Does the secretary of agriculture need unlimited power over farmers to protect them against themselves? The Supreme Court might finally settle this issue in an imminent decision on one of USDA’s most bizarre regimes.
When Franklin D. Roosevelt became president in 1933, his secretary of agriculture, Henry Wallace, and others urged him to appoint a temporary “farm dictator.” Congress quickly enacted legislation that vested vast power in the secretary of agriculture and his deputies. Four years later, Congress enacted the Agricultural Marketing Agreement Act, which authorized creation of marketing boards to issue orders to forcibly boost prices.
Marketing orders were based on the New Deal philosophy of “managed abundance” — prosperity through “universal monopoly and universal scarcity.” Americans quickly realized that it was not in the public interest to give private industry a federal license to conspire and gouge their customers. But such prerogatives have been retained by USDA marketing committees.
The Raisin Administrative Committee, one of the most powerful boards, can confiscate up to half of raisin farmers’ harvests with little or no compensation. The feds perpetually invoke the danger of surpluses to nullify raisin farmers’ property rights.
The committee fined Marvin Horne, a 67-year-old raisin farmer in Fresno, Calif., almost $700,000 after he refused to surrender control of 47 percent of his harvest. Mr. Horne, who labels the raisin regulations as “involuntary servitude,” fought the feds all the way to the Supreme Court, which heard arguments on the case in late March.
The case seemed to shock the court’s liberals. Many, if not most, justices sounded clueless about how far USDA’s iron fist stretches. Justice Stephen G. Breyer declared, “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 Justice Elena Kagan suggested that this could be “the world’s most-outdated law.” Justice Sonia Sotomayor sounded so confused by the case’s administrative and legal tangle that she was in danger of spinning out of her chair.
The Obama administration and USDA insist that, even though the government commandeers raisin farmers’ harvest, there is no “taking” because the seizure drives up the price of the remaining raisins. They invoked a federal appeals court ruling that the government need not pay compensation because Mr. Horne and his wife “voluntarily choose to send their raisins into the stream of interstate commerce.”
But since when did state lines nullify property rights? The fact that a business’s products are sold beyond its own neighborhood should not automatically turn the producer into bureaucratic cannon fodder. Or should we presume that USDA is like a medieval robber baron, entitled to seize half of the produce that passes near his fortified checkpoint? Brian Leighton, one of Mr. Horne’s lawyers, noted, “Thieves, murderers and rapists have far greater rights of due process and speedy appeal than do farmers regulated under USDA marketing orders.”
Federal marketing orders exemplify the quasi-covert nature of much of contemporary government coercion. If USDA sent armed agents into every grocery store in the country and arrested shoppers who sought to buy too many California raisins, USDA would be universally denounced as God’s prize idiots. Instead, the government imposes its controls directly on California farms and fruit handlers — and few Americans recognize how their government is thwarting the bounty of the nation’s farms.
It is unclear why the Obama administration feels obliged to defend the raisin regime. Perhaps the administration’s masterminds presume that this is another government program that cannot possible be as stupid as it looks. Or perhaps the fact that the program is long-established proves that it deserves all the power it has seized.
Many liberals have remained totally ignorant on USDA supply controls because they have scant curiosity about how government actually uses its power. Because they presume that government is benevolent, they need not sweat the specifics of its good deeds. But it is in the grisly details where Americans’ rights and liberties are increasingly shredded.
There is no evidence that federal supply controls are a cornucopia for farmers. Raisin growers have been whipsawed by fluctuating prices in the past dozen years, and many farmers have simply given up on the raisin business. The program has continued largely as a result of USDA’s version of agoraphobia — boundless dread of free markets. But there is no excuse for restricting supply of one commodity that should not apply to restricting supply of all commodities. The same market mechanisms that suffice for radishes, raspberries and rhubarbs could serve raisins just fine.
The government should no longer be permitted to condemn harvests to prevent farmers from committing suicide. The raisin case provides an excellent chance for the Supreme Court to signal that mindless administrative tyranny will no longer be tolerated.
James Bovard is the author most recently of a new e-book memoir, “Public Policy Hooligan” (Sixth Street Books, 2012).