|
BROWSE THE
SITE:
[Home]
[About Heritage]
[Heritage Coffee Canada]
[Vending & OCS]
[Specialty Coffee]
[Food Service]
[Green Coffee Buyers]
[Stuart Daw Reports]
[Business Resources]
[Coffee Humor]
[Helpful Links]
[A Few Coffee Facts]
Sales
800-791-7811
Fax: 519-668-1384
97 Bessemer Rd., #1
London, ON N6E 1P9
Contact Us
| |
IN MY OPINION: BY STUART DAW
[ Up ] [ April Fool's and the Work Ethic ] [ Balancing Act of a New Business ] [ Coffee, Grounds and Percolators ] [ Coffee Weights 1982 ] [ Ethics and the Coffee Business ] [ Guesses, Anyone? ] [ Heavyweight Champions ] [ Help!! ] [ Potatoes Can't Run ] [ Sad tales neither die nor fade away ] [ Stuart Daw on Trial ] [ What Determines the Price? ] [ SCAA and SMAA ] [ Excitement in the Coffee Business ] [ New Coffee Slogan ]
Stuart Daw on Trial
© 2003 Stuart Daw
Judge:
Stuart Daw, you are charged with moral turpitude, doing work on behalf of the
U.S.
government, knowing the laws under which you performed your work were immoral.
How do you plead to this charge?
Me:
Not guilty as charged, your Honor.
A
few years ago, as founder and chairman of a philosophic society called the Tampa
Bay Objectivists, I was often in search of a theme for our monthly meetings, a
theme that would entertain while giving members a chance to apply important
principles to their everyday lives. An experience from my own past struck me as
being a pretty good subject for review by this intelligent group of mostly young
people, many of whom were in college preparing for life out there in the real
world.
I cupped them "blind"
with the Customs man standing close by.
The
incident in question had related to something I had done in the coffee business.
Was it morally right, or was it morally wrong? I hadn't really given it much
thought, though I obviously must have felt it was okay at the time. It seemed to
me that an interesting way to present the case to the group would be to hold a
mock trial, with myself as the accused. As luck would have it, three of our club
members were practicing lawyers. That meant we had a built-in judge, along with
both a prosecutor and defense attorney, with the other people serving as the
jury. The "courtroom" was my office, jammed with around 25 members.
First,
an outline of the alleged moral crime. I had acted for some time as an official
coffee taster for the Customs Division of the U.S. Treasury Department,
identifying the country of origin of contraband coffee through blind cup
testing. At the time, the
U.S.
was a signatory to the International Coffee Organization (ICO) quota system, in
effect a cartel of governments designed to fix coffee prices above their true
market level.
Both
importing and exporting nations could sign on, and most did. Coffee growing
countries that did not were left with the problem of trying to sell their coffee
to countries not in the ICO. They might move their surplus to a country that had
not been able to fill its quota, to be slipped under the name of that country
(this became known as "tourist coffee"). Or they would dump it in
places such as countries behind the old Iron Curtain. One loophole was known as
a "basket quota," under which an importing member could grant an
amount of its purchases to a non -member that was in its good graces. An example
of a country with a basket quota to export to the
U.S.
was mainland
China
, a non-signatory to the ICO Agreement, but which was held in particular favor
and being wooed by the
U.S.
administration at the time.
Customs
had seized two shipments from
China
on the west coast, probably resulting from a tip. After the coffee had been
impounded, the two luckless importers were obliged to sue the government to get
the coffee released. Permission had apparently been granted to import the coffee
by the
U.S.
authorities, but in this case the problem was that there was more coffee in the
seizure than was grown in
China
at the time. So if the coffee never came from
China
, where did it come from?
I
received 42 samples of green coffee from Customs in
San Francisco
, flown in and hand-delivered late at night. I met the agent, samples and all,
at the airport, and after dropping him off at a hotel, headed for home with the
samples in the trunk of the car. No sooner had I pulled into my driveway than a
taxi came roaring down the street. Out jumped the Customs guy, demanding to know
if I had opened the trunk of my car.
Luckily
I had not. Apparently he had called local agents in
Tampa
from his hotel. They asked him if he had the samples in his possession. He
hadn't realized — or had forgotten — that it was crucial to "maintain
the chain of custody," never letting the samples out of his sight. So when
they warned him that he may have ruined the case against the importers, he
quickly come to rescue his treasure.
The
next morning we met at my office. He would not tell me where the samples had
originated. All 42 of them were numbered and otherwise unmarked. I cupped them
"blind" with the Customs man standing close by. Five of the samples
turned out to be of the robusta variety, the rest were arabicas. In a written
report to Customs, I said that while it was impossible to be sure, the coffee
was of a type and kind that I would expect to receive from
Indonesia
.
As
it turned out, the coffee had indeed come from
Indonesia
. It had been shipped to
China
and re-bagged with Chinese identification. An interesting part of the story was
that after WWII the Indonesians had deported the Dutch and Chinese from what had
been known as the Netherlands East Indies. The Chinese resettled on the
island
of
Hainan
off the southeast coast of
China
, taking slips from Indonesian coffee trees with them. Thus had begun an
accelerated coffee culture in
China
, traditionally a tea-drinking nation.
