here in America, we believe that all of us are equal and that each of us deserves the chance to pursue our own version of happiness,” Obama said. “It’s what led us to become a nation. It’s at the heart of who we are as a people, and our history is defined by the struggle to fulfill this ideal, to build a more perfect union, to ensure that all of us, regardless of our race or religion, our color or our creed, are afforded the same rights as Americans, and the fair and equal treatment under the law.

“I think all of us understand that we haven’t always lived up to those ideals,” Obama said. “When we’ve fallen short, it’s been up to ordinary citizens to stand up to inequality and unfairness wherever they find it. That’s how we’ve made progress. That’s how we’ve moved forward. And that’s why we are here today -- to sign a bill into law that closes a long and unfortunate chapter in our history.”

The Pigford II legislation signed by Obama yesterday also includes $3.4 billion to settle a 14-year lawsuit alleging mismanagement of tribal trust funds by the U.S. Interior Department.

Elouise Cobell, the lead plaintiff, claimed Interior failed to account for tens of billions of dollars that it was supposed to collect on behalf of 300,000 Native Americans.

Although the Native American case has received less attention recently than the black farmers’ settlement, it made headline in 1999 when U.S. District Judge Royce Lamberth found Interior Secretary Bruce Babbitt and Treasury Secretary Robert Rubin in contempt of court when the Clinton administration failed to produce court-ordered documents.

“Elouise’s argument was simple: The government, as a trustee of Indian funds, should be able to account for how it handles that money,” Obama said. “And now, after 14 years of litigation, it’s finally time to address the way that Native Americans were treated by their government.  It’s finally time to make things right.”