The Justice Department raided the Gibson Guitar factory in Nashville on Wednesday morning. From a Gibson press release:
On August 24, 2011, around 8:45 a.m. CDT, agents for the federal government executed four search warrants on Gibson’s facilities in Nashville and Memphis and seized several pallets of wood, electronic files and guitars. Gibson had to cease its manufacturing operations and send workers home for the day, while armed agents executed the search warrants. Gibson has fully cooperated with the execution of the search warrants.
This actually happened once before:
In 2009, more than a dozen agents with automatic weapons invaded the Gibson factory in Nashville. The Government seized guitars and a substantial amount of ebony fingerboard blanks from Madagascar. To date, 1 year and 9 months later, criminal charges have NOT been filed, yet the Government still holds Gibson’s property.
Why is the Justice Department invading Gibson’s factory and seizing its property, without filing any charges? Do they think illegal materials might be hidden inside the guitars? Or, given recent history, were they trying to hide illegal guns inside guitars headed for Mexico?
No, this is all about the wood the guitars are made from. As the Wall Street Journal explains:
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.
What jots and tittles would those be? This isn’t some kind of environmental crisis. I don’t suppose Gibson’s musician clientele would tolerate one of those. According to the Gibson statement:
The wood the Government seized on August 24 is from a Forest Stewardship Council certified supplier and is FSC Controlled, meaning that the wood complies with the standards of the Forest Stewardship Council, which is an industry-recognized and independent, not-for-profit organization established to promote responsible management of the world’s forests. FSC Controlled Wood standards require, among other things, that the wood not be illegally harvested and not be harvested in violation of traditional and civil rights. See www.fsc.org for more information. Gibson has a long history of supporting sustainable and responsible sources of wood and has worked diligently with entities such as the Rainforest Alliance and Greenpeace to secure FSC certified supplies. The wood seized on August 24 satisfied FSC standards.
Well, it’s all about the Lacey Act, which the Memphis Daily News tells us “does not directly address conservation issues, but is about obeying all laws of the countries from which wood products are procured.” In other words, if you’re going to buy wood from India, you have to be in full compliance with Indian law.
Which Indian law did Gibson allegedly violate? Gibson Guitar CEO Henry Juszkiewicz told the Memphis Daily News the government refuses to explain the charges to him:
But Gibson’s CEO says his company has not been told what it did wrong and that he assumes the allegation is that some of the wood being used to manufacture the company’s guitars is illegal.
“Everything is sealed. They won’t tell us anything,” Juszkiewicz said, never raising his voice but pulling no punches in his defense of the storied guitar maker.
However, a Reuters report includes some speculation that it might be a weird Justice Department interpretation of a law the Indian government has not asked the American government to enforce:
"(The government) has suggested that the use of wood from India that is not finished by Indian workers is illegal, not because of U.S. law, but because it is the Justice Department's interpretation of a law in India," Juszkiewicz said.
If the same wood from the same tree was finished by Indian workers, the material would be legal, he said.
In an affidavit, agent John Rayfield of the U.S. Fish and Wildlife Service said U.S. Customs agents in June detained a shipment of sawn ebony logs from India.
The paperwork accompanying the shipment identified it fraudulently as Indian ebony fingerboards for guitars and it did not say it was going to Gibson, the affidavit said.
In July, agents observed Indian ebony and rosewood delivered to a storage facility for Gibson, according to the affidavit, which asked permission to seize Gibson's business computers.
Juszkiewicz vented his frustrations to the Memphis Daily News:
“The federal bureaucracy is just out of hand,” Juszkiewicz said. “And it seems to me there’s almost a class warfare of companies versus people, rich versus poor, Republicans versus Democrats … and there’s just a lack of somebody that stands up and says, ‘I’m about everyone. I’m really about America and doing what’s good for the country and not fighting these little battles.’”
“We feel totally abused. We believe the arrogance of federal power is impacting me personally, our company personally and the employees here in Tennessee, and it’s just plain wrong.”
I can’t imagine why we have stagnant GDP growth and chronic high unemployment! The Obama Administration is actively at war with every business they don’t choose to subsidize.