“Got Milk” Ad Campaign

Introduction

Imagine being told by the government that you must advertise your product, even if you don’t want to.

This is exactly what is happening to traditional dairy farmers Joseph and Brenda Cochran from Westfield, Penn., which is located in the north-central region of the state. The Cochrans are being forced by federal law to help pay for those ubiquitous “got milk” advertisements. Represented by the Arlington, VA-based Institute for Justice, the Cochrans are in court seeking to stop this form of government-compelled speech. The case pits the First Amendment against agricultural regulation and promises to have far-reaching consequences for free speech.At issue is the federal law that created the well-known “got milk” ad campaign. Although just about everyone has seen these ads on television and in print, most people do not know that under the federal Dairy Promotion Program dairy farmers are forced to pay for them. ¹ The Cochrans, for example, must pay approximately $4,000 a year from their thin operating budget for advertisements that obscure the distinctions between the Cochrans’ traditional farming and other producers. Federal laws create a number of similar programs for a wide variety of agricultural products. Besides “got milk,” government programs are also responsible for the “ahh, the power of cheese,” “beef, it’s what’s for dinner” and “pork, the other white meat” ad campaigns, to name just a few. Federal and state agricultural programs exist for many more products as well. Clever ad campaigns all, but should the government force individual producers to pay for these programs whether or not they want to advertise their products and whether or not they agree with the advertising the programs fund?

The U.S. Supreme Court long ago held that the First Amendment does not allow government to compel individuals to speak, just as it does not allow government to prevent them from speaking. Speech wouldn’t be “free” after all if government could require people to convey officially sanctioned messages. The same principle applies to compelling people to pay for speech with which they disagree.

The Cochrans are “traditional” dairy farmers. They allow their cows more room to graze and to move around, and they don’t use bovine growth hormone. Although traditional dairy farming generally produces less milk than other types of farming, in the Cochrans’ view it results in healthier cows, a cleaner environment and a superior product. Judging by the booming market for organic products, ² many people agree with this approach to farming.

The Cochrans thus have every reason to distinguish their product from that of other producers. The Dairy Act, however, compels them to do just the opposite. It requires them to fund generic ads whose message is that all milk is the same, regardless of who produces it or what methods they use. Imagine if farmers who chose not to use pesticides were forced to fund advertising of foods produced using pesticides or if paper manufacturers who use only recycled products were forced to fund advertising of those that do not, and you begin to get an idea of why this is objectionable. The Cochrans, in other words, are forced to support a message and farming practices they have specifically chosen to reject. And they are forced to do so to the tune of thousands of dollars a year, a steep price for small dairy farmers who operate on thin margins.

On April 2, 2002, the Cochrans filed Cochran v. Veneman ³ in the U.S. District Court for the Middle District of Pennsylvania challenging the Dairy Program as a violation of their rights under the First Amendment. Just two years ago, in United States v. United Foods, the U.S. Supreme Court held that a federal promotional program for mushrooms that is nearly identical to the Dairy Promotion Program was unconstitutional because it compelled mushroom producers to fund advertising with which they disagreed. ⁴ As the Court stated in that case, “First Amendment values are at serious risk if the government can compel a particular citizen, or a discrete group of citizens, to pay special subsidies for speech on the side that it favors.” ⁵ Even when the issue is product advertising, the rights of dissenting producers deserve to be recognized under the First Amendment. ⁶

Unfortunately, the High Court has issued other decisions that have left the line between constitutional economic regulations and unconstitutional speech regulations unclear. ⁷ As a result of this confusion, the Cochrans lost their case in District Court, with the court ruling on March 4, 2003, that the Dairy Program is constitutional because the milk industry is otherwise heavily regulated. In essence, the Court told dairy farmers that as long as the government regulates their prices and certain aspects of production, it may as well control their free speech, too. But two wrongs don’t make a right; restricting one kind of freedom—economic liberty—isn’t license to destroy another—free speech. Considering how prevalent economic regulations have become in all manner of businesses, this is a very troubling ruling. It is also a textbook example of how restricting some rights leads inevitably to restrictions on all rights—a trend the Institute for Justice fights tirelessly against.

The Cochrans appealed their case to the U.S. Court of Appeals for the Third Circuit, and IJ agreed to handle their appeal. The case is slated to be argued in Philadelphia in January 2004 with a decision following some months thereafter.

