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U.S. Constitution Title: Raisin takings case oral argument goes badly for the government Raisin takings case oral argument goes badly for the government Things did not go well for the federal government in today’s oral argument in Horne v. US Department of Agriculture, the raisin takings case. Nearly all of the justices were highly skeptical of the government’s claim that forcible confiscation of large quantities of raisins somehow does not qualify as a taking of private property that requires “just compensation” under the Fifth Amendment. The forced transfer is part of a 1937 program that requires farmers to turn over a large portion of their raisin crop to the government so as to artificially reduce the amount of raisins on the market, and thereby increase the price. Essentially, the scheme is a government-enforced cartel under which producers restrict production so as to inflate prices. The lower court decision by the Ninth Circuit held that this doesn’t qualify as a taking because personal property (including raisins) is not protected by the Takings Clause, and because Hornes and other raisin farmers actually benefit from the program, which increases the price of the products they sell. There was virtually no sympathy for the former argument among the justices, and Deputy Solicitor General Edwin Kneedler barely even tried to defend it. At one point, he suggested that that argument “has not been our position,” though later on he said a similar program targeting property rights in land would be a “fundamentally different” case. Kneedler was probably wise not to push this argument much, since both the text of the Fifth Amendment, the original understanding, and longstanding precedent all indicate that the Takings Clause protects all private property rights equally (which is why the text uses the general term “private property” without differentiating between real and personal property). The relevant history and precedent is covered in detail in an amicus brief I joined along with a number of other constitutional law and property scholars. Kneedler put most of his emphasis on the argument that there is no taking because the Hornes and other raisin farmers actually benefit from the program that confiscates their raisins. In the words of Justice Antonin Scalia, the government’s argument here is that the Hornes are actually “ingrates” who should be grateful for the government’s largesse. As several justices emphasized, even if the Hornes really do benefit from the confiscation of their property, that does not change the reality that a taking has occurred. The fact that property owners benefit in some way from the taking of their property may affect the level of compensation they are owed. But it does not change the reality that a taking has occurred in the first place. Justice Samuel Alito noted that the government’s logic leads to the conclusion that there is no taking in any situation where the government seizes personal property for purposes that might potentially benefit the owners in some way: Could the government say to a manufacturer of cellphones, you can sell cellphones; however, every fifth one you have to give to us? Or a manufacturer of cars, you can sell cars in the United States, but every third car you have to give to the to the United States. After all, reducing the number of cell phones or cars on the market is likely to raise the price of those products, thereby benefiting their manufacturers. Michael McConnell, the prominent constitutional law scholar representing the Hornes, pointed out that his clients are probably still net losers from the program, even if you take into account the way in which they benefit from having a higher price. They would likely be better off if they could sell a larger quantity raisins at the lower price that would prevail in a freer market, than by selling fewer raisins for a higher price under the cartel scheme. Deputy SG Kneedler claimed this was not true because the demand for raisins is so “inelastic” that consumers would not buy more of them if the price were lower. That claim goes against basic economics 101, and I highly doubt that the justices will buy it. In any event, even if it is true, it should only affect the amount of compensation paid, not the determination of whether a taking has occurred at all. In addition, some producers are differently situated from others, and might potentially be better off without the program than with it. The Hornes themselves likely fall into that category, for reasons articulated by McConnell in the oral argument, and in his reply brief. UPDATE: It is worth noting that Horne is one of the rare cases that that has gone to the Supreme Court twice. In 2013, the justices unanimously rejected the federal government’s claim that the property owners should not even be allowed to present their Takings Clause argument in federal court without first paying some $483,000 in fines and pursuing various likely futile administrative remedies. Notice anything wrong? Send Silk feedback Post Comment Private Reply Ignore Thread Top • Page Up • Full Thread • Page Down • Bottom/Latest The forced transfer is part of a 1937 program that requires farmers to turn over a large portion of their raisin crop to the government so as to artificially reduce the amount of raisins on the market, and thereby increase the price... So...Under FDR gold was confiscated as well as large quantities of raisin crop?? That's clearly adding insult to injury. One day someone is going to have to highlight all the major socialist decrees illegally legislated or EO'd during the original Lyin' King's criminal regime.
#2. To: tpaine, A K A Stone (#0) WaPo.
#3. To: Liberator (#1) If I were the federal government, I'd say, "OK, Hornes. You win. No more 'takings'." Let's let the market decide. Raisin prices will drop so much that half the growers will be out of business in 12 months. Hopefully, Hornes will be one of them.
#4. To: Liberator (#1) Before 2002, (Horne) had been contributing voluntarily to the reserve, although he stopped that year. As of July 2013, he is now in debt to the government $650,000, with a deficit of 1.2 million pounds of raisins, which would take four full years of harvesting to make up." All the other raisin farmers have been contributing and this SOB has been selling everything he grows at the government guaranteed price. NOW he says the law was unconstitutional. Hang 'im high.
#5. To: misterwhite (#3) If I were the federal government, I'd say, "OK, Hornes. You win. No more 'takings'." So you are a communist then? So if half of them do go out of business with raisins then that means they'll grow something else instead. Do they really need the government to protect them from growing too much of what society doesn't want? Is this an "Oh, the humanity" moment for you?
#6. To: misterwhite (#4) "Contributing" ... nice euphemism to describe a taking. I'm glad to see this guy wise up to what it is, and happier still that he's willing to go through the trouble and expense of exposing it. Now THAT is public service to society.
#7. To: Pinguinite (#5) "So if half of them do go out of business with raisins then that means they'll grow something else instead." Sure. Just like that. One year raisins, next year ... what ... radishes? Don't know anything about farming, do you? Soil, climate, machinery to plant, machinery to harvest, storage, skill set. Whatever. You and I are in agreement. Get the government out of it. Let them file for bankruptcy. In 3-4 years, raisin prices will double and the box will be marked, Made in Taiwan. Then you'll blame the farmers.
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