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As we noted, Big Government has been colonizing economic activity through schemes such as the Agricultural Marketing Agreement Act of 1937. This New Deal act, based on the notion that central planning works, set up cooperative boards and conscripted growers into reserve set-asides. This meant that Fresno raisin growers Marvin and Laura Horne, like many other farmers, would have to fork over 30 percent of their crop and get little in return.
The Hornes considered this an act of theft and proceeded to grow, package, and sell raisins on their own, apart from government planners. Their reward was a fine of $695,000. They appealed, and the case reached the U.S. Supreme Court. As Michael Doyle of McClatchy News observes, the decision is now in: “The court said Monday the program that compels some raisins to be held back in a reserve is subject to the just compensation commands of the Fifth Amendment.”
Chief Justice John Roberts ruled that “Raisins are private property, the fruit of the growers’ labor, not public things subject to the absolute control of the state,” adding “Any physical taking of them for public use must be accompanied by just compensation.” The Chief Justice further ruled that the Fifth Amendment “protects ‘private property’ without any distinction between different types.” The decision was 5-4 with only Sonia Sotomayor, who bills herself as a “wise Latina,” objecting to the whole thing.
U.S. Department of Agriculture bosses declined to speak with reporters, but as the case played out, their lawyers made the government position clear. If growers didn’t like the federal program, they were free to plant other crops. Roberts called that “pretty audacious,” and Justice Elena Kagan slammed the whole raisin program as “ridiculous.”
As The Economist observed, “If the court halts the raisin ransacking, it could affect other coercive farm programs, too.” And so it should. Nearly 80 years after passage of the Agricultural Marketing Agreement Act of 1937, it is time to stop government colonization of the market.