Agriculture Promotional Programs: Government Regulated Speech; Pork Barrel Politics

During the past two decades, Congress has created a host of promotional programs for many agricultural products besides milk. Programs have existed for products as wide-ranging as beef, pork, honey, potatoes, watermelons, mangos, kiwifruit, limes, fresh cut flowers, peanuts, popcorn, pecans, soybeans, avocados and wool, to name just a few. ⁸ Congress was so enamored of the promotional programs that in 1996 it enacted the generic Commodity Promotion Act, which is a catchall act that allows the Secretary of Agriculture to create promotional programs for any agricultural commodity. ⁹ The states have also gotten into the game, creating promotional programs for products such as California grapes, Washington apples and even Louisiana alligator skins. Advertising, it seems, is increasingly something that governments view as too important to be left to individual producers and the free market.

The catch, of course, is that under most of these programs, producers who disagree with the advertising strategy of appointed industry boards have no right to create their own ads under the programs, to refuse to fund ads with which they disagree, or to opt out of the programs altogether. Under the Dairy Program, for instance, all dairy farmers must pay to the program 15 cents per “hundredweight” (i.e., per 100 lbs.) of milk they sell. ¹⁰ For the Cochrans, this amounts to roughly $4,000 per year.

Proponents of the programs cite a number of justifications for this compulsion. They claim, for instance, that the ads are only generic and contain no message at all, so who can complain? But both consumers and producers make distinctions based on different brands and different production methods. Why should one producer be required to contribute to a general advertising fund for all products of a given type when he believes his product is superior? As the large market for organic foods and the many different brands of products available show, consumers are interested not only in the products themselves, but in how they are produced. In short, as the Supreme Court has made clear, the whole point of the First Amendment is to allow the speaker and the listener—not governments or industry boards imbued with government power—to assess the importance of commercial information. ¹¹

Proponents also claim that any producer who is allowed to opt out of the promotional programs will be permitted to be free riders on the advertising of others. But this is a complaint more properly directed at collective advertising itself, not those who dissent from such schemes. If proponents of these schemes don’t like free riding, they should end collective advertising, not complain about those who believe that they can do better by advertising for themselves.

In a similar vein, defenders of the Dairy Program claim that it will increase demand for dairy products, which is necessary in order to decrease the federal government’s financial obligations under the so-called “dairy price support program.” In 1949, Congress passed a law that required the federal government to purchase dairy products if the price of milk fell too low. ¹² The idea of the program was to prop up the price of milk by establishing the government as the buyer of last resort. The problem is that this eliminated the incentive to cut production or to direct milk to more efficient uses when prices fell. As a result, dairy producers kept producing dairy products that the government was obligated to purchase. Before long, the government had a lot of dairy products it didn’t need and a very large bill. Thus, proponents of the Dairy Program argue, clever “got milk” ads are necessary to make private citizens buy up all that excess milk so the government won’t have to. But here again, the problem is not a lack of advertising but an ill-advised price support program that distorts the milk market and leaves the federal government holding the bag.

Another justification for promotional programs is the idea that agricultural products are just too important to the economy to leave their advertising to the free market. This, however, can be used to justify government involvement in any market. And, indeed, Congress has used it repeatedly, claiming with each new program that the product at issue was vital to the national economy and public health. ¹³ But are popcorn, kiwifruit and cut and dried flowers, to name just a few of the many products for which promotional programs exist, really a matter of national concern?

The truth is, the laws that create these promotional programs are as much a result of special interest politics as any other pork barrel measure—with the only difference being that instead of heaping taxpayer dollars on a particular industry, Congress essentially lends out its legal authority to coerce all producers into a collective advertising scheme. The government’s own website for the Dairy Program trumpeted the fact that the program is a private business with government “help.” As the website put it, “Dairy Producer Checkoff: A $250 Million Business.” ¹⁴ This shouldn’t be surprising. The idea for the website came from dairy industry groups who were unhappy with voluntary local and regional advertising programs and wanted a national program that kept dissenting farmers from opting out. Not surprisingly, a number of dairy producers intervened in the Cochrans’ lawsuit to defend the program, arguing that it is beneficial to dairy producers—including those who wish to differentiate their products from the mainstream. But whether or not the Dairy Program helps dairy farmers who don’t object to its advertising is not the issue. They can always choose to advertise their products or to join with others and advertise collectively. The Cochrans, however, cannot choose to opt out of the Dairy Program.

