Cadillac Desert (61 page)

When the valley ranchers saw how rich one could become through irrigation farming, they began to switch from cows and dryland wheat to crops. Few had Miller’s ambition or wealth, however, and even when organized into irrigation districts they couldn’t duplicate his dam, so they irrigated with primitive sluiceways cut from the rivers, much as did the farmers along the Nile. As for the state and federal governments, they wanted nothing to do with publicly financed irrigation projects, which were widely regarded as socialistic.

Everything changed with the invention, shortly after World War I, of the centrifugal pump. Suddenly able to draw hundreds of gallons per minute out of the valley’s shallow aquifer, the irrigation farmers no longer had to worry about building expensive canals, about cleaning them of silt; they no longer had to dream of regulating the rivers with dams to ensure summer flows. By the mid-1920s, thanks to irrigation pumping, California had surpassed Iowa as the richest agricultural state in the country; the Central Valley was the largest semicontinuous expanse of irrigated farmland in the world. The aquifer, which had collected over many thousands of years, was prodigious; before pumping began, it may have held three-quarters of a billion acre-feet. With the expansion of irrigation farming from a few thousand to millions of acres, however, the water table began to drop sharply. By the end of the Great Drought of the 1930s, the farmers had so badly depauperated the groundwater that the depletion curves were precipitous. Twenty thousand acres had already lost their groundwater and gone out of production; hundreds of thousands more overlay a groundwater table that was becoming dangerously low. Suddenly, the valley’s reserve of groundwater, which had so recently seemed limitless, had only a few more decades of economic life.

The farmers could look in two directions for help: Sacramento and Washington, D.C. The Bureau of Reclamation, which was just completing Hoover Dam, had such a hold on the public imagination and the Roosevelt administration that it could build almost anything it pleased. On the other hand, it was supposed to create new subsistence farms in the West, not rescue the farmers who were already there from the consequences of their short-sighted avarice. Besides, Hoover Dam had been a great gift to California, and the other western states were waiting in line.

Sacramento, then, was the better bet, even if it couldn’t dip into the federal treasury to finance the farmers’ rescue. In 1933, the state legislature succumbed to heavy lobbying from the growers—who had become its biggest source of campaign contributions—and passed the Central Valley Project Act. The legislation was a striking display of ambition for a single state, proposing as it did the control, through dams and reservoirs, of the largest and third-largest rivers in California. The project bonds, however, could not be sold in the middle of the Depression, so the state was forced to let the Bureau of Reclamation take over the Central Valley Project; it was such a gargantuan scheme that the completion of its main features, including four big dams, required eighteen years.

The Central Valley Project was without question the most magnificent gift any group of American farmers had ever received; they couldn’t have dreamed of building it themselves, and the cheap power and interest exemption constituted a subsidy that would be worth billions over the years. It is interesting, therefore, that originally many of the farmers
hadn’t wanted
the Bureau to build the CVP.

The wedding between the Bureau of Reclamation and the Central Valley farmers was never more than a marriage of convenience, and, like many such marriages, it was soon on the rocks. As a starlet trades a virile but impecunious husband for a wealthy old tycoon, the farmers had, in effect, traded whatever hope they had of becoming agricultural grandees like Henry Miller for a secure supply of water. The Reclamation Act, which would apply, in theory, to the CVP even though it only delivered supplemental water to most, required a farmer owning more than 160 acres of land (320 for a man and wife) to sign recordable contracts to dispose of the excess holdings in order to continue receiving subsidized water. Since a great many farmers owned far more than that, the CVP looked as if it might become the first real land-redistribution device in U.S. history. Leasing acreage above and beyond the 320-acre limit was also prohibited under the act, and all excess holdings were supposed to be sold at their pre-project worth—which, in a valley where no crop could be raised without irrigation, was very little. On top of all this, farmers receiving Reclamation water were required to live on their land, not farm from Fresno or San Francisco, as many of them did. (The Bureau stopped enforcing the residency provision in 1916, but a federal court later determined that it was still valid.) The whole idea was to keep speculators away, and to open up arid land to as many new farmers as possible. “We weren’t even supposed to give them 160 acres if they could make a living on less,” says former commissioner Floyd Dominy. “And in warm states like California you could make a living on a lot less. We were talking about subsistence—nothing more.”

