Property Rights Go Before the U.S. Supreme Court

This morning the U.S. Supreme Court heard oral arguments in the case of Kelo v. New London, in which a group of homeowners are suing their city government to prevent their private property from being taken through eminent domain proceedings. The city wants to turn around and sell the property to private developers.

The Pittsburgh Post-Gazette's Supreme Court correspondent, Michael McGough, explained the basic facts in an article published Monday:

The question before the Supreme Court is whether the redevelopment of Fort Trumbull, which the city believes will invigorate the economy of New London, is a "public use" that overrides the owners' right to hold on to their land if they choose.

For Scott G. Bullock, the lawyer for the New London property owners, the answer is obvious: "This is a clear abuse of eminent domain. If they can take these properties, any neighborhood is up for grabs."

Bullock is an attorney for the Institute for Justice, a Washington-based libertarian public interest group ...

In interviews and in the institute's brief to the Supreme Court, Bullock argues that the New London case should be an easy one because -- as is not the case with other uses of eminent domain -- New London did not assert that the neighborhoods it seeks to condemn are "blighted." The redevelopment took place under a state law designed to revitalize older commercial and industrial areas.

"To petitioners, like most Americans, their homes are their castles," the institute's brief says. "In this case, they face the loss of the homes and neighbors they cherish through the use of eminent domain not for a traditional public use, such as a road or public building, nor even for the removal of blight. Rather, respondents -- a local government and a private development corporation -- seek to take petitioners' 15 homes to turn them over to other private parties in the hope that the city may benefit from whatever trickle-down effects those new businesses produce."

Supported by city governments -- not including Pittsburgh's -- and environmental organizations, New London argues in its brief that "employing the power of eminent domain to revitalize a municipality's economy satisfies the public use requirement. This is especially true in urban settings, in which the problem of land assembly often acts as a barrier to economic revitalization."

Timothy Sandefur, an attorney with the Pacific Legal Foundation, gives some background on the issue in his article (published in the March 2005 issue of Liberty magazine), "They're Coming for Your Land!":

Eminent domain — the government's power to force a person to sell real estate against his will, at a price the government deems "just compensation" — is one of the most extreme forms of government coercion, and today, among the most common. Used for centuries for building railroads, highways, and post offices, eminent domain is now a multi-billion dollar industry, and a classic example of rent-seeking run amok. Governments throughout America routinely seize property to transfer it to private companies to "create jobs" and increase the tax base in a community. In 1999, the city of Merriam, Kan., condemned a Toyota dealership to sell the land to the BMW dealership next door. That same year, Bremerton, Wash., condemned 22 homes to resell the land to private developers. In one especially notorious case, billionaire Donald Trump convinced the government of Atlantic City, N.J., to condemn the home of an elderly widow so that he could build a limousine parking lot. As attorney Jennifer Kruckeberg puts it, "Whether you know it or not, your house is for sale. Corporations, using cities as their personal real estate agents, are proposing the following assignment: 'Find me your most prominent location, get rid of what is on it, help me pay for it, and maybe you will be lucky enough to have me move to your city.' Such is the state of the current eminent domain power."

The exploitation of eminent domain by such private interests is a relatively new phenomenon, and is explicitly prohibited by the U.S. Constitution, which holds that "private property" may be taken only "for public use." But a series of court decisions beginning in the first years of the 20th century, and culminating in the 1954 decision Berman v. Parker, eroded the "public use" limitation to such a degree that, as Richard Epstein once noted, some law professors have taken to replacing that clause with an ellipsis when writing out the text of the 5th Amendment.

In Berman, the Supreme Court held that eliminating slums was a public use because once the legislature deems a project worthy of its attention, that project is necessarily a public one: "[W]hen the legislature has spoken, the public interest has been declared in terms well-nigh conclusive," wrote Justice William O. Douglas for a unanimous Court. "In such cases the legislature, not the judiciary, is the main guardian of the public needs to be served by social legislation."

While the Institute for Justice is the lead counsel for the plaintiffs -- IJ staff attorney Scott Bullock won the coin toss to represent the Institute in today's oral arguments -- 25 individuals and organizations filed friend-of-the-court briefs on behalf of the plaintiffs, including the Cato Institute, the Tidewater Libertarian Party (from Virginia), and Jane Jacobs, author of the classic text, The Death and Life of Great American Cities. The group of amici includes some strange bedfellows, such as the AARP, NAACP, Southern Christian Leadership Conference, former Milwaukee Mayor John Norquist (author of The Wealth of Cities), and the Rutherford Institute. IJ's president, Chip Mellor, says that "Each brief, in its own way, helps to underscore the tragic consequences and dire implications of eminent domain abuse."

I have long maintained -- and I am not alone in this assessment -- that the Institute for Justice is the single most effective libertarian organization in the country. This is not meant to denigrate other libertarian organizations, which do necessary and terrific work, but IJ has done the best to meet the goals of its narrowly-set mission, achieving more measurable successes than other libertarian groups have been able to do.

This is due, in part, to the fact that the successes of other libertarian organizations are not immediately measurable. The Cato Institute's work on Social Security reform, for instance, dates to 1979 but is only beginning to bear fruit today. The Institute for Humane Studies identifies and educates young scholars who may not make an impact for another 30 years. The Libertarian Party, on the other hand, can judge its impact as its vote totals rise from 2% to 3% to 3.5% from election to election.

With IJ, the impact is known and felt immediately: A court decision is rendered in favor of liberty, or against it. And more and more frequently, IJ's attorneys persuade judges to rule in favor of liberty, whether it's fighting against government-mandated taxi monopolies, or arguing in favor of freedom of association (BSA v. Dale), arguing for family choice in education, or standing up for an Atlantic City David against Donald Trump's Goliath. (With that case in mind, what other libertarian group has been featured in a series of Doonesbury comic strips?)

Reports of today's oral arguments have not yet been published. As they are, I will update this posting with news of the Court's proceedings.