The First Amendment Bars Compelled Subsidies for Speech

The Cochrans’ challenge to the Dairy Program finds its roots in the principle, first established by the U.S. Supreme Court in 1943, that just as the First Amendment prevents government from prohibiting individuals from speaking, so it prevents government from requiring them to speak. Thus, the Court has held that states cannot force schoolchildren to recite the pledge of allegiance ¹⁵ or citizens to display state slogans on their car license plates. ¹⁶

In 1977, the Supreme Court applied this principle in the context of financial support for speech, holding that governments may not require individuals to subsidize speech with which they disagree, just as they may not require one to speak when they wish to remain silent. That case, Abood v. Detroit Bd. of Education, ¹⁷ involved a challenge by a group of non-union public school teachers to a law that required them to pay service fees to the teachers union for activities that benefited them. The Supreme Court held that the law was valid as to activities that benefited all teachers, such as the union’s collective bargaining activities, but that dissenting teachers could not be forced to subsidize the union’s political activities. As the Court put it, “at the heart of the First Amendment is the notion that an individual should be free to believe as he will, and that in a free society one’s beliefs should be shaped by his mind and his conscience rather than coerced by the state.” ¹⁸ A few years later, the Supreme Court applied the same principle to the California State Bar, holding that while a state could require attorneys to pay dues toward bar activities that maintain the standards of the profession, it could not require them to pay for the Bar’s political activities. ¹⁹

Applying these principles in the context of compelled subsidies for promotional programs has lead the U.S. Supreme Court to issue seemingly contradictory decisions. In 1997, the Court upheld a federal law that required producers of California peaches and nectarines to subsidize a collective advertising program. ²⁰ In 2001, the Court struck down a program that required producers of mushrooms to do the same. ²¹ Why allow compelled subsidies for advertising California peaches and nectarines but not for mushrooms? The answer lies in the way the two laws were structured. The law at issue for California peaches and nectarines regulated all aspects of the market for those fruits. It had a purpose beyond speech, and thus the Court viewed it as analogous to a law that required public employees to pay union dues. The law at issue in the mushroom case, however, was designed to do only one thing: advertise. It was, as Justice Stevens described it, a “naked imposition . . . of compulsion” very much like a “naked restraint” on speech that the First Amendment would obviously prohibit. ²²

The Dairy Program is almost identical to the Mushroom Program that the Supreme Court struck down. The milk industry, however, is regulated a bit more extensively than the mushroom industry, leading some, including the District Court in the Cochrans’ case, to conclude that the Dairy Program’s compelled subsidies for speech are constitutional even though the Mushroom Program was not. According to this view, it is appropriate to compel producers to subsidize advertising with which they disagree so long as their industries are otherwise heavily regulated. The problem, of course, is that many industries are heavily regulated—pharmaceuticals, securities, law and accounting, to name just a few. Do individuals give up their rights of free speech simply by choosing to do business in these areas? Fortunately, that is not what the Supreme Court has held. In fact, two federal appellate courts have recently struck down similar promotional programs for beef and pork under the First Amendment. ²³

The Plaintiffs

Joseph and Brenda Cochran operate a dairy farm in Tioga County, Pennsylvania, which is located in the north-central part of the state. They tend to about 200 cows on roughly 900 acres of land, 200 of which they own and 700 of which they rent. Dairy farming has been in Joe’s family for three generations.

The Cochrans object to the Dairy Program because it forces them to subsidize speech with which they disagree. In Joe’s words, “[i]t is our belief that the use of sustainable agriculture in the form of [a] less intensive herd management and grazing system makes for a superior milk, promotes a better use of the resources, promotes the environment, and, in sum, provides a healthier product for humans and our planet.” They do not consider milk to be a generic product and object to being forced to subsidize advertising that supports farming and dairy production methods that are, in their view, wasteful and inferior to their own.

The Cochrans are independent dairy farmers. They are not members of any dairy manufacturing or marketing cooperative. They market their milk themselves, and they alone determine how much to produce, how to sell it, and to whom it will be sold. Each year, they independently negotiate with the various processing plants who purchase their milk. They would be perfectly happy if the government would leave dairy farmers alone and let them produce, market and sell their milk themselves.

Litigation Team

The lead attorney in this case for the Institute for Justice is Steve Simpson, who litigates First Amendment, economic liberty and property rights cases nationwide. Simpson is currently the lead attorney in ForSaleByOwner.com v. Zinnemann, the Institute’s challenge to California’s effort to require for-sale-by-owner advertising websites to obtain real estate brokers licenses. Prior to joining the Institute, Simpson was an associate in the litigation department of the international law firm Shearman & Sterling. He will be joined by William H. Mellor, president and general counsel of the Institute for Justice, and Scott Bullock, a senior attorney at the Institute. Assisting the Institute for Justice as local counsel is Walter Grabowski of Holland & Grabowski in Wilkes Barre, Pennsylvania.

For more information, contact:

John E. Kramer (Vice President for Communications)
Lisa Knepper (Director of Communications)
Institute for Justice
1717 Pennsylvania Ave., N.W.
Suite 200
Arlington, VA 22203
(703) 682-9320