The CVP, in short, was fundamentally different from every earlier Reclamation project. It did not create many new irrigated farms. It rescued thousands of farms that were already there, including a good many that were far larger than the law allowed. One of the “farmers” whose land lay within the service area of the Central Valley Project, and who was scheduled ultimately to receive its water, was the DiGiorgio Corporation, whose lands grew more commercial tomatoes than any state except Florida. Another was the Southern Pacific—not a mere railroad, but the largest private landowner in California, and the eventual owner of 109,000 acres in the Westlands Water District, which was scheduled to become the largest single recipient of CVP water. The roster of landlords within the San Joaquin Valley was a Who’s Who in corporate agriculture. Figures for 1946, published in a Senate report on the acreage limitation, reveal that Standard Oil owned 79,844 acres in the probable CVP service area; Will Gill and Sons owned 29,926 acres; the Bellridge Oil Company owned 30,120 acres; the Tidewater Associated Oil Company owned 25,554 acres; the Richfield Oil Company owned 10,718 acres; the Anderson and Clayton Company owned 19,144 acres; and the J. G. Boswell Ranch Company, which, among others listed, was already receiving Kings River water virtually free courtesy of the Army Corps of Engineers, owned 16,760 acres—part of a worldwide land empire later estimated at some 860,000 acres minimum. If such growers availed themselves of the Bureau’s water, which they would doubtless want to do, the law was quite clear about the disposition of their cases: they would have to sell all lands in excess of 160 (or, more likely, 320) acres that received the subsidized water. The Reclamation Act’s chief sponsor in the House, Frank Mondell, had said on introducing the bill that this divestiture provision “was drawn with a view to breaking up any large landholding which might exist in the vicinity of Government works.” It was hard to imagine it stated more emphatically than that.

The threat of divestiture gave the big growers in the CVP service area fits, even if the Bureau was far more interested in building more dams than in trying to enforce such an unpopular law—especially when the Interior Department’s lawyers, few of whom were legal stars, had to go up against some of the craftiest legal talent in the state. One modest example of how the farmers managed to deceive the Bureau was provided by the case of Russell Giffen, one of the big landowners in the Westlands district. A Fresno rancher who stitched together seventy-seven thousand acres of valley property—about seven times the acreage of Manhattan Island—Giffen was the largest cotton grower in the world: nationally, he also ranked just behind Boswell and one other farming company in the combined federal farm subsidies he received. In the 1970s, Giffen decided to clean up his estate for probate, and sold most of the land for $32.5 million. One of the buyers was a New York-based company called Jubil Farms, in which a Bakersfield couple, William and Judith Rogers, owned an 80 percent interest. The Rogerses, five other couples (most of them Rogers employees), the trusts of four Rogers children, and a mail-order denture company took title to 1,812 acres, all of it in parcels of 160 acres or less. All the new landowners then leased their property back to Jubil Farms. Financing for the whole deal, in the amount of $3.5 million, was provided by the Nissho Iwai American Corporation, the subsidiary of a Japanese conglomerate, which happened to own the other 20 percent of Jubil Farms.

On paper, and in the Bureau’s recordable contracts file in Sacramento, the requirements of the Reclamation Act were satisfied. In reality, the whole business was a translucent sham. One company, Jubil Farms, with its headquarters in New York City, was farming eleven times as much California land as the law allowed, with water it bought from the government for a few dollars per acre-foot—probably one-tenth of its worth on the free market, had there been such a thing. But this phony transaction, cynical as it was, was at least a gesture of compliance with the Reclamation Act. Other farmers chose to stonewall the Bureau in court, moving into compliance a centimeter at a time. Any self-respecting lawyer could drag such a case out for years, while his client continued to receive subsidized water the whole time. Others were being granted special exemptions by the Interior solicitor’s office. No one has ever produced hard evidence, but there has been speculation that such exemptions bore a more than casual relationship to the size of a campaign contribution—and these were growers who could easily contribute $50,000 to a candidate’s coffer. Rita Singer was a lawyer in the Interior solicitor’s office through the 1960s and early 1970s, until she resigned and joined the legal staff of California’s Department of Water Resources. “We’d be working on a case for months,” Singer recalled during an interview in 1984, “and then my supervisors would send down an interpretation of the law that nullified our cause of action. Some of the subterfuges would be allowed. Others would be disallowed. There wasn’t any rhyme or reason. In most cases we never got an explanation. It was legal hairsplitting. The solicitor’s office would recognize ‘distinctions’ in cases that were identical.

