David R. Henderson  

Guitar Felons

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Federal agents swooped in on Gibson Guitar Wednesday, raiding factories and offices in Memphis and Nashville, seizing several pallets of wood, electronic files and guitars. The Feds are keeping mum, but in a statement yesterday Gibson's chairman and CEO, Henry Juszkiewicz, defended his company's manufacturing policies, accusing the Justice Department of bullying the company. "The wood the government seized Wednesday is from a Forest Stewardship Council certified supplier," he said, suggesting the Feds are using the aggressive enforcement of overly broad laws to make the company cry uncle. . . .

The question in the first raid seemed to be whether Gibson had been buying illegally harvested hardwoods from protected forests, such as the Madagascar ebony that makes for such lovely fretboards. And if Gibson did knowingly import illegally harvested ebony from Madagascar, that wouldn't be a negligible offense. Peter Lowry, ebony and rosewood expert at the Missouri Botanical Garden, calls the Madagascar wood trade the "equivalent of Africa's blood diamonds." But with the new raid, the government seems to be questioning whether some wood sourced from India met every regulatory jot and tittle.


This, from Eric Felten, "Guitar Frets: Environmental Enforcement Leaves Musicians in Fear," Wall Street Journal, August 26, 2011, is more support for my claim that the Obama administration is moving to criminalize some fairly innocent business behavior.

HT to Cameron Neumann.


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COMMENTS (10 to date)
Joey Donuts writes:

I have come to the conclusion that the only way to deal with this administration is to ridicule it every chance one has to do so. Ridicule sometimes works better than argument.

On this topic see this
Iowa Hawk

Les Cargill writes:

I happen to have a mid-range Martin of 2002 vintage that uses a quite satisfactory substitute for ebony or rosewood called Micarta. Some do not like the feel.

Since the DOJ is not talking, we don't know what the justification for this really is. On Mark Perry's blog ( which appears to be taken from a press release by Gibson's CEO ), the claim is that *Indian* law was not met ( even though the items were shipped to Gibson). So we are left to presume many things, but until the DOJ makes clear what Gibson is accused of, it's a bit early to attribute this to Obama Administration policy.

But yes, there is more than a hint of Kafka here.

Dano writes:

http://www.gibson.com/absolutenm/templates/FeatureTemplatePressRelease.aspx?articleid=1340&zoneid=6

According to Gibson, the raid is because the wood wasn't finished in India which violates Indian, not U.S., law.

Perhaps it is more than just antipathy to business but a case of helping your friends. It has been pointed out that Gibson's competitor, C.F. Martin wasn't raided even though Martin's catalog includes guitars with the same wood. The difference: Martin's CEO has contributed to the Democratic Party while Gibson's CEO has contributed to Republicans.

http://landmarkreport.com/andrew/2011/08/ceo-of-gibson-guitar-a-republican-donor/

Jeremy, Alabama writes:

I saw this, linked off Drudge.

The same article says, further down, that a guy importing hundred-year-old Bosendorfer pianos had to cop a plea and pay a large fine because those pianos have 100-year-old ivory.

Bear in mind that the raiding is being performed by bureaucrats with gold-plated pensions. Those being raided are trying to create wealth and employment. This is an example of the statistic that each regulatory bureaucrat destroys 95 jobs a year.

Powerline had a link that suggested that Martin guitars, a big Democrat donor in a similar situation, has not been raided. Whether this is true or not, it is obvious that the more profoundly invasive the government becomes, the more it can act politically rather than in the interests of the people it is supposed to serve.

Hannah writes:

The use of dangerously broad language in the construction of federal criminal laws is not an Obama problem. This has been going on for many years now, and getting increasingly worse, no matter who is in the White House. Prosecutors looking to bag a big kill go after people under a large number of laws at once; because the laws are so cloudy, the cost to defend and clear one's name can be completely ruinous. Trial court judges often get jury instructions wrong, and these convictions may be overturned on appeal. Those charged may be found to be either completely innocent, or guilty of something much less serious. That should not cost them their livelihoods and reputations.

If you want to do something about this, elect prosecutors more interested in justice than "cleaning up the streets" which is usually code for indiscriminately counting wins to polish their careers, regardless of whether they are doing the right thing for taxpayers or the justice system.

Also, don't try to get out of jury duty. You can help by being a good citizen and holding prosecutors to their standard of proof, which is (as people so often forget) innocent until proven guilty.

I sincerely hope this does not spell the beginning of the end of the era of Gibson. I was raised on Gibson guitars. My dad gave me my 1969 Tobacco Sunburst J-45 for my 16th birthday, and it is one of my most treasured possessions. They are such a comfortable, warm play, and I would hate to see them shut down because of shoddy law-writing and overzealous prosecution.

Bill Drissel writes:

The Inet has a couple of stories that Gibson's main competitor is a big Democratic Party supporter who advertises guitars made of the "forbidden" wood.

One story claims that if the nut on your guitar is made of ivory, it's not enough to know your guitar was made before a certain date. It's not enough to know the piece of ivory was collected before a certain date. You must know when it was cut and fitted on your guitar. Confiscation of a beloved musical instrument isn't where it ends. If you have made a mistake in filling out the paper work, a fine is certain and jail is possible.

It's oppressive acts like this that are making Americans hate their government.


Regards,
Bill Drissel
Grand Prairie, TX, USA

David R. Henderson writes:

@Hannah,
You write,
The use of dangerously broad language in the construction of federal criminal laws is not an Obama problem. This has been going on for many years now, and getting increasingly worse, no matter who is in the White House.
Your second sentence is correct; your first sentence is wrong. Obama presides over it, as did Bush, as did Clinton, etc. They all have control. They choose to let it go on. Therefore, they are responsible.
I think your first statement is indicative of an attitude that is widespread: the attitude that government officials are not responsible for the people they hire.

Arina writes:

What I don't get is why can't FBI first make sure that Gibson is using illegal wood and then shut them down! This is so dumb I don't even know what else to say.

Robert, Springfield Virginia writes:

The economic story here is the similar to the use of illegal labor.

Gibson is accused of using wood that is not legally documented. To stay competitive Gibson has had to skirt the law, bend rules and find loopholes or face being defeated by competitors who do so successfully.

This is the same dilemma faced by many small businesses. Take for example my friend Brent. He runs a small franchise maid service in Fairfax Virginia. He knows he is hiring illegal workers, but he skirts the law, just like the other 3 competing maid franchises in his territory.

Brent believes he is following the letter of the law, if not the spirit of the law. He know staying competitive requires him to hire the best workers for market prices. To him it is not about ideology but about staying in business.

In both cases competitive markets force business owners to game the system just to survive. They showcase the need for well educated and trained policy makers, free from biased special interests, to create better rules to manage the game.

It's a shame Madagascar is a ruined ecosystem. It's a shame foreign workers are exploited.
It's a shame we point fingers and take sides for ideological point scoring rather than doing real work and fixing these problems. Who really wins?

Mo writes:

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