Supreme Court May Put an End to Government's Raisin Takings

The justices consider an "outdated" New Deal-era farm control law.

Earlier this week the U.S. Supreme Court heard oral arguments in the case of Horne v. USDA. I watched the case in person at the Supreme Court—the first time I’ve done so.

Horne concerns the USDA’s raisin marketing order program, one of many New Deal-era food-regulatory schemes that subsist for no good reason. The program requires raisin handlers (who process raisins for sale) to give a portion of the crop to the government—often without compensation.

The issue in the case (aside from a jurisdictional issue that appeared to evaporate quickly during oral arguments on Wednesday) is whether plaintiffs like Marvin and Laura Horne, in their capacity as raisin handlers, may sue to prevent a violation of the Takings Clause—rather than being forced to sue for restitution only after any such a violation.

The issue concerns the actions of something called the Raisin Administrative Committee, a government-mandated body that proudly “employs a staff of 17” who work diligently each year to determine how much of a raisin handler’s crop they will take, and whether they will compensate the raisin handler at all for the crop they take.

The plaintiff’s attorney explained last year how the committee’s takings work in practice.

“In 2003, when the case began,” the Hornes' attorney, Stanford University law professor and retired judge Michael McConnell, told the L.A. Times, “raisin handlers were required to set aside 47% of the crop.”

“In those two years,” says McConnell, “the raisin board ‘determined that the compensation for the reserve-tonnage raisins should be set at precisely zero dollars.”

The cost of the USDA’s raisin program is borne twice by taxpayers—who both fund the program and pay more for raisins. Though that’s true of many New Deal-era USDA programs, it still didn’t sit well with some of the Court’s justices this week.

“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,” Justice Stephen Breyer exclaimed.

That sort of robed skepticism was in evidence throughout much of oral arguments.

Toward the end of the government’s presentation of its case, Justice Elena Kagan speculated the Court could remand the case so the lower court could determine whether the USDA’s raisin marketing order program was either an unconstitutional taking “or it’s just the world’s most outdated law.”

Like most any New Deal-era food law still on the books—from farm subsidies to portions of the Food, Drug, and Cosmetic Act—it’s probably both.

It’s also a foolish and complex barrier to a free market in raisins.

Lawyers for Reason Foundation, which publishes this website, filed an amicus brief in support of the Hornes in which they compared the raisin marketing order program’s options for an injured party like the Hornes to a “Rube Goldberg” scenario.

Others agree.

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