Raisin Raison

They [The makers of our Constitution] … conferred the right to be let alone—the most comprehensive of rights and the right most valued by civilized men.” – Justice Louis Bradeis, dissenting Olmstead v. United States [1]

To what are we entitled?  To what do we have a right?  If someone works earnestly and diligently at their job, came to the position honestly, fulfills all the requirements of that job and gets a great performance review … every year… well, should they get to keep that job?

What if you run a business that manufactures, produces or supplies a product or service?  What if, at some point during the year the government could come and demand a percentage of what you produce?  Up to 47% of your output?  And what if they could pay you whatever they wanted for that confiscation?  Even down to zero dollars and zero cents?

Last month the Supreme Court was in the news. The news frenzy and activist buzzing about the two Same-sex Marriage cases caused most to miss a case of some importance – the Raisin Case, or Horne v United States Department of Agriculture.

Raisins?  Really?  Yes.

California is the most prolific grape producing region in the world.  They produce over 99.5% of the US and over 40% of the world’s supply.  And, surprisingly, more of those grapes go to producing raisins than wine.  Each year, raisin “handlers” are required to “transfer” to the US Government whatever percentage the Raisin Administration Committee (RAC) dictates.

Who is the RAC?  It operates within the Agricultural Marketing Service.  Who are they?  Part of the United States Department of Agriculture.  What do they do with the raisins?  Whatever they want, including destroy them.  More often they are given away, quite often to school lunch programs.

How much do they pay the raisin producers for the product they take?  As little as they want.  Some years it is nothing, nil, nada, nichts, niente.  Zip. Zero. Rien for the raisins.

How is this even possible?  Way back during the Great Depression the US Government executed control grabs of large parts of the economy.  The Agricultural Marketing Agreement Act of 1937 strengthened the marketing agreement segment of the first Agricultural Agreement Act of 1933, allowing the government to basically do anything in terms of setting prices – including controlling production, storage, supply and demand of most agricultural products.  Including raisins.

By controlling the prices of produce – through central planning – the government believed they could keep farmers from going broke and city people from starving.  The 1930s were terrible and awful and I’m not about to blame the FDR New Dealers for trying to intercede. But that was 80 years ago.

The price of raisins – actually monitoring the price and nudging the price by controlling supply and demand – has remained a government function ever since.

California farmers Mavin and Laura Horne had to turn over 47% of their crop in 2002.  That year they changed their business model so that – they believed – they could keep the fruits of their labor.  In 2003 the set-aside was 30%.  The Hornes sold their product and didn’t turn anything over to the government. They put all 3 tons of raisins on the market.

They were promptly charged nearly half a million dollars by the government, for the projected market value of 30% of their raisins, and an additional $200,000 in fines.

Their case ended up in front of the San Francisco based 9th Circuit Court of Appeals, pretty widely regarded as the most liberal court in the country [2].  The Court ruled that the Horne’s had no standing in court (meaning they might be right or wrong, but it doesn’t matter since their case does not belong in court) since they never paid the fee or the fine ~:-\.  In other words, they had to pay the fees and fines (a lot of money) and THEN go to court.

The case, including their standing, finally made it to the Supreme Court last month.  A key part of the argument is the 5th Amendment’s “takings clause” —  and that is “… nor shall private property be taken for public use, without just compensation.”

The Supreme Court has a history of standing on its head to support expanded powers for government, from local to federal.  In the last significant “takings” case, the court supported a forced transfer from one private individual to another private individual when done by a municipality [Kelo v New London (CT)].  In 1942 the court upheld the USDA’s dictating that a farmer could not even grow wheat to feed to his livestock (Wickard v Filburn) and in 2012 the court upheld the PPACA (Patient Protection and Affordable Care Act) by loosely interpreting a payment clearly intended to be a penalty as, instead, a tax.

That is to say: Don’t expect a sweeping decision in favor of individual rights, and in favor of the Hornes and the raisin producers and handlers of California, many of them family businesses like the Hornes’.

But even the court’s liberals realize that there probably should be some practical limits to the scope of government’s powers.  Elena Kagan said that it was “either unconstitutional, or it’s the world’s most outdated law.”  Stephen Breyer: ““I can’t believe that Congress wanted the taxpayers to pay for a program that’s going to mean they have to pay higher prices as consumers.”

I expect a narrow ruling. The court will send the case back to the 9th Circuit with instructions that the Hornes do indeed have standing.  In other words: the Hornes might have been wronged.  But this is only one unique case and the government retains broad sweeping power to take property, control supply, prop up demand and run a centrally planned economy if they think it’s the right thing to do and in our best interest.

Back to Stephen Breyer’s very insightful comments.  We as taxpayers are paying for this confiscation program.  We pay for salaries, and office space and computers and IT personnel and lawyers.

We can agree that everyone at the Raisin Administration committee probably works hard and is a good person, but – sorry for the pun – just what is their raison d’ etre?  Surely a job that produces nothing – but takes, confiscates, re-distributes – and puts a drag on the economy while suppressing individual freedom needs to be eliminated.

And one wonders: how many more of these committees and administrations and agencies are hidden within our gargantuan government?

Experience should teach us to be most on our guard to protect liberty when the Government’s purposes are beneficent. … The greatest dangers to liberty lurk in insidious encroachment by men of zeal, well-meaning, but without understanding.” –  Justice Louis D. Brandeis, dissenting, Olmstead v. United States

I wish you peace and freedom.  Including freedom from oppressive Government

Joe Girard © 2013

[1] Olmstead v. United States, Dissenting Opinion, 277 U.S. 438 (1928)

[2] http://www.calcontrk.org/news/1086-april-2012/1954-us-supreme-court-rejects-most-decisions-by-the-us-9th-circuit-court-of-appeals

[3] http://reason.com/archives/2013/03/23/supreme-court-may-put-an-end-to-governme

2 thoughts on “Raisin Raison”

  1. Elle Rolfe

    That reminds me of the huge amount of comodities I used to see in the Mercer Island School refrigerators,when I worked there. I was Elementary School lunch manager in the 70’s. We got all sorts of stuff that we could not use, including lots of powdered milk, more butter than we could ever use and big boxes of dried prunes, plus other foods. I never knew kids to be so fond of dried prunes, and they weren’t.

    All school districs got more comodities than they could ever use.

  2. Kristy Weprin

    Joe,
    Thanks for this insightful article. I remember tons of butter and cheese being served up in elementary school back in the 60s and 70s too! I don’t remember prunes, but those probably just got tossed!

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