|Ten Years After Kelo, Supreme Court Can Make Property Rights Course Correction|
By Timothy H. Lee
Thursday, April 23 2015
"...nor shall private property be taken for public use without just compensation." —United States Constitution, Amendment V
Can government confiscate, in the name of regulating prices and market micromanagement, up to half of a farmer's crops without providing just compensation?
The Fifth Amendment seems perfectly clear in rejecting that proposition. The federal leviathan, however, claims a more enlightened interpretation.
In our Constitution's opening words, the Founding Fathers declared their intent "to form a more perfect Union, establish Justice, insure domestic Tranquility, provide for the common defence, promote the general Welfare, and secure the Blessings of Liberty to ourselves and our Posterity." As reflected in the Fifth Amendment passage above, private property was among the most sacred of those blessings of liberty they sought to secure. And as James Madison, the father of the Constitution, observed, "A government is instituted to protect property of every sort ... This being the end of government, that alone is a just government, which impartially secures to every man, whatever is his own."
This week, the United States Supreme Court heard oral argument in the private property rights case of Horne v. USDA. Accordingly, it now possesses the opportunity to restore Constitutional fidelity to an area of law that it did so much to despoil ten years ago in its odious Kelo v. City of New London decision.
At issue in Horne is the Depression-era Market Management Act of 1937, and the Raisin Administrative Committee - no kidding - established under its authority in 1949. Reflecting that period's New Deal bureaucratic hubris, government regulators believed that they could supplant market forces and dictate prices for raisins and dozens of other crops by artificially limiting supply. In pursuit of that goal, the committee each year determined what percentage of raisin farmers' annual crop would be commandeered by the federal government to sell, ship overseas, give away or simply let rot.
Enter plaintiff raisin growers Marvin and Laura Horne of Fresno, California.
In 2002, the federal government confiscated 47% of the Hornes' raisin crop for below what it cost to grow it. One year later, they were forced to surrender 30% of their crop without compensation. At that point the Hornes objected, so regulators literally sent trucks to their farm to confiscate the requisite tonnage of raisins. When that attempt failed, they instead decided to fine the Hornes in the amount of $700,000.
The Hornes sued, and the subsequent procedural history itself illustrates the appalling degree to which the Constitution's protections are casually disregarded by the federal government, as well as courts established specifically to safeguard them.
Numerous federal circuits rightfully hold that the Fifth Amendment's Takings Clause applies to individual property as well as real property. The oft-rebuked Ninth Circuit, however, took a different view. A three-judge panel of judges first ruled against the Hornes under the twisted logic that by simply entering the stream of commerce they submitted to regulators' authority. Under that logic, given the sheer number of professions and economic sectors regulated by the federal government, a citizen surrenders his or her Constitutional rights by simply making a living in almost any imaginable way.
Following an en banc Ninth Circuit appeal, the panel altered its position and held that the Hornes could only appeal to the Court of Federal Claims, and only after first paying the fine imposed by regulators. The Hornes appealed to the Supreme Court, which unanimously reversed. Even far-left Justice Elena Kagan ridiculed the Depression-era law in question by instructing the Ninth Circuit to "figure out whether this marketing order is a taking, or just the world's most outdated law." Ouch.
Forced to rehear the case, the Ninth Circuit again switched rationales. This time, it reasoned that the Fifth Amendment protects only land, not personal property. Alternatively, it held that the federal program boosted raisin prices on the broader market by creating artificial scarcity, thereby providing "just compensation" to the Hornes.
On appeal, the Supreme Court now has the opportunity to correct that misjudgment and affirm what the Fifth Amendment explicitly requires: "just compensation" whenever government forcibly confiscates "private property."
Ten years ago, the Court in Kelo infamously and outrageously disregarded the Fifth Amendment's command that property only be taken by government for "public use." While the case currently before the Court won't reverse that abominable decision, it does provide the opportunity for a course correction in the critical realm of property rights.
And while American voters cannot control the Court's decision or the Hornes' legal fate, next year's presidential election provides the opportunity to control who will nominate justices to fill any subsequent vacancies. With four justices - Breyer, Kennedy, Scalia and Ginsburg - above the age of 76, that is a consideration that should remain paramount.
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