Will
Stuart he found guilty of this crime of moral turpitude? What will it mean for
countries considering coffee cartels?
The
Trial
Space here precludes going through the actual subsequent pre-trial procedures
and the final disposition of the case, which was strictly decided on the legal
issues involved. But let’s get back to the story of our philosophical society
and the mock “trial.” Our group was closely knit intellectually and
philosophically, for each member was a student of Objectivism, the philosophy of
Ayn Rand. While their knowledge of Objectivism varied from one to the other,
they all had at least a basic grasp of it and the meaning of the four main
branches of philosophy -- Metaphysics (what is?), Epistemology (how do I know
what is -- the theory of knowledge), Ethics (how should I behave?), and Politics
(what is the proper form of social organization?).
We grasped the idea that all government laws should rest on some idea of proper
ethics and morality in any society. A cartel such as the ICO coffee agreement
would mean imprisonment if ordinary citizens attempted it. A good question to
ask then would be: why should governments somehow exempt themselves from their
own law and be able to get away with it?
The evening “trial” went well beyond our expectations. I thought it would be
an easy win for me in working to enforce the law, but it turned out quite
differently. While the proceedings were not recorded, here is a very brief
summary of it (after following the usual courtroom preliminaries):
Prosecutor:
Do you believe cartels should be legalized?
Me:
Yes. But more accurately, simply being ignored as not harmful except to those
indulging in them.
Prosecutor:
Don’t you believe that if companies were allowed to fix prices they would run
wild and rip off the public with impunity?
Me:
No, for competition would not allow it. The profit returns from inordinately
high prices would also be high, and there are always competitors looking for
places to invest capital in profitable enterprises. The result would be new
entries into such a business, normalizing prices again. There’s no need for
government involvement.
Prosecutor:
Having admitted antitrust laws are wrong, why then did you agree to work for the
government in prosecuting private citizens for breaking an immoral law?
Me:
Because while I believed the law was wrong, I knew that coffee brought into the
country well below market prices meant competitors of our company would have an
unfair price advantage. Further, if a law is immoral but legal, one must realize
that in breaking the law, one runs the risk of detection and punishment.
Prosecutor:
In other words, you are a philosophic pragmatist. You were only concerned for
your own company, and not that some of your fellow citizens could benefit from
lower prices. That was selfish of you, Mr. Daw.
Defense Attorney:
Objection Your Honor. He’s badgering the witness.
Judge:
Overruled.
Me:
A few people might benefit from lower prices with respect to that relatively
small amount of coffee being smuggled into the country, but the rest of the
populace would have to bear prices much higher than the market because of their
own government meddling in the process.
Prosecutor:
I don’t think we need further testimony from this man. He’s clearly guilty
of breaking the moral law. He knows that the proper role of government in a free
society excludes being involved in the field of economics, interfering with the
individual rights, including property rights, of private citizens. By testifying
for the State, he knew he was going against his own conscience and sense of
right or wrong.
My lawyer called a couple of “character witnesses” on my behalf; then took
over the questioning: Mr. Daw, do we have a responsibility to help the poor
farmers of the Third World get more for their products?
Me:
This is a zero sum game, whereby some countries may get a short-term benefit
from a government coffee cartel while others, not part of the cartel, are
losing. Besides, raising prices above market levels of any agricultural product
only encourages farmers to over-produce, creating a glut. Eventually the dam
bursts, prices crash, impoverishing all the producers. That’s the natural law
of the open marketplace.
Defense Attorney:
You knew cartels were bad. Please tell the jury why, then, you witnessed for the
government in the case of this seizure?
Me:
The ruling principle here was justice. The law is wrong, and I admit it. But in
the case of a bad law in a free society, the only moral course to follow for an
individual citizen is to uphold the law, while working to have the bad law
changed.
Those were the essence of the arguments before and against the defendant. The
judge, attorneys and I left the room to allow the jury to come to a decision. To
our surprise, it did not come quickly. It was perhaps a half-hour before we were
called back to hear the verdict. The jury had taken this case very
seriously.
The
judge asked for the verdict, and the jury “foreman” stood and pronounced
“not guilty.” The judge then polled the jury, and to my surprise I had won
by only a couple of votes. But that was proof that we had found a really good
issue to chew on. And we all had a lot of fun in the play.
It is appropriate to be serious and consider the principles involved in the
above mock trial, in case either Canada or the US should ever think of
re-entering the price fixing game of an international cartel. It would not be
the moral thing for them to do. And remember, the moral is the practical. For
whatever we may think of private efforts to raise prices through such things as
Fair Trade, we must remember that these groups are strictly voluntary. Consumers
are not obliged to pay more than the real market price for coffee if they choose
not to. Coffee consumption is the ideal democratic process - people voting with
their palates and their dollars for the best value we in the business can offer.
© 2003 Stuart Daw |
