Tuesday, February 22, 2005

A Private Resort Ain't For the Public Good

Let me give you a hypothetical situation. Your family has lived in a home for generations. While you sometimes struggle to make ends meet, you always have paid your property taxes on time. Others have left the town in hopes of a better life, but you stay, because of your loyalty to the town you grew up in and to your family who still live there. You have often spent time and money to improve your property, building additions, redoing the roof, what have you. You expect to live in the town for the rest of your life and maybe give the house to your children when you’re gone. You never consider that anything would happen to change this.

Suddenly, there’s a knock on your door. You open the door and some bureaucrat tells you that you have to give up this home because of something called “eminent domain.” It’s not for anything public. It’s not for a new road or new park. It’s for private development. You are offered money for your house but it’s not much and it’s not what the house is worth to you. Besides, you want to keep this house. Your grandfather built this house and you are going to keep it in the family. If you were going to sell it, you would have sold it. At least if you sold it yourself it would have been your choice and you could have at least ensured that the house you treasure so much would keep standing. This guy is giving you no choice saying that you have to take this piddling sum and you have to see the house get torn down.

This is what’s going on in New London, Connecticut. For once, some people are standing up to this blatant abuse of eminent domain. And today, the Supreme Court has agreed to take up this issue and define what eminent domain is all about.

All of this goes back to the language of the Fifth Amendment of the Constitution which states the following: “…nor shall private property be taken for public use, without just compensation.”

The reason this clause was included was to ensure that the rights of private property were respected. At the time, what “public use” meant was very clear. It meant roads, bridges, dams, canals, etc. It was limited to things that actually were going to be widely and clearly a publicly produced good.

It is crucially important that private property is respected and it is not stolen by the government by the whims of the politicians or a tyrannical majority. When you are forced to give it up against your will just so some private company can gain benefit and then supposedly increase the tax base, it is outright theft and even if it does benefit the community as a whole, when it actually usually doesn’t, the justification is not there.

The protection of private property is crucial to the success of our economy. When you are unsure that you will be able to keep property once you buy, the risk of losing it makes you much less likely to buy it. Once you own a property, if you are constantly worried about losing it, you are much less likely to make any improvement on the property. What’s the point? If someone can take away what you put your sweat and tears into, why bother making the effort? The downward civic spiral that this kind of behavior creates causes irreparable harm. Any short-term economic benefit that the private development gives to the community is dwarfed by the negative long-term results in both the economic and social sense.

As this case demonstrates, the issue of private property is not just a rich man’s problem. Most everyone owns property and it often is not a transfer from the rich to the poor. Instead it is a transfer from the poor and the middle class to rich and well-connected. Currently in the seaside of New Jersey, century-olds homes are being stolen and torn down just so resorts can be made to supposedly improve the tax base. Instead the area just gets richer and the poor people who lost their homes are forced to leave. The factory in Detroit that was made in the 80s and destroyed an old, poor ethnic neighborhood ended up closing soon after they were granted eminent domain in another abuse of this idea. This historic community was laid to waste for an abandoned factory? Was it worth it then? In that Poletown case, the courts failed to protect the rights of the powerless. Hopefully the Supreme Court will finally right these wrongs and put an end this horrendous practice.

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