Why We Don’t Have More Light Trucks: The Story of the Chicken Tax
Here at BoldRide we love to talk about cars, trucks, vans – anything with four wheels and an engine. Occasionally, though, we diverge slightly from our favorite topic to touch on issues related to the automotive world. This time around we’re going to explore one of the countless absurdities our government has perpetrated during the 200+ years since 1776. Known as the chicken tax, it explains why we don’t see more light trucks on our roads. It also offers valuable insights into how Washington really works. Travel with us back in time to the early 1960s. God is in heaven, LBJ is in the White House, and the Mustang is an idea in Lee Iacocca’s mind. Europeans are enjoying what was once a rare delicacy for their discerning palates: chicken. While it’s among the cheapest animal foods in today’s world, prior to WW2 only the rich and powerful could afford to dine on the animal’s flesh. Think of that the next time you’re munching on a “McNugget.”
All of this changed after 1945, when Uncle Sam began encouraging farmers to raise chickens in large quantities. The idea was to supply the public with a protein-rich diet. American farmers raised so many of the birds that they began exporting them to Europe.
Our friends in France and West Germany loved the meat, so much so that their governments became concerned that their own agricultural producers were getting shafted. They imposed tariffs on American chickens, which by August 1962 cut our poultry exports to the affected nations by 25%.
This really is a story about trucks; trust me. We’re getting there.
PHOTOS: See More of the 1963 Ford Ranchero
LBJ decided to retaliate with a tariff on potato starch, brandy, and dextrin. Then he had a talk with UAW president Walker Reuther. The president wanted the powerful union to throw its support behind his civil rights initiatives. Reuther agreed that his organization would endorse them on one condition: that the White House do something about those pesky Germans, who were sending thousands of cheap, reliable vehicles to our shores.
LBJ promptly slapped a 25% tax on light trucks. This decimated sales of Volkswagen cargo vans and pickups in the first half of the 1960s.
Like all brilliant examples of statesmanship, this move had a number of unintended consequences, including:
The tax allowed the Big Three to become even more complacent about the quality of their own products, setting the stage for the Gremlin and other abominations.
PHOTOS: See More Subaru Cars
Subaru added seatbelts and carpeting to the rear bed of its BRAT so it would be classified as a passenger vehicle.
For years, European cargo vans were fully assembled in Germany, then partly disassembled and shipped to SC, where American workers promptly reassembled them and sent them out to dealers.
To get around the tariff, Ford contractors strip light trucks from Turkey of their rear windows, seats, and seatbelts after they arrive in Baltimore. The process costs the Dearborn automaker hundreds of dollars per unit, but saves it thousands of bucks in taxes. What happens to all those unused components? They’re junked, of course!