“In effect, we were telling the growers, ‘Go ahead. Do whatever you want.’ When we moved for enforcement, it was always inconsistent. We never gave them a serious message that we meant business.” In public, Singer says, the growers cursed the Bureau, calling it “dictatorial” and using epithets far stronger than that. “In private, they regarded the federal government as a laughingstock.”

The Bureau knew full well that numerous violations were taking place in California. In 1964, Interior Secretary Stewart Udall ordered Commissioner Floyd Dominy to investigate the number of violations occurring within the service area of the Metropolitan Water District of Southern California—presumably to use the information as a weapon to force the Met to drop its campaign of divide and delay against the Central Arizona Project. Dominy’s regional director in Boulder City, Arleigh West, hired an investigator from Phoenix named Ralph O. Baird to conduct a surreptitious hunt for violators, learning what he could through deed records and word of mouth. According to a December 30, 1964, blue-envelope memo sent to Dominy by West, “extreme caution was required”—apparently Baird thought he had some reason to fear for his safety. In three months, he managed to document ninety-nine violations of the excess-lands provision, totaling 105,229 acres. Several growers were irrigating thousands of acres with federally subsidized water wholesaled to them by the Met; the largest of them was the Irvine Ranch, which, in 1980, was the eleventh-largest landowner in California, with 28,257 acres of cropland, 82,344 acres all told, and $140 million in annual sales, according to the California Department of Corporations and Dun and Bradstreet. The list of violators has apparently been destroyed; not a trace of it could be found in Dominy’s files or Bureau records in Boulder City. But West would admit in retirement that the violations had indeed occurred, that they might still be occurring, that in his estimation it was a clear-cut illegality under Reclamation law, and that—for reasons he “wasn’t privy to”—nothing was done. “I didn’t even dare mail the list to Dominy,” he said. “I hand-carried it to him on a plane. He looked it over and put it away. He told me never to talk about it—and he said it in that tone of voice of his that meant you’d better obey—and I never saw it again. There were some pretty powerful people on that list.”

In eighty-two years, the Bureau would see the breakup of only one major illegal landholding through to the end. That was the DiGiorgio Company, and it was stripped of its excess lands only because John Kennedy’s Interior Department solicitor, Frank Barry, was relatively serious about enforcing the act. Later, when Jimmy Carter began making noises about enforcing the letter of the law again, the growers managed to lobby through (in 1982) the most extensive and, in the view of those who had watched in frustration as large growers evaded the Reclamation Act not just for years but for decades, the least justifiable revision of the law in its eighty-year history. The 160-acre limit was raised to 960 acres, and the leasing and residency restrictions were eliminated. In return, the growers are supposed to pay “full cost” for water delivered to all lands beyond the 960-acre limit. (In 1987, however, the Reagan administration delivered an Interior Solicitors opinion allowing subsidized water to be sold to unlimited 960-acre “paper farms” owned by relatives and trusts in the same family—the same fraud, on a much larger scale, that had gone on before the Reclamation Act was “reformed.”)

A Carter administration investigation conducted a couple of years earlier before the reform—the first serious effort to gauge the degree of compliance with the law—had established that more than 90 percent of the acreage violations were occurring in California and Arizona, whose hot climate permits high-value crops and two-crop seasons—exactly the kind of climate where the original 160-acre limit is eminently fair. In Colorado, or Montana, or Wyoming, where most farms are at altitudes of at least 4,000 feet, where the freeze-danger period runs to eight months, and where farmers are lucky to raise one good crop of low-value corn or wheat, a revision of the acreage limit was probably in order. But California’s farmers, having received the gift of subsidized water not long before, were now awarded with a so-called reform whose chief result was to legalize wholesale noncompliance with federal law.