Despite the damage that Kosuga and Siegel’s actions caused, the Onions Futures Act was not generally popular among traders. E.B. Harris, a prominent voice because of his position as president of the Chicago Mercantile Exchange, went hard against the bill and was quoted as saying “We submit that burning down the barn to find a suspected rat is a pretty drastic remedy.”
The fight against the bill continued after its passing in 1958, as the Chicago Mercantile Exchange filed a lawsuit in federal court to have it struck down on the basis that it restricted trade in an unfair and unnecessary manner. That lawsuit proved to be unsuccessful, at which point the CME decided to drop the fight instead of taking it to the Supreme Court.
Eisenhower Made Several Other Laws
Dwight D. Eisenhower, president of the United States from 1953 to 1961, had a busy presidency, and the Onion Futures Act was one of several key bills he signed into law that were part of his agenda. Two years prior to that bill, he promoted and signed a bill to create the Interstate Highway System, which laid the foundation for the most important highways and roads in the United States.
He also signed the National Defense Education Act in 1958, which infused large amounts of funding into the educational system with a focus on strengthening national defense. A year earlier, Eisenhower also signed the Civil Rights Act of 1957, which intended to support and enforce the 1954 Supreme Court ruling that officially banned segregation in schools.
Kosuga and His Partner Were Banned From Trading
The bill titled “The Onion Futures Act,” as put forward by Gerald Ford, dictated that all onion futures traded in the future would have to be sorted out in cash as opposed to actual physical onions. It also proposed that the government should have the right to set limits on the quantity of onion futures that could be traded.
Unsurprisingly, the Chicago Mercantile Exchange opposed both measures and opposed the bill in general. In the end, trading onions as a commodity was banned. For Kosuga and Siegel, the consequences they faced seem, in retrospect, to have been minor: their registrations as brokers were revoked, and they were banned from trading for ten months.
Chicago’s Pork Belly Market Closed Down
After Kosuga and Siegel’s onion scheme caused onions to be banned from being traded at the Chicago Mercantile Exchange, one of the commodities that took their place was pork bellies. They came onto the scene in 1961 and enjoyed a lot of success through that decade and the 1970s.
By the time pork bellies futures trading was shut down in 2011 due to a lack of demand and activity, they had been the oldest livestock futures to trade in the country. Harvey Paffenroth, who happened to be none other than Kosuga’s nephew and was a member of the Chicago Mercantile Exchange, said that pork bellies were the glamour market.
Kosuga Opened a Restaurant in His Hometown
In the early 1960s, Kosuga returned to his corner of New York state, Pine Island in Orange County, and opened a restaurant he and his wife named “Ye Jolly Onion Inn.” The restaurant boasted a large and diverse menu and a full bar and also included live music and other special events. Over the decades, the restaurant enjoyed great success even as it passed through two different owners after Kosuga sold it in 1970.
The restaurant closed down in 2008 but was reopened a decade later under new management. To this day, it remains a popular destination for locals and visitors alike, whether it is visited for a casual meal or to celebrate occasions like weddings and graduations.